Delaware
|
|
20-0653570
|
(State
or Other Jurisdiction of Incorporation or
Organization)
|
|
(IRS Employer Identification
No.)
|
Pharma-Bio Serv Building,
#6 Road 696
Dorado, Puerto Rico
|
|
00646
|
(Address
of Principal Executive Offices)
|
|
(Zip
Code)
|
787-278-2709
|
(Registrant’s
Telephone Number, Including Area Code)
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
|
|
|
Large
accelerated filer
|
☐
|
Accelerated
filer
|
☐
|
Non-accelerated
filer
|
☑
|
Smaller
reporting company
|
☑
|
|
|
Emerging
growth company
|
☐
|
|
|
|
Page
|
|
|||||
PART I
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1
|
|
||||||
|
|
4
|
|
||||||
|
|
10
|
|
||||||
|
|
10
|
|
||||||
|
|
10
|
|
||||||
|
|
10
|
|
||||||
|
|
|
|
|
|
||||
PART II
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
11
|
|
||||||
|
|
11
|
|
||||||
|
|
12
|
|
||||||
|
|
17
|
|
||||||
|
|
17
|
|
||||||
|
|
17
|
|
||||||
|
|
17
|
|
||||||
|
|
18
|
|
||||||
|
|
|
|
|
|
||||
PART III
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
19
|
|
||||||
|
|
19
|
|
||||||
|
|
19
|
|
||||||
|
|
19
|
|
||||||
|
|
19
|
|
||||||
|
|
|
|
|
|
||||
PART IV
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
20
|
|
||||||
|
|
22
|
|
||||||
|
|
23
|
|
||||||
|
|
|
|
|
|
||||
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
|
|
|
F-1
|
|
Name
|
|
Age
|
|
Position
|
Victor
Sanchez
|
|
49
|
|
Chief
Executive Officer, President and President of European
Operations
|
Pedro
J. Lasanta
|
|
60
|
|
Chief
Financial Officer, Vice President - Finance and Administration and
Secretary
|
Plan
Category
|
Number of
securities to be issued upon exercise of outstanding
options
|
Weighted-average
exercise price per share of outstanding options
|
Number of
securities remaining available for future issuance under equity
compensation plans
|
Equity compensation
plans approved by security holders:
|
|
|
|
2005 Long-Term
Incentive Plan
|
80,000
|
$1.2800
|
-
|
2014 Long-Term
Incentive Plan
|
410,000
|
$0.8615
|
1,580,000
|
Equity compensation
plans not approved by security holders
|
-
|
-
|
-
|
Total
|
490,000
|
|
1,580,000
|
|
Year ended
October 31
|
|||
Revenues by
Region
|
2019
|
2018
|
||
Puerto
Rico
|
$16,798
|
86.1%
|
$14,439
|
81.1%
|
United
States
|
2,188
|
11.2%
|
2,138
|
12.0%
|
Europe
|
315
|
1.6%
|
1,153
|
6.5%
|
Other
|
206
|
1.1%
|
67
|
0.4%
|
|
$19,507
|
100.0%
|
$17,797
|
100.0%
|
Level 1:
|
Quoted
prices in active markets for identical assets and
liabilities.
|
|
|
Level 2:
|
Observable
inputs other than Level 1 prices such as quoted prices for similar
assets or liabilities, quoted prices in markets with insufficient
volume or infrequent transactions (less active markets), or
model-derived valuations in which all significant inputs are
observable or can be derived principally from or corroborated by
observable market data for substantially the full term of the
assets or liabilities.
|
|
|
Level 3:
|
Prices
or valuation techniques that require inputs that are both
significant to the fair value measurement and unobservable
(supported by little or no market activity).
|
|
|
Incorporated
By Reference
|
|||
Exhibit
Number
|
Exhibit
Description
|
Form
|
File
Number
|
Exhibit
|
Filing
Date
|
Asset
Purchase Agreement, dated August 13, 2018 by and between Scienza
Labs, Inc. and Romark Global Pharma, LLC (1)
|
8-K
|
000-50956
|
2.1
|
8/17/18
|
|
Restated
Certificate of Incorporation
|
8-K
|
000-50956
|
99.1
|
5/1/2006
|
|
Certificate
of Amendment to the Certificate of Incorporation
|
8-K
|
000-50956
|
3.1
|
4/12/13
|
|
By-laws
|
10-SB12G
|
000-50956
|
3.2
|
9/24/2004
|
|
Amendment
No. 1 to the By-laws
|
8-K
|
000-50956
|
3.1
|
6/6/2008
|
|
Amendment
No. 2 to the By-laws
|
8-K
|
000-50956
|
3.2
|
4/12/13
|
|
4.1*
|
Description
of the Registrant’s securities
|
|
|
|
|
Consulting
Agreement, effective January 1, 2014, between Pharma-Bio Serv Inc.,
Strategic Consultants International, LLC and Elizabeth
Plaza.
