Back to GetFilings.com
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
Form 10-K
Annual Report Pursuant to Section 13 or 15(d)
Of the Securities Exchange Act of 1934
FOR THE FISCAL YEAR ENDED COMMISSION FILE NUMBER
December 31, 1999 0-12248
Daxor Corporation
(Exact name of Registrant as specified in its charter)
New York 13-2682108
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification Number)
350 Fifth Avenue
Suite 7120
New York, New York 10118
(Address of principal executive offices) (Zip Code)
Registrant's telephone number: (212) 244-0555
Securities registered pursuant to Section 12(b) of the Act:
Common Shares, $.01 par value
(Title of Class)
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether 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 and (2) has been subject to such filing requirements for
the past 90 days.
Yes (X) No ( )
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-X is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
form 10-K. [ ]
As of March 28, 2000, the aggregate market value of the voting stock held by
non-affiliates of the Registrant was $ 35,205,640. The market value of Common
Stock of the Registrant, par value $.01 per share, was computed by reference to
the closing price of one share on such date, as reported by the American Stock
Exchange, which was $ 23.
The number of shares outstanding of the Registrant's Common Stock, par value
$.01 per share, as of March 28, 2000: 4,692,909 shares.
Documents incorporated by reference: The information required by Part III is
incorporated by reference from the proxy statement for the 1999 Annual Meeting
of Shareholders.
PART I.
Item 1. Business
Daxor Corporation is a medical device manufacturing Corporation with additional
biotech services. The company was originally founded for cryobanking services.
For the past 15 years, its major focus has been on the development of a rapid,
accurate system to measure human blood volume. The company developed a system
called the BVA-100 which is used in conjunction with a single use diagnostic
injection and collection kit. The company maintains a website, www.daxor.com
which describes its operations.
In mid-1998, the company achieved marketing clearance from the FDA for the
instrument and its kit. At the year end 1998 and throughout 1999 the blood
volume analyzer underwent beta-testing in a number of major hospitals. Test
results from these sites indicated that the blood volume analyzer was accurate
and provided information that was important in a wide variety of acute and
chronic medical and surgical situations. The Company acquired a manufacturing
facility for the injection kit components in Rochester, N.Y. The blood volume
analyzer is manufactured for the Company. The Company has received United
States, European Common Market, and Japanese patents for its system. In 1999,
and the first quarter of the year 2000, the company has begun marketing its
blood volume analyzers under three different programs. These include direct sale
of an instrument, leasing of an instrument, or a reagent sale/instrument loaner
plan. These plans provide flexibility to potential users in acquiring an
instrument.
Blood volume measurement has been available for more than 50 years in formats
which required as much as two to six hours of technician time with variable
degrees of accuracy. Because of the time required, certain technical shortcuts
were used which reduced the accuracy of the measurement. An additional problem
was the inability to derive an accurate normal blood volume for a specific
individual. Measurement of blood volume is achieved by the use of an indicator
or tracer which is injected into a patient which is then followed by the
collection of timed samples. The volume of blood in a patient is inversely
proportional to the dilution of the tracer. The measurement while relatively
simple in principle, has been difficult to perform accurately and rapidly
because of the high degree of precision required in each step. The standard
practice requires the hospital or user to prepare an exactly matching set of
standards and tracer injectate with precise and complete injection of the
tracer. Because of the difficulty in achieving this type of precision blood
volume measurements are performed in only a small minority of hospitals in the
United States. The standard tests used in anemia, the hemoglobin or the
hematocrit measures the thickness and not the volume of an individual's blood.
These surrogate or proxy tests are well known to be misleading in many
situations where a blood volume is abnormal. In acute situations, for example,
during surgical blood loss or after trauma, it may take 24 to 72 hours for the
hematocrit to accurately or reasonably reflect the degree of blood loss.
Pulmonary Artery Catheterization (PAC) which involves the insertion of a
catheter into a vein through the right chambers of the heart has frequently been
used as a surrogate technique to evaluate blood volume in critically ill
patients. Pulmonary Artery Catheterization measures pressure directly but not
volume. In 1999, the Lutheran Medical Center presented its research on the first
direct comparison of actual blood volume measurements on patients with PAC.
Their findings confirmed that PAC could be inaccurate and misleading in patients
who had significant blood volume deficits. Hypovolemia or low blood volume can
be particularly dangerous during surgery and may lead to sudden severe drops in
blood pressure. Such a drop in blood pressure, also known as shock, is
associated with strokes, heart attacks or even sudden death.
The Company has received preliminary reports on the use of the blood volume
analyzer in septic or toxic shock. Septic shock is associated with death rates
as high as 40-70%. A medical center using the BVA-100 reported preliminary
results in patients diagnosed with septic shock who were found to have
unanticipated low blood volume. The patients who were treated with fluids and
blood to restore their blood volume, to normal levels had a markedly reduced
death rate. These findings if verified on a larger scale would be very important
for marketing the blood volume analyzer. The Company anticipates the publication
of these findings in the near future. A primary goal of the Company is to have
the blood volume analyzer become a standard of care within hospitals as part of
the decision-making process for administration of blood and intravenous therapy.
If these
preliminary findings in the treatment of septic shock are verified, it could be
expected to have a significant impact on hospital demand for obtaining a blood
volume analyzer. Septic shock is a common daily occurrence in all hospitals.
In extreme emergencies, preliminary blood volume measurements are available
within 15 to 20 minutes. Final results accurate to 98% can be available within
30 to 40 minutes. The instrument will also calculate the normal blood volume for
a specific individual. The normal blood volume for an individual is related to a
complex interplay of height and weight. The instrument provides these
calculations. The instrument will calculate the deficit or excess of both the
red cells and the plasma. The provision of this type of data in the opinion of
the Company will provide critical information in a timely fashion not only in
surgery but in other conditions such as heart failure and kidney failure. The
Company believes that, if its blood volume measurement equipment were available
in a hospital, it would be feasible for the hospital to routinely perform a
blood volume test on every patient for whom a blood transfusion appeared to be
indicated. There are over 4 million patients who receive blood transfusions
every year.
The largest potential use for the Blood Volume Analyzer, is for evaluation and
treatment of outpatients medical problems. Many disease conditions result in
alterations of blood volume which may have serious consequences for the patient.
