1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the quarterly period ended JANUARY 31, 2001
----------------
[ ] 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: 0-5958
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MERIDIAN MEDICAL TECHNOLOGIES, INC.
-----------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 52-0898764
--------------------------------------- --------------------------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
10240 OLD COLUMBIA ROAD, COLUMBIA, MARYLAND 21046
-------------------------------------------- --------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 410-309-6830
--------------------------
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
YES [X] NO [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
CLASS OUTSTANDING AS OF FEBRUARY 28, 2001
--------------------------------------- -----------------------------------
Common Stock, $.10 par value 3,040,642 Shares
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MERIDIAN MEDICAL TECHNOLOGIES, INC.
FORM 10-Q
Page No.
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PART I. FINANCIAL INFORMATION
------------------------------
ITEM 1. Consolidated Financial Statements
Consolidated Balance Sheets as of
January 31, 2001 and July 31, 2000................................................................... 4
Consolidated Statements of Income for
the Three and Six Months Ended January 31, 2001 and 2000 ............................................ 5
Consolidated Statements of Cash Flows for
the Six Months Ended January 31, 2001 and 2000....................................................... 6
Notes to Consolidated Financial Statements............................................................. 7
ITEM 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.................................................................. 8
ITEM 3 Quantitative and Qualitative Disclosures About Market Risk.............................................11
PART II. OTHER INFORMATION
--------------------------
ITEM 2. Changes in Securities and Use of Proceeds .............................................................11
ITEM 4. Submission of Matters to a Vote of Security Holders....................................................11
ITEM 6. Exhibits and Reports on Form 8-K.......................................................................11
SIGNATURES........................................................................................................13
EXHIBIT INDEX.....................................................................................................14
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MERIDIAN MEDICAL TECHNOLOGIES, INC.
FORM 10-Q
INTRODUCTION
Meridian Medical Technologies, Inc. (hereinafter referred to as the "Company" or
"MMT" or "Meridian") is a medical technology company operating in two segments:
Pharmaceutical Systems and Cardiopulmonary Systems.
Pharmaceutical Systems - The Pharmaceutical Systems segment consists of the
Commercial Systems and Government Systems businesses, both of which utilize the
Company's auto-injector technology. The principal source of Commercial Systems
revenue currently is the EpiPen(R) family of auto-injectors, which are
prescribed for severe allergic reactions and other causes of anaphylaxis. The
Company expects, over the coming years, to realize significant revenue growth
from new commercial applications of its auto-injector products. Additionally,
revenue growth is anticipated from alliances that introduce new products in
auto-injectors and other drug delivery devices. Current new therapies under
development or in negotiations for delivery in auto-injectors include an
anti-seizure drug for management of breakthrough seizures and a drug for
hypoglycemia. Government Systems revenues are principally generated from
auto-injector products and services marketed to the U.S. Department of Defense
(DoD), and other federal, state, local, and foreign governments. Marketing
efforts from this unit will focus on maintaining the Industrial Base Maintenance
Contract with the U.S. Department of Defense, as well as expanding international
markets and domestic preparedness applications.
Cardiopulmonary Systems - The Cardiopulmonary Systems segment utilizes the
Company's electrocardiology and telemedicine technologies. Telemedicine sales
currently are the principal source of revenue. In fiscal 2000, the Company
introduced its PRIME ECG(TM) electrocardiac mapping system in Europe after
several years of development. Management believes that PRIME ECG has the
potential to become the standard ECG system of the future and to generate
significant revenues and profits for the Company.
