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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
---------------------
(Mark One)
FORM 10-Q
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: June 30, 1997
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
EXCHANGE ACT
For the transition period from __________ to _____________
COMMISSION FILE NUMBER: 0-26520
NEOPROBE CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 31-1080091
(State or other jurisdiction of (I.R.S. employer identification no.)
incorporation or organization)
425 METRO PLACE NORTH, SUITE 300, DUBLIN, OHIO 43017
(Address of principal executive offices)
(614) 793-7500
(Issuer's telephone number, including area code)
Indicate by check X whether the issuer: (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
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.
[X] [ ]
Yes No
22,761,397 SHARES OF COMMON STOCK, PAR VALUE $.001 PER SHARE
(Number of shares of issuer's common equity outstanding as of the close
of business on August 12, 1997)
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PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
NEOPROBE CORPORATION AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, JUNE 30,
1996 1997
---- ----
ASSETS
Current assets:
Cash and cash equivalents $30,168,412 $20,456,816
Available-for-sale securities 19,748,819 16,186,944
Accounts receivable 1,240,474 864,098
Inventory 216,272 630,952
Prepaid expenses and other current assets 2,289,546 2,272,075
----------- -----------
Total current assets 53,663,523 40,410,885
----------- -----------
Note receivable 1,500,000 1,500,000
Property and equipment at cost:
Equipment, net of accumulated depreciation 4,916,650 5,874,246
Construction in progress 1,531,711 2,830,790
----------- -----------
6,448,361 8,705,036
Intangible assets, net of accumulated amortization 2,130,335 2,189,364
Other assets 130,949 139,010
----------- -----------
Total assets $63,873,168 $52,944,295
=========== ===========
The accompanying notes are an integral part of the consolidated
financial statements.
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NEOPROBE CORPORATION AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED BALANCE SHEETS
DECEMBER 31 JUNE 30,
1996 1997
---- ----
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 2,404,655 $ 1,866,286
Accrued expenses 2,951,430 3,266,415
Deferred revenue 2,000,000 2,000,000
Notes payable to finance company 155,091 39,355
Capital lease obligation, current 76,161 66,980
------------- -------------
Total current liabilities 7,587,337 7,239,036
------------- -------------
Long-term debt 1,000,687 1,687,777
Capital lease obligation 8,096 197,071
------------- -------------
Total liabilities 8,596,120 9,123,884
------------- -------------
Commitments and contingencies
Stockholders' equity:
Preferred Stock; $.001 par value; 5,000,000
shares authorized at December 31, 1996 and
June 30, 1997; none outstanding (500,000 -- --
shares designated as Series A, $.001 par
value, at June 30, 1997; none outstanding)
Common stock; $.001 par value; 50,000,000
shares authorized; 22,586,527 and 22,758,725
shares issued and outstanding at
December 31, 1996 and June 30, 1997, respectively 22,587 22,759
Additional paid-in capital 119,293,862 119,999,259
Deficit accumulated during development stage (64,116,003) (76,077,136)
Unrealized loss on available-for-sale securities (29,859) (38,100)
Cumulative foreign currency translation adjustment 106,461 (86,371)
------------- -------------
Total stockholders' equity 55,277,048 43,820,411
------------- -------------
Total liabilities and stockholders' equity $ 63,873,168 $ 52,944,295
============= =============
The accompanying notes are an integral part of the consolidated
financial statements.
