1
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 10-QSB
(Mark One)
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 OF THE SECURITIES EXCHANGE
ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 OF THE SECURITIES EXCHANGE
ACT OF 1934 FOR THE TRANSITION PERIOD FROM ________________ TO
________________.
Commission file number 0-22170
EPOCH PHARMACEUTICALS, INC.
(exact name of small business issuer as specified in its charter)
Delaware 91-1311592
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
1725 220th Street, S.E., No. 104, Bothell, Washington 98021
(Address of principal executive offices)
(206) 485-8566
(Issuer's telephone number)
NOT APPLICABLE
----------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports 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 X NO
------ ------
State the number of shares outstanding of each of the issuer's classes of
common equity as of the latest practicable date.
Class Outstanding at July 30, 1996
----- -----------------------------
Common Stock, $.01 par value 14,266,713
Page 1 of 54 Pages
Exhibit Index on Page 14
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EPOCH PHARMACEUTICALS, INC.
INDEX TO FORM 10-QSB
PART I. FINANCIAL INFORMATION Page Number
-----------
Item 1. Financial Statements
Balance Sheets as of December 31, 1995
and June 30, 1996 (unaudited) . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Statements of Operations (unaudited) for the three
months and six months ended June 30, 1995 and 1996. . . . . . . . . . . . . . . . 4
Statements of Cash Flows (unaudited) for the six months ended
June 30, 1995 and 1996 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Notes to Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . . . . . . . . . . . . . . . . . . . 7
PART II. OTHER INFORMATION
Item 1. Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
EXHIBIT INDEX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
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EPOCH PHARMACEUTICALS, INC.
BALANCE SHEETS
DECEMBER 31, JUNE 30, 1996
1995 (UNAUDITED)
------------- --------------
ASSETS
Current assets:
Cash and cash equivalents . . . . . . . . . . . . . . . . . . $ 3,739,144 $ 5,860,879
Receivables . . . . . . . . . . . . . . . . . . . . . . . . . 147,975 60,852
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . 52,968 48,525
------------- -------------
Total current assets . . . . . . . . . . . . . . . . . 3,940,087 5,970,256
Equipment and leasehold improvements, net . . . . . . . . . . . 350,045 282,348
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . 39,363 21,150
------------- -------------
Total assets . . . . . . . . . . . . . . . . . . . . . $ 4,329,495 $ 6,273,754
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable . . . . . . . . . . . . . . . . . . . . . . . . $ 1,217,994 $ 16,301
Accounts payable . . . . . . . . . . . . . . . . . . . . . . 341,899 214,780
Accrued liabilities . . . . . . . . . . . . . . . . . . . . . 361,664 278,542
Accrued litigation costs . . . . . . . . . . . . . . . . . . 250,000 --
------------- -------------
Total current liabilities . . . . . . . . . . . . . . 2,171,557 509,623
Stockholders' equity:
Common stock, par value $.01; authorized 20,000,000 shares,
issued and outstanding 7,023,400 and 14,246,713 shares . 70,234 142,467
Additional paid-in capital . . . . . . . . . . . . . . . . . 46,860,059 52,087,320
Deferred compensation . . . . . . . . . . . . . . . . . . . . (99,512) (70,712)
Accumulated deficit . . . . . . . . . . . . . . . . . . . . . (44,672,843) (46,394,944)
------------- -------------
Total stockholders' equity . . . . . . . . . . . . . . 2,157,938 5,764,131
Total liabilities and stockholders' equity . . . . . . $ 4,329,495 $ 6,273,754
============= =============
See accompanying notes to financial statements.
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EPOCH PHARMACEUTICALS, INC.
