SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10-Q

Amendment No. 3

QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For Quarter Ended March 31, 2004 Commission File No. 0-11881

INTERWEST MEDICAL CORPORATION

(Exact name of registrant as specified in its charter)


Oklahoma		75-1864474

(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

Arlington Heights Professional Office Building
3221 Hulen Street, Suite C, Fort Worth, TX 76107-6193
(Address of principal executive offices, zip code)

Registrant’s telephone number, including area code: (817)731-2743

Not Applicable

(Former name, former address, and former fiscal year, if changed since last report)

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 x No o

APPLICABLE ONLY TO ISSUERS INVOLVED IN
BANKRUPTCY PROCEEDINGS DURING THE
PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.

(Not Applicable)

Yes x No o

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act)

Yes o No x

(APPLICABLE TO CORPORATE ISSUERS)

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the close of the period covered by this report. 15,915,211 shares of Common Stock, $0.001 Par Value.

TABLE OF CONTENTS


PART I — EXHIBIT I
	Item 2. Management’s Discussion and Analysis of Financial Position and Results of Operations.
	Item 3. Quantitative and Qualitative Disclosures About Market Risk.
	Item 4. Controls and Procedures.
PART II. OTHER INFORMATION
	Item 1. Legal Proceedings.
	Item 2. Changes in Securities.
	Item 3. Defaults upon Senior Securities.
	Item 4. Submission of Matters to a Vote of Securities Holders.
	Item 5. Other Information
	Item 6. Exhibits and Reports on Form 8-K.
SIGNATURES
Section 302 Certification
Section 906 Certification

INTERWEST MEDICAL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS


	March 31,			December 31,
	2004			2003
	(Unaudited)
ASSETS
CURRENT ASSETS
Cash	$	581,884		$	796,434
Accounts receivable — trade		3,402,146			3,655,364
Investments — trading		313,139			355,252
Prepaid expenses and other receivables		355,783			75,933

Total current assets		4,652,952			4,882,983

PROPERTY AND EQUIPMENT, at cost Land		294,354			294,354
Buildings and improvements		4,149,032			4,147,464
Equipment and furniture		1,246,625			1,240,906
Oil and gas properties (successful efforts method of accounting)		170,489			170,489

		5,860,500			5,853,213
Less accumulated depreciation and depletion		2,789,526			2,723,936


		3,070,974			3,129,277

OTHER ASSETS
Cash escrow accounts		253,203			253,202
Deferred financing costs, net		78,569			78,569

		331,772			331,771

TOTAL ASSETS	$	8,055,698		$	8,344,031

LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Current maturities of long-term debt	$	—		$	50,539
Accounts payable		2,127,363			2,022,066
Accrued expenses		412,976			708,786

Total current liabilities		2,540,339			2,781,391

LONG-TERM DEBT		4,605,855			4,555,316

STOCKHOLDERS’ EQUITY
Common stock, par value $0.001, authorized 50,000,000 shares, issued 22,000,000 shares		22,000			22,000
Additional paid-in capital		5,096,745			5,096,745
Retained earnings (deficit)		(3,156,957	)		(3,059,187	)


		1,961,788			2,059,558

Less cost of shares held in the treasury, 2004 - 6,084,789 shares; 2003 - 6,084,289 shares		892,284			892,234
Notes receivable — officer		160,000			160,000


		909,504			1,007,324


TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	8,055,698		$	8,344,031

See Accompanying Notes to Condensed
Consolidated Financial Statements.

INTERWEST MEDICAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)


	Three Months Ended
	March 31,
	2004			2003
REVENUES
Patient service revenue	$	4,237,569		$	3,572,250
Other revenue		10,224			9,419


Total revenue		4,247,793			3,581,669

COSTS AND EXPENSES
Professional care of patients		2,468,632			2,185,950
General services		663,067			668,458
Administrative services		1,091,423			829,203
Other costs		2,318			5,377
Depreciation, depletion and amortization		74,774			70,931


Income (loss) from operations		(52,421	)		(178,250	)

OTHER INCOME (EXPENSES)
Investment income (loss)		57,972			(970	)
Interest income		778			1,161
Interest expense		(104,055	)		(81,000	)


Income (loss) before taxes on income (loss)		(97,726	)		(259,059	)

Provision for income taxes		—			—


Net income (loss)		($97,726	)		($259,059	)


Weighted averages shares outstanding		15,915,211			15,915,711


Earnings (loss) per common share — basic and diluted		($0.01	)		($0.02	)

See Accompanying Notes to Condensed
Consolidated Financial Statements.