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NEOPROBE CORPORATION AND SUBSIDIARIES
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
November 16,
Three Months Ended Six Months Ended 1983
June 30, June 30, (inception)
-------- -------- to June 30,
1996 1997 1996 1997 1997
---- ---- ---- ---- ----
Net sales $ 159,419 $ 1,051,871 $ 355,816 $ 2,176,845 $ 6,235,842
Cost of goods sold 79,233 199,968 229,974 692,909 2,821,206
------------ ------------ ------------ ------------ ------------
Gross profit 80,186 851,903 125,842 1,483,936 3,414,636
------------ ------------ ------------ ------------ ------------
Operating expenses:
Research and development 3,773,634 5,734,054 6,326,380 9,184,988 54,084,322
Marketing and selling 238,955 955,442 344,094 1,812,347 3,268,935
General and administrative 1,249,552 1,992,687 2,417,385 3,626,969 27,928,302
------------ ------------ ------------ ------------ ------------
Total operating expenses 5,262,141 8,682,183 9,087,859 14,624,304 85,281,559
------------ ------------ ------------ ------------ ------------
Loss from operations (5,181,955) (7,830,280) (8,962,017) (13,140,368) (81,866,923)
------------ ------------ ------------ ------------ ------------
Other income (expense):
Interest income 568,495 623,062 803,323 1,207,665 4,973,050
Interest expense (11,075) (3,696) (21,287) (9,848) (515,888)
Other 225,917 (24,291) 231,164 (18,582) 1,332,625
------------ ------------ ------------ ------------ ------------
Total other income 783,337 595,075 1,013,200 1,179,235 5,789,787
------------ ------------ ------------ ------------ ------------
Net loss $ (4,398,618) $ (7,235,205) $ (7,948,817) $(11,961,133) $(76,077,136)
============ ============ ============ ============ ============
Net loss per share of
common stock $ (0.22) $ (0.32) $ (0.43) $ (0.53)
============ ============ ============ ============
Shares used in computing
net loss per share 19,740,705 22,749,713 $ 18,580,659 $ 22,701,093
============ ============ ============ ============
The accompanying notes are an integral part of the
consolidated financial statements.
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NEOPROBE CORPORATION AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF CASH FLOWS
NOVEMBER 16,
SIX MONTHS ENDED 1983
JUNE 30, (INCEPTION)
-------- TO JUNE 30,
1996 1997 1997
---- ---- ----
Net cash used in operating activities $ (7,234,086) $(11,815,631) $ (66,476,746)
Cash flows from investing activities:
Purchases of available-for-sale securities (35,393,239) (5,986,812) (100,660,228)
Proceeds from sale of available-for-sale securities 25,726,484 1,793,963 47,783,615
Maturities of available-for-sale securities 3,500,000 7,739,201 36,703,943
Purchase of property and equipment (1,047,123) (2,566,638) (9,085,555)
Other (41,467) (69,211) (908,370)
------------ ------------ -------------
Net cash (used in) provided by investing activities (7,255,345) 910,503 (26,166,595)
------------ ------------ -------------
Cash flows from financing activities:
Proceeds from issuance of common stock, net 34,286,997 705,571 102,524,492
Other (226,064) 497,567 10,597,223
------------ ------------ -------------
Net cash provided by financing activities 34,060,933 1,203,138 113,121,715
------------ ------------ -------------
Effect of exchange rate changes on cash (7,865) (9,606) (21,558)
------------ ------------ -------------
Net increase (decrease) in cash and cash equivalents 19,563,637 (9,711,596) 20,456,816
Cash and cash equivalents at beginning of period 10,032,973 30,168,412 0
------------ ------------ -------------
Cash and cash equivalents at end of period $ 29,596,610 $ 20,456,816 $ 20,456,816
============ ============ =============
The accompanying notes are an integral part of the
consolidated financial statements.
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NEOPROBE CORPORATION AND SUBSIDIARIES
(A DEVELOPMENT STAGE COMPANY)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION
The information presented for June 30, 1996 and 1997, and for the
periods then ended is unaudited, but includes all adjustments (which
consist only of normal recurring adjustments) which the management of
Neoprobe Corporation (the "Company") believes to be necessary for the
fair presentation of results for the periods presented. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to the rules and
regulations of the Securities and Exchange Commission. The results for
the interim period are not necessarily indicative of results to be
expected for the year. The financial statements should be read in
conjunction with the Company's audited financial statements for the
year ended December 31, 1996, which were included as part of the
Company's Annual Report on Form 10-KSB/A (file no. 0-26520). Certain
1996 amounts have been reclassified to conform with the 1997
presentation.
In February 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 128 ("SFAS No. 128")
"Earnings Per Share". SFAS No. 128 revises the method for computing and
format for presentation of earnings per share for entities with
publicly held common stock. This Statement supersedes APB Opinion No.
15 and is effective for financial statements issued for periods ending
after December 15, 1997. Management of the Company intends to adopt
SFAS No. 128 in connection with the issuance of financial statements
for the year ended December 31, 1997; however, management does not
believe adoption will have any material impact on the financial
condition or results of operations of the Company.