FORWARD LOOKING STATEMENTS
This report and other written and oral statements made by the Company may
contain forward-looking statements within the meaning of the Private Securities
Litigation Reform Act with respect to financial performance and other financial
and business matters. Forward-looking statements are typically identified by
future or conditional verbs or similar expressions regarding events that have
yet to occur. These forward-looking statements are based on the Company's
current expectations and are subject to numerous assumptions, risks and
uncertainties. The following factors, among others, could cause actual results
to differ materially from forward-looking statements: economic and competitive
conditions; capital availability or costs; fluctuations in demand for the
Company's products; government procurement timing and policies; technological
challenges associated with the development and manufacture of the Company's
products; commercial acceptance of the Company's products; delays, costs and
uncertainties associated with clinical testing and government approvals required
to market new drugs and medical devices; availability and quality of raw
materials; success and timing of cost reduction and quality enhancement
programs; regulatory and contract compliance; relationships with significant
customers; adequacy of product liability insurance; ability to obtain, timing
and success of marketing representatives and strategic alliances; and adequacy
of intellectual property protection. Meridian assumes no duty to update
forward-looking statements.
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MERIDIAN MEDICAL TECHNOLOGIES, INC.
FORM 10-Q
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
MERIDIAN MEDICAL TECHNOLOGIES, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
January 31, July 31,
Assets 2001 2000
------ ------------ -----------
(unaudited)
Current assets:
Cash and cash equivalents $104 $79
Restricted cash 288 285
Receivables, less allowances of $455 and $524, respectively 7,556 7,229
Inventories 8,707 8,061
Deferred income taxes 1,937 1,937
Other current assets 919 1,218
-------- --------
Total current assets 19,511 18,809
-------- --------
Property, plant and equipment 23,907 23,261
Less - Accumulated depreciation (8,501) (7,466)
-------- --------
Net property, plant and equipment 15,406 15,795
-------- --------
Deferred financing fees 605 691
Capitalized software costs, net 1,272 1,429
Excess of cost over net assets acquired, net 5,808 6,340
Other intangible assets, net 1,455 1,621
-------- --------
Total assets $44,057 $44,685
======== ========
Liabilities and Shareholders' Equity
------------------------------------
Current liabilities:
Accounts payable and other accrued liabilities $5,148 $8,062
Note payable to bank 3,394 1,743
Customer deposits 179 392
Current portion of long-term debt 1,000 1,026
-------- --------
Total current liabilities 9,721 11,223
-------- --------
Long-term debt - notes payable, net of discount 16,443 16,823
Deferred income taxes 1,765 1,765
Other non-current liabilities 837 783
-------- --------
Total liabilities 28,766 30,594
-------- --------
Shareholders' equity:
Common stock (voting and non-voting)
Par value $.10 per share; 18,000,000 shares authorized;
3,038,641 and 3,001,962 shares issued 304 300
Additional capital 32,644 32,345
Accumulated other comprehensive loss - cumulative translation adjustment (185) (154)
Accumulated deficit (17,242) (18,152)
Unearned stock option compensation (17) (35)
Treasury stock, 30,176 shares at cost (213) (213)
-------- --------
Total shareholders' equity 15,291 14,091
-------- --------
Total liabilities and shareholders' equity $44,057 $44,685
======== ========
The accompanying notes are an integral part of these consolidated financial
statements.
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MERIDIAN MEDICAL TECHNOLOGIES, INC.
FORM 10-Q
MERIDIAN MEDICAL TECHNOLOGIES, INC.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share data)
-------------------------------------
(unaudited)
Three Months Ended Six Months Ended
January 31, January 31,
2001 2000 2001 2000
---- ---- ---- ----
Net sales $14,022 $12,066 $27,007 $23,821
Cost of sales 8,085 7,296 15,932 14,363
-------- -------- -------- --------
Gross profit 5,937 4,770 11,075 9,458
Selling, general, and administrative expenses 2,601 1,969 4,568 3,852
Research and development expenses 719 716 1,502 1,233
Depreciation and amortization 877 924 1,748 1,730
-------- -------- -------- --------
4,197 3,609 7,818 6,815
-------- -------- -------- --------
Operating income 1,740 1,161 3,257 2,643
Other (expense) income:
Interest expense (732) (831) (1,433) (1,674)
Other income (expense) (23) 9 (24) (49)
-------- -------- -------- --------
(755) (822) (1,457) (1,723)
-------- -------- -------- --------
Income before income taxes 985 339 1,800 920
Provision for income taxes 500 132 890 359
-------- -------- -------- --------
Net income $ 485 $ 207 $ 910 $ 561
======== ======== ======== ========
Net income per share:
Basic $ .16 $ .07 $ .30 $ .19
======== ======== ======== ========
Diluted $ .14 $ .06 $ .26 $ .17
======== ======== ======== ========
Weighted average shares:
Basic 3,037 2,995 3,023 2,995
Diluted 3,520 3,228 3,568 3,209
The accompanying notes are an integral part of these consolidated financial
statements.