INTERWEST MEDICAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)


	Three Months Ended
	March 31,			March 31,
	2004			2003
CASH FLOWS FROM OPERATING ACTIVITIES		($156,674	)		($342,464	)

CASH FLOWS FROM INVESTING ACTIVITIES
Payments for acquisition of property		(7,287	)		(6,717	)


Net cash used in investing activities		(7,287	)		(6,717	)

CASH FLOWS FROM FINANCING ACTIVITIES
Purchase of treasury stock		(50	)		—
Payments on borrowings		(50,539	)		(10,062	)


Net cash used in financing activities		(50,589	)		(10,062	)


Net increase (decrease) in cash		(214,550	)		(359,243	)

CASH, beginning of period		796,434			1,004,795


CASH, end of period	$	581,884		$	645,552

See Accompanying Notes to Condensed
Consolidated Financial Statements.

INTERWEST MEDICAL CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.	In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments necessary to present fairly the Company’s financial position as of March 31, 2004, and its results of operations for the three months ended March 31, 2004 and 2003, and cash flows for the three months ended March 31, 2004 and 2003. The results of operations for the period presented are not necessarily indicative of the results to be expected for a full year.

2.	Income per share was computed by dividing the net income by the weighted average number of shares outstanding.

3.	The Company has adopted a Stock Option Plan which provides for the granting of options to officers and other key employees for the purchase of common stock of the Company.

	The Plan reserves 1,500,000 shares of common stock for the granting of such options. Options are subjected to adjustment upon any change in the capital structure of the Company such as a stock dividend, stock split or other similar events.

	Options may be granted at not less than 100% of the fair market value of the Company stock at the date of grant, and are exercisable during a term of ten years from the date of grant at any time in whole or in part, and are subject to continued employment and other conditions as set forth in the option agreement.

	Options are exercisable only by the participants and are not assignable during their lifetime and must be exercised within one year of the death of the participant by his legal representative.

	A summary of the status of the Company’s stock options for 2004 and 2003 is as follows:


	2004				2003
			Weighted				Weighted
			Average				Average
	Shares		Exercise		Shares		Exercise
	(000)		Price		(000)		Price
Outstanding, beginning		1,500		.15		1,500	$	.15
Granted		—		—		—		—
Exercised		—		—		—		—
Forfeited		—		—		—		—


Outstanding, ending		1,500		.15		1,500	$	.15


Options exercisable at year end		1,500	$	.15		1,500	$	.15


Weighted average fair value of options granted during the year			$	—			$	—

At March 31, 2004, the 1,500,000 options have an exercise price of $0.15 per share and a weighted average remaining contractual life of 6 years.

REVIEW BY INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS

Weaver and Tidwell, L.L.P., Independent Certified Public Accountants, have performed a review of the condensed consolidated balance sheet as of March 31, 2004 and the condensed consolidated statements of operations for the three months ended March 31, 2004 and 2003, and cash flows for the three months ended March 31, 2004 and 2003, in accordance with established professional standards and procedures for such a review. All adjustments or additional disclosures proposed by Weaver and Tidwell, L.L.P. have been reflected in the data presented.

The report of Weaver and Tidwell, L.L.P. commenting upon their review is included as Part I - Exhibit I.

INDEPENDENT ACCOUNTANT’S REVIEW REPORT

To the Board of Directors
InterWest Medical Corporation

We have reviewed the condensed consolidated balance sheet of InterWest Medical Corporation as of March 31, 2004, and the related condensed consolidated statements of operations for the three month periods ended March 31, 2004 and 2003, and cash flows for the three months ended March 31, 2004 and 2003. These financial statements are the responsibility of the Company’s management.