A recent Mayo Clinic study estimated that there are 50 million Americans who
have hypertension. Hypertension is caused primarily by two variables. There is
either too much blood (hypervolemia) or fluid retention within the circulation
or too much vasoconstriction (tightening of the blood vessels). Diuretics are
one major category of drugs used to treat hypertension. Diuretics cause the
kidney to excrete salt and water and thereby decreasing the blood volume and
lowering the blood pressure. A second major category of medications is
vasodilators. These drugs relax the blood vessels, or vasoconstriction, and
lower the blood pressure. Within each of these two major categories are drugs
which work by different mechanisms but they all essentially fall into one of
these two main therapeutic categories, diuretics or vasodilators. Treatment is
often a trial and error approach because neither vasoconstriction or blood
volume is actually measured in a patient (with rare exception). One of the most
serious complications of hypertension is loss of kidney function (renal failure)
which may require a patient to undergo permanent renal dialysis. Over the past
year, the company has received reports on patients treated for hypertension with
diuretics, who have a low blood volume. The physicians treating these patients
reduced or removed the diuretic therapy. African-Americans have been reported to
have significantly higher rates of strokes, and kidney failure as compared to
whites for comparable levels of elevated blood pressure. Diuretic therapy would
be expected to be beneficial for patients whose elevated blood pressure is
caused by an expanded blood volume and would be expected to be harmful for
patients whose high blood pressure is accompanied by low blood volume. At the
present time, there is inadequate data to determine whether African Americans as
a group are more likely to be individuals treated with diuretics. It is well
known that diuretics can cause blood volume to decrease to the point of causing
disruption of kidney function. The kidney is particularly vulnerable to low
blood volume. Kidney failure is a common complication of severe low blood
volume. Medications which cause low blood volume, may contribute to premature
renal failure. The measurement of blood volume in the treatment of hypertension
may help prevent these types of complications. By measuring the blood volume
within the patient, the physician can make a more rational or scientific choice
in regard to the medical choice of therapy administered.
It is estimated that there are 5 millions individuals that are treated annually
for congestive heart failure. The January 2000 issue of the American College of
Cardiology reported on a series of patients treated for congestive heart failure
who had low blood volume and were decompensated. Over-treatment of congestive
heart failure is very difficult to detect and symptoms of over-treatment can be
confused with the primary disease itself. It is estimated that $38 billion is
spent annually on treatment for congestive heart failure. Congestive heart
failure is the number one reason for admission to hospitals in the US for
patients over 65 years of age. $23 billion is spent annually on hospital
treatment of congestive heart failure patients. Three thousand patients annually
receive heart transplants. The overwhelming majority of patients treated for
heart failure must be treated medically with a varied combination of drugs. The
blood
volume analyzer is currently undergoing testing specifically for utilization in
optimizing the treatment for congestive heart failure patients.
According to the Journal of Clinical Geriatrics, one out of every three elderly
patients has a condition known as orthostatic hypotension. Orthostatic
hypotension is a condition whereby when a person arises from a sitting or
reclining position, the blood pressure drops. A sudden drop in blood pressure
may cause dizziness or even loss of consciousness. One in eight elderly
Americans experiences a hip fracture. It is unknown how many of these hip
fractures are caused by patients having a transient drop in blood pressure. A
blood volume measurement can help differentiate the cause of orthostatic
hypotension. Some patients with low blood volume caused by either low red cell
volume or low plasma volume can be treated with medications. Patients who have a
normal blood volume with orthostatic hypotension have a condition related to
autonomic dysfunction or ineffective control of the constriction of small blood
vessels. A medication is also available for this condition. Anemia or low red
cell volume is a common occurrence in patient's undergoing chemotherapy for
AIDS, or patients undergoing chemotherapy for cancer. Epogen and Procrit which
are manufactured by the Amgen Corporation, can provide therapy for such
conditions. The standard surrogate tests, hematocrit and hemoglobin may not
reflect the full degree of decreased red blood cell volume in such patients. A
blood volume measurement can detect low blood volume in such patients which may
be contributing to a profound feeling of weakness common in such conditions.
Blood volume measurement can detect patients who have unrecognized low blood
volume.
The chronic fatigue syndrome is a condition said to affect approximately one
million Americans, particularly patients with low blood pressure. Low blood
volume has been reported to be a factor in such conditions. The ability to
measure blood volume with a high degree of precision and accuracy may identify
patients who have low blood volume and are not optimally treated at the present
time. Examples of other conditions with blood volume derangements are renal
(kidney) failure and syncope (fainting). Measurement of blood volume permits
more precise therapy.
In 1998, the medication Viagra, produced by Pfizer for erectile dysfunction was
associated with sudden death in a limited number of cases in patients who used
vasodilators such as Nitrates. Unrecognized low blood volume was suspected as a
possible factor in some of these cases. The company is currently conducting a
small study on blood volume measurements on potential Viagra users who might
benefit from a blood volume measurement prior to Viagra use.
The Company believes that the most significant market for its blood volume
measurement equipment consists of approximately 8,500 hospitals and Radiology
Imaging Centers in the United States. The Company believes that there is an
additional international market of 10 to 14,000 potential users of its BVA-100.
Blood volume measurement is an approved test with six separate CPT codes.
Reimbursement has been received from a number of insurance companies for
measurement of blood volume using the BVA-100. Reimbursement is particularly
important for hospitals because hospitals may receive reimbursement and income
from non-hospitalized patients who undergo blood volume measurement.
SCIENTIFIC MEDICAL SYSTEMS SUBSIDIARY (wholly owned by Daxor)
BLOOD BANKING
The Company's frozen blood bank is the only blood bank in New York that allows
people to store their own blood for up to ten years. In 1985, the Company
established the first facility in the United States for long-term autologous
(self-storage) blood banking. The blood banking industry is a group of
for-profit and not-for-profit corporations whose total revenue is estimated to
exceed six billion dollars.
Utilizing cryobiology technology, frozen blood has been shown to be capable of
being stored for up to 20 years. The present donor system of blood transfusions
presents risks to those individuals receiving blood. This is a risk which can be
avoided by utilizing one's previously stored blood. There are approximately
15-18 million blood transfusions administered annually to 4 million patients.
Compounding the risks of infection and other complications, is the frequent
withholding of blood from severely anemic patients by their physicians because
of these known risks of transfusion. It is a common medical practice to replace
the first three pints of lost blood with three pints of sterile water or their
equivalent. This problem has not been brought to public attention, but is widely
known among physicians who have treated patients who have lost blood. The number
of patients who suffer major complications, including sudden death, from
under-transfusion is unknown but significant. Patients who have decreased blood
volume are termed 'Hypovolemic'. The Blood volume Analyzer has the potential to
detect such individuals before complications from under-transfusion occurs.
