1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
Mark
One
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended MARCH 31, 2001
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from to
Commission file number 0-24128
BIO-PLEXUS, INC.
(Exact name of Registrant as specified in its Charter)
Connecticut 06-1211921
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
129 Reservoir Road, Vernon Connecticut 06066
(Address of principal executive offices including zip code)
(860) 870-6112
(Registrant's telephone number, including area code)
N/A
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [ ]. No [X].
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Shares Outstanding
Class of Common Stock as of June 22, 2001
- --------------------- -------------------
Common Stock, no par value 15,002,162
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BIO-PLEXUS, INC.
INDEX TO QUARTERLY REPORT
ON FORM 10-Q
PAGE
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Balance Sheets at March 31, 2001 (unaudited) and
December 31, 2000
Condensed Statements of Operations (unaudited) for the three
months ended March 31, 2001 and 2000 2
Condensed Statements of Cash Flows (unaudited) for the three
months ended March 31, 2001 and 2000
Notes to Condensed Financial Statements 3
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations 10
PART II. OTHER INFORMATION
Item 2. Changes in Securities 16
Item 4. Submission of Matters to a Vote of Security Holders 16
Item 5. Other Information 17
Item 6. Exhibits and Reports on Form 8-K 17
SIGNATURES 19
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BIO-PLEXUS, INC.
CONDENSED BALANCE SHEETS
MARCH 31, DECEMBER 31,
2001 2000
(UNAUDITED)
------------ ------------
ASSETS
Current assets:
Cash and cash equivalents $ 1,240,000 $ 4,003,000
Accounts receivable 322,000 516,000
Inventories:
Raw materials 1,455,000 1,379,000
Work-in-process 219,000 36,000
Finished goods 1,019,000 1,634,000
------------ ------------
2,693,000 3,049,000
------------ ------------
Other current assets 152,000 124,000
------------ ------------
Total current assets 4,407,000 7,692,000
------------ ------------
Fixed assets, net 8,458,000 7,845,000
Deferred debt financing expenses 957,000 1,017,000
Patents, net of amortization 419,000 415,000
Other assets 3,000 3,000
------------ ------------
$ 14,244,000 $ 16,972,000
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt
(Note 3) $ 17,399,000 $ 52,000
Accounts payable and accrued
expenses 305,000 1,105,000
Accrued interest payable 10,000 24,000
Accrued vacation 154,000 122,000
Other accrued employee costs 149,000 282,000
Deferred revenue 255,000 0
------------ ------------
Total current liabilities 18,272,000 1,585,000
------------ ------------
Long-term debt, net (Note 3) 1,232,000 17,806,000
Commitments and contingencies (Note 4) -- --
Shareholders' deficit:
Convertible preferred stock, no par value,
3,000,000 authorized, no shares issued
and outstanding -- --
Common stock, no par value, 40,000,000
authorized, 15,002,162 and 14,887,230
shares issued and outstanding 76,524,000 76,412,000
Accumulated deficit (81,784,000) (78,831,000)
------------ ------------
Total shareholders' deficit (5,260,000) (2,419,000)
------------ ------------
$ 14,244,000 $ 16,972,000
============ ============
The accompanying notes are an integral part of these condensed financial
statements.
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BIO-PLEXUS, INC.
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
THREE MONTHS ENDED MARCH 31,
------------------------------
2001 2000
------------ ------------
Revenue:
Product $ 1,254,000 $ 1,408,000
Services 66,000 34,000
Licensing fees (Note 6) 100,000 100,000
------------ ------------
Total revenue 1,420,000 1,542,000
------------ ------------
Operating costs and expenses:
Product 839,000 748,000
Services -- 29,000
Research and development 350,000 323,000
Selling, general and administrative 2,511,000 1,574,000
------------ ------------
Total operating costs and expenses 3,700,000 2,674,000
------------ ------------
Operating loss (2,280,000) (1,132,000)
Financing expenses:
Amortization of deferred debt financing 60,000 61,000
Interest expense 648,000 1,682,000
Other income (35,000) (36,000)
------------ ------------
Total financing expenses 673,000 1,707,000
------------ ------------
Net loss $ (2,953,000) $ (2,839,000)
============ ============
Net loss per share of common stock:
Basic and diluted $ (0.20) $ (0.20)
============ ============
Weighted average common shares outstanding
basic and diluted (Note 2) 14,934,437 14,213,151
The accompanying notes are an integral part of these condensed financial
statements.
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BIO-PLEXUS, INC.
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
THREE MONTHS ENDED MARCH 31,
----------------------------
2001 2000
----------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $(2,953,000) $(2,839,000)
Adjustments to reconcile net loss to cash used
by operating activities:
Depreciation and amortization 153,000 131,000
Amortization of deferred debt financing
expenses 60,000 61,000
Amortization of debt discount 110,000 1,444,000
Decrease (increase) in assets:
Accounts receivable 194,000 500,000
Inventories 356,000 (443,000)
Other current assets (28,000) (21,000)
Increase (decrease) in liabilities:
Accounts payable and accrued expenses (800,000) 495,000
Accrued interest payable (14,000) 178,000
Accrued vacation and other accrued
employee costs (101,000) (62,000)
Increase in deferred revenue (Note 6) 255,000
Other 33,000 7,000
----------- -----------
Net cash used in operating activities (2,735,000) (549,000)
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to fixed assets (760,000) (255,000)
Cost of patents (11,000) (11,000)
----------- -----------
Net cash used in investing activities (771,000) (266,000)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES
Accretion of accrued interest 675,000 --
Proceeds from sale of common stock 79,000 --
Proceeds from exercise of common stock options -- 83,000
Payments of deferred financing costs -- (364,000)
Increase in notes payable (Note 3) -- 1,650,000
Repayments of long-term debt (11,000) (202,000)
----------- -----------
Net cash provided by financing activities 743,000 1,167,000
----------- -----------
Net increase (decrease) in cash and
cash equivalents (2,763,000) 352,000
Cash and cash equivalents, beginning of
period 4,003,000 867,000
----------- -----------
Cash and cash equivalents, end of period $ 1,240,000 $ 1,219,000
=========== ===========
Supplemental cash flow disclosures:
Cash payments of interest (net of amounts
capitalized) $ 26,000 $ 60,000
Surrender of debt upon conversion to equity $ -- $ 642,000
The accompanying notes are an integral part of these condensed financial
statements.