STATEMENTS OF OPERATIONS
(UNAUDITED)
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
------------------------------ ------------------------------
1995 1996 1995 1996
------------- ------------- ------------- -------------
Operating expenses:
Research and development . . . . . . . . $ 6,881 $ 483,542 $ 456,383 $ 1,012,464
General & administrative . . . . . . . . 620,901 121,763 881,697 529,079
---------- ---------- ----------- -----------
Operating loss . . . . . . . . . . . (627,782) (605,305) (1,338,080) (1,541,543)
Other income (expense):
Interest income . . . . . . . . . . . . . 6,099 26,250 9,636 62,193
Interest and financing expense . . . . . (57,277) (23,495) (107,219) (179,251)
Other income . . . . . . . . . . . . . . 1,800 4,601 2,400 9,401
---------- --------- ---------- ----------
Loss from continuing operations . . . (677,160) (597,949) (1,433,263) (1,649,200)
Income (loss) from discontinued
operations . . . . . . . . . . . . . . 62,464 (79,934) 541,299 (72,901)
---------- ---------- ----------- -----------
Net loss . . . . . . . . . . . . . . $ (614,696) $ (677,883) $ (891,964) $(1,722,101)
========== ========== =========== ===========
Loss per share from continuing
operations . . . . . . . . . . . . . . . . $ (0.10) $ (0.08) $ (0.21) $ (0.22)
Income (loss) per share from
discontinued operations . . . . . . . . . . $ 0.01 $ (0.01) $ 0.08 $ (0.01)
---------- ---------- ----------- -----------
Net loss per share . . . . . . . . . . . . . $ (0.09) $ (0.09) $ (0.13) $ (0.23)
Weighted average common shares
outstanding during the period . . . . . . . 7,014,996 7,756,794 7,011,548 7,390,616
See accompanying notes to financial statements.
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EPOCH PHARMACEUTICALS, INC.
STATEMENTS OF CASH FLOWS
(UNAUDITED)
SIX MONTHS ENDED
JUNE 30,
--------------------------------
1995 1996
---------- ----------
Cash flows from operating activities:
Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (891,964) $(1,722,101)
Adjustments to reconcile net loss to net cash
used in operating activities:
Continuing operations:
Depreciation and amortization . . . . . . . . . . . . . . 139,348 127,014
Amortization of discount on notes payable . . . . . . . . -- 122,326
Changes in operating assets and liabilities:
Other assets . . . . . . . . . . . . . . . . . . . . . . . 13,988 21,573
Accounts payable and accrued liabilities . . . . . . . . . (765,840) (446,745)
Other current liabilities . . . . . . . . . . . . . . . . 124,687 (625)
Discontinued operations:
Changes in current assets and current liabilities . . . . 612,746 75,334
Decrease in net noncurrent assets
in excess of noncurrent liabilities . . . . . . . . . 42,504 --
---------- -----------
Net cash used in operating activities . . . . . . . . . . . (724,531) (1,823,224)
Cash used in investing activities - acquisition of equipment
and leasehold improvements . . . . . . . . . . . . . . . . . (4,000) (30,516)
---------- -----------
Cash flows from financing activities:
Proceeds from notes payable . . . . . . . . . . . . . . . . 1,250,000 --
Principal payments on notes payable . . . . . . . . . . . . (144,274) (1,324,019)
Principal payments on capital leases . . . . . . . . . . . . (13,425)
Proceeds from sale of common stock . . . . . . . . . . . . . -- 4,632,500
Exercise of warrants and stock options . . . . . . . . . . . 4,420 666,994
---------- -----------
Net cash provided by financing activities . . . . . . . . . 1,096,721 3,975,475
---------- -----------
Net increase in cash and cash equivalents . . . . . . . . . . 368,190 2,121,735
Cash and cash equivalents at beginning of period . . . . . . . . 9,984 3,739,144
---------- -----------
Cash and cash equivalents at end of period . . . . . . . . . . . $ 378,174 $ 5,860,879
========== ===========
Supplemental disclosure of cash flow information-
cash payments made during the period for interest . . . . $ 13,688 $ 68,101
========== ===========
See accompanying notes to financial statements.