Physicians who fear the complications of transfusion with potentially
contaminated blood do not have these concerns when patients use autologous blood
(self-storage).
The Company believes that an educational process will be required to establish
the desirability of autologous blood storage and to overcome opposition to any
change in the current blood banking system from established tax-exempt
(non-profit) and profit-making entities. The company believes that it can work
with some voluntary blood banks to establish joint marketing of long term frozen
personal blood storage programs.
Blood Banking services are provided by a broad spectrum of organizations.
Approximately one-half of the blood supply used for transfusions is supplied by
the American Red Cross and its affiliates. The other portion is supplied by
various other tax-exempt and for-profit organizations. Some hospitals operate
their own donor services, but require the services of outside vendors such as
the Red Cross for adequate supplies of blood products. At the present time there
are no other organizations providing long-term personal frozen blood storage in
the Northeastern United States. It is the company's intentions to form alliances
with other short-term donor blood banks to expand frozen personal blood storage
services. The Company views personal blood storage as a supplement to and not as
a competition to other existing blood donor services.
Idant (Division of Scientific Medical Systems, subsidiary of Daxor Corporation)
Semen (Sperm) Banking
Idant, in 1985, was the first semen bank to institute an AIDS quarantine period
for frozen semen. Viruses such as HIV and hepatitis B or C may be undetectable
for up to 6 months in infected individuals. By freezing the semen of donors and
retesting the donor 6 months later the risk of hepatitis or AIDS can be
virtually eliminated. In 1989, New York State and a number of other states
enacted laws requiring sperm banks to freeze and quarantine sperm for a minimum
of six months with donors being tested at the beginning and at the end of the
six-month period. By storing semen from a large cross-section of sperm donors,
Idant can closely match the physical characteristics of the sperm donor. The
Company maintains a complete physical description of each donor on file and
matches multiple physical characteristics and additional special characteristics
sought by the family to those of the sterile father. The Company also provides,
on request, special screening for rare hereditary recessive genetic traits. The
increased likelihood of a child who resembles his recipient father can make the
child, who results from artificial insemination, much more psychologically
acceptable to the father.
Storage of Sperm for Personal Use
Idant pioneered both the technology and the commercial application of long-term
preservation of human sperm for use in artificial insemination. The division has
provided frozen semen services to physicians worldwide. Idant holds
approximately 55,000 human semen units in long-term storage at its central New
York City facility. The Company has the only semen bank in the state of New
York, out of more than 50 licensed banks, which is accredited by the American
Association of Tissue Banks. The Company's sperm bank facilities contain stored
sperm, which should remain viable for many years. Semen stored for 23 years, at
minus 321 degrees, has shown minimal change (the Company has had documented
normal births from semen stored 16 years). The Company's facilities are used by
men who, for a variety of reasons, anticipate impairment of their ability to
father children and by men who have been found to be marginally fertile. These
men may now be able to have children by use of techniques that increase their
fertility by treating
their sperm to artificially inseminate their partners. The facilities are also
used by men who plan to undergo sterilization by vasectomy, but who believe that
they might desire children in the future. Artificial insemination using stored
sperm is much more effective and less expensive than present techniques of
vasectomy reversal. In addition, patients with a variety of diseases, including
many types of cancer, store semen prior to undergoing treatment by chemotherapy
or radiation. By utilizing cryogenic preservation facilities, these patients,
who are frequently in their teens or twenties, will be able to father their own
children after cancer treatment, despite the high risk of sterility and birth
defects associated with treatments. The Company receives referrals for these
services from multiple sources, primarily physicians.
The Company uses a customized carousel canister system in its sperm bank storage
system. This permits retrieval of specimens from lower levels without removal of
upper specimens. Only a few other sperm banks in the U.S. are known to have such
a system. Most other banks use a "rack and cane" pull-up system, which requires
removal of upper specimens from the tank to retrieve specimens at lower levels.
In such a bank, a specimen may be exposed to a temperature change of
- -321(degrees)F (the temperature of the liquid nitrogen) to room temperature of
78(degrees)F more than 100 times during its storage lifetime. This will result
in a gradual degradation of the specimen. In the Idant system the specimen
remains under liquid nitrogen almost continuously while in storage. The Company
is aware of only one other semen bank, which uses the carousel system for long
term storage of semen. Idant periodically spot-checks its bank storage to test
viability of selected specimens of stored semen; results of these spot-checks
have shown sperm samples held in excess of 23 years to have almost no loss in
viability or change in condition.
Patent and Copyright Protection
The Company has received separate United States patents on its Blood Volume
Analyzer (BVA-100) kit. This is the only patent ever issued for an instrument
dedicated to the measurement of total human blood volume for a specific
individual. The Company received a European patent covering 12 countries. The
Company has received a Japanese patent for the BVA-100. This is the first patent
ever issued for an instrument in Japan to measure human blood volume. The
instrument is designed to work with an injection kit to be manufactured by the
Company. It is theoretically possible to use the blood volume analyzer without
the kit by preparing the reagents used for the test. However, the cost and time
for such preparations would be uneconomical and it is unlikely that a purchaser
of the instrument would use it without purchasing the reagent kit. This is the
first U.S. patent ever issued for a system, which permits a fixed quantitative
amount of isotope to be injected for diagnostic purposes. The injection system
was specifically designed for use with the BVA-100. However, it can be used for
other diagnostic test purposes where a precise complete quantitative injection
of a diagnostic reagent is required. The Company is currently investigating the
filing of additional patents involving the BVA-100 system.
Marketing
The Company is marketing its Blood Volume Analyzer either on a direct sale, a
lease or an instrument loaner basis to potential users. Users are expected to be
primarily hospitals, surgi-centers, and imaging centers (radiology). In addition
to direct sales, the Company utilizes an instrument loaner plan coupled with
utilization of a specific number of blood volume measurement kits per week. This
type of marketing approach is common in the laboratory equipment industry and
will permit hospitals to test the Blood Volume Analyzer without first making a
commitment to purchase an instrument. The Company also has been demonstrating
its equipment at major trade shows such as Nuclear Medicine, Surgical
Anesthesiology, and trauma conferences. The Company is also in the process of
developing a network of dealers as well as it's own internal sales force. The
company has developed a website (http:// www.daxor.com), which contains
extensive detail about the BVA-100 blood volume analyzer as well as examples of
actual cases (with patient identities removed). The website permits rapid
communication between marketing personnel and potential users prior to an onsite
visit.