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BIO-PLEXUS, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1 - BASIS OF PRESENTATION
The accompanying unaudited condensed financial statements have been
prepared in accordance with the instructions to Form 10-Q and, in the opinion of
the management of the Company, include all adjustments which are of a normal
recurring nature, necessary for a fair presentation of financial position and
the results of operations and cash flows for the periods presented. However, the
financial statements do not include all information and footnotes required for a
presentation in accordance with generally accepted accounting principles. These
condensed financial statements should be read in conjunction with the financial
statements and the notes thereto included in the Company's 2000 Annual Report on
Form 10-K. The results of operations for the interim periods are not necessarily
indicative of the results of operations to be expected for the full year.
Chapter 11 Filing
On April 4, 2001 (the "Petition Date") the Company filed a voluntary
petition for relief under chapter 11 of the United States Code the "Bankruptcy
Code") with the United States Bankruptcy Court for the District of Connecticut.
As of the Petition Date, the Company commenced operating its business and manage
its properties as a debtor-in-possession.
On April 4, 2001, the Company filed a Disclosure Statement (the
"Disclosure Statement") and a Plan of Reorganization (the "Plan of
Reorganization") with the Bankruptcy Court. The Disclosure Statement sets forth
certain information regarding, among other things, significant events that have
occurred during the Company's chapter 11 case and the anticipated organization,
operation and financing of reorganized Bio-Plexus ("Reorganized Bio-Plexus").
The Company subsequently filed certain amendments to the Plan of Reorganization
to add and clarify certain terms of the Plan of Reorganization and to establish
conditions to confirmation and effectiveness of the Plan of Reorganization.
Among other things, the Plan of Reorganization (1) divides the Company's
creditors into eight classes; (2) provides that certain classes of creditors
will be paid in full, and will be otherwise rendered unimpaired; (3) provides
that, in exchange for their secured claim, Appaloosa Management, L.P., Appaloosa
Investment Limited Partnership I, Palomino Fund Ltd. and Tersk LLC
(collectively, "Appaloosa Entities") will receive shares of common stock of the
Reorganized Bio-Plexus representing 85% of the Reorganized Bio-Plexus
outstanding common stock, and (4) provides that holders of common stock issued
prior to the confirmation of the Plan of Reorganization will receive, in
substitution of their existing shares, new shares of common stock of the
Reorganized Bio-Plexus, which will constitute 15% of Reorganized Bio-Plexus
outstanding common stock.
On June 12, 2001 a confirmation order was issued by the United States
Bankruptcy Court that confirmed the Plan of Reorganization pursuant to
Bankruptcy Code section 1129, and the Company emerged from its
debtor-in-possession status as the Reorganized Bio-Plexus. The conditions
precedent to the effectiveness of the Plan of Reorganization include, among
other things, reincorporation of the Reorganized Bio-Plexus in the State of
Delaware, there being no material adverse change in the
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development and launch of the Company's Winged Set product, and the consummation
of a private placement of $3.0 million with the Appaloosa Entities. In
connection with the private placement, the Company will issue to the Appaloosa
Entities 1,314,060 additional shares of Common Stock of the Reorganized
Bio-Plexus and warrants to purchase an additional 1,314,060 additional shares of
Common Stock of the Reorganized Bio-Plexus.
The Plan of Reorganization will have a material effect on certain facts
which existed as of December 31, 2000, including the termination of certain
outstanding options, warrants and other rights (such as conversion rights) to
acquire the Company's common stock. The Plan of Reorganization could materially
change the amounts and classifications of assets and liabilities reported in the
accompanying financial statements. The financial statements do not include any
adjustments to the carrying value of assets or amounts of liabilities that might
be necessary as a consequence of the Plan of Reorganization.
NOTE 2 - EARNINGS PER SHARE
Basic Earnings Per Share ("EPS") is based on the weighted average number of
common shares outstanding for the period, excluding any dilutive common share
equivalents. Diluted EPS reflects the potential dilution that could occur if
securities or other contracts to issue common stock were exercised or converted.
In determining net loss per common share, common stock equivalents are excluded
from the computation as their effect is anti-dilutive.
NOTE 3 - SIGNIFICANT CAPITAL TRANSACTIONS
NASDAQ Delisting
The Company was notified by The Nasdaq SmallCap Stock Market that our
Common Stock was delisted from The Nasdaq Stock Market effective with the
opening of business on March 6, 2001. The delisting was as a result of the
Company's failure to meet Nasdaq's requirements for continued listing. The
Company did not appeal the delisting on the Nasdaq National Market and is not
currently eligible for listing on The New York Stock Exchange or the American
Stock Exchange.
Trading in the Company's Common Stock is being conducted on the National
Association of Securities Dealers' Pink Sheets and could also be subject to
additional restrictions. As a consequence of such delisting, it is expected that
the Company's stockholders will find it more difficult to dispose of, or to
obtain accurate quotations as to the market value of, the Common Stock. In
addition, such delisting will make the Company's Common Stock substantially less
attractive as collateral for margin and purpose loans, for investment by
financial institutions under their internal policies or state legal investment
laws, or as consideration in future capital raising transactions.
