<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-QSB
[ x ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2000.
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from:
Commission file number 0-29462
MEDICAL MANAGEMENT SYSTEMS, INC.
(Exact name of Small Business Issuer as specified in its charter.)
COLORADO 95-4121451
(State of other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
c/o Bookdigital.com, Inc.
65 Broadway - 5th Floor
New York, New York 10006
(Address of principal executive offices, including zip code.)
(212) 430-6380
(Issuer's telephone number, including area code.)
5459 South Iris Street, Littleton, Colorado 80123
(Former Address, if changed since last report.)
Check whether the Issuer (1) has filed all reports required to be filed
by Section 13 or 15(d) of the Securities 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 [ ]
State the number of shares outstanding of each of the issuer's
classes of common equity, as of the latest practicable date: Common
Stock par value per share, at May 12, 2000 was 263,256 shares.
<PAGE> 2
PART I
ITEM 1. FINANCIAL STATEMENTS
Medical Management Systems, Inc.
BALANCE SHEET
March 31, 2000 December 31,
(Unaudited) 1999
ASSETS
Cash $ - $ -
Related party receivables 1,935 4,423
------------ ------------
Total Assets $ 1,935 $ 4,423
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Accounts payable $ - $ 210
Compensation payable 300,000 300,000
------------ ------------
Total Liabilities 300,000 300,210
Stockholders' Equity
Preferred stock, 10,000,000
shares authorized, no par
value; none issued and
outstanding
Common stock, 40,000,000
shares authorized, no par
value: 263,256 shares
issued and outstanding 1,287,718 1,287,718
Accumulated deficit (1,585,783) (1,583,505)
------------ ------------
Total Stockholders' Equity (298,065) (295,787)
------------ ------------
Total Liabilities and
Stockholders' Equity $ 1,935 $ 4,423
============ ============
2
<PAGE> 3
Medical Management Systems, Inc.
STATEMENTS OF OPERATIONS
For the Three Months Ended March 31, 2000 and 1999
Three Months Three Months
2000 1999
(Unaudited) (Unaudited)
CONTINUING OPERATIONS
Revenues $ - $ -
General and administrative
expenses 2,278 7,288
-------- ---------
NET LOSS $ (2,278) $ (7,288)
======== =========
3
<PAGE> 4
Medical Management Systems, Inc,
STATEMENT OF CASH FLOWS
For the Three Months Ended March 31, 2000 and 1999
2000 1999
(Unaudited) (Unaudited)
CASH FLOWS FROM OPERATIONS
Net loss $ (2,278) $ (7,288)
Adjustments to reconcile net
loss to net cash used by
operating activities:
(Gain) loss on disposal of
business
Changes in current assets
and liabilities (210) 7,276
-------- --------
Net cash provided (used)
by operating activities (2,488) (12)
CASH FLOWS FROM FINANCING ACTIVITIES
Advances from related parties 2,488
-------- --------
Net cash provided by
financing activities 2,488
-------- --------
NET INCREASE (DECREASE) IN CASH (12)
CASH, beginning of period 12
-------- --------
CASH, end of period $ - $ -
======== ========
4
<PAGE> 5
Medical Management Systems, Inc.
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION
Medical Management Systems, Inc. (the "Company") was incorporated as
Apache Investments, Inc. in 1987 under the laws of the State of
Colorado. In February 1992, the Company commenced its initial principal
operations of owning and operating a pet school and kennel in Grand
Prairie, Texas. In September 1991, the name of the Company was changed
to Dog World, Inc. In June 1993, the Company acquired a veterinary
practice in Irving, Texas. In April 1995, substantially all the
Company's assets and business operations were sold. The Company
subsequently changed its name to Medical Management Systems, Inc.
The Company currently has no business operations and intends to
actively seek, locate, evaluate, structure and complete mergers or
acquisitions of private companies, partnerships or sole
proprietorships.
2. RELATED PARTY TRANSACTIONS
On April 9, 1999, the Board of Directors agreed to award bonuses to its
officers for services rendered to the Company totaling $300,000 and the
Company accrued the liability at June 30, 1999.
In July 1999 the Board of Directors agreed to issue 11,036 restricted
shares of its common stock to two shareholders in satisfaction of
$11,036 owed to them for payments made from personal funds for Company
expenses. In September 1999 the Board agreed to issue an additional
2,218 shares of its restricted common stock to the two shareholders in
satisfaction of an additional $2,218 paid by them from personal funds.
In October 1999 the Company entered into a letter of intent to acquire
100% ownership of a privately-held company and received $5,000 as a
deposit, The transaction was not consummated and under terms of the
agreement, the Company retained the deposit and recognized the amount
as income. The funds were deposited by the two shareholders into a
personal account partially in payment of loans made to the Company. The
balance is being used to personally pay for subsequent Company
expenses.