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EPOCH PHARMACEUTICALS, INC.
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1996
(UNAUDITED)
(1) BASIS OF PRESENTATION
Epoch Pharmaceuticals, Inc. ("Epoch" or "the Company"), formerly MicroProbe
Corporation, was organized to develop, manufacture and market therapeutic and
diagnostic products utilizing oligonucleotide technology. In November 1995,
the Company sold its diagnostics assets to Becton, Dickinson and Company (see
note 2). The Company's continuing activities are focused on the development of
therapeutic technologies and products.
The unaudited financial statements have been prepared in accordance with
generally accepted accounting principles for interim financial information and
with the instructions to Form 10-QSB. Accordingly, they do not include all of
the information and footnotes required to be presented for complete financial
statements. The accompanying financial statements include all adjustments
(consisting only of normal recurring accruals) which are, in the opinion of
management, necessary for a fair presentation of the results for the interim
periods presented. Certain 1995 balances have been reclassified to conform
with the 1996 presentation.
The financial statements and related disclosures have been prepared with the
presumption that users of the interim financial information have read or have
access to the audited financial statements for the preceding fiscal year.
Accordingly, these financial statements should be read in conjunction with the
audited financial statements and the related notes thereto included in the
Company's Annual Report on Form 10-KSB as filed with the Securities and
Exchange Commission on April 9, 1996 (pursuant to Rule 12b-25 under the
Securities Exchange Act of 1934).
The Company has experienced significant quarterly fluctuations in operating
results and it expects that these fluctuations in expenses and net losses will
continue.
(2) SALE OF DIAGNOSTICS ASSETS
In November 1995, the Company sold the Company's assets and technology
associated with its Diagnostics Division (the "Assets") to Becton, Dickinson
and Company, a New Jersey corporation, through its Becton Dickinson Diagnostic
Instrument Systems Division (collectively, "Becton"). The Assets related to
the Company's development, marketing and sale of diagnostic products which
involve the use of nucleic acid probes to detect and identify microorganisms in
biological samples under the names "Affirm(R) VP," "Affirm(R) VPIII,"
"Affirm(R) DP," "Hybriquick(R)" and "Isoquick(R)". The Assets included:
tangible personal property, interests in certain contracts and other
instruments, rights in permits and licenses, raw materials and inventory,
technology, trade secrets, patents, other intellectual property (including the
name "MicroProbe"), rights in customer lists, records and data, computer
software programs, goodwill and causes of action held by the Company against
third parties. The aggregate purchase price paid by Becton for the Assets and
for the Company's covenant not to compete with Becton for a period of five
years was $8,510,000. The Purchase Price is subject to an upward adjustment of
$1,500,000 contingent upon Procter & Gamble entering into a supply
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agreement with Becton by November 2002, for the dental diagnostic products,
which were transferred by the Company to Becton, and Procter & Gamble obtaining
all clearances from the United States Food and Drug Administration necessary
for the commercial sale of such products in the U.S.
(3) PRIVATE PLACEMENT
In June 1996, the Company successfully completed a private offering of Units,
each Unit consisting of one share of the Company's Common Stock and one warrant
to purchase 0.5 shares of the Company's Common Stock. The Company sold a total
of 5 million Units, for an aggregate purchase price of $5 million to
institutional and accredited individual investors.
The term of the warrants is five (5) years, and they are exercisable at $2.50
per share (or $1.25 per 0.5 shares). Each warrant shall be redeemable by the
Company at any time after eighteen months from the date that they are issued at
$0.05 per warrant, provided that the closing trading price per share of Common
Stock is at least $3.75 for twenty (20) consecutive trading days.
In connection with the private placement, pursuant to an agreement with its
financial advisor, David Blech, the Company paid fees of $350,000 to Mr. Blech.