The Company is a development stage enterprise engaged in the
development and commercialization of technologies for the diagnosis and
treatment of cancers. There can be no assurance that the Company will
be able to commercialize its proposed products. There can also be no
assurance that adequate financing will be available when needed or on
terms attractive to the Company.
2. INVENTORY
The components of inventory are as follows:
DECEMBER 31, June 30,
1996 1997
---- ----
Materials and component parts $ 51,264 $265,387
Work-in-process 94,389 84,510
Finished goods 70,619 281,055
-------- --------
$216,272 $630,952
======== ========
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3. LONG-TERM DEBT
Neoprobe (Israel) Ltd. ("Neoprobe (Israel)"), a subsidiary of the
Company, is in the process of constructing a radiolabeling facility
near Dimona, Israel, for use in future operations of the Company.
Construction of the facility is being partially financed under an
investment program approved by the state of Israel's Finance Committee
(the "Committee"). In July 1997, the Company was notified that the
Committee had approved a $3.5 million increase in the approved
investment, bringing the total approved investment to $8.3 million.
Under the approved program, Neoprobe (Israel) is entitled to government
grants and government loan guarantees equal to a percentage of the
total loan taken for the construction and operation of the facility.
Amounts received under the agreement are collateralized by certain
property obtained through the use of proceeds received. As of June 30,
1997, Neoprobe (Israel) has received approximately $1.7 million and
$400,000 in the form of loans and grants, respectively.
4. STOCK OPTIONS
In February 1997, the Board granted options to certain directors,
officers, and employees of the Company under the Neoprobe Corporation
Incentive Stock Option and Restricted Stock Purchase Plan (the "Plan")
for 325,200 shares of common stock, exercisable at $13.38 per share,
vesting over a period of three years. Currently, the Company has
approximately 2.4 million options outstanding under the Plans, and
approximately 1.4 million options have vested as of June 30, 1997.
5. AGREEMENTS
In May 1997, the Company and United States Surgical Corporation (USSC)
executed an amendment ("Amendment No.1") to the License and
Distributorship Agreement (the "Main Agreement"). Amendment No.1
revises terms of the Main Agreement related to sales of Neoprobe
instruments by USSC's subsidiaries in certain foreign countries. Under
Amendment No.1, Neoprobe will sell devices directly to USSC's
subsidiaries for resale within the affected territories according to a
set price structure, but will no longer pay USSC a commission on sales
of such devices. The term of Amendment No.1 coincides with the term of
the Main Agreement.
6. CONTINGENCIES
The Company is subject to legal proceedings and claims which arise in
the ordinary course of its business. In the opinion of management, the
amount of ultimate liability with respect to these actions will not
materially affect the financial position of the Company.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
This Management Discussion and Analysis of Financial Condition and Results of
Operations and other parts of this Report contain forward-looking statements
that involve risks and uncertainties. The Company's actual results in 1997
and future periods may differ significantly from the prospects discussed in
the forward-looking statements.
LIQUIDITY AND CAPITAL RESOURCES
Since inception, the Company has financed its operations primarily through
private and public offerings of its equity securities, from which it has
raised gross proceeds of approximately $120 million. The Company has devoted
substantially all of its efforts and resources to research and clinical
development of innovative systems for the intraoperative diagnosis and
treatment of cancers. The RIGS system integrates radiolabeled targeting
agents and a radiation detection instrument. The Company has completed
testing in a pivotal Phase III clinical trial for the detection of metastatic
colorectal cancer.
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The Company must obtain regulatory approval to market its products before
commercial revenue can be generated. During 1996, the Company submitted to
the European regulatory agencies and to the FDA applications to request
permits to begin marketing and selling the Company's RIGS products for the
detection of metastatic colorectal cancer. During the fourth quarter of 1996,
the Company received notification from its Korean marketing partner that it
had received an approved license to distribute RIGScan CR49 in South Korea.
The Company began distributing commercial product in Korea during 1997.
The Company is studying the safety and efficacy of RIGS products for the
detection of other solid tumor cancer types, and the safety and efficacy of
certain cancer therapy products (RIGS/ACT) based on its activated cellular
therapy technology. In addition, the Company is funding the initial Phase I
study to determine the safety and feasibility of using activated cellular
therapy to help boost the immune system of patients with HIV/AIDS and patient
enrollment was completed during the first quarter of 1997. There can be no
assurance that the Company's products will be approved for marketing by the
FDA or any foreign government agency, or that any such products will be
successfully introduced or achieve market acceptance.