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MERIDIAN MEDICAL TECHNOLOGIES, INC.
FORM 10-Q
MERIDIAN MEDICAL TECHNOLOGIES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(unaudited)
Six Months Ended
January 31,
2001 2000
---- ----
OPERATING ACTIVITIES:
Net income $ 910 $ 561
Adjustments to reconcile net income to net cash (used
for) provided by operating activities:
Depreciation and amortization 1,748 1,730
Amortization of capitalized software costs 157 --
Amortization of notes payable discount and
deferred financing fees 204 184
Changes in assets and liabilities
Receivables (327) (783)
Inventories (646) (2,316)
Other current assets 299 96
Accounts payable and other liabilities (3,141) 1,717
Other 42 92
------- -------
Net cash (used for) provided by operating activities (754) 1,281
INVESTING ACTIVITIES
Purchase of fixed assets (646) (571)
Increase in restricted cash (3) (4)
------- -------
Net cash used for investing activities (649) (575)
FINANCING ACTIVITIES
Net proceeds from line of credit 1,651 215
Payment on long-term debt (526) (670)
Payment of deferred financing fees -- (20)
Proceeds from issuance of common stock 303 --
------- -------
Net cash provided by (used for) financing activities 1,428 (475)
------- -------
Net increase in cash 25 231
Cash and cash equivalents at beginning of period 79 227
------- -------
Cash and cash equivalents at end of period $ 104 $ 458
======= =======
The accompanying notes are an integral part of these consolidated financial
statements.
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MERIDIAN MEDICAL TECHNOLOGIES, INC.
FORM 10-Q
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. In the opinion of management, the accompanying unaudited consolidated
financial statements contain all adjustments (consisting of normal
recurring accruals) necessary to present fairly the Company's financial
position as of January 31, 2001 and July 31, 2000, the results of its
operations for the three-month and six-month periods ended January 31,
2001 and 2000, and its cash flows for the six-month periods ended
January 31, 2001 and 2000. The results of operations for the three-month
and six-month periods ended January 31, 2001 are not necessarily
indicative of the results that may be expected for the fiscal year
ending July 31, 2001. Certain prior period amounts have been
reclassified to conform to current period presentation. The information
included in this Form 10-Q should be read in conjunction with
Management's Discussion and Analysis and financial statements and notes
thereto included in the Meridian Medical Technologies, Inc. 2000 Form
10-K filed with the Securities and Exchange Commission.
2. The Company considers all investments with a maturity of three months or
less on their acquisition date to be cash equivalents. Restricted cash
consists of cash pledged as collateral on an outstanding letter of
credit supporting the working capital line of credit at the Company's
Belfast subsidiary.
3. Inventories consisted of the following:
January 31, 2001 July 31, 2000
---------------- -------------
Components and subassemblies $5,587 $4,673
Work in process 3,366 3,250
Finished goods 597 884
------- -------
9,550 8,807
Less: inventory valuation allowance (843) (746)
------- -------
$8,707 $8,061
======= =======
4. A reconciliation of net income to comprehensive income is as follows:
Three Months Ended Six Months Ended
January 31, January 31,
2001 2000 2001 2000
---- ---- ---- ----
Net income $485 $207 $910 $561
Foreign exchange translation adjustment 7 27 (31) 44
----- ----- ----- -----
Comprehensive income $492 $234 $879 $605
===== ===== ===== =====
5. In accordance with Statement of Financial Accounting Standards No. 86,
the Company began amortizing capitalized software costs relating to its
PRIME ECG product during the third quarter of fiscal 2000, as it was
available for sale. Amortization, which is being provided on a 5 year,
straight-line basis, totaled $157,000 for the six months ended January
31, 2001, and is included in cost of sales.
