BIOSPECIFICS
TECHNOLOGIES CORP.
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Delaware
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0-19879
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11-3054851
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(State
or other jurisdiction
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(Commission
file number)
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(I.R.S.
Employer
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of
incorporation or organization)
|
|
Identification
No.)
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Class
of Stock
|
Outstanding September
4, 2007
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Common
Stock ($.001 par value)
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5,316,101
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Page
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ITEM
1.
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2
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2
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3
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4
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5
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ITEM
2.
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11
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ITEM
3.
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16
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17
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ITEM
1.
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17
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ITEM
2.
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17
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ITEM
3.
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17
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ITEM
4.
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17
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ITEM
5.
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17
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ITEM
6.
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17
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BIOSPECIFICS
TECHNOLOGIES
CORP. AND
SUBSIDIARIES
|
||||||||
Consolidated
Balance Sheets
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||||||||
March
31,
|
||||
2007
|
||||
(unaudited)
|
||||
Assets
|
||||
Current
assets:
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Cash
and cash equivalents
|
$ |
3,525,209
|
||
Accounts
receivable, net
|
25,339
|
|||
Prepaid
expenses and other current assets
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89,691
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|||
Total
current assets
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3,640,239
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|||
Property,
plant and equipment, net
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59,787
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|||
Total
assets
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3,700,026
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|||
Liabilities
and Stockholders' Equity
|
||||
Current
liabilities:
|
||||
Accounts
payable and accrued expenses
|
2,084,954
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|||
Deferred
revenue
|
1,437,116
|
|||
Accrued
tax and other accrued liabilities of discontinued
operations
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78,138
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|||
Total
current liabilities
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3,600,208
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|||
Long-term
deferred revenue
|
3,984,470
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|||
Stockholders'
equity (deficit):
|
||||
Series
A Preferred stock, $.50 par value, 700,000 shares authorized; none
outstanding
|
-
|
|||
Common
stock, $.001 par value; 10,000,000 shares authorized; 5,392,816
and
5,365,816
shares
issued and outstanding at March 31, 2007 and December 31, 2006,
respectively
|
5,393
|
|||
Additional
paid-in capital
|
4,144,010
|
|||
Retained
earnings (deficit)
|
(6,714,324 | ) | ||
Treasury
stock, 131,267 shares at cost at March 31, 2007 and December 31,
2006
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(693,957 | ) | ||
Notes
receivable from former CEO and Chairman and other related
party
|
(625,774 | ) | ||
Total
stockholders' equity (deficit)
|
(3,884,652 | ) | ||
Total
liabilities and stockholders’ equity
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$ |
3,700,026
|
||
See
accompanying notes to consolidated financial
statements
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BIOSPECIFICS
TECHNOLOGIES
CORP. AND
SUBSIDIARIES
|
||||||||
Consolidated
Statements of Operations
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||||||||
(unaudited)
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||||||||
Three
Months Ended
March
31,
|
||||||||
2007
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2006
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|||||||
Revenues:
|
||||||||
Net
sales
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$ |
1,100
|
$ |
6,793
|
||||
Licensing
fees
|
289,279
|
289,279
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||||||
Consulting
fees
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70,000
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23,333
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||||||
360,379
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319,405
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|||||||
Costs
and expenses:
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||||||||
General
and administrative
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1,097,467