Competition
Blood Volume Analyzer
The medical technology market is intensely competitive. There are, however, no
competing instruments manufactured or marketed which perform rapid
semi-automatic blood volume analysis, such as the BVA-100. The Company believes
that its receipt of a United States, European and Japanese patent for its Blood
Volume Analyzer provides significant protection against any future potential
competition in the blood volume analysis field. The receipt of the U.S. patent
for the injection kit system provides significant additional protection as the
Company believes that the kits will be a major source of revenue. The Company
believes that its main hindrance to market acceptability will be the need to
demonstrate that its blood volume measurement equipment is capable of producing
accurate data on a cost effective basis. Test kit costs will be modest relative
to the cost of the critical information derived from the test. A blood volume
measurement, for example in septic shock can literally mean the difference
between life and death in terms of the therapeutic approach to the patient.
Blood Banking
The Idant frozen blood bank is the only facility that provides long term
personal blood storage in the Northeastern Untied States.
Semen Banking
There are at least 300 sperm banks in the United States operated by either
commercial entities or by academic institutions. The Idant semen bank is the
only semen bank in the State of New York out of more than fifty that is
accredited by the American Association of Tissue Banks. The Company has
developed a web site (http: // www.Idant.com), which will be helpful for
marketing purposes.
Regulation
The development, testing, production and marketing of medical devices are
subject to regulation by the FDA under the Federal Food, Drug and Cosmetic Act,
and may be subject to regulation by similar agencies in various states and
foreign countries. The governing statutes and regulations generally require
manufacturers to comply with regulatory requirements designed to assure the
safety and effectiveness of medical devices. The FDA clearance for marketing of
the Blood Volume Analyzer, BVA-100, and the associated quantitative injection
kit marks one of the most important milestones in the history of Daxor. The
products manufactured by and for the Company in regard to the BVA-100 are
subject to continuing FDA regulations and inspections.
The New York State Department of Health regulates the Company's Idant semen and
blood bank within New York State The Idant Semen Bank and Blood Bank are
divisions of Scientific Medical Systems, which is wholly owned by the Daxor
Corporation. Scientific Medial Systems has its own separate directors. These
facilities are subject to regulations and inspections by the New York State
Department of Health.
Employees
On March 26, 1999, the Company had 33 employees. None of the Company's employees
are covered by a collective bargaining agreement. The Company believes that its
employee relations are good.
Item 2. Properties
In February 1992, the Company signed a thirteen-year lease for a new facility at
the Empire State Building. The initial space was for 6,000 square feet, with
option provisions in the lease for up to 24,000 square feet. The company
currently occupies approximately 7,500 square feet with an annual rent cost of
$273,433.49. In 1998 the
company signed a lease for approximately 11,000 of manufacturing and office
space in Rochester New York. The lease was signed when Daxor acquired the assets
of the Wellport Corporation. Both leases contain CPI escalation clauses.
Item 3. Legal Proceedings
The Company had no litigation in 1999 and no pending lawsuits.
Item 4. Submission of Matters to a Vote of Security Holders
No matters were submitted to a vote of the Company's shareholders during the
fourth quarter of 1999.
Item 5. Market for Registrant's Common Equity and Related Stockholder Matters
The common stock is traded on the American Stock Exchange under the
symbol DXR.
1998
High Low
---- ---
First Quarter...................... 16 3/8 12 3/8
- ------------------------------------------------------------------
Second Quarter..................... 15 12 5/16
- -------------------------------------------------------------------
Third Quarter...................... 14 1/8 11 5/8
- ------------------------------------------------------------------
Fourth Quarter..................... 14 7/8 11 1/2
1999
High Low
---- ---
First Quarter...................... 15 7/16 13 3/4
- -----------------------------------------------------------------
Second Quarter..................... 14 2/8 11 3/4
- -----------------------------------------------------------------
Third Quarter...................... 13 5/16 12 1/8
- -----------------------------------------------------------------
Fourth Quarter..................... 18 1/2 12
On March 27, 1999, the Company had approximately 340 holders of record of the
Common Stock. The Company believes there are approximately 2500 beneficial
holders.
The Company paid a single cash dividend, $.50, on the Common Stock in 1997. Any
future dividends will be dependent upon the Company's earnings, financial
condition and other relevant factors.
ITEM 6. SELECTED FINANCIAL DATA
The following table sets forth certain selected financial data with
respect to the Company and is qualified in its entirety by reference to
the financial statements and notes thereto, from which these data were
derived, included elsewhere in the report.
Selected Operations
Statement Data:
Year Ended December 31,
1999 1998 1997 1996 1995
---- ---- ---- ---- ----
Operating revenues $ 500,969 $ 324,192 $ 529,737 $ 717,308 $ 1,864,552
Other revenues $74,407
Dividend income 1,856,119 1,942,759 2,138,755 2,132,173 2,209,962
Gains (losses) on sale
investments 469,595 362,487 144,681 16,354 674,421
----------- ----------- ----------- ----------- -----------
Total revenues 2,901,090 2,629,438 2,813,173 2,865,835 4,748,935
----------- ----------- ----------- ----------- -----------
Costs and expenses:
Operations of laboratories &
costs of production 833,751 961,031 628,729 819,722 1,041,275
Selling, general and
administrative 2,016,004 1,561,159 2,161,626 2,080,969 2,369,660
Interest expenses, net
of interest income 147,105 484,563 167,452 74,175 (113,973)
----------- ----------- ----------- ----------- -----------
Total costs and expenses 2,996,860 3,006,753 2,957,807 2,974,866 3,296,962
----------- ----------- ----------- ----------- -----------
Net income or (loss) before
income taxes (95,770) (377,315) (144,634) (109,031) 1,451,973
Provision for income taxes 1,380 43,145 14,219 3,134 164,858
----------- ----------- ----------- ----------- -----------
Net income or (loss) $ (97,130) $ (420,460) $ (158,853) $ (112,165) $ 1,287,115
=========== =========== =========== =========== ===========
Weighted average number of
shares outstanding 4,721,492 4,762,542 4,696,876 4,722,709 4,872,481
----------- ----------- ----------- ----------- -----------
Net income per common
equivalent share $ (0.02) $ (0.09) $ (0.03) $ (0.02) $ 0.26
=========== =========== =========== =========== ===========
- --------------------------------------------------------------------------------
Selected Balance Sheet Data:
Year Ended December 31,
1999 1998 1997 1996 1995
---- ---- ---- ---- ----
Working capital 28,869,309 34,837,930 32,501,404 31,306,579 31,598,345
Total assets 35,846,065 44,056,349 41,322,592 37,288,804 37,744,621
Total liabilities* 6,566,496 8,752,515 8,404,868 5,507,384 5,691,790
Shareholders' equity 29,279,569 35,303,834 32,917,724 31,781,420 32,052,831
Return on equity* 0.00% 0.00% 0.00% 0.00% 4.41%
* Return on equity is calculated by dividing the Company's net income for the
period by the shareholders' equity at the beginning of the period.