3. REVERSE STOCK SPLIT
In January 1999, the Company's stockholders approved a 100 to 1 reverse
stock split. The Company's authorized shares and stated capital remain
unchanged.
4. SUBSEQUENT EVENTS
In April 2000, the officers agreed to reduce accrued compensation from
$300,000 to $200,000.
5
<PAGE> 6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND PLAN OF OPERATION.
Results of Operations - Through March 31, 2000.
There have been no operations since April 1995 when the Company
sold substantially all of its assets in pet care and veterinary
services. Since April 1995, the Company has been basically dormant;
except the Company incurred $310,845 of expenses in 1999 for legal,
accounting costs, and bonus's granted to the directors; $14,262 of
expenses in 1998 for legal and accounting costs and $24,473 of expenses
in 1997, primarily for legal and accounting costs associated with
filing its Form 10; $8,964 in 1996 for various administrative expenses
and $102,098 in 1995 for costs incurred subsequent to the disposal of
the business in an initial effort to enter other business ventures.
The Company's expenses in 1997, 1998 and 1999 were funded by advances
from shareholders.
In the period ended December 31,1999, a fee to the Company of
$5000.00 in connection with a potential merger was received directly by
shareholders of the Company and is being held by them to pay Company
expenses. The balance of the funds held by them at December 31, 1999
is $4,423.
In August 1995, the Company changed its business purpose to a
blank check company.
On May 7, 1997, the Company reached an agreement with a former
director of the Company whereby the former director agreed to pay
$8,500 in cash along with a promissory note for $1,500 in settlement of
a dispute involved in the sale of Company assets in April 1995. In
addition, the former director agreed to surrender options granted him
to acquire 985,333 shares of the Company's common stock and release the
Company from all claims, demands and obligations. The Company accepted
the cash and note in satisfaction of a $60,000 note due from the former
director which had been written off and recorded as a loss in its
financial statements for the year ended December 31, 1996. The
promissory note carries interest at 12%, is unsecured and is due with
accrued interest six months from the agreement date. The promissory
note was repaid in February 1998.
The Company used $8,000 of the cash received to settle an
outstanding trade payable. The difference between the amount that had
been due, $14,358, and the amount paid has been recorded with gain on
disposal of business, along with the $10,000 settlement referred to
above.
On January 19, 1999, the Company reverse split its shares on a
one-for-one hundred basis.
<PAGE> 7
On April 9, 1999, the Company's board of directors granted bonuses
to the three directors totaling $300,000. The Company intended to pay
these bonuses if the funds became available. Subsequent to the end of
the quarter, the directors reduced their bonuses to $200,000 and these
bonuses were paid with funds obtained pursuant to a loan from an
acquisition candidate. On July 15, 1999, and September 30, 1999, the
Company issued 11,036 and 2,218 shares of Common Stock respectively, to
two shareholders in consideration of cash advances to the Company in
the amount of $11,036.00 and $2,218.00.
Liquidity and Capital Resources.
The Company had 263,256 shares of Common Stock outstanding on
December 31, 1999. The Company has no current operating history and no
material assets. The Company has $4,423.00 in cash held by two
shareholders of the company as of December 31, 1999.
There have been no operations since April 1995 when the Company
sold substantially all of its assets in pet care and veterinary
services. Since April 1995, the Company has been basically dormant;
except the Company incurred $14,262 of expenses in 1998 for legal and
accounting costs and $24,473 of expenses in 1997, primarily for legal
and accounting costs associated with filing its Form 10; $8,964 in 1996
for various administrative expenses and $102,098 in 1995 for costs
incurred subsequent to the disposal of the business in an initial
effort to enter other business ventures. The Company's expenses in
1997 and 1998 were funded by advanced from shareholders.
The Company expenses in 1998 were funded by advances from
shareholders. During October 1998, 6,689,868 shares of Common Stock
were issued to two shareholders in consideration of $33,449 of the
advances. The balance, $3,208 at December 31, 1998 is payable without
interest when the Company has funds available. On January 19, 1999,
the Company reverse split its shares on a one-for-one hundred basis,
which is not reflected herein.
On May 7, 1997, the Company reached an agreement with a former
director of the Company whereby the former director agreed to pay
$8,500 in cash along with a promissory note for $1,500 in settlement of
a dispute involved in the sale of Company assets in April 1995. In
addition, the former director agreed to surrender options granted him
to acquire 985,333 shares of the Company's common stock and release the
Company from all claims, demands and obligations. The Company accepted
the cash and note in satisfaction of a $60,000 note due from the former
director which had been written off and recorded as a loss in its
financial statements for the year ended December 31, 1996. The
promissory note carries interest at 12%, is unsecured and is due with
accrued interest six months from the agreement date. The promissory
note was repaid in February 1998.
