SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): January 20, 1999
SIMS Communications, Inc.
(Exact name of registrant as specified in its charter)
Delaware 0-25474 65-0287558
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation or organization) File Number) Identification No.)
18001 Cowan, Suite C & D
Irvine, California 92614
(Address of principal executive offices)
(Zip Code)
(949) 261-6665
(Registrant's telephone number, including area code)
N/A
(Former name, former address and former fiscal year,
if changed since last report)
<PAGE>
Item 5. Other Events
In December, 1998, the Company filed an 8-K report (dated December 14, 1998)
which disclosed the issuance of shares of the Company's Series C Preferred Stock
and the issuance of shares of common stock in connection with the acquisition of
certain technology from MedCard Management Systems, Inc.
Subsequent to the filing of the Company's 8-K report dated December 14,
1998, the Company issued additional shares of common stock and warrants.
The following "as adjusted" balance sheet of the Company as of November 30,
1998 reflects these transactions:
November 30, 1998
November 30, 1998 Adjustments (as adjusted)
ASSETS:
Cash and cash equivalents $558,000 737,109 (1), (5) $1,295,109
Accounts receivables,
less allowance for
doubtful accounts 150,000 150,000
Inventories 511,000 511,000
Prepaid expenses and
other current assets 297,000 297,000
Notes receivable,
current portion 150,000 150,000
Property and Equipment
net of accumulated depreciation 2,740,000 2,740,000
Notes receivable 415,000 415,000
Patents, net of accumulated
amortization 370,000 370,000
Licensing Rights (MedCard) 794,000 794,000
Goodwill 923,000 923,000
Other 350,000 77,730 (3) 427,730
--------- --------- ---------
Total Assets $7,258,000 $814,839 $8,072,839
========== ======== ==========
<PAGE>
November 30, 1998
November 30, 1998 Adjustments (as adjusted)
LIABILITIES:
Accounts payable and
Accrued Expenses $1,000,768 (26,250) (4) 974,518
Bank Line of credit 250,000 250,000
Current obligations
under capital lease 88,000 88,000
Current maturities
of long term debt 639,000 (310,347) (2) 328,653
Notes Payable-Other 200,000 200,000
Franchise deposits
and deferred revenue 828,000 828,000
Long term debt 217,000 217,000
Obligations under
capital leases 470,000 470,000
------- -------
Total Liabilities 3,692,768 3,356,171
STOCKHOLDERS' EQUITY
Preferred Stock, Series A and B 125 125
Preferred Stock, Series C 155 155
Common Stock 980 163 (1), (2) 1,143
(4), (5)
Additional Paid in Capital 26,018,972 1,151,273 (1)-(5) 27,170,245
Accumulated Deficit (22,455,000) (22,455,000)
------------ ------------
Total Stockholders' Equity 3,565,232 4,716,668
-------- ---------
Total Liabilities and Stockholders'
Equity $7,258,000 $814,839 $8,072,839
========== ======== ==========
<PAGE>
(1) Reflects sale of 883,349 shares of common stock and 176,670 warrants for
$530,010, less related offering expenses. Each warrant allows the holder to
purchase one additional share of common stock at a price of $1.54. The
exercise price of the warrants is 105% of the closing price of the Company's
common stock on the date the shares of common stock were sold.
(2) Reflects issuance of 310,347 shares of Company's common stock upon
conversion of notes payable.
(3) Reflects issuance of warrants to investment banker. Value of warrants has
been computed using Black-Scholes option pricing model.
(4) Reflects issuance of 20,000 shares of Company's common stock for
services.
(5) Reflects proceeds of notes payable (December 28 and 29, 1998) and issuance
of 423,728 shares of Company's common stock upon conversion of notes
payable.
Financial Statements
The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and give effect to the sale of the Company's Series C
Preferred Stock and the issuance of shares of common stock in connection with
the MedCard transaction.
Item 7. Financial Statements and Exhibits
No exhibits are filed with this report.
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.
DATE: January 20, 1999
SIMS COMMUNICATIONS, INC.
By /s/ Mark Bennett
-----------------------------
Mark Bennett, President