* Total liabilities include deferred taxes of $3,961,623 for unrealized gains.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
GENERAL
Idant Laboratories subsidiary contributed 99%, 100% and 100% of operating
revenues in 1999, 1998 and 1997 respectively. The Companies operations in semen
banking and blood banking (laboratories) were partially restricted throughout
1998. These operations were restored to full function in February 1999 as part
of a negotiated settlement in 1998. The Company in 1999 increased its research
and beta-testing of the Blood Volume Analyzer. The potential market for the
Blood Volume Analyzer is significantly larger than the Company's current
operations. The Company anticipates that proceeds from Daxor's blood volume
analyzer will be the primary source of revenue in the immediate future. The
first quarter of the year 2000 provided revenue from the blood volume analyzer.
The company believes that the potential market for blood volume measurement and
analysis is between 15-20 million tests per year. Successful penetration of even
a small fraction of the market would significantly change the company's
structure. The Company intends to focus its marketing efforts on the Blood
Volume Analyzer.
YEAR ENDED DECEMBER 31, 1999 AS COMPARED TO DECEMBER 31, 1998
Total revenues were $2,901,090 in 1999, up from the $2,629,438 reported in
1998. Dividend income earned on the Company's securities portfolio was $
1,856,119, a decrease from the $1,942,759 reported in 1998. Gains on the sale
of investments was $469,595 in 1999 as compared to $362,487 in 1998. Net
income before income taxes was a loss of $ 97,130 in 1999 vs. $420,460 in
1998.
YEAR ENDED DECEMBER 31, 1998 AS COMPARED TO DECEMBER 31, 1997
Total revenues were $2,629,438 in 1998, down from the $2,813,173 reported in
1997. Dividend income earned on the Company's securities portfolio was
$1,942,759, a decrease from the $2,138,755 reported in 1997. Gains on the
sale of investments was $362,487 in 1998 as compared to $144,681 in 1997. Net
income before income taxes was a loss of $420,460 in 1998 vs. $158,853 in
1997.
LIQUIDITY AND CAPITAL RESOURCES
The Company's management has pursued a policy of maintaining sufficient
liquidity and capital resources in order to assure continued availability of
necessary funds for the viability and projected growth of all ongoing projects.
The Company continues to maintain its diversified securities portfolio comprised
primarily of high-yielding electric utility preferred and common stocks. The
income derived from these investments has helped to offset increases in
operating, selling and general and administrative expenses and thus to maintain
our fees at a competitive level. The portfolio also provides for the
availability of funds as needed for new projects and the expansion of existing
sources of revenue.
At December 31, 1999, the Company's short-term debt was $2,443,794 vs.
$2,050,549 at 1998. At year-end 1999, shareholders' equity was $29,279,569. At
year-end 1998, the Company had shareholders' equity of $35,303,834. At December
31, 1999 the Company's security portfolio had a market value of $34,867,286 vs.
$43,016,243 in 1998.
During 1998, the Company obtained FDA clearance for marketing the Blood Volume
Analyzer, BVA-100. In 1998 The Company purchased the assets of the Wellport
Manufacturing Company. This Company had previously manufactured the injection
kit. In the initial beta- testing phase of marketing, the Company lent the
instrument and supplies to a limited number of teaching hospitals. The company
developed a localized sales team to support the testing facilities. In 1999, two
instruments were placed on a permanent basis. In the first quarter of 2000, the
company began a more active marketing program and either placed or received
orders for 12 instruments of which 10 were outright sales. The Company is also
involved in discussions with independent medical distributor to market the
BVA-100. The Company offers to lease, as well as loan its Blood Volume Analyzer
(BVA-100) as part of a reagent purchase plan.
The company is reviewing options to purchase some of the original equipment
manufacturers who provide various parts of the BVA-100 Blood Volume Analyzer
system. The company may elect to seek additional funding as part of a more rapid
nationwide expansion of its medical technology and services. The company
believes that it may be a valuable partner to company's which produce blood
substitutes as well as companies that produce blood stimulants such a s Epogen.
Blood volume measurement would enhance the validation of these products. The
Company will actively look to form such marketing alliances.
Year-end 1999, finds the Company in a satisfactory financial position with
adequate funds available for its immediate anticipated needs.
DAXOR CORPORATION
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
and Exchange Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereto duly authorized.
DAXOR CORPORATION
by: /s/ Joseph Feldschuh
--------------------
Joseph Feldschuh, M.D.
President and Chief
Executive Officer
Chairman of the Board
Dated: March 31, 1999
-------------------
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of
the Registrant and in the capacities and on the dates indicated.
Signature Title Date
- --------- ----- ----
/s/ Joseph Feldschuh President and Director March 31, 1999
- -------------------- (Principal Executive Officer)
Joseph Feldschuh, M.D.
/s/ Ron Baldry Vice President March 31, 1999
- --------------
Robert Rosenthal
/s/ Octavia Atanasiu Corporate Treasurer March 31, 1999
- -------------------- Accounting Supervisor
Octavia Atanasiu (Principal Financial Officer)
/s/ Virginia Fitzpatrick Corporate Secretary March 31, 1999
- ------------------------
Virginia Fitzpatrick
/s/ Stephen M. Moss Director March 31, 1999
- -------------------
Stephen M. Moss, PhD
/s/ Bruce Hack Director March 31, 1999
- --------------
Bruce Hack
/s/ James Lombard Director March 31, 1999
- -----------------
James Lombard
/s/ Martin Wolpoff Director March 31, 1999
- ------------------
Martin Wolpoff
Board of Directors:
Name Title
Dr. Joseph Feldschuh Chairman, President, & CEO
Stephen Moss Director
James Lombard Director
Martin Wolpoff Director
Bruce Hack Director
Item 14(a) (1). Index to Financial Statements
The following statements and schedules of Daxor Corporation are submitted
herewith:
Page
----
Report of Independent Accountants F-1
Financial Statements as at December 31, 1999 and 1998
and for the three years ended December 31, 1999
Balance Sheets F-2
Statements of Income F-3
Statements of Shareholders' Equity F-3
Statements of Cash Flows F-4
Notes to Financial Statements F-5
Schedule I - Marketable Securities - Other Investments - Year ended
December 31, 1999 F-9
Schedule IX - Short-term Borrowings - Years ended December 31, 1999
1998, and 1997 F-9
Schedule X - Supplementary Income Statement Information -
Years ended December 31, 1999, 1998, and 1997 F-9
All other schedules for which provision is made in the applicable accounting
regulations of the Securities and Exchange Commission are not required under the
related instructions, are inapplicable or the required information is set forth
in the financial statements filed herewith, including notes thereto, and
therefore have been omitted.