|
8-K
|
000-50956
|
10.1
|
12/31/13
|
|
Consulting
Agreement Amendment, effective January 1, 2015, between Pharma-Bio
Serv Inc., Strategic Consultants International, LLC and Elizabeth
Plaza.
|
8-K
|
000-50956
|
10.1
|
1/5/2015
|
|
Consulting
Agreement Amendment, effective January 1, 2016, between Pharma-Bio
Serv Inc., Strategic Consultants International, LLC and Elizabeth
Plaza.
|
8-K
|
000-50956
|
10.1
|
1/5/2016
|
|
Consulting
Agreement Amendment, effective January 1, 2017, between Pharma-Bio
Serv Inc., Strategic Consultants International, LLC and Elizabeth
Plaza.
|
8-K
|
000-50956
|
10.1
|
1/20/2017
|
|
Consulting
Agreement Amendment, dated January 2, 2018, by and among Pharma-Bio
Serv, Inc., Strategic Consultants International, LLC and Elizabeth
Plaza, effective January 1, 2018.
|
8-K
|
000-50956
|
10.1
|
1/8/2018
|
|
Consulting
Agreement Amendment, dated December 31, 2018, by and among
Pharma-Bio Serv, Inc., Strategic Consultants International, LLC and
Elizabeth Plaza, effective January 1, 2019.
|
8-K
|
000-50956
|
10.1
|
1/4/2019
|
|
Consulting
Agreement Amendment, dated December 27, 2019, by and among
Pharma-Bio Serv, Inc., Strategic Consultants International, LLC and
Elizabeth Plaza, effective January 1, 2020.
|
8-K
|
000-50956
|
10.1
|
12/27/2019
|
Employment
Agreement, effective January 1, 2015, between Pharma-Bio Serv, Inc.
and Victor Sanchez
|
8-K
|
000-50956
|
10.2
|
1/5/2015
|
|
Employment
Agreement dated November 5, 2007 between the Pharma-Bio Serv, Inc.
and Pedro Lasanta
|
10-K
|
000-50956
|
10.8
|
1/29/2009
|
|
|
Incorporated
By Reference
|
|||
Exhibit Number
|
Exhibit Description
|
Form
|
File Number
|
Exhibit
|
Filing Date
|
Amendment
to Employment Agreement dated December 17, 2008 between the
Registrant and Pedro Lasanta
|
8-K
|
000-50956
|
99.1
|
12/23/2008
|
|
Amendment
to Employment Agreement, dated March 11, 2009, by and between the
Company and Pedro Lasanta
|
8-K
|
000-50956
|
10.3
|
3/17/2009
|
|
Employment
Agreement Amendment, effective as of January 1, 2010, by and
between the Company and Pedro Lasanta.
|
8-K
|
000-50956
|
10.2
|
1/07/2010
|
|
Employment
Agreement Amendment, dated January 31, 2012, by and between the
Company and Pedro J. Lasanta
|
8-K
|
000-50956
|
10.1
|
2/2/2012
|
|
Employment
Agreement Amendment, dated December 31, 2012, by and between the
Company and Pedro J. Lasanta
|
8-K
|
000-50956
|
10.1
|
1/7/2013
|
|
Employment
Agreement Amendment between Pharma-Bio Serv, Inc. and Pedro
Lasanta, effective January 1, 2014.