The Company's Common Stock may become subject to regulation as a "penny
stock." The Securities and Exchange Commission has adopted regulations which
generally define "penny stock" to be any equity security that has a market price
or exercise price less than $5.00 per share, subject to certain exceptions,
including listing on the Nasdaq National Market. If the Company's Common Stock
is not listed on the Nasdaq National Market and no other exception applies, the
Company's Common Stock may be subject to the SEC's Penny Stock Rules, Rules
15g-1 through Rule 15g-9
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under the Exchange Act. For transactions covered by these rules, the
broker-dealer must make a special suitability determination for the purchase of
such securities and have received the purchaser's written consent to the
transaction prior to the purchase. Additionally, for any transaction involving a
penny stock, unless exempt, the rules require the delivery, prior to the
transaction, of a risk disclosure document mandated by the SEC relating to the
penny stock market. The broker-dealer must also disclose the commission payable
to both the broker-dealer and the registered representative, current quotations
for the securities and, if the broker-dealer is the sole market maker, the
broker-dealer must disclose this fact and the broker-dealer's presumed control
over the market. Finally, monthly statements must be sent disclosing recent
price information for the penny stock held in the account and information on the
limited market in penny stocks. Consequently, the penny stock rules may restrict
the ability of broker-dealers to sell the Company's securities and may affect
the ability of holders to sell the Company's securities in the secondary market
and the price at which such holders can sell any such securities. Rule 15g-9
under the Exchange Act imposes additional sales practice requirements on
broker-dealers who sell such securities except in transactions exempted from
such rule. Such exempt transactions include those meeting the requirements of
Rule 505 or 506 of Regulation D promulgated under the Securities Act and
transactions in which the purchaser is an institutional accredited investor or
an established customer of the broker-dealer.
Common Stock and Stock Options
On March 13, 2001, the Company issued to Fresenius Medical Holdings Inc.
101,744 restricted common no par stock as part of a licensing and development
agreement.
On March 9, 2000, an officer of the Company effected a net exercise of
stock options to purchase 32,000 shares of Common Stock in exchange for 14,950
shares of Common Stock.
During the first quarter of 2000, an employee exercised stock options to
purchase 30,000 shares of Common Stock.
Convertible Note Financing
On September 21, 1999, the Company received a commitment from Appaloosa
Management, L.P., of Chatham, New Jersey ("Appaloosa") for a total financing
package of $17.5 million, comprised of (i) $16.75 million of zero-coupon,
secured convertible notes due 2005 (the "Convertible Notes"), (ii) 250,000
shares of Common Stock issued at a purchase price of $3.00 per share (the
"Permanent Financing Shares") and (iii) nine-year warrants to purchase up to 1.5
million shares of Common Stock at an initial exercise price of $7.00 per share
(the "$7 Warrants", and collectively with the Convertible Notes and the
Permanent Financing Shares, the "Permanent Financing"). The Permanent Financing
was consummated on April 28, 2000 after receipt of stockholder approval of the
terms of the Permanent Financing and certain related matters.
Bridge Transactions
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Pending consummation of the Permanent Financing, on October 21, 1999, the
Company issued to Appaloosa and entities affiliated therewith (the "Appaloosa
Entities") a 7.5% non-convertible secured note in the aggregate principal amount
of $3 million (the "First Bridge Note"). In January 2000, the interest rate on
the First Bridge Note was increased to 12% per annum. In connection with the
issuance of the First Bridge Note, the Company also issued to the Appaloosa
Entities (i) a five-year warrant to purchase up to 1.0 million shares of Common
Stock, at an initial exercise price of $3.00 per share (the "$3 Warrants") and
(ii) a nine-year warrant to purchase up to 1.5 million shares of Common Stock at
an initial exercise price of $5.00 per share (the "$5 Warrants") (the $3
Warrants and $5 Warrants are collectively referred to herein as the "First
Bridge Warrants"). At the Purchaser's election and upon the closing of the
Permanent Financing, the exercise price of the $3 Warrants increased to $4.00
per share of Common Stock. The exercise price of the $5 Warrants increased to
$7.00 per share of Common Stock upon the closing of the Permanent Financing. The
$5 Warrants contain a net-exercise provision. The fair value of the warrants at
the date of issuance was recorded as a discount on the debt and was amortized
over the term of the First Bridge Note.
On January 5, 2000, the Company issued to the Appaloosa Entities a 15%
non-convertible secured note in the aggregate principal amount of $1.65 million
(the "Second Bridge Note"). In connection with the issuance of the Second Bridge
Note, the Company also agreed to issue and sell on the earlier of (i) April 30,
2000 and (ii) the closing of the Permanent Financing, five-year warrants to
acquire up to 200,000 shares of Common Stock at an initial exercise price of
$3.00 per share (the "Second Bridge Warrants"). The Second Bridge Warrants
contain a net-exercise provision.
On April 3, 2000, the Company issued to the Appaloosa Entities a 15%
non-convertible secured note in the aggregate principal amount of $2.2 million
(the "Third Bridge Note"). No warrants or convertible securities were issued in
connection with the Third Bridge Note. The First Bridge Note, the Second Bridge
Note and the Third Bridge Note are collectively referred to as the "Bridge
Notes". The issuance of the Bridge Notes, the First Bridge Warrants and the
Second Bridge Warrants are collectively referred to as the "Bridge
Transactions".
The Bridge Notes were not convertible into shares of Common Stock and were
paid-in-full at the closing of the Permanent Financing on April 28, 2000.
Permanent Financing
In order to consummate the Permanent Financing, the Company was required
by the rules of The NASDAQ Stock Market to obtain the approval of a majority of
the Company's stockholders of the terms and conditions of the Permanent
Financing. In addition, the Connecticut Business Corporation Act required that
the Company obtain stockholder approval of (i) an amendment to the Company's
certificate of incorporation (the "Charter Amendment") and (ii) an amendment to
the Company's 1991 Long-Term Incentive Plan (the "Incentive Plan Amendment").
The Charter Amendment and the Incentive Plan Amendment were required by the
terms of the Permanent Financing. The approval of the Company's stockholders of
the terms of the Permanent Financing, the Charter Amendment and the Incentive
Plan Amendment is collectively referred to as "Stockholder Approval".
Coinciding with Stockholder Approval obtained on April 28, 2000, the
Company issued to the Appaloosa Entities the Convertible Notes, the Permanent
Financing Shares and the $7 Warrants. The
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Convertible Notes are convertible into shares of Common Stock at an initial
conversion price of $3.00. The $7 Warrants contain a net-exercise provision. The
fair value of the warrants at the date of issuance was recorded as a discount on
the debt which will be amortized over the term of the debt.