For the period from inception to June 30, 1997, the Company has incurred
cumulative net losses of approximately $76.1 million. The Company does not
currently have a RIGS product approved for commercial sale, but has filed its
request for a marketing permit in the U.S. and Europe. The Company has
incurred, and will continue to incur, substantial expenditures for research
and development activities related to bringing its products to the commercial
market. The Company intends to devote significant additional funds to
clinical testing, manufacturing validation, and other activities required for
regulatory review and commercialization of RIGS products. The amount of funds
and length of time required to complete such testing will depend upon the
outcome of regulatory reviews. The regulatory bodies may require more testing
than is anticipated by the Company. There can be no assurance that the
Company's RIGS products will be approved for marketing by the FDA or any
foreign government agency, or that any such products will be successfully
introduced or achieve market acceptance.
As of June 30, 1997, the Company has cash, cash equivalents, and
available-for-sale securities of $36.6 million. In April 1996, the Company
sold 1,750,000 shares of common stock at a price of $18.50 per share in a
secondary offering, and received proceeds net of underwriting discounts of
$30.5 million. In November 1992 and December 1993, the Company issued a total
of 2,330,000 Class E Redeemable Common Stock Purchase Warrants ("Class E
Warrants") which expired on November 12, 1996. During 1996, the Company
received proceeds from the exercise of Class E Warrants of approximately
$15.0 million. In September 1996, the Company received a $2 million license
payment from United States Surgical Corporation ("USSC"). If the Company does
not receive FDA and European regulatory approvals for the RIGS system within
24 months from the execution date, and if USSC terminates the Agreement
pursuant to certain provisions in the Agreement during this period, the
Company must refund the license payment to USSC.
The Company anticipates that 1997 research and development expenses will
continue to increase over 1996 levels and selling, general and administrative
expenses will increase significantly over 1996 expenditures. A significant
portion of the increased selling, general and administrative expenses will be
associated with marketing activities in preparation for the commercial launch
of the first RIGS product. In addition, the Company anticipates expenses
directly associated with selling RIGScan CR49 and the Neoprobe 1000 system
will increase proportionately with sales, particularly in the second half of
1997. The Company cannot predict when marketing approvals will be received.
However, when the Company receives permission from the regulatory authorities
to begin marketing its products and begins generating revenue from the sale
of its products, additional costs for marketing and distribution will be
incurred. During 1997, in addition to product launch activities, the Company
will continue to focus on improving manufacturing processes for the
production of RIGS products and developing other RIGScan products. The
Company also anticipates opening clinical trials for additional applications
of RIGScan CR49. The Company currently anticipates that approximately $21.0
million in cash will be used to finance operating activities during 1997. The
Company has executed various agreements with third parties that supplement
the technical and business
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capabilities of the Company. The Company is generally obligated to such
parties to pay royalties or commissions upon commercial sale of the related
product. The Company's estimate of its allocation of cash resources is based
on the current state of its business operations, its business plan, and
current industry and economic conditions, and is subject to revisions due to
a variety of factors including without limitation, additional expenses
related to marketing and distribution, regulatory licensing and research and
development, and to reallocation among categories and to new categories. The
Company may need to supplement its funding sources from time to time.
Neoprobe Europe AB ("Neoprobe Europe"), formerly NewMonoCarb AB, is a
wholly-owned subsidiary of the Company, located in Lund, Sweden, where it
operates a manufacturing and purification facility. The Company intends to
use the production capability of Neoprobe Europe to produce future RIGScan
products and to prepare the CC49 monoclonal antibody produced by
Bio-Intermediair BV for final radiolabeling. The Company advanced Neoprobe
Europe funds during the first half of 1997 to cover capital expenditures of
approximately $360,000 and operating expenses of approximately $650,000. The
Company anticipates advancing $1.4 million during the second half of 1997 to
cover operating and capital expenditures.