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972,395
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||||||
Research
and development
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386,359
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745,365
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||||||
1,483,827
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1,717,760
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|||||||
Operating
loss from continuing operations
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(1,123,448 | ) | (1,398,355 | ) | ||||
Other
income (expense):
|
||||||||
Interest
income
|
41,249
|
17,825
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||||||
Interest
expense
|
-
|
(505 | ) | |||||
41,249
|
17,320
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|||||||
Loss
from continuing operations before benefit (expense) for income
tax
|
(1.082,199 | ) | (1,381,035 | ) | ||||
Income
tax benefit (expense)
|
(3,600 | ) |
-
|
|||||
Net
income (loss) from continuing operations
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(1,085,799 | ) | (1,381,035 | ) | ||||
Discontinued
operations:
|
||||||||
Net
gain (loss) from discontinued operations
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-
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(1,115,704 | ) | |||||
Net
gain on the sale of assets
|
-
|
3,601,102
|
||||||
Net
loss
|
$ | (1,085,799 | ) | $ |
1,104,363
|
|||
Basic
net income (loss) per share:
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||||||||
From
continuing operations
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$ | (0.21 | ) | $ | (0.27 | ) | ||
From
discontinued operations
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$ |
-
|
$ |
0.48
|
||||
Basic
net loss per share
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$ | (0.21 | ) | $ |
0.21
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|||
Diluted
net income (loss) per share:
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||||||||
From
continuing operations
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$ | (0.21 | ) | $ | (0.27 | ) | ||
From
discontinued operations
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$ |
-
|
$ |
0.48
|
||||
Diluted
net loss per share
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$ | (0.21 | ) | $ |
0.21
|
|||
Shares
used in computation of basic net income (loss) per
share
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5,235,149
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5,178,374
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||||||
Shares
used in computation of diluted net income (loss) per
share
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5,235,149
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5,178,454
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||||||
See
accompanying notes to consolidated financial
statements
|
BIOSPECIFICS
TECHNOLOGIES
CORP. AND
SUBSIDIARIES
|
||||||||
Consolidated
Statements of Cash Flows
|
||||||||
(unaudited)
|
||||||||
Three
Months Ended March 31,
|
||||||||
Cash
flows from operating activities:
|
2007
|
2006
|
||||||
Net
loss
|
$ | (1,085,799 | ) | $ | (1,381,035 | ) | ||
Adjustments
to reconcile net loss to net cash provided
|
||||||||
by
operating activities:
|
||||||||
Depreciation
and amortization
|
8,036
|
18,243
|
||||||
Stock-based
compensation expense
|
138,547
|
418,975
|
||||||
Changes
in operating assets and liabilities:
|
||||||||
Accounts
receivable
|
21,484
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(64,374 | ) | |||||
Prepaid
expenses and other current assets
|
(40,977 | ) |
12,573
|
|||||
Accounts
payable and accrued expenses
|
370,056
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567,613
|
||||||
Deferred
revenue
|
40,721 |
112,389
|
||||||
Net
cash provided by (used in) operating activities from continuing
operations
|
(547,932 | ) |
313,552
|
|||||
Net
cash provided by (used in) discontinued
operations
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(321,037 | ) |
1,072,691
|
|||||
Net
cash provided by investing activities from discontinued
operations
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-
|
6,058,713
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||||||
Cash
flows from financing activities:
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||||||||
Proceeds
received from stock option exercises
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27,000
|
-
|
||||||
Payment
to minority
shareholders
|
-
|
(83,406 | ) | |||||
Net
cash provided by (used in) financing activities from continuing
operations
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27,000
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(83,406 | ) | |||||
Net
cash used in financing activities from discontinued
operations
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-
|
-
|
||||||
Increase
in cash and cash equivalents
|
(841,969 | ) |
6,732,382
|
|||||
Cash
and cash equivalents at beginning of year
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4,367,178
|
539,380
|
||||||
Cash
and cash equivalents at end of period
|
$ |
3,525,209
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$ |
7,271,762
|
||||
Supplemental
disclosures of cash flow information:
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||||||||
Cash
paid during the periods for:
|
||||||||
Interest
|
$ |
-
|
$ |
505
|
||||
Supplemental
disclosures of non-cash transactions:
In March 2007, in full repayment of the $304,398
loan
owed to the Company by Wilbur Street Corporation (“WSC”),
WSC
offset $304,398 in back rent due from the Company in repayment
of the
loan. The transaction was recorded by reducing the rent payable by
$304,398 and the receivable from the former CEO and Chairman by
$98,253
and increasing additional paid in capital by $206,145.