The Permanent Financing generated aggregate proceeds to the Company of
$17.5 million. After repayment of the Bridge Notes and costs and expenses
associated with the financing, the Company realized net proceeds of
approximately $9.6 million which is available along with existing resources for
general working capital purposes, subject to the terms and conditions of the
Permanent Financing transaction agreements.
The convertible notes contain certain restrictive covenants including but
not limited to, minimum (maximum) operating profit (loss), minimum product sales
revenues, and maximum permitted capital expenditures, all as defined. At March
31, 2001, the Company was in violation of the operating profit (loss) covenant.
Under the terms of the agreement, the Appaloosa Entities may call the
convertible notes if the Company is in violation of any restrictive covenant.
The covenant violation has not been waived by the Appaloosa Entities, as such
notes will be converted under the provisions of the Plan of Reorganization (see
Note 1). Accordingly, the full amount of the convertible debt has been
classified as a current liability as of March 31, 2001.
Convertible Debentures
On April 27, 1999, the Company sold an aggregate principal amount of
$2,500,000 of its 6% Convertible Debentures due June 30, 2004 (the "6%
Debentures") to several purchasers (the "Debenture Holders") (the "Convertible
Debenture Financing"). The 6% Debentures were convertible at any time at the
option of the Debenture Holders into shares of the Company's Common Stock at the
lesser of a fixed conversion price of $3.06 per share (as may be adjusted from
time to time) or a floating conversion price at the time of the conversion if
the floating conversion price is less than $3.06 per share (as may be adjusted
from time to time). The 6% Debentures could be wholly or partially redeemed at
the option of the Company for an amount not to exceed 130% of the face value
thereof plus accrued and unpaid interest at any time after the date of issuance.
As of September 30, 2000, the Debenture Holders had converted all of the
$2,500,000 outstanding principal balance of the 6% Debentures into 880,733
shares of Common Stock. The Company and the Debenture Holders had limited put
and call options, respectively, for additional 6% Debentures. In connection with
a subsequent financing with Appaloosa Management, L.P. and certain related
entities, the Company agreed not to exercise its put right under the 6%
Debentures. As of July 26, 2000, the Debenture Holders' call options expired and
were not exercised. In connection with the Convertible Debenture Financing, the
Company issued a warrant to purchase up to 500,000 shares of the Company's
Common Stock at an exercise price of $3.38 per share.
NOTE 4 - COMMITMENTS
As of March 31, 2001, the Company had capital expenditure purchase
commitments outstanding of approximately $822,000 which were primarily comprised
of machinery & equipment and tooling for the construction of its winged
intravenous set production line.
NOTE 5 - SEGMENT FINANCIAL DATA
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The Company's operations consist of two worldwide business segments: (i)
Safety Medical Products and Accessories and (ii) Joint Venture Design &
Development. The Safety Medical Products and Accessories segment includes
operations associated with the manufacture of blood collection needles, needle
holders and needle disposal containers. The Joint Venture Design & Development
segment includes operations associated with product design and development,
product licensing, and the design, development and construction for machinery
and tooling in connection with joint venture partners.
Distinct reporting by such segments was deemed necessary by management
based on the significance of reported revenues and expenses and the Company's
intention to focus operating resources in both of these areas.
Information with respect to each of the Company's business segments is as
follows:
SEGMENT REVENUE
THREE MONTHS ENDED MARCH 31,
--------------------------------------------------
2001 2000 1999
---- ---- ----
SAFETY MEDICAL PRODUCTS AND ACCESSORIES $1,254,000 $1,345,000 $1,145,000
JOINT VENTURE DESIGN & DEVELOPMENT 166,000 197,000 1,169,000
---------- ---------- ----------
TOTAL CONSOLIDATED REVENUE $1,420,000 $1,542,000 $2,314,000
========== ========== ==========
Major Customers
There were two customers, domestic distributors of the Company's products,
Allegiance Healthcare and Fisher HealthCare, that exceeded 10% of the Company's
Safety Medical Products and Accessories segment revenue for the periods
presented. The loss of business of any of the foregoing customers could
potentially have a material adverse effect on the business and prospects of the
Company. In the Joint Venture Design & Development segment, Johnson and Johnson
Medical, Inc. ("JJM") of Arlington, Texas and TFX Medical ("TFX"), a division of
Teleflex Incorporated, contributed to more than 10% of the revenues for the
periods presented. The following table represents the revenue associated with
these major customers by segment:
THREE MONTHS ENDED MARCH 31,
--------------------------------------------------
2001 2000 1999
---- ---- ----
Total Revenue Major Customers:
Safety Medical Products and Accessories $ 869,000 $1,166,000 $ 708,000
Joint Venture Design & Development 150,000 197,000 1,095,000
Other Domestic Sales 401,000 179,000 222,000
Export Sales:
Safety Medical Products and Accessories -- -- 289,000
Joint Venture Design & Development -- -- --
---------- ---------- ----------
Total Consolidated Revenue $1,420,000 $1,542,000 $2,314,000
========== ========== ==========
During the periods presented, there were no material intersegment revenues.
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Segment Operating Profit
THREE MONTHS ENDED MARCH 31,
-------------------------------------------------------
2001 2000 1999
---- ---- ----
Safety Medical Products and Accessories 415,000 $ 603,000 $ 337,000
Joint Venture Design & Development 166,000 162,000 826,000
----------- ----------- -----------
Total Consolidated Operating Profit 581,000 765,000 1,163,000
----------- ----------- -----------
Selling, General and Administrative Expenses (2,511,000) (1,574,000) (1,104,000)
Other (350,000) (323,000) --
Financing Expenses (673,000) (1,707,000) (56,000)
----------- ----------- -----------
Net Profit (Loss) ($2,953,000) ($2,839,000) $ 3,000
=========== =========== ===========
For the Safety Medical Products and Accessories segment, operating profit
consists of total revenues less product costs and expenses. In the Joint Venture
Design and Development segment, operating profit consists of total revenues less
certain operating costs and expenses and research and development expenses.