In 1994, the Company formed Neoprobe (Israel) to construct and operate a
radiolabeling facility for the Company's targeting agents. The Company owns
95 percent of Neoprobe (Israel), with Rotem Industries Ltd., the private arm
of the Israeli atomic energy authority ("Rotem") owning the balance and
managing the facility. Construction of a facility is underway near Dimona,
Israel and is being financed through an investment program approved by the
state of Israel's Finance Committee ("the Committee"). In July 1997, the
Company was notified that the Committee had approved an increase in the
approved investment of $3.5 million, bringing the total approved investment
to $8.3 million. Under the approved program, Neoprobe (Israel) is entitled to
government grants and government loan guarantees equal to a percentage of the
total loan taken for the construction and operation of the facility. Amounts
received under the agreement are collateralized by certain property obtained
through the use of proceeds received. As of June 30, 1997, Neoprobe (Israel)
had received approximately $1.7 million and $400,000 in the form of loans and
grants, respectively. On August 10, 1995, the Company and Neoprobe (Israel)
raised $1.1 million for Neoprobe (Israel) through the issuance of convertible
debentures. During 1996, all of these convertible debentures were converted
into 200,000 shares of Common Stock of Neoprobe Corporation. Costs associated
with construction of the facility and operations at Neoprobe (Israel) during
1997 have been financed primarily through funds advanced by the Company and
with government grants and loans guaranteed by the Israeli government. During
the first half of 1997, Neoprobe (Israel) expended approximately $2.1 million
on capital expenses and approximately $560,000 on operating activities. The
Company anticipates Neoprobe (Israel) will have approximately $2.7 million of
capital expenditures and approximately $580,000 of operating expenditures
during the second half of 1997.
At December 31, 1996, the Company had net operating loss carryforwards of
approximately $55.6 million to offset future taxable income through 2011.
Additionally, the Company has tax credit carryforwards of approximately $1.9
million available to reduce future income tax liability through 2011. Under
Section 382 of the Internal Revenue Code of 1986, as amended, use of prior
net operating loss carryforwards is limited after an ownership change. As a
result of ownership changes which occurred in March 1989 and in September
1994, the Company's net operating tax loss carryforwards and tax credit
carryforwards are subject to the limitations described by Section 382.
RESULTS OF OPERATIONS
Since inception, the Company has dedicated substantially all of its resources
to research and development of its RIGS system for the interoperative
diagnosis and treatment of cancer. Until the appropriate regulatory approvals
are received, the Company is limited in its ability to generate revenue.
Although the Company's Neoprobe 1000 and Neoprobe 1500 systems have received
regulatory clearance, the Company does not anticipate generating positive
cash flow from sales of the Neoprobe 1000 or 1500 systems alone. During the
first half of 1997, the Company generated sales of Neoprobe 1000 systems of
approximately $2.1 million. Sales of the Neoprobe 1500 are expected to start
during the third quarter of 1997.
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Since acquiring Neoprobe Europe in December 1993 for the purpose of
manufacturing RIGScan products, Neoprobe Europe has continued to generate
revenue from the sale of its serology products. Neoprobe Europe generated
sales of serology products of approximately $100,000 during the first half of
1997. The Company currently plans to sell Neoprobe Europe's serology business
and develop production capacity at Neoprobe Europe for future RIGScan
products. As a result, the Company anticipates that revenue generated from
sale of serology products will continue to decline in 1997 and subsequent
periods.
Three months ended June 30, 1996 and 1997. Total net sales for the three
months ended June 30, 1997 were approximately $1.1 million, compared to net
sales of approximately $159,000 during the same period during 1996. The
increase is attributed to the increased level of sales of the Neoprobe 1000
Portable Radioisotope Detector during the second quarter of 1997. Net sales
in the second quarter of 1997 related almost entirely to the Neoprobe 1000.
Net sales in the second quarter of 1996 related primarily to sales of
serology products by Neoprobe Europe of $104,000. Interest income for the
three months period ended June 30, 1997 was approximately $623,000, compared
to interest income of approximately $568,000 for the same period in 1996.
Research and development expenses increased to approximately $5.7 million for
the second quarter in 1997 from approximately $3.8 million in 1996. The
expenses increased as a result of additional contracted services and wages
and benefits. Contracted services increased primarily from instrument
development efforts as well as ongoing validation efforts related to the
commercialization of RIGScan CR49. Wages and benefits increased primarily due
to new personnel added over the course of the first quarter and second
quarter of 1997. Research and development expenses also increased due to
activities associated with the Company's therapy business. The Company
expects these expenses to continue during the remainder of 1997.