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MERIDIAN MEDICAL TECHNOLOGIES, INC.
FORM 10-Q
6. Segment information is as follows:
Three Months Ended Six Months Ended
January 31, January 31,
2001 2000 2001 2000
---- ---- ---- ----
Revenues:
Pharmaceutical systems $13,476 $11,811 $26,001 $23,425
Cardiopulmonary systems 546 255 1,006 396
-------- -------- -------- --------
Total revenues $14,022 $12,066 $27,007 $23,821
======== ======== ======== ========
Operating income (loss):
Pharmaceutical systems $2,619 $1,906 $4,995 $4,046
Cardiopulmonary systems (879) (745) (1,738) (1,403)
-------- -------- -------- --------
Total operating income $1,740 $1,161 $3,257 $2,643
======== ======== ======== ========
ITEM 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
THE QUARTER IN REVIEW
MMT's net income was $485,000 ($0.16 basic and $0.14 diluted earnings per share)
on sales of $14.0 million for the quarter ended January 31, 2001, the second
quarter of fiscal 2001. This compares with net income of $207,000 ($0.07 basic
and $0.06 diluted earnings per share) on sales of $12.1 million in the same
period of fiscal 2000. This represents a 16.2% increase in revenues, a 134.3%
increase in net income, and a 133.3% increase in diluted earnings per share from
the same quarter of the prior year. On a year-to-date basis, MMT had net income
of $910,000 ($0.30 basic and $0.26 diluted earnings per share) on sales of $27.0
million for the six months ended January 31, 2001. This compares with net income
of $561,000 ($0.19 basic and $0.17 diluted earnings per share) on sales of $23.8
million in the same period of fiscal 2000. Weighted average diluted shares
outstanding for the quarter and year-to-date were higher than the same periods
of the prior year primarily due to the increased market price of the Company's
stock.
Revenues of MMT's two business segments and total gross profit for the
three-month and six-month periods ended January 31, 2001 and 2000 are as
follows:
Three Months Ended Six Months Ended
January 31, January 31,
($ in thousands) 2001 2000 2001 2000
---- ---- ---- ----
Pharmaceutical Systems:
Commercial Systems $ 6,168 $ 4,800 $ 14,018 $ 10,923
Government Systems 7,308 7,011 11,983 12,502
------- ------- ------- -------
Total Pharmaceutical Systems 13,476 11,811 26,001 23,425
Cardiopulmonary Systems 546 255 1,006 396
------- ------- ------- -------
Total Revenues 14,022 12,066 27,007 23,821
======= ======= ======= =======
Gross Profit $ 5,937 $ 4,770 $ 11,075 $ 9,458
======= ======= ======= =======
Gross Profit % 42.3% 39.5% 41.0% 39.7%
EBITDA (1) $ 2,673 $ 2,094 $ 5,138 $ 4,324
======= ======= ======= =======
(1) EBITDA represents operating income plus or minus other income (expense) and
plus depreciation and amortization. EBITDA is not a measure of performance or
financial condition under generally accepted accounting principles, but is
presented to provide additional information related to operating results. EBITDA
should not be considered in isolation or as a substitute for other measures of
financial performance or liquidity under generally accepted accounting
principles. While EBITDA is frequently used as a measure of operations and the
ability to meet debt service requirements, it is not necessarily comparable to
other similarly titled captions of other companies due to potential
inconsistencies in the method of calculation.
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MERIDIAN MEDICAL TECHNOLOGIES, INC.