Segment Capital Expenditures
THREE MONTHS ENDED MARCH 31,
--------------------------------------------
2001 2000 1999
---- ---- ----
Safety Medical Products and Accessories $760,000 $255,000 $ 93,000
Joint Venture Design & Development -- -- --
-------- -------- --------
Total Consolidated Capital Expenditures $760,000 $255,000 $ 93,000
======== ======== ========
There has been no material change in identifiable assets related to
reportable segments since the 2000 Annual Report.
NOTE 6 - LICENSING AND DISTRIBUTION AGREEMENTS
On October 23, 1998, the Company entered into an exclusive License
Agreement and Design, Development and Asset Transfer Agreement for a safety
Peripherally Inserted Central Catheter ("PICC") introducer with TFX Medical. The
License Agreement includes certain minimum annual volume requirements and
ongoing royalties on the sale of PICC introducer catheters featuring the
Company's proprietary Punctur-Guard(R) technology. Under the Design, Development
and Asset Transfer Agreement, the Company would design and develop safety needle
assemblies to be used with the TFX peelable catheter, and would modify existing
manufacturing equipment to be transferred to TFX pursuant to the terms and
conditions of the agreement. On July 26, 1999, an agreement was entered into
with TFX to modify the License Agreement dated October 23, 1998. The amended
agreement included additional licensing fees and changes in royalty revenue in
exchange for TFX's right to exclusively market to one of its customers. In the
first quarter of 2000, the Company completed its obligations under the Design,
Development and Asset Transfer Agreements, and recognized licensing fee revenue
of $100,000.
On December 19, 2000, the Company entered into a Development and
Manufacturing and Distribution Agreement with Fresenius Medical Care Holdings,
Inc. ("Fresenius"). Pursuant to this agreement, during the first two phases, the
Company and Fresenius will develop Extracorporeal Therapy Needles and in the
second phase, Fresenius will manufacture, market, and distribute the
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needles. In connection with this agreement, the Company also granted to
Fresenius an exclusive worldwide license to manufacture, have manufactured, use,
sell, have sold or after for sale such needles utilized in dialysis applications
covered by the PUNCTUR-GUARD(R) technology. The Fresenius agreement provides
for the payment of royalties to the Company once products developed under the
agreement are sold.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
FORWARD LOOKING STATEMENTS
The discussions set forth in this Management's Discussion and Analysis of
the Results of Operations and Financial Condition and elsewhere herein contain
certain statements which are not historical facts and are considered
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934,
as amended. Forward-looking statements can be identified by the use of such
forward-looking terminology as "believes," "expects," "may," "will," "should,"
or "anticipates" or negatives thereof or other derivations thereon or comparable
terminology, or discussions of strategy that involve risks and uncertainties.
THESE RISKS AND UNCERTAINTIES INCLUDE THE COMPANY'S ABILITY TO TIMELY AND FULLY
IMPLEMENT ITS BANKRUPTCY COURT CONFIRMED PLAN OF REORGANIZATION; THE
CONSUMMATION OF THE PRIVATE PLACEMENT FINANCING PROVIDED FOR IN THE PLAN; THE
AVAILABILITY OF SUFFICIENT CAPITAL TO FUND THE COMPANY'S OPERATIONS PENDING
CONSUMMATION OF THAT FINANCING; THE CONTINUED WILLINGNESS OF THE COMPANY'S
CUSTOMERS, VENDORS AND EMPLOYEES TO MAINTAIN THEIR RELATIONSHIPS WITH THE
COMPANY DURING THIS PERIOD; THE ACCEPTANCE OF THE COMPANY'S PRODUCTS BY HEALTH
CARE PROFESSIONALS; THE COMPANY'S ABILITY TO PROTECT ITS PROPRIETY TECHNOLOGY;
AVAILABILITY OF QUALIFIED PERSONNEL; CHANGES IN, OR FAILURE TO COMPLY WITH
GOVERNMENT REGULATIONS; THE RISKS ASSOCIATED WITH EXPANDING THE COMPANY'S
BUSINESS INTERNATIONALLY; GENERAL ECONOMIC AND BUSINESS CONDITIONS; AND OTHER
RISK FACTORS AND UNCERTAINTIES DETAILED IN THIS REPORT, DESCRIBED FROM TIME TO
TIME IN THE COMPANY'S OTHER SECURITIES AND EXCHANGE COMMISSION FILINGS, OR
DISCUSSED IN THE COMPANY'S PRESS RELEASES.
All forward-looking statements included in this document are based on
information available to the Company on the date hereof, and the Company assumes
no obligation to update any such forward-looking statements.
OVERVIEW
The Company's principal focus is the design, development, testing and
evaluation of its blood collection safety needle and accessory products, and the
design and development of the molds, needle assembly machines and production
processes needed for manufacturing the blood collection safety needle as well as
the design and development of new products. Since its inception in September
1987
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through March 31, 2001, the Company has incurred cumulative losses totaling
approximately $81,784,000. For the Company to achieve profitability, further
reductions in manufacturing costs and increases in sales are necessary, as well
as the addition of new product lines. The Company has also focused its efforts
on developing strategic partnerships with major healthcare companies in order to
bring other products to market featuring its patented internal blunting
technology.
The Company believes that similar distribution agreements or strategic
partnerships may be possible with one or more major healthcare companies for its
other products. Such arrangements could assist the Company in raising additional
capital and help fund research and development of new products, as well as
accelerate the rate of sales growth. However, such arrangements could also
decrease the revenue per unit for the Company, as a result of sharing revenue
with its distribution or strategic partners. The Company believes the overall
benefits and potential for greater market share outweigh the disadvantages that
may result from such arrangements.
RESULTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 2001 COMPARED TO THREE MONTHS ENDED MARCH 31, 2000
The Company had product sales of $1,254,000 for the three months ended
March 31, 2001, compared to $1,408,000 for the comparable period in the prior
year. The decrease was primarily attributable to a decrease in sales of safety
medical devices over the prior year.
The Company had revenues from services totaling $66,000 for the three
months ended March 31, 2001, compared to $34,000 for the comparable period in
the prior year. The increase is primarily attributable to the Fresenius
agreement.