The Company used $8,000 of the cash received to settle an
outstanding trade payable. The difference between the amount that had
been due, $14,358, and the amount paid has been recorded with gain on
disposal of business, along with the $10,000 settlement referred to
above.
<PAGE> 8
In August 1995, the Company changed its business purpose to a
blank check company.
In July 1999, the Board of Directors agreed to issue 11,036
restricted shares of its common stock to two shareholders in
satisfaction of $11,036 owed to them for payments made from personal
funds for Company expenses. In September 1999 the Board agreed to
issue an additional 2,218 shares of its restricted common stock to the
two shareholders in satisfaction of an additional $2,218 paid by them
from personal funds.
On April 17, 2000, the Company and its officers and directors
entered into an agreement pursuant to which, among other things, its
then officers and directors resigned and were replaced by the officers
and directors of Bookdigital.com, Inc. Bookdigital.com Inc., is a
privately held Delaware corporation formed in March of 1999
("Bookdigital") and is a development stage company engaged in certain
areas of web commerce. Bookdigital is comprised of three
sites/divisions, www.BOOKdigital.com , a general comprehensive online
reference site, www.BOOKdigitalschools.com, a site that serves schools,
and www.LawXpressUSA.com, an online legal subscription service for
attorneys, consultants and paralegals, which is in beta testing and
will become operational before the end of the year 2000. The Company
has initiated an exchange offer to Bookdigital's shareholders so that
Bookdigital will become a majority (if not wholly) owned subsidiary of
the Company. The Company will then change its name to Bookdigital,
Inc. The Company plans to fund its current operations from
Bookdigital's working capital.
PART II.
OTHER INFORMATION
Item 1. Legal Proceedings.
There are no material legal proceedings commenced or maintained
by, or against, the Company.
Item 2. Changes in Securities.
None
Item 3. Defaults Upon Senior Securities.
The Company has no debt securities outstanding.
Item 4. Submission of Matters to a Vote of Security Holders.
There were no matters submitted for a vote of the security holders
during the period covered by this report.
<PAGE> 9
Item 5. Other Information.
On April 17, 2000, the Company and each of its officers and
directors entered into an agreement pursuant to which they resigned and
were replaced by the officers and directors of Bookdigital.com, Inc.,
a privately held Delaware corporation ("Bookdigital"). Pursuant to
such agreement the Company's then directors reduced the aggregate
amounts due to them from $300,000 to $200,000 and such balance was paid
by Bookdigital. Pursuant to the agreement, each of Phillip J. Davis
and John C. Lee were issued three year options for the purchase of
100,000 shares of the Company's common stock at $.50 per share.
Pursuant to the agreement, the Company has initiated an exchange offer
directed to the holders of Bookdigital which would result in the
Bookdigital holders owning 93% of the Company's shares if all of the
Bookdigital holders were to elect to participate in the exchange.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
Exhibit 99.1 Letter Agreement, dated April 17, 2000, by and among the
Issuer, Bookdigital.com, Inc., Phil Davis, Ray Vahab,
Zahra S. Yamini, John C. Lee and Charles C. Van Gundy.
(b) Reports on Form 8-K
No reports were filed on Form 8-K during the quarter ended March
31, 2000.
<PAGE> 10
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, thereunto duly authorized.
Dated this 12th day of May, 2000.
MEDICAL MANAGEMENT SYSTEMS, INC.
By: /s/ Ray Vahab
Ray Vahab, Chief Executive Officer
and Chairman of the Board
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Statement of Financial Condition at March 31, 2000 (Unaudited) and the Statement
of Income for the three months ended March 31, 2000 (Unaudited) and is qualified
in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-END> MAR-31-1999
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 1,935
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 300,000
<BONDS> 0
0
0
<COMMON> 1,287,718
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 300,000
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 2,278
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (2,278)
<EPS-BASIC> (0.01)
<EPS-DILUTED> (0.01)
</TABLE>
<PAGE> 11
Exhibit 99.1
Phil Davis
5429 South Iris Street
Littleton, CO 80123
Phone (303) 932-9998 Fax (303) 904-1183
e-mail [email protected]
April 17, 2000
Mr. Ray Vahab, Chairman of the Board
Bookdigital.com, Inc. ("Book")
65 Broadway - 6th Floor
New York, New York 10004
Dear Mr. Vahab:
This letter is intended to summarize our discussions as of the
date hereof regarding the combination of Medical Management
Systems, Inc. ("MMSI") and Bookdigital.com, Inc. ("Book"). We have
agreed as follows:
1. Subject to the terms and conditions hereof, the present
members of the board of directors of MMSI, to wit, Phil Davis, John
C. Lee and Charles C. Van Gundy (collectively the "Old MMSI
Board"), will appoint the present members of the Board of Directors
(the "Book Board") of Book to the MMSI Board of Directors. MMSI
will, provided that counsel has determined that such filing is
required, promptly upon such appointment, file a Schedule 14F-1
with the Securities and Exchange Commission ("SEC") and mail the
same to its shareholders, which shall state that at the end of the
required ten day waiting period (the "Wait Period"), the Old MMSI
Board shall resign and the directors of MMSI will be the Book
Board. If there is no requirement to file a Form 14F-1 then the
Old MMSI Board shall resign within five days of the execution of
this agreement. Book and its counsel will fully cooperate in the
preparation and filing of any required Schedule 14F-1.