|
||||||||
For
the year ended December 31, 2006, the Company reduced its liability
to the
employee stock bonus plan
by issuing $162,300 of common stock. The remaining balance of $6,600
was
cancelled.
|
||||||||
In March 2006, we sold our topical collagenase business to DFB. In order to effectuate the transaction with DFB, we repurchased all of the outstanding shares of ABC-NY and ABC-Curacao held by minority shareholders in exchange for a combination of approximately $83,000 in cash and 102,574 restricted shares of our treasury stock. | ||||||||
See
accompanying notes to consolidated financial
statements
|
Three Months Ended
|
Three Months Ended
|
|||||||
March
31, 2007
|
March
31, 2006
|
|||||||
Research
and development
|
$ |
2,580
|
$ |
60,605
|
||||
General
and administrative
|
135,967
|
358,370
|
||||||
Total
employee stock-based compensation expense
|
138,547
|
418,975
|
||||||
Total
stock-based compensation expense
|
$ |
138,547
|
$ |
418,975
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Option
|
|
Total Number
of
Shares
|
|
|
Weighted-Average
Exercise
Price
|
Outstanding
as of December 31, 2006
|
|
1,281,125
|
$1.17
|
||
Granted
|
|
92,000
|
$4.11
|
Forfeited
|
|
(9,400)
|
$3.28
|
||
Exercised
|
|
(27,000)
|
$1.00
|
||
Expired
|
|
-
|
-
|
||
Outstanding
as of March 31, 2007
|
|
1,336,725
|
$1.38
|
||
|
|
|
|
|
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Exercisable
as of March 31, 2007
|
|
1,142,225
|
$1.27
|
Three
Months Ended March 31,
|
||||||||
2007
|
2006
|
|||||||
Net
loss from discontinued operations
|
$ |
-
|
$ | (1,115,704 | ) | |||
Pre-tax
gain on disposal of discontinued operations (1)
|
-
|
3,601,102
|
||||||
Net
income (loss) from discontinued operations
|
$ |
-
|
$ |
2,485,398
|
Three
Months Ended
March
31,
|
||||||||
2007
|
2006
|
|||||||
Stock
options
|
1,336,725
|
1,348,363
|
||||||
Warrants
|
10,000
|
10,000
|
||||||
Total
|
1,346,725
|
1,358,363
|
March
31,
2007
|
December
31,
2006
|
|||||||
Trade
accounts payable and accrued expenses
|
$ |
1,826,843
|
$ |
1,751,014
|
||||
Accrued
legal and other professional fees
|
107,000
|
120,030
|
||||||
Accrued
payroll and related costs
|
151,111
|
148,252
|
||||||
Total
|
$ |
2,084,954
|
$ |
2,019,296
|
||||
|
·
|
Any
payment by the Company in excess of $10,000 other than payments
for
previously approved reoccurring expenses requires the written approval
of
any member of the Audit Committee in addition to the signature
of our
President, Thomas L. Wegman; and
|
|
·
|
Any
payment by the Company for the business expenses of our President,
Thomas
L. Wegman requires the written approval of any member of the Audit
Committee.
|
|
3.1
|
Articles
of Incorporation of the Registrant (incorporated by reference to
Exhibit
3.1 to the Registrant's Annual Report on Form 10-KSB for the fiscal
years
ended December 31, 2005, 2004 and
2003).
|
|
3.2
|
Bylaws
of the Registrant (incorporated by reference to Exhibit 3.2 to
the
Registrant’s Annual Report on Form 10-KSB for the fiscal years ended
December 31, 2005, 2004 and 2003).
|
BIOSPECIFICS
TECHNOLOGIES CORP.
|
|
(Registrant)
|
Date: September
26, 2007
|
/s/
Thomas L. Wegman
|
Thomas
L. Wegman
President
(Principal
Executive and Financial Officer)
|