The Company had licensing fee revenue of $100,000 in the first quarter of
2001 which was attributable to the completion of the Design, Development and
Asset Transfer Agreement with JJMI Medical.
Product costs were $839,000 for the three months ended March 31, 2001,
compared to $748,000 for the comparable period in the prior year despite greater
revenues from product sales. The increase in these costs resulted primarily from
higher manufacturing costs associated with the blood collection needle product
line.
Research and development expenses were $350,000 for the three months ended
March 31, 2001, compared to $323,000 for the same period a year ago. The
increase in these costs resulted from an increase in engineering labor and
operating expenses in 2001 as compared to 2000 due to greater research and
development costs related to the winged intravenous set.
Selling, general and administrative expenses were $2,511,000 for the three
months ended March 31, 2001, compared to $1,574,000 for the same period a year
ago. The increase resulted from increases of approximately $98,000 in sales and
marketing expenses due to increased marketing activity and additional sales and
marketing personnel, and $839,000 in administrative expenses due primarily to
professional fees associated with the bankruptcy petition.
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Financing expenses were $673,000 for the three months ended March 31,
2001, compared to $1,707,000 for the same period in 2000. The decrease in these
costs resulted primarily from a decrease in expenses associated with the
Permanent Financing of $815,000 and the capitalization of $167,000 in interest.
LIQUIDITY AND CAPITAL RESOURCES
The Company's need for additional funds has continued from period to
period, as a result of its ongoing losses from operations, and its continued
efforts to develop new products. To date, the Company has financed its
operations primarily through borrowings and the sale of equity securities.
Through March 31, 2001, the Company has received net proceeds of approximately
$48,456,000 through borrowings and the sale of debt securities and $51,758,000
through the sale of equity securities.
Cash used in operating activities for the three months ended March 31,
2001 totaled $2,735,000 and was primarily due to a net loss for the period of
$2,953,000, decreases in accounts payable and accrued employee costs,
partially offset by a decrease in accounts receivable and inventories and
depreciation and amortization expenses primarily reflecting the amortization of
deferred debt financing expenses.
Net cash used in investing activities amounted to $771,000 for the three
month period primarily due to additions to fixed assets totaling $760,000
consisting substantially of capitalized costs associated with the construction
of its winged intravenous set production line.
Net cash provided by financing activities amounted to $743,000 for the
three months ended March 31, 2001 primarily due to accretion of interest and
the sale of common stock.
At March 31, 2001, the Company's shareholders' deficit increased to
($5,260,000) from ($2,419,000) at December 31, 2000 due to a net loss for the
three months ended March 31, 2001. Also, at March 31, 2001, current liabilities
exceed current assets due to the classification of the convertible notes as
current liabilities.
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FINANCING DURING THE CHAPTER 11 CASE
On May 17, 2001, the Bankruptcy Court entered an order authorizing the
Company to borrow from Appaloosa Management L.P. term loans in an amount not to
exceed the aggregate principal amount of $300,000 pursuant to the terms of a
Credit Agreement (the "DIP Credit Agreement") between the Debtor and Appaloosa
Management L.P. The term loans were used for the purposes of funding general
working capital needs in the ordinary course of the Company's business in excess
of the net income generated by the Company's business. As security for the
prompt payment of the term loans and performance of any and all obligations,
liabilities and indebtedness of the Company to Appaloosa Management L.P. under
the Credit Agreement or otherwise, Appaloosa Management L.P. was granted
valid and perfected first priority security interests and liens, superior to all
other creditors of the estate of the Company (subject to certain exceptions), in
and upon all now existing and hereafter acquired or arising property of the
Company which constitutes collateral under the Credit Agreement, wherever
located, of any kind or nature, and the proceeds (including insurance proceeds)
and products thereof. The term loans are to be repaid from the proceeds of the
Appaloosa Private Placement and/or cash on hand.
THE APPALOOSA PRIVATE PLACEMENT
Immediately following the effective date of the Company's Plan of
Reorganization (the "Effective Date"), the Company shall issue to Appaloosa
Management, L.P., Appaloosa Investment Limited Partnership I, and Palomino Fund
Ltd. (collectively, the "Appaloosa Entities") 1,314,060 shares of common stock
of the Reorganized Bio-Plexus ("New Common Stock") pursuant to a private
placement (the "Private Placement") for a purchase price of $3 million. The
Private Placement shall be subject to definitive documentation containing terms
and conditions customary for similar private placement transactions as well as
any and all other terms and conditions acceptable to Appaloosa in its sole
discretion. In the event that the Private Placement is consummated, the purchase
price to be paid by Appaloosa will be satisfied, in part, by and to the extent
of the cancellation of all amounts, if any, outstanding under the DIP Credit
Agreement. Appaloosa's obligation to purchase shares of New Common Stock in the
Private Placement is conditioned upon the Private Placement Conditions
(described below). Funds received in the Private Placement by Company will be
used by the Company for general corporate purposes. In the event that the
Private Placement fails to be consummated as a result of (i) a failure to
satisfy any of the Private Placement Conditions or (2) the occurrence of any
other event not directly caused by any act or omission of Appaloosa, then all
obligations of the Company under the DIP Credit Agreement shall become
immediately due
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and payable in full by the Company to Appaloosa. The obligation of Appaloosa to
purchase the shares of New Common Stock in the Private Placement is subject to
the following conditions (the "Private Placement Conditions"): (1) the Company's
Plan of Reorganization shall have become effective on or before June 30, 2001,
and (2) there not having occurred any "material adverse change" in the
development and launch of the Company's Winged Set product. A "material adverse
change" with respect to the Winged Set product shall mean a material adverse
development which would have the effect of materially delaying the commercial
launch of the Winged Set product beyond June 15, 2001, or a material development
that could adversely affect the Company's ability to maintain the commercial
viability of the Winged Set product following launch. In all cases,
determination of the materiality of such event will be in Appaloosa's sole
reasonable discretion. Unless otherwise agreed to in writing by and between the
Company and Appaloosa, under no circumstances shall the Winged Set product be
deemed to have been commercially launched unless and until the Company shall
have produced 50,000 units of commercial sale quality inventory of Winged Sets
that are ready for shipment. Although the Company's Plan of Reorganization did
not become effective by June 30, 2001, the Company believes that Appaloosa will
waive this Private Placement Condition. The Company believes that it has already
met or, in the immediate future will meet, the other Private Placement
Conditions.