2. The Old MMSI Board will take all action required to
reduce MMSI total indebtedness to $200,000, including, waivers of
any amounts above such amount due to them. The members of the Old
MMSI Board shall fully cooperate with the implementation of the
transactions contemplated hereby both as directors of MMSI and as
shareholders of MMSI and each consents, both as a director and as
a shareholder to the consummation of the transactions contemplated
hereby. Book shall (i) if there is no Wait Period, upon the
execution of this agreement or (ii) if there is an applicable Wait
Period, after at the conclusion of the Wait Period, cause the sum
of $200,000 to be with MMSI to be paid as the Old MMSI Board shall
direct after the Wait Period.
<PAGE> 12
3. Each member of the OLD MMSI Board jointly and severally
represents and warrants to Book that (i) other than obligations
which will be satisfied after the $200,000 is released from escrow,
MMSI shall have no monetary obligations to any party whatsoever as
of the date that the Old MMSI Board shall resign; (ii) the Annual
Report on Form 10-SB for the year ended December 31, 1999 filed by
MMSI is true accurate and complete and does not omit to state a
fact necessary to make the statements made therein not misleading;
(iii) each of the representations of MMSI contained in a certain
draft Agreement and Plan of Merger, dated as of April 10, 2000 by
and between Book and MMSI and MMSI Sub, Inc., a copy of which is
annexed hereto (the "Merger Agreement") is true and accurate and
complete on the date hereof and will be true accurate and complete
at the end of the Wait Period (if any).
4. Book and each member of the Book Board jointly and
severally represents and warrants to MMSI and to each member of the
Old MMSI Board that (i) each of the representations of Book
contained the Merger Agreement is true and accurate and complete on
the date hereof and will be true accurate and complete at the end
of the Wait Period (if any) other than for events as may occur in
the operation of Book's business in the ordinary course; (ii) the
transfer of the $200,000 has been duly authorized by Book's Board
of Directors; and (iii) promptly upon the last to occur of the
completion of the Wait Period (if any) or within twenty days of the
date hereof, Book shall initiate a merger or an exchange offer to
combine MMSI and Book on the same economic terms as contemplated by
the Merger Agreement, to wit, that assuming all of the securities
of Book are tendered for exchange, the present holders of MMSI will
have a 7% interest in the issued and outstanding shares of Book and
Phil Davis and John C. Lee shall each be issued options for the
purchase of 100,000 shares of MMSI (which will then own Book) at
$.50 per share and of three years' duration.
5. The Old MMSI Board shall jointly and severally indemnify
Book and hold Book harmless from and against any claim loss or
damage caused by a breach of any of its representations and
warranties hereunder. The Book Board shall jointly and severally
indemnify and hold harmless MMSI and each member of the Old MMSI
Board against any loss or damage caused by a breach of any of
Book's representations and warranties hereunder. Book shall,
within ten days of the date hereof, provide an opinion of counsel,
in form and substance satisfactory to Phil Davis and John C. Lee
and their counsel with respect to the application of Exchange Act
Rule 16b-3 to the grant of the options referred to herein.
6. This agreement may be executed in counterparts,
transmitted by facsimile, all of which, taken together, shall
constitute one and the same instrument.
<PAGE> 13
Please indicate your agreement to the foregoing buy signing
where indicated below.
Very truly yours,
/s/ Phil Davis
Phil Davis, individually, and as a shareholder and director of
Medical Management Systems, Inc. and on behalf of Medical
Management Systems, Inc., as its President
Accepted and agreed to:
/s/ Ray Vahab
Ray Vahab, Individually and on behalf of Bookdigital.com, Inc., as
its Chairman of the Board
/s/ Zahra S. Yamani
Zahra S. Yamani (Director of Bookdigital.com, Inc.)
/s/ John C. Lee
John C. Lee (individually and as a Director and Shareholder of
Medical Management Systems, Inc.)
/s/ Charles C. Van Gundy
Charles C. Van Gundy (individually and as a Director and
Shareholder of Medical Management Systems, Inc.)