|
8-K
|
000-50956
|
10.2
|
2/21/2014
|
|
Employment
Agreement Amendment, dated October 7, 2019, by and between the
Company and Pedro Lasanta
|
8-K
|
000-50956
|
10.1
|
10/11/2019
|
|
2005
Long-Term Incentive Plan, as amended
|
DEF
14A
|
000-50956
|
Appendix
C
|
3/26/2007
|
|
Amendment
to 2005 Long-Term Incentive Plan
|
10-Q
|
000-50956
|
10.4
|
3/17/2014
|
|
Pharma-Bio
Serv, Inc. 2014 Long-Term Incentive Plan
|
8-K
|
000-50956
|
10.1
|
5/2/2014
|
|
Code of
business conduct and ethics for senior management
|
10-KSB
|
000-50956
|
14.1
|
2/2/2007
|
|
21.1*
|
List of
Subsidiaries
|
|
|
|
|
|
|
Incorporated
By Reference
|
|||
Exhibit Number
|
Exhibit Description
|
Form
|
File Number
|
Exhibit
|
Filing Date
|
23.1*
|
Consent
of Crowe PR PSC (formerly known as Horwath Vélez & Co,
PSC)
|
|
|
|
|
31.1*
|
Certification
of chief executive officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002
|
|
|
|
|
31.2*
|
Certification
of chief financial officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002
|
|
|
|
|
32.1**
|
Certification
of chief executive officer and chief financial officer pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
|
|
101.INS*
|
XBRL
Instance Document
|
|
|
|
|
101.SCH*
|
XBRL
Taxonomy Extension Schema
|
|
|
|
|
101.CAL*
|
XBRL
Taxonomy Extension Calculation Linkbase
|
|
|
|
|
101.DEF*
|
XBRL
Taxonomy Extension Definition Linkbase
|
|
|
|
|
101.LAB*
|
XBRL
Taxonomy Extension Label Linkbase
|
|
|
|
|
101.PRE*
|
XBRL
Taxonomy Extension Presentation Linkbase
|
|
|
|
|
104*
|
Cover
page Interactive Data File (formatted as inline XBRL and contained
in Exhibit 101)
|
|
|
|
|
|
|
|
|
|
PHARMA-BIO SERV, INC.
|
|
|
|
|
|
|
Dated:
January 29, 2020
|
By:
|
/s/
Victor Sanchez
|
|
|
Name:
Victor Sanchez
|
|
|
|
Title: Chief
Executive Officer and
President Europe
Operations
(Principal
Executive Officer)
|
|
|
|
|
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
|
|
|
|
|
/s/
Victor Sanchez
|
|
Chief
Executive Officer and President Europe Operations
|
|
January
29, 2020
|
Victor
Sanchez
|
|
(Principal
Executive Officer)
|
|
|
|
|
|
|
|
|
|
|
|
|
/s/
Pedro J. Lasanta
|
|
Chief
Financial Officer, Vice President Finance and Administration and
Secretary
|
|
January
29, 2020
|
Pedro
J. Lasanta
|
|
(Principal
Financial and Accounting Officer)
|
|
|
|
|
|
|
|
|
|
|
|
|
/s/
Elizabeth Plaza
|
|
Chairman
|
|
January
29, 2020
|
Elizabeth
Plaza
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
/s/
Kirk Michel
|
|
Director
|
|
January
29, 2020
|
Kirk
Michel
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
/s/
Howard Spindel
|
|
Director
|
|
January
29, 2020
|
Howard
Spindel
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
/s/ Dov
Perlysky
|
|
Director
|
|
January
29, 2020
|
Dov
Perlysky
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
/s/
Irving Wiesen
|
|
Director
|
|
January
29, 2020
|
Irving
Wiesen
|
|
|
|
|
|
|
Page
|
|
|
|
|
|
|
F-2
|
|
|
|
|
|
|
|
F-3
|
|
|
|
|
|
|
|
F-4
|
|
|
|
|
|
|
|
F-5
|
|
|
|
|
|