As part of the Private Placement, on the Effective Date, the Company will
also issue to the Appaloosa Entities warrants to purchase 1,314,060 shares of
the Reorganized Bio-Plexus having an exercise price of $2.283 per share (the
"Appaloosa Warrants"). Total proceeds to the Company if the Appaloosa Entities
exercise all of the Appaloosa Warrants will be $3 million. The Appaloosa
Warrants will become callable by the Company at $0.01 per share to the extent
set forth below, once the following performance targets (the "Performance
Targets") have been achieved: (1) $1.5 million worth of the Appaloosa Warrants
will be callable when "net sales" (as reported in accordance with generally
accepted accounting principles) of the Winged Set product reach $1.8 million;
and (2) the final $1.5 million of the Appaloosa Warrants will be callable when
the Winged Set product "net sales" (as reported in accordance with generally
accepted accounting principles) reach $4.0 million.
The Company believes that the net proceeds of the Appaloosa Private
Placement, its existing cash, cash generated from operations, and funds
available through trade credit financing will be sufficient to satisfy its cash
requirements through 2001. Although the Company fully anticipates that it will
be able to continue meetings its obligations as they become due beyond that
date, the Company's ability to do so will depend on its ability to successfully
implement its business plans, general economic and business conditions, and
other factors noted in the section entitled "Forward Looking Statements."
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
CHAPTER 11 FILING
On April 4, 2001 (the "Petition Date") the Company filed a voluntary
petition for relief under chapter 11 of the United States Code the "Bankruptcy
Code") with the United States Bankruptcy
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Court for the District of Connecticut. As of the Petition Date, the Company
commenced operating its business and manages its properties as a
debtor-in-possession.
On April 4, 2001, the Company filed a Disclosure Statement (the "Disclosure
Statement") and a Plan of Reorganization (the "Plan of Reorganization") with the
Bankruptcy Court. The Disclosure Statement sets forth certain information
regarding, among other things, significant events that have occurred during the
Company's chapter 11 case and the anticipated organization, operation and
financing of reorganized Bio-Plexus ("Reorganized Bio-Plexus"). The Disclosure
Statement also describes the Plan of Reorganization, certain effects of Plan
confirmation, certain risk factors associated with securities to be issued under
the Plan, and the manner in which distributions will be made to the Company's
creditors under the Plan of Reorganization for all amounts that were owed to
such parties on the Petition Date. In addition, the Disclosure Statement
discusses the confirmation process and the voting procedures that holders of
claims in impaired classes must follow for their votes to be counted.
The Plan of Reorganization divides the Company's creditors into eight
classes: Allowed Secured Claim of Victor and Margaret DeMattia (Class 1);
Allowed Secured Claim of Spafford Leasing (Class 2); Allowed Priority Claims
under Bankruptcy Code section 507(a)(3) (Class 3); Allowed Priority Claims under
Bankruptcy Code section 507(a)(4) (Class 4); Allowed Secured Claim of the
Appaloosa Entities (Class 5); Allowed Unsecured Claims (Class 6); Allowed
Interests of Holders of Old Common Stock (Class 7); Allowed Interests of Holders
of Other Interests (Class 8).
In general, the Plan of Reorganization provides that holders of
Administrative Claims, Allowed Tax Claims, Allowed Priority Claims and Allowed
Unsecured Claims will be paid in full, and will be otherwise rendered
unimpaired. Allowed Secured Claims other than the Allowed Secured Claim of the
Appaloosa Entities will be reinstated and paid in accordance with their terms.
In exchange for their Allowed Secured Claim, the Appaloosa Entities (the
Company's largest secured creditor) will receive common stock of the Reorganized
Bio-Plexus which will constitute 85% of outstanding common stock of the
Reorganized Bio-Plexus. Holders of common stock issued prior to the confirmation
of the Plan of Reorganization will receive, in substitution of their existing
shares, new shares of common stock of the Reorganized Bio-Plexus, which will
constitute 15% of Reorganized Bio-Plexus outstanding common stock.
The Plan of Reorganization also sets forth certain information, means for
implementation of the Plan of Reorganization, the effect of rejection of the
Plan of Reorganization by one or more classes of claims or interests, provisions
for how distributions will be made to the Company's creditors, the treatment of
executory contracts and leases and conditions precedent to confirmation of the
Plan of Reorganization and the occurrence of the Effective Date of the Plan of
Reorganization.
The Company filed with the United States Bankruptcy Court the First
Amended Plan of Reorganization on April 19, 2001 and the Modified First Amended
Plan of Reorganization on June 12, 2001 to add and clarify certain terms of the
Plan of Reorganization and to establish conditions to confirmation and
effectiveness of the Plan of Reorganization.
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On April 19, 2001 an order was approved by the Bankruptcy Court (i)
approving the Disclosure Statement (ii) establishing solicitation, voting, and
tabulation procedures and deadlines, and (iii) scheduling a hearing to consider
confirmation of the Plan of Reorganization, establishing deadlines and
procedures for filing objections to confirmation of the Plan of Reorganization.
On June 12, 2001 a confirmation order was issued by the United States
Bankruptcy Court that confirmed the Plan of Reorganization pursuant to
Bankruptcy Code section 1129. Conditions precedent to the Effective Date of the
Plan of Reorganization include, among other things, reincorporation of
Reorganized Bio-Plexus in the State of Delaware, the commercial launch of the
Company's Winged Set product, and the private placement of $3.0 million by the
Appaloosa Entities in exchange for the issuance to the Appaloosa Entities of
1,314,060 additional shares of Common Stock of the Reorganized Bio-Plexus and
warrants to purchase an additional 1,314,060 additional shares of Common Stock
of the Reorganized Bio-Plexus.