In addition, the Company cancelled fifty percent (50%) of the obligations of
Mr. Blech arising in connection with the transactions involving Ribonetics
GmbH, including the "put" rights contained in an agreement dated December 1,
1993 between the Company and Mr. Blech. The aggregate amount cancelled was
$1,635,588. The balance is accruing interest at the minimum applicable federal
rate. As the obligation had been fully reserved, and the remaining balance is
fully reserved, neither the cancellation nor the remaining obligation is
reflected on the Company's balance sheet. The Company also issued to Mr. Blech
five year warrants to purchase 500,000 shares of Common Stock at $1.00 per
share. The warrants are not exercisable for one year and are held in escrow by
the Company until the balance of the Ribonetics debt is satisfied.
In addition to completion of the private placement, major shareholders of the
Company elected to exercise previously existing warrants to purchase 2,200,000
shares of the Company's Common Stock at $0.30 per share generating an
additional $660,000 of cash to the Company.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
At June 30, 1996, the Company had cash and cash equivalents of $5,861,000 which
the Company anticipates will provide sufficient working capital to operate
approximately fifteen months. The Company's continuing operations are research
and development, and will not generate cash in the near term to fund future
operations.
In June 1996, the Company successfully completed a private offering of Units,
each Unit consisting of one share of the Company's Common Stock and one warrant
to purchase 0.5 shares of the Company's Common Stock as described in Note (3)
of the Notes to the Financial Statements.
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Also in June 1996, the Company announced that it intends to exchange for every
two (2) warrants which were issued in conjunction with the Company's public
offering in September 1993 at $6.50 per share, one (1) new warrant to purchase
one (1) share of the Company's Common Stock with a term of five (5) years that
is exercisable at $2.50 per share. Each warrant shall be redeemable by the
Company at any time after eighteen months from the date that they are issued at
$0.05 per warrant, provided that the closing trading price per share of Common
Stock is at least $3.75 for twenty (20) consecutive trading days.
Since inception, the Company has financed its operations primarily through the
sales of its equity securities. In addition, the Company received $8,510,000
from the sale of its Diagnostics Division. To continue operations, the Company
will be required to sell additional equity securities, borrow additional funds,
or obtain additional financing through licensing, joint venture, or other
collaborative arrangements. The Company is pursuing such financing
arrangements but has no commitments for such financing and there can be no
assurance that such financing will be available on satisfactory terms, if at
all.
This Quarterly Report on Form 10-QSB contains certain forward-looking
statements that are based on current expectations. In light of the important
factors that can materially affect results, including those set forth below and
elsewhere in this Quarterly Report on Form 10-QSB, the inclusion of
forward-looking information herein should not be regarded as a representation
by the Company or any other person that the objectives or plans of the Company
will be achieved. The Company may encounter competitive, technological,
financial and business challenges making it more difficult than expected to
continue to develop and market therapeutic technologies and products; the
market may not accept the Company's therapeutic products; the Company may be
unable to retain existing key management personnel; and there may be other
material adverse changes in the Company's operations or business. Certain
important factors affecting the forward-looking statements made herein include,
but are not limited to (i) the successful development of viable therapeutic
technologies and products, (ii) accurately forecasting capital expenditures,
and (iii) obtaining new sources of external financing. Assumptions relating to
budgeting, marketing, product development and other management decisions are
subjective in many respects and thus susceptible to interpretations and
periodic revisions based on actual experience and business developments, the
impact of which may cause the Company to alter its marketing, capital
expenditure or other budgets, which may in turn affect the Company's financial
position and results of operations.
Future operating results may be impacted by a number of factors that could
cause actual results to differ materially from those stated herein, which
reflect management's current expectations. These factors include industry
specific factors, the Company's ability to maintain access to external
financing sources and its financial liquidity, the Company's ability to timely
develop and produce commercially viable therapeutic products and the Company's
ability to manage expense levels.
RESULTS OF OPERATIONS
The following discussion of results of operations reflects the Company's
Diagnostics Division as discontinued operations for the three and six month
periods ended June 30, 1995 and 1996.