FORM 10-Q
Commercial Systems revenue for the quarter ended January 31, 2001 was $6.2
million, $1.4 million higher than in the comparable prior year period. The 28.5%
increase in revenue primarily resulted from higher unit sales of EpiPens in the
current quarter compared to the same quarter in the prior year. On a
year-to-date basis, Commercial Systems revenue was $14.0 million for the six
months ended January 31, 2001, 28.3% higher than the same period of fiscal 2000.
R&D revenue also increased to $998,000 and $1,715,000 for the three and six
months ended January 31, 2001, compared to the $541,000 and $875,000 of revenues
in the same periods of the prior year. This increase was due to the timing and
number of projects, reflecting the variable nature of R&D revenue from period to
period.
Government Systems revenues were $7.3 million in the quarter ended January 31,
2001 compared to $7.0 million in the second quarter of fiscal 2000. Revenue for
the six months ended January 31, 2001 was $12.0 million compared to $12.5
million for the same period of the prior year. Domestic Preparedness sales were
$388,000 and $487,000 for the three and six months ended January 31, 2001,
respectively, versus $84,000 and $108,000 for the three and six month periods
ended January 31,2000. DoD and foreign government revenues decreased due to the
timing of procurements by those customers.
Cardiopulmonary Systems revenues were $546,000 and $1.0 million for the three
and six months ended January 31, 2001, respectively. This compares to $255,000
and $396,000 of revenue for the three and six-month periods ended January 31,
2000. This increase was due to stronger telemedicine sales during the quarter
and first six months. The Company continued to invest in the development of its
PRIME ECG sales and marketing network in Europe during the quarter.
Additionally, the Company is continuing its ongoing multi-site clinical study of
PRIME ECG, which is expected to be completed during the third quarter.
Gross profits were $5.9 million or 42.3% of revenues during the second quarter
of 2001, compared to $4.8 million or 39.5% for the same period of the prior
year. For the first six months of fiscal 2001, gross profits were $11.1 million
or 41.0% of revenues, compared to $9.5 million or 39.7% for the same period last
year. The comparable gross profit percentage is a result of product price, cost,
and sales mix.
Operating costs were $4.2 million and $7.8 million for the three and six months
ended January 31, 2001, respectively. This is compared to $3.6 million and $6.8
million incurred in the same periods of last year. Selling, general and
administrative expenses (SG&A) were $632,000 and $716,000 higher than the same
periods of the prior year primarily due to the Company's investment in the
marketing infrastructure for the PRIME ECG, costs associated with the ongoing
multi-site clinical trial, and initial expenses relating to the building of a
sales and marketing infrastructure for specialty pharmaceuticals.
Interest expense was $732,000 in the second quarter of fiscal 2001 and $1.4
million for the six months ended January 31, 2001. This represents a decrease
from fiscal 2000 due to lower average debt balances, partially offset by higher
interest rates.
The provision for income taxes was $890,000 for the six months ended January 31,
2001, reflecting an estimated effective tax rate of 49% for the year. The tax
provision incorporates estimated benefits from utilization of operating loss
carryforwards, offset by permanent book to tax differences and losses from
foreign subsidiaries. The Company takes no consolidated tax benefit from the
foreign losses. U.S. pre-tax income, taxed at the statutory rate after permanent
and temporary differences, is higher than the consolidated pre-tax income, which
inflates the effective rate.
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MERIDIAN MEDICAL TECHNOLOGIES, INC.
FORM 10-Q
LIQUIDITY AND CAPITAL RESOURCES
Total cash as of January 31, 2001 was $104,000, an increase of $25,000 from July
31, 2000. The Company used $753,000 in cash from operations in the first six
months of fiscal 2001 attributable mostly to increased operating working capital
requirements including higher accounts receivables and inventories, and lower
accounts payable. Investing activities in the first half of fiscal 2001 used
$649,000 of cash, mostly for capital additions. Financing activities generated
$1.4 million, primarily from net borrowings on existing debt facilities and the
sale of stock through stock option and warrant exercises. Availability under the
working capital lines of credit was $3.3 million at January 31, 2001.