We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical review procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should be made to the accompanying interim condensed consolidated financial statements referred to above, for them to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with auditing standards generally accepted in the United States of America, the consolidated balance sheet of InterWest Medical Corporation as of December 31, 2003, and the related consolidated statements of operations, stockholders’ equity and cash flows for the year then ended (not presented herein); and in our report dated March 19, 2004, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of December 31, 2003, is fairly stated in all material respects in relation to the consolidated balance sheet from which it has been derived.

(-s- Weaver and Tidwell, L.L.P.)

WEAVER AND TIDWELL, L.L.P.

Fort Worth, Texas
May 12, 2004

674

PART I — EXHIBIT I

Item 2.	Management’s Discussion and Analysis of Financial Position and Results of Operations.

	Changes in Balance Sheet Accounts

	Current assets were $4,652,952 and total assets were $8,055,698 at March 31, 2004 as compared to $4,882,983 current assets and $8,344,031 total assets at December 31, 2003. Current liabilities were $2,540,339 at March 31, 2004 as compared to $2,781,391 at December 31, 2003.

	Results of Operations

	For the Three Months Ended March 31, 2004, operating revenue was $4,247,793; costs and expenses were $4,300,214, net loss was ($97,726) and interest income was $778, as compared to the Three Months Ended March 31, 2003, operating revenue of $3,581,669, costs and expenses of $3,759,919, net income was ($259,059) and interest income of $1,161.

	Cash Flows

	For the Three Months Ended March 31, 2004, cash flows from operating activities were ($156,674), cash flows from investing activities were ($7,287), cash flows from financing activities were ($50,589) net decrease in cash was ($214,550), cash at the beginning of the period was $796,434, and cash at the end of the period was $581,884 as compared to the Three Months Ended March 31, 2003, to cash flows from operating activities of ($342,464), cash flows from investing activities of ($6,717), cash flows from financing activities of ($10,062), net decrease in cash of ($359,243), cash at the beginning of the period of $1,004,795 and cash at the end of the period of $645,552.

Item 3.	Quantitative and Qualitative Disclosures About Market Risk

	The Company has not entered into any derivative financial instruments, derivative commodity instruments or other similar instruments during the quarter ended March 31, 2004.

Item 4.	Controls and Procedures

	(a)	Disclosure Controls and Procedures

		The Company maintains disclosure controls and procedures designed to ensure that it is able to collect the information it is required to disclose in the reports it files with the SEC, and to process, summarize and disclose this information within the time periods specified in the SEC rules and forms. Disclosure controls are also designed with the objective of ensuring that such information is accumulated and communicated to our management, including the CEO and CFO, as appropriate to allow timely decisions regarding required disclosure.

		Based on their evaluation as of the end of the period covered by this quarterly report on Form 10-Q, Mr. Arch Gilbert, who acts as our CEO and CFO has concluded that our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d – 15(e) under the Securities Exchange Act of 1934 are effective in alerting him on a timely basis to material information that is required to be included in our periodic SEC reports.

	(b)	Changes in Internal Controls

		There were no changes during our most recent fiscal quarter in our internal controls or in other factors that have materially affected or are reasonably likely to materially affect these controls, including any corrective actions with regard to deficiencies or material weaknesses.

PART II. OTHER INFORMATION

Item 1.		Legal Proceedings.

		Not applicable.

Item 2.		Changes in Securities.

		Not applicable.

Item 3.		Defaults upon Senior Securities.

		Not applicable.

Item 4.		Submission of Matters to a Vote of Securities Holders.

		Not applicable.

Item 5.		Other Information

		Not applicable.

Item 6.		Exhibits and Reports on Form 8-K.

	(a)	Exhibit 31 – Section 302 Certification

	(b)	Exhibit 32 – Section 906 Certification

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its half by the undersigned thereunto duly authorized.


	INTERWEST MEDICAL CORPORATION
	By:	/s/ Arch B. Gilbert
	Arch B. Gilbert, President, Chief Executive Officer, Chief Financial Officer, and Chief Accounting Officer

Date: January 20, 2005

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INTERWEST MEDICAL CORP 10-Q/A