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Research and development expenses for the three months ended June 30, 1996
increased $477,000 over the same period in the prior year. In the three month
period ended June 30, 1995, research and development expense was reduced by
$404,000 for a research contract which had been accrued but was subsequently
cancelled. This same adjustment affects the comparison of the six month
results. Additionally, increased research activity is being funded with
proceeds from the sale of the diagnostic assets and from the private placement.
Additional increases in expenditures for research and development throughout
1996 are anticipated as the Company devotes additional resources to these
efforts.
General and administrative expenses decreased in both the three and six month
periods ended June 30, 1996, compared to the corresponding period in 1995.
Contributing to these reductions are the elimination of activities associated
with selling the diagnostic division and patent litigation, both of which
caused increased legal and travel expenses in the 1995 periods. Specifically,
legal expenses were $105,000 and travel expenses were $66,000 in the three
month period ended June 30, 1995, as compared to $15,000 for legal and $29,000
for travel in the same period of 1996. Also, the building lease was
renegotiated in late 1995, resulting in savings on rent expense in the first
six months of 1996, compared to the same six month period of 1995 of $54,000.
Additionally, in July 1996 the In Re Blech Securities Litigation suit (see Part
II, Item 1, Legal Proceedings) was dismissed. Accordingly, $250,000 of
estimated costs which had been accrued for this matter was reversed as a
reduction of expenses in the three and six month periods ended June 30, 1996.
Interest income in the three and six month periods ended June 30, 1996
increased compared with the respective period in the prior year due to higher
investable funds. Interest expense in the period increased over the respective
periods in the prior year as a result of obligations incurred to secure bridge
financing for the Company. While the Company received significant cash from
the sale of the diagnostics division, the bridge loans were not fully paid off
until completion of the private placement in June 1996. In addition to the
interest on the principle amounts of the loans, interest expense in the six
months ended June 30, 1996 includes $122,000 of amortization of debt discount
relating to a $480,000 warrant price adjustment associated with the bridge
refinancing. The price adjustment was credited to additional paid-in capital
and the debt discount was being amortized over the term of the notes. At March
31, 1996 the discount had been fully amortized.
LIQUIDITY AND CAPITAL RESOURCES
The net cash increase of $2,122,000 from December 31, 1995 to June 30, 1996 was
the result of the receipt of net proceeds of $4,633,000 from the private
placement completed in June 1996, and the receipt of $660,000 from the exercise
of warrants to purchase the Company's common stock by major shareholders in
June 1996. These receipts were offset by the repayment of notes payable plus
interest in the amount of $1,396,000, and disbursements for normal operating
expenditures.
The Company's accounts payable and accrued liabilities balances decreased by
$210,000 from December 31, 1995 to June 30, 1996 primarily due to the payment
of $66,000 in interest on notes payable as well as normal business fluctuations
and payments issued after receipt of funds from the sale of the Diagnostics
Division.
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The Company's primary future needs for capital are for continued research and
development. The Company's working capital requirements may vary depending
upon numerous factors including the progress of the Company's research and
development, competitive and technological advances and the FDA regulatory
process.
The Company will require additional funds to continue its operations and, over
the longer term, will require substantial additional funds to maintain and
expand its research and development activities and to ultimately commercialize,
with or without the assistance of corporate partners, any of its proposed
products. The Company will seek collaborative or other arrangements with large
pharmaceutical companies, under which such companies would provide additional
capital to the Company in exchange for exclusive or non-exclusive license or
other rights to certain of the technologies and products the Company is
developing. However, the competition for such arrangements with major
pharmaceutical companies is intense, with a large number of biopharmaceutical
companies attempting to satisfy their funding requirements through such
arrangements. There can be no assurance that an agreement or agreements will
arise from these discussions in a timely manner, or at all, or that revenues
that may be generated thereby will offset operating expenses sufficiently to
reduce the Company's short- or long-term funding requirements. Additional
equity or debt financings may be required, and there can be no assurance that
funds will be available from such financings on favorable terms, or at all.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
The Company has from time to time received written notices from parties
alleging that the Company's products and proposed products infringe the
proprietary rights of such parties. The Company believes that such notices are
common in its industry and believes it is not infringing the proprietary rights
of such parties. However, there can be no assurance that such parties will not
ultimately bring legal proceedings against the Company.