INDEPENDENT AUDITOR'S REPORT
- ----------------------------
To the Board of Directors and Shareholders of Daxor Corporation:
We have audited the accompanying balance sheet and consolidated balance sheet of
Daxor Corporation as at December 31, 1999 and 1998, the related statements of
income, shareholders' equity and cash flows for each of the three years in the
period ended December 31, 1999. Our audits also included the financial statement
schedules listed in the Index at Item F-9.
These financial statements and financial statement schedules are the
responsibility of the Corporation's management. Our responsibility is to express
an opinion on these financial statements and financial statement schedules based
on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the financial position of Daxor Corporation as at December 31, 1999
and 1998, and the results of their operations and its cash flows for each of the
three years in the period ended December 31, 1999 in conformity with generally
accepted accounting principles. Also, in our opinion, such financial statement
schedules, when considered in relation to the basic financial statements taken
as a whole, present fairly in all material respects the information set forth
herein.
Frederick A. Kaden & Co.
Franklin Square, New York
March 20, 1999
F-1
DAXOR CORPORATION
FINANCIAL STATEMENTS
================================================================================
BALANCE SHEETS
1999 1998
---- ----
Consolidated
------------
- --------------------------------------------------------------------------------
ASSETS
- --------------------------------------------------------------------------------
CURRENT ASSETS
Cash $67,783 $79,511
Marketable Securities at Fair Value
December 31,1999 and December 31,
1998. (Notes 1 and 2) 34,867,286 43,016,243
Accounts receivable (Note 3) 6,745 151,234
Accounts receivable-Related parties 75,979
Other current assets 493,991 261,597
Tax refunds receivable 5,881
---------------- ------------
Total Current Assets $35,435,805 43,590,445
EQUIPMENT AND IMPROVEMENTS (NOTE 4)
Storage tanks 125,815 125,815
Leasehold improvements,furniture
and equipment 825,794 823,859
Laboratory equipment 275,817 274,418
-------------------------------
1,227,426 1,224,092
Less:Accumulated depreciation and amortization 861,156 796,159
-------------------------------
Net equipment and improvements 366,270 427,933
Other assets 43,990 37,971
Total Assets $35,846,065 $44,056,349
-------------------------------
- --------------------------------------------------------------------------------
LIABILITIES AND SHAREHOLDERS' EQUITY
- --------------------------------------------------------------------------------
CURRENT LIABILITIES
Accounts payable and accrued liabilities $127,341 $88,594
Loans payable (Notes 1 and 2) 2,443,794 2,050,549
Other Liabilities (Note 5) 33,738 10,384
Deferred Taxes (Note 1) 3,961,623 6,602,988
-------------------------------
Total Liabilities 6,566,496 8,752,515
Commitments and contingencies (Note 6)
SHAREHOLDERS' EQUITY
Common stock, par value $.01 per share:
Authorized 10,000,000 shares: issued and
outstanding shares 4,692,909 December 31,1999
and 4,752,709 December 31,1998 53,097 53,097
Additional Paid in Capital 9,798,232 9,798,232
Net unrealized holding gains on available
for sale securities (Note 1) 7,690,209 12,817,565
Retained earnings 16,195,846 16,292,976
Treasury stock (4,457,815) (3,658,036)
-------------------------------
Total Shareholders' Equity 29,279,569 35,303,834
Total Liabilities and Shareholders' Equity $35,846,065 $44,056,349
-------------------------------
See accompanying notes to financial statements
F-2
DAXOR CORPORATION
STATEMENTS OF INCOME
Year Ended December 31,
(Consolidated) (Consolidated)
Revenues: 1999 1998 1997
---- ---- ----
- ------------------------------------------------------------------------------------------------------------------------------------
Operating revenues (Note 12) $ 500,969 $324,192 $ 529,737
Other revenues 74,407
Dividend income 1,856,119 1,942,759 2,138,755
Gains on sale of securities 469,595 362,487 131,618
Gains (losses)on sale of
options and commodities - - 13,063
------------ ------------- ------------
Total revenues 2,901,090 2,629,438 2,813,173
------------ ------------- ------------
- ------------------------------------------------------------------------------------------------------------------------------------
Costs and expenses:
- ------------------------------------------------------------------------------------------------------------------------------------
Operations of Laboratories &
Costs of Productions 833,751 961,031 628,729
Selling, General, and Administrative 2,016,004 1,561,159 2,161,626
Interest expense, net of interest income 147,105 484,563 167,452
------------ ------------- ------------
Total costs and expenses 2,996,860 3,006,753 2,957,807
------------ ------------- ------------
Net Loss Before Income Taxes (95,770) (377,315) (144,634)
Provision for income taxes (Note 9) 1,380 43,145 14,219
------------ ------------- ------------
Net Loss $ (97,130) $ (420,460) $(158,853)
------------ ------------- ------------
Weighted Average Number
of Shares Outstanding 4,721,492 4,762,542 4,696,876
Net Income per Common Equivalent Share $ (0.02) $ (0.09) $ (0.03)
See accompanying notes to financial statements
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
DAXOR CORPORATION
STATEMENTS OF SHAREHOLDERS EQUITY
- ---------------------------------
Three Years Ended December 31,1999
Common stock Additional
Number Paid-in Retained Treasury
of Shares Amount Capital Earnings Stock
--------- ------ ------- -------- -----
- ------------------------------------------------------------------------------------------------------------------------------------
Balance at January 1, 1997 4,712,709 $53,097 $8,579,803 $19,226,044 $(3,271,682)
- ------------------------------------------------------------------------------------------------------------------------------------
Net loss for the year ended
December 31,1997 (158,853)
Purchase of Treasury Stock (22,000) (204,100)
Dividends (2,353,755)
- ------------------------------------------------------------------------------------------------------------------------------------
Balance December 31,1997 4,690,709 53,097 8,579,803 16,713,436 (3,475,782)
--------- ------- ---------- ------------ -------------
- ------------------------------------------------------------------------------------------------------------------------------------
Net loss for the year ended
December 31,1998 (420,460)
Purchase of Treasury Stock (38,000) (458,775)
Sale of Treasury Stock 100,000 1,218,429 276,521