ITEM 2. CHANGES IN SECURITIES
On March 13, 2001, the Company issued to Fresenius Medical Holdings Inc.
101,744 restricted common no par stock as part of a licensing and development
agreement.
ITEM 3. DEFAULT UPON SENIOR SECURITIES
The convertible notes payable issued on April 28, 2000 to the Appaloosa
Entities (see Note 5) contain certain restrictive covenants, including but not
limited to, minimum (maximum) operating profit (loss), minimum product sales
revenue and maximum permitted capital expenditures. On March 31, 2001, the
Company was in violation of the operating profit (loss) covenant. Under the
terms of the agreement, the Appaloosa Entities may call the convertible notes
as a result of this violation. The covenant violation has not been waived by
the Appaloosa Entities as such notes will be converted to common stock under
the provisions of the Plan of Reorganization.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Company held a Special Meeting of Stockholders on April 28, 2000. The
following proposals were voted upon at the Special Meeting:
Proposal No. 1 - Permanent Financing Proposal to approve the issuance and sale
of (i) the Convertible Notes, (ii) the Permanent Financing Shares and (iii) the
$7 Warrants, including the reservation and subsequent issuance of the shares of
Common Stock issuable upon conversion of the Convertible Notes and exercise of
the $7 Warrants (the "Permanent Financing Proposal") to the Purchasers, and to
approve and adopt the Convertible Note Purchase Agreement (the "Purchase
Agreement"), Warrants, (as defined in the Purchase Agreement) Registration
Rights Agreement, (as defined in the Purchase Agreement) and Security Agreement
(as defined in the Purchase Agreement) (collectively, the "Transaction
Documents") and the transactions contemplated by the Transaction Documents;
Proposal No. 2 - Charter Amendment Proposal to amend the Company's Certificate
of Incorporation to increase from 25 million (25,000,000) to 40 million
(40,000,000) the number of shares of Common Stock that the Company is authorized
to issue, which proposal was proposed, in part, to ensure that there are
sufficient shares of Common Stock reserved for the subsequent issuance of shares
of Common Stock upon conversion of the Convertible Notes and exercise of the $7
Warrants and as
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awards in connection with the Company's 1991 Long Term Incentive Plan (the
"Charter Amendment Proposal"); and
Proposal No. 3 - Incentive Plan Amendment Proposal to amend the Company's 1991
Long-Term Incentive Plan (as amended, the "Incentive Plan") to increase from one
million (1,000,000) to 2.5 million (2,500,000) the number of shares of Common
Stock subject to the Incentive Plan, which proposal was made to ensure that
there were sufficient shares of Common Stock reserved for the subsequent
issuance of awards to employees and consultants under the Incentive Plan (the
"Incentive Plan Amendment Proposal").
The stockholders approved the Permanent Financing, the Charter Amendment
and the Incentive Plan Amendment. The proposals required a vote of holders of a
majority of the issued and outstanding shares of common stock present in person
or represented by proxy at the Special Meeting and voting when a quorum was
present. The proposals were approved by the following vote:
Proposal 1: Permanent Financing Proposal
For 9,108,651
Against 138,623
Abstain 13,200
Proposal 2: Charter Amendment Proposal
For 9,074,819
Against 173,255
Abstain 12,400
Proposal 3: Incentive Plan Amendment Proposal
For 8,922,021
Against 316,336
Abstain 22,117
There were no broker non-votes.
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
Exhibit No. Description Method of Filing
- ----------- ----------- ----------------
3.1 Certificate of Incorporation of the Incorporated by reference to Exhibit 3.1 to the
Company, as amended Registrant's Quarterly Report on Form 10-Q for the
quarter ended September 30, 1998 (File No. 0-
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24128).
3.2 Bylaws of the Company, as amended Incorporated by reference to Exhibit 3.2 to the
Registrant's Annual Report on Form 10-K filed on
April 13, 1998 (File No. 0-24128)
3.3 Certificate of Amendment of Certificate of Incorporated by reference to Exhibit 3.3 to the
Incorporation, dated April 28, 2000. Registrant's Quarterly Report on Form 10-Q for the
quarter ended March 31, 2000 filed on
May 15, 2000 (File No. 0-24128)
10.44 Employment Agreement dated April 26, 2000 Incorporated by reference to Exhibit 10.44 to the
between the Company and John S. Metz Registrant's Quarterly Report on Form 10-Q for the
quarter ended March 31, 2000 filed on
May 15, 2000 (File No. 0-24128)
10.45 Security Agreement dated April 28, 2000 Incorporated by reference to Exhibit 10.45 to the
between the Company and Appaloosa Registrant's Quarterly Report on Form 10-Q for the
Investment Limited Partnership I, L.P. quarter ended March 31, 2000 filed on May 15, 2000
(File No. 0-24128)
10.46 Form of Convertible Note Incorporated by reference to Exhibit 10.46 to the
Registrant's Quarterly Report on Form 10-Q for the
quarter ended March 31, 2000 filed on May 15, 2000
(File No. 0-24128)
(b) Reports on Form 8-K
A report on Form 8-K was filed on February 24, 2000 reporting an
adjournment of a Special Shareholder's Meeting that was to be held on February
28, 2000.
A report on Form 8-K was filed on March 31, 2000 reporting the Company's
1999 financial results.
A report on Form 8-K was filed on April 27, 2000 reporting that the
Company named John S. Metz as its President and Chief Executive Officer
effective April 28, 2000.
A report on Form 8-K was filed on May 11, 2000 reporting that the Company,
at a special meeting of stockholders held on Friday, April 28, 2000, obtained
stockholder approval for the $17.5 million financing with Appaloosa Management,
L.P. (the "Permanent Financing"), an amendment to the Company's Certificate of
Incorporation increasing the number of authorized shares of Common Stock, an
amendment to the Company's 1991 Long-Term Incentive Plan, and reporting that
following the stockholders meeting, the Company and Appaloosa consummated the
Permanent Financing.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
Bio-Plexus, Inc.
(Registrant)
July 10, 2001 /s/ John S. Metz
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(Date) John S. Metz
President and Chief Executive Officer
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