The Company was named as an additional defendant in In Re Blech Securities
Litigation, 94 Civ. 7696 (RWS), pursuant to an Amended Consolidated Class
Action Complaint (the "Amended Complaint") filed on March 28, 1995 in the
United States District Court for the Southern District of New York (the
"Court"). The plaintiffs brought this action as a purported class action on
behalf of persons who purchased, during the period from July 1, 1991 through
September 21, 1994, securities of 24 companies, including securities issued by
the Company. The Amended Complaint names as defendants David Blech, D. Blech &
Co., Mark S. Germain, Nicholas Madonia as trustee for various trusts, Mordechai
Jofen as trustee for The Edward Blech Trust, Chancellor Capital Management,
Inc., Parag Saxena, Bear, Stearns & Company, Inc., Baird Patrick & Co., and
eleven of the foregoing 24 issuing companies. The Company was one of those
eleven named defendant companies.
The Amended Complaint sought to allege against the Company violations of
antifraud provisions of the federal securities law and common law fraud and
deceit in connection with a purported scheme to, inter alia, artificially
inflate and maintain prices of the securities issued by the 24 companies
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referenced above. In that regard, the Amended Complaint purports to allege
fraudulent activities involving the foregoing securities, including without
limitation unlawful "sham" transactions and the providing of undisclosed
"incentives" to investment fund managers and others to purchase such
securities. The Amended Complaint seeks the following relief: (a)
certification of this action as a class action; (b) damages in an unspecified
amount and interest; (c) costs and expenses of this action, including
reasonable fees of attorneys, accountants and experts and other disbursements;
and (d) such other and further relief as may be proper.
The Company moved to dismiss the Amended Complaint as it applies to the Company
on the grounds that the Amended Complaint failed to plead the purported fraud
with the requisite particularity and failed to state a claim. Plaintiffs
opposed the motion. Oral argument of the motion occurred on November 9, 1995.
By decision dated June 6, 1996, the Court granted the Company's motion to
dismiss for failure to plead fraud with particularity and declined to exercise
jurisdiction over the pendent common law claims asserted against the Company
under state law. The Court granted plaintiffs leave to replead their purported
claims within twenty days of the date of the decision, which time the Court
subsequently extended to July 26, 1996. The Company was not named in the
repleading and the case has been dismissed with respect to the Company.
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ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(A) EXHIBITS
4.1 Form of Subscription Agreement with Private Placement
Investors
4.2 Warrant Agreement between the Company and American
Stock Transfer & Trust Company dated June 21, 1996,
with form of Warrant
10.65 Consulting Agreement with David Blech dated March 29,
1996
27 Financial Data Schedules
(B) REPORTS ON FORM 8-K
The Company filed no Current Reports on Form 8-K during the
quarter ended June 30, 1996.
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SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
EPOCH PHARMACEUTICALS, INC.
Date: August 13, 1996 By: /s/ SANFORD ZWEIFACH
---------------------------------
Sanford Zweifach
President/Chief Financial Officer
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EXHIBIT INDEX
Exhibit Page
Number Description Number
------ ----------- ------
4.1 Form of Subscription Agreement with Private Placement Investors 15
4.2 Warrant Agreement between the Company and American Stock Transfer & Trust
Company dated June 21, 1996, with form of Warrant 27
10.65 Consulting Agreement with David Blech dated March 29, 1996 52
27 Financial Data Schedules 54
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