--------- ------- ---------- ------------ -------------
- ------------------------------------------------------------------------------------------------------------------------------------
Balance December 31,1998 4,752,709 53,097 9,798,232 16,292,976 (3,658,036)
--------- ------- ---------- ------------ -------------
- ------------------------------------------------------------------------------------------------------------------------------------
Net loss for the year ended
December 31,1999 (97,130)
Purchase of Treasury Stock (59,800) (799,779)
--------- ------- ---------- ------------ -------------
- ------------------------------------------------------------------------------------------------------------------------------------
Balance December 31,1999 4,692,909 $53,097 $9,798,232 $16,195,846 $(4,457,815)
--------- ------- ---------- ------------ -------------
- ------------------------------------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements
F-3
STATEMENTS OF CASH FLOWS
- ------------------------
Year ended December 31,
(Consolidated) (Consolidated)
1999 1998 1997
---- ---- ----
Cash flows from operating activities:
- -------------------------------------
Net income or (loss) $ (97,130) $(420,460) $ (158,853)
------------- ------------- -------------
Adjustments to reconcile net income
to net cash provided by
operating activities:
Depreciation & Amortization 72,395 66,406 58,985
(Gain) loss on sale of investments (469,595) (362,487) (144,681)
(Gain) loss on sale of equipment (4,554)
Change in assets and liabilities:
(Increase) decrease in accounts receivable 144,489 21,864 438,457
(Increase) decrease in accounts receivable-
Related Parties 75,979 28,371 10,658
(Increase) decrease in other current assets (232,394) (46,507) 20,768
(Increase) decrease in tax refunds receivable 5,881 - 148,020
(Increase) decrease in other assets net of
goodwill amortization (6,019) (6,155) 169
Increase (decrease) in accounts payable,
accrued expenses and other liabilities net of
"short sales" 39,747 (108,503) 55,396
Total adjustments (374,071) (407,011) 587,772
------------- ------------- -------------
Net cash provided by operating activities (471,201) (827,471) 428,919
------------- ------------- -------------
Cash flows from investing activities:
- -------------------------------------
Payment for purchase of equipment and
improvements (55,114) (109,835) (632)
Proceeds from sale of equipment 48,936
Net cash provided or (used) in purchase
and sale of investments 843,604 357,737 1,190,641
Net proceeds (repayments) of loans from
brokers used to purchase investments 393,245 (444,090) 67,770
Proceeds from "short sales" not closed 28,581 6,227 18,008
------------- ------------- -------------
Net cash provided by/(used in)investing
activities 1,259,252 (189,961) 1,275,787
------------- ------------- -------------
Cash flows from financing activities
Receipt of/(repayment of)-bank loan - - 800,000
Loans received/repaid - - (9,198)
Dividends paid - - (2,353,755)
Proceeds from sale of treasury stock 1,494,950
Payment for purchase of treasury stock (799,779) (458,775) (204,100)
------------- ------------- -------------
Net cash used in financing activities (799,779) 1,036,175 (1,767,053)
------------- ------------- -------------
Net increase (decrease) in cash and
cash equivalents (11,728) 18,743 (62,347)
Cash and cash equivalents at beginning
of year 79,511 60,768 123,115
------------- ------------- -------------
Cash and cash equivalents at end of year $ 67,783 $79,511 $ 60,768
------------- ------------- -------------
See accompanying notes to financial statements
- ----------------------------------------------
F-4
DAXOR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The accompanying consolidated financial statements as at December 31, 1999
and 1998 and for the three years ended December 31, 1999 have been prepared in
conformity with principles of accounting applicable to a going concern. Daxor
Corporation operates in the medical services and technology industry.
The consolidated financial statements include the accounts of the Company
and its subsidiary. All significant intercompany transactions and balances have
been eliminated in consolidation.
(1) MARKETABLE SECURITIES
Upon adoption of FASB No. 115, management has determined that the
company's portfolio is best characterized as "Available-For-Sale". This has
resulted in the balance sheet carrying value of the company's marketable
securities investments, as of December 31, 1999 and December 31, 1998 being
increased approximately 50.19 % and 82.30% respectively over its historical
cost. A corresponding increase in shareholders' equity has been effectuated. In
accordance with the provisions of FASB No. 115, the adjustment in shareholders'
equity to reflect the company's unrealized gains has been made net of the tax
effect had these gains been realized.
The following tables summarize the company's investments as of:
December 31, 1999
-----------------
Type of security Cost Fair Value Unrealized Unrealized
- ---------------- ---- ---------- holding gains holding losses
------------- --------------
Equity $23,200,595 $34,866,386 $13,640,132 $1,974,341
Debt 14,859 900 0 13,959
------------------------------------------------------------
Total $23,215,454 $34,867,286 $13,640,132 $1,988,300
=========== =========== =========== ==========
December 31, 1998
-----------------
- --------------------------------------------------------------------------------
Type of security Cost Fair Value Unrealized Unrealized
- ---------------- ---- ----------
holding gains holding losses
------------- --------------
Equity $23,595,690 $43,016,243 $20,441,847 $1,021,294
Debt 0 0 0 0
------------------------------------------------------------
Total $23,595,690 $43,016,243 $20,441,847 $1,021,294
=========== =========== =========== ==========
At December 31, 1999, the securities held by the Company had a market
value of $34,867,286 and a cost basis of $23,215,454 resulting in a net
unrealized gain of $11,651,832 or 50.19% of cost.
At December 31, 1998, the securities held by the Company had a market
value of $43,016,243 and a cost basis of $23,595,690 resulting in a net
unrealized gain of $19,420,553 or 82.30% of cost.
At December 31, 1999 and December 31, 1998, marketable securities,
primarily consisting of preferred and common stocks of utility companies, are
valued at fair value.
F-5
(2) Loans Payable
As at December 31, 1999 and December 31, 1998, the Company had loans
outstanding aggregating $1,000,000 and $1,000,000 borrowed on a short term basis
from a bank, which are secured by certain marketable securities of the Company.