|
|
F-6
|
|
|
|
|
|
|
|
F-7
|
|
|
|
|
|
|
|
F-8
|
|
|
Years ended
October 31,
|
|
|
2019
|
2018
|
REVENUES
|
$19,506,911
|
$17,797,425
|
|
|
|
COST OF
SERVICES
|
13,330,295
|
12,110,618
|
|
|
|
GROSS
PROFIT
|
6,176,616
|
5,686,807
|
|
|
|
SELLING, GENERAL
AND ADMINISTRATIVE EXPENSES
|
4,479,933
|
4,598,545
|
|
|
|
INCOME FROM
CONTINUING OPERATIONS
|
1,696,683
|
1,088,262
|
|
|
|
OTHER INCOME, NET
OF FOREIGN EXCHANGE SETTLEMENT
|
526,567
|
435,527
|
|
|
|
INCOME FROM
CONTINUING OPERATIONS BEFORE INCOME TAXES
|
2,223,250
|
1,523,789
|
|
|
|
INCOME TAX AND US TAX REFORM TRANSITION TAX
EXPENSE
|
135,994
|
2,785,525
|
|
|
|
NET INCOME (LOSS)
FROM CONTINUING OPERATIONS
|
2,087,256
|
(1,261,736)
|
|
|
|
DISCONTINUED
OPERATIONS, NET OF TAX:
|
|
|
NET LOSS FROM
OPERATIONS THROUGH DISPOSAL
|
-
|
(170,774)
|
GAIN ON
DISPOSAL
|
-
|
2,712,244
|
|
|
|
NET INCOME FROM
DISCONTINUED OPERATIONS
|
-
|
2,541,470
|
|
|
|
NET
INCOME
|
$2,087,256
|
$1,279,734
|
|
|
|
|
|
|
BASIC AND DILUTED
LOSSES PER COMMON SHARE (Continuing operations)
|
$0.090
|
$(0.055)
|
BASIC AND DILIUTED
EARNINGS (LOSSES) PER COMMON SHARE (Discontinued
operations)
|
$-
|
$0.110
|
|
|
|
WEIGHTED AVERAGE
NUMBER OF COMMON
|
|
|
SHARES OUTSTANDING
– BASIC
|
23,054,653
|
23,080,995
|
|
|
|
WEIGHTED AVERAGE
NUMBER OF COMMON
|
|
|
SHARES OUTSTANDING
– DILUTED
|
23,113,857
|
23,096,252
|
|
Years ended
October 31,
|
|
|
2019
|
2018
|
|
|
|
NET
INCOME
|
$2,087,256
|
$1,279,734
|
|
|
|
OTHER COMPREHENSIVE
INCOME (LOSS), NET OF RECLASSIFICATION ADJUSTMENTS AND
TAXES:
|
|
|
|
|
|
Foreign currency
translation gain (loss):
|
|
|
Net unrealized gain
(loss)
|
(25,508)
|
73,538
|
Intercompany
balances foreign exchange settlement, included in net
income
|
65,636
|
(121,137)
|
Net unrealized gain
(loss) on available-for sale securities
|
(4,475)
|
17,875
|
|
|
|
TOTAL OTHER
COMPREHENSIVE INCOME (LOSS)
|
35,653
|
(29,724)
|
|
|
|
COMPREHENSIVE
INCOME
|
$2,122,909
|
$1,250,010
|
BALANCE AT OCTOBER 31,
2018
|
23,373,817
|
2,337
|
-
|
-
|
1,346,956
|
19,111,111
|
107,947
|
(304,688)
|
20,263,663
|
|
|
|
|
|
|
|
|
|
|
STOCK-BASED
COMPENSATION
|
-
|
-
|
-
|
-
|
34,120
|
-
|
-
|
-
|
34,120
|
|
|
|
|
|
|
|
|
|
|
ISSUANCE OF COMMON STOCK PURSUANT
TO THE CASHLESS EXERCISE OF STOCK OPTIONS
|
23,890
|
3
|
-
|
-
|
-
|
(3)
|
-
|
-
|
-
|
|
|
|
|
|
|
|
|
|
|
PURCHASE OF TREASURY STOCK (86,422
SHARES)
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(87,891)
|
(87,891)
|
|
|
|
|
|
|
|
|
|
|
NET INCOME
|
-
|
-
|
-
|
-
|
-
|
2,087,256
|
-
|
-
|
2,087,256
|
|
|
|
|
|
|
|
|
|
|
OTHER COMPREHENSIVE
LOSS,
NET OF TAX
|
-
|
-
|
-
|
-
|
-
|
-
|
35,653
|
-
|
35,653
|
|
|
|
|
|
|
|
|
|
|
CASH DIVIDEND ($0.075 PER COMMON
SHARE AT RECORD DATE)
|
-
|
-
|
-
|
-
|
-
|
(1,725,295)
|
-
|
-
|
(1,725,295)
|
|
|
|
|
|
|
|
|
|
|
BALANCE AT OCTOBER 31,
2019
|
23,397,707
|
$2,340
|
-
|
$-
|
$1,381,076
|
$19,473,069
|
$143,600
|
$(392,579)
|
$20,607,506
|
Level 1:
|
Quoted
prices in active markets for identical assets and
liabilities.
