UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended June 30, 2010
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from to .
Commission File No.: 001-34839
Electromed, Inc.
(Exact name of Registrant as specified in its charter)
Minnesota
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41-1732920
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(State or other jurisdiction of
incorporation or organization)
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(IRS Employer
Identification No.)
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500 Sixth Avenue NW, New Prague, MN
(Address of principal executive offices)
(952) 758-9299
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Common Stock $0.01 par value
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Nasdaq Capital Market
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(Title of each class)
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(Name of each exchange on which registered)
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Securities registered pursuant to Section 12(g) of the Exchange Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes No
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 No
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) 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.
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
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Large accelerated filer
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Accelerated filer
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Non-accelerated filer (Do not check if smaller reporting company)
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Smaller Reporting Company
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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes No
The registrant completed the initial public offering of its common stock on August 18, 2010. Accordingly, there was no public market for the registrant’s common stock as of December 31, 2009, the last day of the registrant’s most recently completed second fiscal quarter.
There were 7,887,885 shares of the registrant’s common stock outstanding as of September 16, 2010.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Definitive Proxy Statement for the registrant’s Fiscal 2011 Annual Meeting of Shareholders, to be filed within 120 days of June 30, 2010, are incorporated by reference into Part III of this Form 10-K.
Electromed, Inc.
Index to Annual Report on Form 10-K
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PART I
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4
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Item 1.
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Business
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4
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Item 1A.
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Risk Factors
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23
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Item 1B.
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Unresolved Staff Comments
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23
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Item 2.
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Properties
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23
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Item 3.
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Legal Proceedings
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24
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Item 4.
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(Removed and Reserved)
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24
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PART II
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24
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Item 5.
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Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
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24
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Item 6.
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Selected Financial Data
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25
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Item 7.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations
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26
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Item 7A.
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Quantitative and Qualitative Disclosures About Market Risk
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33
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Item 8.
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Financial Statements and Supplementary Data
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33
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Item 9.
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Changes in and Disagreements with Accountants on Accounting and Financial Disclosures
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34
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Item 9A.
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Controls and Procedures
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34
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Item 9B.
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Other information
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34
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Part III
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34
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Item 10.
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Directors, Executive Officers, and Corporate Governance
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34
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Item 11.
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Executive Compensation
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34
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Item 12.
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Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
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34
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Item 13.
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Certain Relationships and Related Transactions, and Director Independence
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35
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Item 14.
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Principal Accounting Fees and Services
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35
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Item 15.
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Exhibits, Financial Statement Schedules
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35
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INFORMATION REGARDING FORWARD LOOKING STATEMENTS
Some of the statements in this report may contain forward-looking statements that reflect our current view on future events, future business, industry and other conditions, our future performance, and our plans and expectations for future operations and actions. In some cases, you can identify forward-looking statements by the following words: “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “ongoing,” “plan,” “potential,” “predict,” “project,” “should,” “will,” “would,” or the negative of these terms or other comparable terminology, although not all forward-looking statements contain these words. Our forward-looking statements in this report relate to the following: our business and growth strategy, our business strengths and competitive advantages, our intent to increase international sales and distribution, our expectation that our products will be prescribed for an increasing number of conditions, our plan to continue to increase investment in research and development, our intent to continue improvement of our product offerings through innovation, our intent to add sales staff and other employees, our belief that we will continue to expand our intellectual property portfolio, our expectations with respect to our settlement with Hill-Rom, and our anticipated revenues, offering proceeds, expenses, and capital requirements. Many of these forward-looking statements are located in this report under “Item 1. BUSINESS;” “Item 2. “PROPERTIES” and “Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS,” but they may appear in other sections as well. These statements involve known and unknown risks, uncertainties and other factors that may cause our results or our industry’s actual results, levels of activity, performance or achievements to be materially different from the information expressed or implied by these forward-looking statements. Forward-looking statements are only predictions and are not guarantees of performance. These statements are based on our management’s beliefs and assumptions, which in turn are based on currently available information.
You should read this report thoroughly with the understanding that our actual results may differ materially from those set forth in the forward-looking statements for many reasons, including events beyond our control and assumptions that prove to be inaccurate or unfounded. We cannot provide any assurance with respect to our future performance or results. Our actual results or actions could and likely will differ materially from those anticipated in the forward-looking statements for many reasons, including the reasons described in this report. These factors include, but are not limited to:
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the competitive nature of our market;
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the risks associated with expansion into international markets;
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changes to Medicare, Medicaid, or private insurance reimbursement policies;
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changes to health care laws;
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changes affecting the medical device industry;
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our need to maintain regulatory compliance and to gain future regulatory approvals and clearances;
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our ability to protect our intellectual property;
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the outcome of current and future litigation, including our ability to reach a definitive settlement agreement with Hill-Rom in the timeframe expected; and
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general economic and business conditions.
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