The loans bear interest at approximately 7.41%.
Short term margin debt due to brokers,secured by the Companies marketable
securities, totaled $1,443,794 at December 31, 1999 and $1,050,549 at December
31, 1998.
(3) Accounts receivable
Accounts receivable are deemed to be fully collectible.
(4) Equipment and Improvements
Depreciation of equipment and improvements is taken using the straight
line method. For 1999, 1998 and 1997 the charges to income for depreciation
using this method were $72,395, $66,406 and $58,985 respectively.
The cost of maintenance and repairs is charged to expense as incurred. The
cost of betterments and additions are capitalized and depreciated over the life
of the asset. The cost of assets disposed of or determined to be non-revenue
producing, together with the related accumulated depreciation applicable
thereto,are eliminated from the accounts, and any gain or loss is recognized.
(5) Other Liabilities
At December 31, 1999 and December 31, 1998, the Company also maintained a
short position in certain marketable securities. These positions were sold for
$28,581 at December 31, 1999, and $6,227 at December 31, 1998, and had
respective market values of $53,275 and $2,990 resulting in an unrealized loss
of $24,694 at December 31, 1999 and an unrealized gain of $3,237 at December 31,
1998
(6) Commitments and Contingencies
(A) Operating Leases
Future minimum rental payments under non-cancelable operating lease are as
follows:
2000 $299,811
2001 $295,664
2002 $219,830
2003 $219,830
2004 $219,830
Rent expense for all non-cancelable operating leases was $378,372,$273,433
and $232,357 for the years ended December 31, 1999, 1998 and 1997 respectively.
B) Contingent Liabilities
The Company is not aware of any contingent liabilities at year end.
(7) Research and Development Expenses
Research and development expenses were $15,000, $564,275 and $182,294 for
1999, 1998, and 1997 respectively. All research and development costs are
expensed in the year they occur.
(8) Interest Expense and Income
Interest expense was $485,043,$485,043, and $168,073 and interest income
was $480, $480, and $621 in 1999, 1998 and 1997 respectively.
(9) Income Taxes
The following is a reconciliation of the federal statutory tax rate of 34%
for 1999,1998 and 1997, with the provision for income taxes:
1999 1998 1997
---- ---- ----
Statutory tax rate 0 $0 $0
Dividend exclusion
Miscellaneous non-deductible
expenses
State and city taxes 1360. 43,145 14,219
Provision for income taxes
--------- --------- ---------
Effective tax rate 0.% 0.% 0.%
--------- --------- ---------
(10) Shareholders' Equity
During 1999, the Company purchased 59,800 shares of its own stock at a
cost of $799,799.
(11) Subsidiaries
Daxor Corporation has formed a wholly owned subsidiary, Scientific Medical
Systems, Inc., which has taken over the operations of the sperm bank, blood bank
and laboratory in accordance with an agreement reached with the State of New
York. The results of operations have been consolidated in these financial
statements.
F-9
SCHEDULE I
MARKETABLE SECURITIES -- OTHER INVESTMENTS
The following tables summarize the company's investments as of:
December 31, 1999
-----------------------
Type of Unrealized Unrealized
Security Cost Fair Value Holding gains holding losses
- -------- ---- ---------- ------------- --------------
Equity $23,200,595 $34,866,386 $13,640,132 $1,974,341
- ------
Debt 14,859 900 0 13,959
- ----
------------------------------------------------------------------------
Total $23,215,454 $34,867,286 $13,640,132 $1,988,300
- ----- =========== =========== =========== ==========
SCHEDULE IX
SHORT-TERM BORROWINGS
Years Ended December 31, 1999, 1998, 1997
- ---------------- -------------- -------------- --------------- -------------- --------------
Column A Column B Column C Column D Column E Column F
- -------- -------- -------- -------- -------- --------
- ---------------- -------------- -------------- --------------- -------------- --------------
Category of Balance at Weighted Maximum Average Weighted
aggregate the end of average amount amount average
short-term period interest outstanding outstanding interest
borrowings rate at end during this during the rates during
of the period period period the period
- ---------------- -------------- -------------- --------------- -------------- --------------
1999
- ---------------- -------------- -------------- --------------- -------------- --------------
Banks 1,000,000 7.65% 1,000,000 1,000,000 7.65
- ---------------- -------------- -------------- --------------- -------------- --------------
Brokers 1,443,794 7.47% 1,443,794 1,312,442 7.43
- ---------------- -------------- -------------- --------------- -------------- --------------
All Categories 2,443,794 7.54% 2,443,794 2,443,794 7.51
- ---------------- -------------- -------------- --------------- -------------- --------------
1998
- ---------------- -------------- -------------- --------------- -------------- --------------
Banks 1,000,000 7.75% 1,000,000 1,000,000 7.65%
- ---------------- -------------- -------------- --------------- -------------- --------------
Brokers 1,050,549 7.32% 1,267,365 1,262,341 7.29
- ---------------- -------------- -------------- --------------- -------------- --------------
All Categories 2,050,549 7.47% 2,267,594 2,262,341 7.36
- ---------------- -------------- -------------- --------------- -------------- --------------
1997
- ---------------- -------------- -------------- --------------- -------------- --------------
Banks 1,000,000 7.41% $1,000,000 $800,000 7.42%
- ---------------- -------------- -------------- --------------- -------------- --------------
Brokers 1,494,639 7.14% $2,515,594 $1,427,050 7.17%
- ---------------- -------------- -------------- --------------- -------------- --------------
All Categories 2,494,639 7.19% $3,515,594 $2,227,050 7.22%
- ---------------- -------------- -------------- --------------- -------------- --------------
The average borrowings were determined on the basis of the amounts outstanding
at each month-end. The weighted interest rate during the year was computed by
dividing actual interest expense in each year by average short-term borrowings
in such year.
SCHEDULE X
SUPPLEMENTARY INCOME STATEMENT INFORMATION
- --------------------------------------------------------------------------------
COLUMN A COLUMB B
- --------------------------------------------------------------------------------
Item Charged to costs and expenses
Year ended December 31,
-----------------------
1999 1998 1997
---- ---- ----
Maintenance and repairs $ * $ * $ *
Depreciation and amortization
of intangible assets pre-operating
costs and similar deferrals 72,395 66,406 58,985
Taxes, other than payroll and
income taxes * * *
Royalties --- --- ---
Advertising costs * * *
- --------------------------------------------------------------------------------
* less than 1% of total revenues for the year.
- --------------------------------------------------------------------------------