Marketing and Selling expenses increased to approximately $955,000 during the
second quarter of 1997 from approximately $239,000 for the same period in
1996. The increase was a result of commissions earned by the Company's
marketing partner associated with sales of the Neoprobe 1000 system,
additional staff, and RIGScan CR49 pre-launch activities.
General and administrative expenses increased to approximately $2.0 million
during the second quarter of 1997 from approximately $1.2 million during the
same period of 1996. The increase was a result of hiring additional staff,
and increased costs for rent, equipment leases, and taxes.
Six months ended June 30, 1996 and 1997. Total net sales for the six months
ended June 30, 1997 were approximately $2.2 million, compared to net sales of
approximately $356,000 during the same period in 1996. The increase is from
the level of sales of the Neoprobe 1000 Portable Radioisotope Detector during
the first half of 1997. Net sales during the first half of 1997 were
primarily related to the sale of the Neoprobe 1000. Net sales during the
first half of 1996 consisted primarily of sales of serology products by
Neoprobe Europe. Interest income for the six-month period ended June 30, 1997
was approximately $1.2 million compared to interest income of approximately
$803,000 for the same period in 1996. During 1996, the Company also collected
other income of approximately $230,000 related to a license fee paid upon the
exercise of an option for marketing rights in additional territories in Asia.
Research and development expenses increased to approximately $9.2 million in
the first half of 1997 from approximately $6.3 million in the first half of
1996. The expenses increased as a result of additional contracted services
and wages and benefits. Contracted services increased primarily from
instrument design development efforts as well as ongoing process and
validation efforts related to the commercialization of RIGScan CR49. Wages
and benefits increased primarily due to new personnel added in 1997. Research
and development expenses also increased due to activities associated with the
Company's therapy business.
Marketing and Selling expenses increased to approximately $1.8 million in the
first half of 1997 from approximately $344,000 in the first half of 1996. The
increase was primarily a result of commissions earned by the Company's
marketing partner from sales of the Neoprobe 1000 system, additional staff,
and RIGScan CR49 pre-launch activities.
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General and administrative expenses increased to approximately $3.6 million
in the first half of 1997 from approximately $2.4 million in the first half
of 1996. The increase was a result of hiring additional staff, and increased
costs for rent, equipment leases and taxes.
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PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
None.
ITEM 2. CHANGES IN SECURITIES.
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
An annual meeting of the stockholders (the "Stockholders") of the
Registrant was held on May 29, 1997. The matters voted upon at the annual
meeting and the results of the votes are set forth below.
(i) Melvin D. Booth was elected a director to serve for a term of three
years. 17,642,285 shares were voted for his election and 92,830
shares withheld authority.
(ii) John S. Christie was elected a director to serve for a term of three
years. 17,646,822 shares were voted for his election and 88,293
shares withheld authority.
(iii) J. Frank Whitley, Jr. was elected a director to serve for a term of
three years. 17,653,247 shares were voted for his election and 81,868
shares withheld authority.
(iv) An amendment (the "Amendment") to the 1996 Stock Incentive Plan was
approved. 14,202,455 shares were voted for approval, 1,126,214 shares
were voted against approval and 82,454 shares abstained. The material
terms of the Amendment allow grants of limited amounts of
unrestricted stock to employees and consultants of the Registrant,
change the number of shares subject to non-employee director annual
stock option awards ("Directors Options") from 3,600 to 5,000 shares,
add an attendance of board meetings requirement as a precondition to
receiving Directors Options, give the board of directors power to
increase or decrease the number of shares covered by each Directors
Option and remove the limitation on the frequency with which the
provisions concerning Directors Options may be amended.
ITEM 5. OTHER INFORMATION.
None.
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ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) LIST OF EXHIBITS
3. ARTICLES OF INCORPORATION AND BY-LAWS
Exhibit 3.1
Complete Restated Certificate of Incorporation of Neoprobe Corporation, as
corrected February 18, 1994 and as amended June 27, 1994, July 25, 1995 and
June 3, 1996 (incorporated by reference to Exhibit 99.2 to the Registrant's
Current Report on Form 8-K dated June 20, 1996; Commission File No. 0-26520).