Working capital at January 31, 2001 was $9.8 million, up from $7.6 million at
July 31, 2000. The increase was primarily attributable to higher inventories
($646,000) and lower accounts payable and accrued expenses ($3.1 million),
offset by higher notes payable to bank ($1.7 million). At January 31, 2001,
accounts receivable were $7.6 million, representing 42 days-sales-outstanding,
and inventories were $8.7 million representing a turn-over rate of 3.8 times per
year.
OUTLOOK
The Company continues to anticipate that the core Pharmaceutical Systems segment
of the business will have a strong overall year, which would result in double
digit growth in profits before tax for the Company. Demand for EpiPen remains
strong as evidenced by the product's sales performance in the first half of the
fiscal year. The first and second quarters are historically the unit's lowest
sales quarters due to the seasonality associated with EpiPen, sales of which
historically have been highest in the spring and summer months. Overall, sales
of EpiPen are expected to increase by approximately twenty percent as compared
to sales in fiscal 2000.
Government Systems' revenues for the remainder of fiscal 2001 are expected to be
lower than for the first six months of the year. The Company's new
multi-chambered auto-injector is in the FDA approval process. The FDA has
requested additional information that the Company is providing. While the
Company fully expects the MA product will receive FDA approval, previously
forecasted sales associated with this product are now planned for next fiscal
year. Overall gross margins for the Pharmaceutical Systems group are expected to
increase on a full-year basis due to forecasted revenue increases from higher
margin Commercial Systems products.
The Company will continue the early phase of developing its specialty
pharmaceutical group during the second half of fiscal 2001. Focused on central
nervous system (CNS) drugs, utilizing the Company's strong position in
auto-injector technology, the Company intends to build the required sales and
marketing infrastructure to support the initial product launch currently
anticipated during fiscal 2002.
The Cardiopulmonary Systems segment of the business is expected to continue to
generate increased sales through its telemedicine products and through the sales
of PRIME ECG. The Company currently anticipates filing for a 510(k) marketing
approval with the FDA for PRIME ECG during the fourth quarter of fiscal 2001,
subject to successful completion of ongoing clinical trials. The Company
anticipates that initial sales of PRIME ECG in the United States could occur by
the end of calendar 2001, subject to receipt of FDA approval. The Company
anticipates sales of the product in Europe will increase during the course of
the fiscal year.
The Company expects to generate increased EBITDA during fiscal year 2001. The
Company expects to invest substantial amounts in developing the market for PRIME
ECG and expects to increase its expenditures in research and development focused
on further applications for its auto-injector technology. Additionally, the
Company expects to reduce its debt during the fiscal year through cash generated
by operations and/or a placement of equity securities.
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MERIDIAN MEDICAL TECHNOLOGIES, INC.
FORM 10-Q
ITEM 3. Quantitative and Qualitative Disclosure About Market Risk
The Company's earnings are affected by fluctuations in the value of the U.S.
dollar, as compared to foreign currencies, as a result of transactions in
foreign markets. At January 31, 2001, the result of a uniform 10% strengthening
or weakening in the value of the dollar relative to the currencies in which the
Company's transactions are denominated would have resulted in a $122,000
increase or decrease, respectively, in operating income for the six months ended
January 31, 2001. This calculation assumes that each exchange rate would change
in the same direction relative to the U.S. dollar. In addition to the direct
effects of changes in exchange rates, which change the dollar value of the
resulting sales, changes in exchange rates also affect the volume of sales or
the foreign currency sales price as competitors' services become more or less
attractive. The Company's sensitivity analysis of the effects of changes in
foreign currency exchange rates does not factor in a potential change in sales
levels or local currency prices.