|
|
|
Level 2:
|
Observable
inputs other than Level 1 prices such as quoted prices for similar
assets or liabilities, quoted prices in markets with insufficient
volume or infrequent transactions (less active markets), or
model-derived valuations in which all significant inputs are
observable or can be derived principally from or corroborated by
observable market data for substantially the full term of the
assets or liabilities.
|
|
|
Level 3:
|
Prices
or valuation techniques that require inputs that are both
significant to the fair value measurement and unobservable
(supported by little or no market activity).
|
|
|
October
31,
|
|
|
Useful life
(years)
|
2019
|
2018
|
Vehicles
|
5
|
$253,579
|
$269,257
|
Leasehold
improvements
|
5-8
|
84,445
|
84,485
|
Computers
|
3
|
330,250
|
307,579
|
Equipment
|
3-7
|
130,110
|
132,089
|
Furniture and
fixtures
|
10
|
1,549
|
1,563
|
Total
|
|
799,933
|
794,973
|
Less: Accumulated
depreciation and amortization
|
|
(509,275)
|
(496,953)
|
Property and
equipment, net
|
|
$290,658
|
$298,020
|
Twelve months
ending October 31,
|
Amount
|
2020
|
$14,908
|
2021
|
14,908
|
2022
|
14,908
|
2023
|
14,908
|
2024
|
31,181
|
Total future
minimum lease payments
|
90,813
|
Less: Amount of
imputed interest
|
(12,704)
|
Present value of
future minimum lease payments
|
78,109
|
Current portion of
obligation under capital leases
|
(11,030)
|
Long-term portion
|
$67,079
|
|
Amount
|
2020
|
$376,850
|
2021
|
62,808
|
Total minimum
future rental payments
|
$439,658
|
1 Other segments
represent activities that fall below the reportable threshold and
are carried out in Puerto Rico and Brazil. These activities include
a Brazilian compliance consulting division and corporate
headquarters, as applicable.
|
|
|
●
|
permit
our board of directors to issue up to 10,000,000 shares of
preferred stock, with any rights, preferences and privileges as
they may designate;
|
|
|
|
|
●
|
provide
that the authorized number of directors may be changed only by
resolution adopted by a majority of the board of
directors;
|
|
|
|
|
●
|
provide
that all vacancies, including newly created directorships, may,
except as otherwise required by law or subject to the rights of
holders of preferred stock as designated from time to time, be
filled by the affirmative vote of a majority of directors then in
office, even if less than a quorum;
|
|
|
|
|
●
|
divide
our board of directors into three classes; and
|
|
|
|
|
●
|
do not
provide for cumulative voting rights, which means that holders of a
majority of the shares of Common Stock entitled to vote in any
election of directors can elect all of the directors standing for
election.
|
Subsidiary
Name
|
|
Jurisdiction of
Organization
|
|
|
|
Pharma-Bio
Serv PR, Inc.
|
|
Puerto
Rico
|
|
|
|
Pharma-Bio
Serv US, Inc.
|
|
Delaware
|
|
|
|
Pharma
Serv, Inc.
|
|
Puerto
Rico
|
|
|
|
Scienza
Labs, Inc.
|
|
Puerto
Rico
|
|
|
|
Pharma-Bio
Serv Validation & Compliance Limited
|
|
Ireland
|
|
|
|
Pharma-Bio
Serv S.L.
|
|
Spain
|
|
|
|
Pharma-Bio
Serv Brasil Servicos de Consultoria Ltda.
|
|
Brazil
|
Date:
January 29, 2020
|
By:
|
/s/
Victor Sanchez
|
|
|
|
Victor
Sanchez
|
|
|
|
Chief
Executive Officer
|
|
|
|
(principal
executive officer)
|
|
|
|
|
|
Date:
January 29, 2020
|
By:
|
/s/
Pedro J. Lasanta
|
|
|
|
Pedro
J. Lasanta
|
|
|
|
Chief Financial Officer
|
|
|
|
(principal
financial and accounting officer)
|
|
1.
|
The
report fully complies with the requirements of Section 13(a) or
Section 15(d) of the Securities Exchange Act of 1934, as amended;
and
|
2.
|
The
information contained in the report fairly presents, in all
material respects, the financial condition and results of
operations of the Company.
|
/s/
Victor Sanchez
|
|
/s/
Pedro J. Lasanta
|
Victor
Sanchez
|
|
Pedro
J. Lasanta
|
Chief
Executive Officer
|
|
Chief
Financial Officer
|
(principal
executive officer)
|
|
(principal
financial and accounting officer)
|
|
|
|