Exhibit 3.2
Amended and Restated By-Laws dated July 21, 1993 as amended July 18, 1995 and
May 30, 1996 (incorporated by reference to Exhibit 99.4 to the Registrant's
Current Report on Form 8-K dated June 20, 1996; Commission File No.
0-26520).
4. INSTRUMENTS DEFINING THE RIGHTS OF SECURITY HOLDERS, INCLUDING
INDENTURES
Exhibit 4.1
See Articles FOUR, FIVE, SIX and SEVEN of the Restated Certificate of
Incorporation of the Registrant (see Exhibit 3.1).
Exhibit 4.2
See Articles II and VI and Section 2 of Article III and Section 4 of Article
VII of the Amended and Restated By-Laws of the Registrant (see Exhibit 3.2).
Exhibit 4.3
Rights Agreement dated as of July 18, 1995 between the Registrant and
Continental Stock Transfer & Trust Company (incorporated by reference to
Exhibit 1 of the registration statement on Form 8-A; Commission File No.
0-26520).
10. MATERIAL CONTRACTS
Exhibit 10.1.1 - 10.4.20
Reserved.
Exhibit 10.4.21
First Amendment to License and Distributorship Agreement dated May 1, 1997
between the Registrant and United States Surgical Corporation (filed pursuant
to Rule 24b-2 under which the Registrant has requested confidential treatment
of certain portions of this Exhibit).
13
14
11. STATEMENT REGARDING COMPUTATION OF PER SHARE EARNINGS
Exhibit 11.1
Computation of Net Loss Per Share.
27. FINANCIAL DATA SCHEDULE
Exhibit 27.1
Financial Data Schedule (submitted electronically for SEC information only).
(b) REPORTS ON FORM 8-K.
No report on Form 8-K was filed by the Registrant during the fiscal quarter
ended June 30, 1997.
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.
NEOPROBE CORPORATION
(the "Registrant")
Dated: August 13, 1997
By: /s/ Larry E. Anderson
------------------------
Larry E. Anderson
Vice President, Chief Financial Officer
(duly authorized officer and principal
financial officer)
By: /s/ John Schroepfer
------------------------
John Schroepfer
Vice President, Finance and Administration
(chief accounting officer)
14
15
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------
NEOPROBE CORPORATION
---------------------
FORM 10-Q QUARTERLY REPORT
FOR THE FISCAL QUARTER ENDED:
JUNE 30, 1997
---------------------
EXHIBITS
---------------------
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- --------------------------------------------------------------------------------
16
INDEX
Exhibit 3.1
Complete Restated Certificate of Incorporation of Neoprobe Corporation, as
corrected February 18, 1994 and as amended June 27, 1994, July 25, 1995 and
June 3, 1996 (incorporated by reference to Exhibit 99.2 to the Registrant's
Current Report on Form 8-K dated June 20, 1996; Commission File No. 0-26520).
Exhibit 3.2
Amended and Restated By-Laws dated July 21, 1993 as amended July 18, 1995 and
May 30, 1996 (incorporated by reference to Exhibit 99.4 to the Registrant's
Current Report on Form 8-K dated June 20, 1996; Commission File No.
0-26520).
Exhibit 4.1
See Articles FOUR, FIVE, SIX and SEVEN of the Restated Certificate of
Incorporation of the Registrant (see Exhibit 3.1).
Exhibit 4.2
See Articles II and VI and Section 2 of Article III and Section 4 of Article
VII of the Amended and Restated By-Laws of the Registrant (see Exhibit 3.2).
Exhibit 4.3
Rights Agreement dated as of July 18, 1995 between the Registrant and
Continental Stock Transfer & Trust Company (incorporated by reference to
Exhibit 1 of the registration statement on Form 8-A; Commission File No.
0-26520).
Exhibit 10.4.21
First Amendment to License and Distributorship Agreement dated May 1, 1997
between the Registrant and United States Surgical Corporation (filed pursuant
to Rule 24b-2 under which the Registrant has requested confidential treatment
of certain portions of this Exhibit).
Page 17 in the manually signed original.
Exhibit 11.1
Computation of Net Loss Per Share
Page 23 in the manually signed original.
Exhibit 27.1
Financial Data Schedule (submitted electronically for SEC information only).