The Company is exposed to changes in interest rates as a result of its
outstanding debt. Total short-term and long-term debt outstanding at January 31,
2001 was $20.8 million, consisting of $6.4 million in variable rate borrowing
and $14.4 million in fixed rate borrowing. At this level of variable rate
borrowing, a hypothetical 10% increase in interest rates would have decreased
pre-tax earnings by approximately $29,000 for the six months ended January 31,
2001. At January 31, 2001, the fair value of the Company's fixed rate debt
outstanding was estimated at $15.0 million. A hypothetical 10% change in
interest rates would not result in a material change in the fair value of the
Company's fixed rate debt. The Company does not currently utilize any
derivative financial instruments related to its interest rate exposure.
PART II - OTHER INFORMATION
ITEM 2. Changes in Securities and Use of Proceeds
During the quarter ended January 31, 2001, the Company issued an aggregate of
3,056 shares of its common stock upon the exercise of warrants at an exercise
price of $11.00. The Company received aggregate proceeds of $33,616 from the
warrant exercises. These shares were issued pursuant to an exemption by reason
of Section 4(2) under the Securities Act of 1933.
ITEM 4. Submission of Matters to a Vote of Security Holders
The Company held its annual meeting of stockholders on January 11, 2001 (the
"Annual Meeting"). A total of 2,954,585 shares of common stock were represented
at the Annual Meeting in person or by proxy. The stockholders voted to reelect
E. Andrews Grinstead, III as a director with 2,769,191 votes cast for the
nominee and 185,394 votes withheld. James H. Miller, Robert G. Foster, Bruce M.
Dresner and David L. Lougee remained in office as continuing directors following
the meeting. The stockholders voted to approve the Company's Employee Stock
Purchase Plan with 2,006,377 votes cast for approval of the Employee Stock
Purchase Plan, 30,149 votes against, and 13,807 abstentions or broker-nonvotes.
The stockholders voted to approve the Company's 2000 Stock Incentive Plan with
1,411,825 votes cast for approval of the 2000 Stock Incentive Plan, 624,091
votes against, and 14,417 abstentions or broker-nonvotes. Finally, the
stockholders voted to ratify the selection by the Board of Directors of Ernst &
Young LLP as independent auditors of the Company for the fiscal year with
2,941,064 votes cast for ratification, 3,000 votes against, and 10,520
abstentions or broker-nonvotes.
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MERIDIAN MEDICAL TECHNOLOGIES, INC.
FORM 10-Q
ITEM 6. Exhibits and Reports on Form 8-K:
(a) Exhibits
Exhibit 4.4 Offer letter to change the terms of certain warrants
expiring March 14, 2001. Filed herewith.
Exhibit 10.41 Meridian Medical Technologies, Inc. 2000 Stock Incentive
Plan. Incorporated by reference from Exhibit 4 to
Registration Statement No. 333-54780 on Form S-8. *
* - Management contract, compensatory plan or arrangement.
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the three months
ended January 31, 2001.
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MERIDIAN MEDICAL TECHNOLOGIES, INC.
FORM 10-Q
SIGNATURES
Pursuant to the requirement 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.
MERIDIAN MEDICAL TECHNOLOGIES, INC.
-----------------------------------
Registrant
March 7, 2001 By: /S/James H. Miller
------------- ------------------
Date James H. Miller
President and
Chief Executive Officer
(Principal Executive Officer)
March 7, 2001 By: /S/Dennis P. O'Brien
------------- --------------------
Date Dennis P. O'Brien
Vice President-Finance
and Chief Financial Officer
(Principal Financial and
Accounting Officer)
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MERIDIAN MEDICAL TECHNOLOGIES, INC.
FORM 10-Q
EXHIBIT INDEX
Exhibit No. Description of Exhibit
4.4 Offer letter to change the terms of certain warrants
expiring March 14, 2001. Filed herewith.
10.41 Meridian Medical Technologies, Inc. 2000 Stock Incentive
Plan. Incorporated by reference from Exhibit 4 to
Registration Statement No. 333-54780 on Form S-8. *
* - Management contract, compensatory plan or arrangement.
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