MINNEAPOLIS, Feb. 27 /PRNewswire-FirstCall/ -- CABG Medical, Inc. today reported results for the year ended 2005. Net loss for the year 2005 was $9.7 million, or $0.52, per share compared to a net loss of $3.5 million, or $0.34 per share, for the year ended 2004. The 2005 net loss included research and development expense of $8,822,000 of which $4,363,000 was related to the Company’s March 22, 2005 paclitaxel license agreement with Angiotech Pharmaceuticals, Inc. The license agreement expense included a non-cash charge of $4,335,000 related to the issuance of equity securities to Angiotech.
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As previously announced, the Company has ceased research and development activities associated with the Holly Graft System, terminated seven of its eleven full-time employees and has initiated the process for the formal liquidation and dissolution of the Company. In parallel with the formal dissolution process the Company continues to evaluate strategic alternatives through its engagement with Goldsmith, Agio, Helms, a Minneapolis investment bank. To date there have been no discussions with a potential acquirer that management believes could reasonably lead to an acquisition offer; and there is no assurance that an agreement resulting in an acceptable transaction will be entered into prior to shareholder approval of a dissolution.
The Company anticipates that in the event of a liquidation and dissolution, it will be able to distribute a total of approximately $1.20 per share to $1.47 per share in cash to shareholders. Any such liquidation and dissolution would be subject to shareholder approval prior to the distribution of funds to shareholders. It is anticipated that a special meeting of shareholders to approve a dissolution of the Company will be held on or about April 27, 2006.
The $1.47 per share amount represents the Board of Directors’ estimate of the amount that could be distributed to the shareholders if: (i) the dissolution is approved by shareholders on or about April 27, 2006, (ii) there are no significant legal actions brought against us prior to effecting the dissolution and (iii) there are no other significant contingent obligations arising prior to the effective date of the dissolution. The $1.20 per share amount represents the Board of Directors’ best estimate of the distributions the shareholders could reasonably expect to receive in the event the dissolution process does not proceed as currently anticipated. Currently, unforeseen patient or other legal claims, contingent obligations, larger than anticipated impairments and discounts on the sale of illiquid assets and larger than expected operational expenses may reduce the amount of cash available for distribution to a greater extent than we anticipate, and depending on their magnitude, could reduce the actual cash distribution to significantly lower than $1.20 per share.
CABG Medical, Inc. Statements of Operations (unaudited) Three Months Ended December 31, Year Ended 2004 2005 2004 2005 (In thousands, except share and per share data) Revenue $21 $70 $21 $104 Expenses: Research and development 1,007 1,312 2,647 8,822 Marketing, general and administrative 400 605 996 2,105 Total 1,386 1,847 3,622 10,823 Interest income 46 321 71 1,099 Net loss $(1,340) $(1,526) $(3,551) $(9,724) Basic and diluted net loss per share $(0.11) $(0.08) $(0.34) $(0.52) Weighted average shares outstanding - basic and diluted 11,773,524 19,493,785 10,298,639 18,624,697 CABG Medical, Inc. Balance Sheets (unaudited) December 31, December 31, 2004 2005 (In thousands) Assets Current assets: Cash and short term investments $28,936 $32,648 Other current assets 291 615 Total current assets 29,227 33,263 Property and equipment, net 199 70 Total assets $29,426 $33,333 Liabilities & Stockholders’ Equity Current liabilities: Accounts payable $841 $647 Accrued liabilities 19 48 Total current liabilities 860 695 Total stockholders’ equity 28,566 32,638 Total liabilities and stockholders’ equity $29,426 $33,333
Photo: NewsCom: http://www.newscom.com/cgi-bin/prnh/20050114/CGF013LOGOAP Archive: http://photoarchive.ap.orgPRN Photo Desk, photodesk@prnewswire.comCABG Medical, Inc.
CONTACT: Manny Villafana, Chairman & CEO, or, John L. Babitt, President &CFO, both of CABG Medical, Inc., PHONE, +1-763-258-8005, FAX,+1-763-258-8008
Web site: http://www.cabgmedical.com//
