SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Filed Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) JUNE 16, 1999
MEDICAL SCIENCE SYSTEMS, INC.
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(Exact name of registrant as specified in its charter)
TEXAS
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(State or Other Jurisdiction of Incorporation)
0-23413 94-3123681
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(Commission File Number) (IRS Employer Identification No.)
100 N.E. LOOP 410, SUITE 820, SAN ANTONIO, TEXAS 78216
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(Address of Principal Executive Offices) (Zip Code)
(210) 349-6400
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(Registrant's Telephone Number, Including Area Code)
NOT APPLICABLE
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(Former Name or Former Address, if Changed Since Last Report)
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Item 5. OTHER EVENTS.
On June 16, 1999, the Company completed a private placement (the
"Private Placement") whereby the Company sold 2,000,000 shares of Series A
Preferred Stock, no par value ("Series A Preferred"), at a per share purchase
price of $2.50. In connection with the Private Placement, the Company issued an
additional 200,000 shares of Series A Preferred as the placement agent's fee.
Each share of Series A Preferred will automatically convert into five (5) shares
of common stock, no par value ("Common Stock"), upon shareholder ratification of
the issuance of the Series A Preferred issued pursuant to the Private Placement,
which ratification is required to comply with certain NASDAQ requirements. If
the Company does not issue any shares of Common Stock between June 25, 1999 and
the date the shareholders ratify the issuance of the Series A Preferred issued
pursuant to the Private Placement, the Common Stock issued upon conversion of
the Series A Preferred will equal 66.4% of the outstanding shares of Common
Stock of the Company. If such shareholder approval is not received by December
12, 1999, the number of shares of Common Stock into which each share of Series A
Preferred Stock will be convertible will increase by 0.075 shares every 90 days
following such date. The Series A Preferred will not bear dividends unless it
does not automatically convert into Common Stock by December 12, 1999, after
which the Series A Preferred will bear dividends at 15% per annum on a
cumulative basis.
Exhibit 99.1 hereto is the Company's pro forma balance sheet which
reflects the results of the Private Placement.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS.
EXHIBIT NUMBER DESCRIPTION
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Exhibit 99.1 The Company's Pro Forma Balance Sheet as of May 31,
1999
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
MEDICAL SCIENCE SYSTEMS, INC.
By /s/ U. SPENCER ALLEN
U. Spencer Allen, Chief Financial
Officer and Treasurer
DATE: June 25, 1999
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EXHIBIT 99.1
MEDICAL SCIENCE SYSTEMS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
UNAUDITED UNAUDITED
UNAUDITED UNAUDITED PROFORMA PROFORMA
DECEMBER 31, 1998 MARCH 31, 1999 MAY 31, 1999 ADJUSTMENTS MAY 31, 1999
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<S> <C> <C> <C> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash equivalents ..................... $ 2,432,271 $ 1,183,787 $ 590,080 4,903,000 (1) $ 5,493,080
Accounts receivable, net of allowance
for doubtful accounts ....................... 125,086 113,785 109,184 109,184
Prepaid expenses .............................. 127,426 145,286 182,375 182,375
----------------- -------------- ------------ ------------
Total current assets ........................ 2,684,783 1,442,858 881,639 5,784,639
FURNITURE AND EQUIPMENT, NET .................... 458,107 412,695 380,217 380,217
OTHER ASSETS .................................... 530,000 530,000 530,000 530,000
----------------- -------------- ------------ ------------
TOTAL ASSETS ................................ $ 3,672,890 $ 2,385,553 $ 1,791,856 $ 6,694,856
================= ============== ============ ============
LIABILITIES AND SHAREHOLDERS EQUITY
CURRENT LIABILITIES
Accounts payable .............................. $ 278,773 $ 232,567 $ 363,492 $ 363,492
Accrued expenses .............................. 433,859 450,550 435,132 88,000 (1) 523,132
Notes payable ................................. 47,813 26,111 19,729 19,729
Deferred income ............................... 275,321 274,439 274,646 274,646
Current portion of long-term debt ............. 81,432 81,432 81,432 81,432
Current portion of capitalized lease
obligations ................................. 104,837 102,379 102,379 102,379
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Total current liabilities ................... 1,222,035 1,167,478 1,276,810 1,364,810
LONG-TERM DEBT, LESS CURRENT PORTION ............ 447,856 427,498 413,926 413,926
CAPITALIZED LEASE OBLIGATIONS,
LESS CURRENT PORTION .......................... 156,651 138,891 121,003 121,003
----------------- -------------- ------------ ------------
Total liabilities ........................... 1,826,542 1,733,867 1,811,739 1,899,739
SHAREHOLDERS' EQUITY
Preferred stock, no par value ................. -- -- -- -- (1) --
5,000,000 shares authorized
2,200,000 issued and outstanding
Common stock, no par value .................... 16,719,933 16,730,396 16,730,396 4,815,000 (1) 21,545,396
10,000,000 shares authorized
5,548,470 shares issued and outstanding
Accumulated deficit ........................... (14,873,585) (16,078,710) (16,750,279) (16,750,279)
----------------- -------------- ------------ ------------
Total shareholders' equity .................. 1,846,348 651,686 (19,883) 4,795,117
----------------- -------------- ------------ ------------
Total liabilities and shareholders' equity $ 3,672,890 $ 2,385,553 $ 1,791,856 $ 6,694,856
================= ============== ============ ============
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Notes to Proforma Adjustments
(1) Recognizes issuance of $5 million of preferred stock with a beneficial
conversion feature netted by offering costs
