Utah
|
13-3709558
|
|
(State
or Other Jurisdiction of
Incorporation
of Organization)
|
(I.R.S.
Employer
Identification
No.)
|
Yes
x
|
No ¨ |
Yes x
|
No ¨ |
Transitional Small Business Disclosure Format: |
Yes
¨
|
No x |
Page
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||
PART
I
|
FINANCIAL
INFORMATION
|
1
|
Item
1.
|
Unaudited
Condensed Consolidated Financial Statements
|
1
|
Item
2.
|
Management’s
Discussion and Analysis or Plan of Operation
|
7
|
Item
3.
|
Controls
and Procedures
|
11
|
PART
II
|
OTHER
INFORMATION
|
12
|
Item
1.
|
Legal
Proceedings
|
12
|
Item
2.
|
Sales
of Unregistered Securities and Use of Proceeds.
|
12
|
Item
3.
|
Defaults
Upon Senior Securities.
|
12
|
|
||
Item
4.
|
Submission
of Matters to a Vote of Security Holders.
|
12
|
Item
5.
|
Other
Information
|
12
|
Item
6.
|
Exhibits
|
12
|
December 31, 2007
|
||||
ASSETS
|
||||
Current
Assets
|
||||
Cash
and cash equivalents
|
$
|
473,000
|
||
Total
current assets
|
473,000
|
|||
Security
deposits
|
85,000
|
|||
Investment
in securities
|
186,000
|
|||
TOTAL
ASSETS
|
$
|
744,000
|
||
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||
Current
Liabilities
|
||||
Accounts
payable
|
$
|
183,000
|
||
Accrued
expenses
|
251,000
|
|||
Total
current liabilities
|
434,000
|
|||
Long-term
Liabilities, dividend payable
|
186,000
|
|||
Commitments
and Contingencies
|
||||
STOCKHOLDERS'
EQUITY
|
||||
Preferred
stock, Series A , no par value, 10,000,000 authorized shares; 1,454,090
issued and outstanding
|
||||
Common
stock, no par value, 50,000,000 authorized shares; 25,247,006 issued
and
outstanding
|
21,366,000
|
|||
Accumulated
deficit
|
(21,242,000
|
)
|
||
Total
stockholders' equity
|
124,000
|
|||
$
|
744,000
|
See
accompanying notes to unaudited condensed consolidated financial
statements.
|
BBM
Holdings, Inc. and Subsidiaries
Unaudited
Condensed Consolidated Statements of Operations
|
|||||||
Three Months Ended
|
|||||||
December 31,
|
|||||||
2007
|
2006
|
||||||
NET
REVENUES
|
$
|
-
|
$
|
462,000
|
|||
OPERATING
EXPENSES (INCOME)
|
|||||||
Cost
of revenues
|
587,000
|
||||||
Selling,
general and administrative costs
|
243,000
|
773,000
|
|||||
Research
and development costs
|
357,000
|
||||||
Gain
on sale of assets and settlements
|
(629,000
|
)
|
|||||
Total
operating expenses (income)
|
(386,000
|
)
|
1,717,000
|
||||
Income
(loss) from operations
|
386,000
|
(1,255,000
|
)
|
||||
OTHER
INCOME
|
|||||||
Interest
income, net
|
1,000
|
||||||
1,000
|
|||||||
Net
income (loss)
|
$
|
387,000
|
$
|
(1,255,000
|
)
|
||
Net
income (loss) per common share
|
|||||||
Basic
|
$
|
0.02
|
$
|
(0.41
|
)
|
||
Diluted
|
$
|
0.01
|
$
|
(0.41
|
)
|
||
Weighted
average number of common shares outstanding
|
|||||||
Basic
|
25,247,000
|
3,091,000
|
|||||
Diluted
|
30,858,000
|
3,091,000
|
See accompanying notes to unaudited condensed consolidated financial statements. |
Unaudited
Condensed Consolidated Statements of Cash Flows
|
|||||||
Three Months Ended
|
|||||||
December 31,
|
|||||||
2007
|
2006
|
||||||
Cash
flows from operating activities
|
|||||||
Net
Income (loss)
|
$
|
387,000
|
$
|
(1,255,000
|
)
|
||
Adjustments
to reconcile net income (loss) to
|
|||||||
net
cash used in operating activities:
|
|||||||
Depreciation
|
53,000
|
||||||
Gain
from sale of assets
|
(381,000
|
)
|
|||||
Settlements
and forgiveness of indebtedness
|
(248,000
|
)
|
(157,000
|
)
|
|||
Restructuring
charge (lease), net
|
84,000
|
||||||
Changes
in operating assets and liabilities:
|
|||||||
Accounts
receivable, net
|
(403,000
|
)
|
|||||
Inventories
|
57,000
|
||||||
Prepaid
expenses and other current assets
|
3,000
|
29,000
|
|||||
Accounts
payable
|
(24,000
|
)
|
(8,000
|
)
|
|||
Accrued
expenses
|
(5,000
|
)
|
49,000
|
||||
Net
cash used in operating activities
|
(184,000
|
)
|
(1,635,000
|
)
|
|||
Cash
flows from investing activities
|
|||||||
Purchases
of machinery and equipment
|
(49,000
|
)
|
|||||
Proceeds
from sale of assets
|
460,000
|
||||||
Net
cash provided by (used in) investing activities
|
460,000
|
(49,000
|
)
|
||||
Cash
flows from financing activities
|
|||||||
Net
proceeds from issuance of preferred stock
|
1,798,000
|
||||||
Proceeds
from exercise of stock options
|
2,000
|
||||||
Net
cash provided by financing activities
|
1,800,000
|
||||||
Net
increase in cash and cash equivalents
|
276,000
|
116,000
|
|||||
Cash
and cash equivalents, beginning of period
|
197,000
|
34,000
|
|||||
Cash
and cash equivalents, end of period
|
$
|
473,000
|
$
|
150,000
|
|||
Supplemental
schedules of non-cash investing and financing
activities
|
|||||||
Conversion
of bridge loans into common stock
|
$
|
-
|
$
|
457,000
|
Warrants
|
13,075,935
|
|||
Options
|
17,040
|
|||
Total
|
13,092,975
|
Present
value of future lease payments, net
|
$
|
164,000
|
||
Customer
claims
|
15,000
|
|||
Accrued
professional fees
|
48,000
|
|||
Other
|
24,000
|
|||
|
$
|
251,000
|
Restructuring Reserve
at September 30, 2007
|
Accrual
Adjustment
|
Paid
or Settled
|
Restructuring Reserve
at December 31, 2007
|
||||||||||
Leases
|
$
|
161
|
$
|
164
|
$
|
(34
|
) |
$
|
291
|
||||
Customer
Claims
|
$
|
195
|
$
|
(180
|
) |
$
|
15
|
||||||
$
|
356
|
$
|
164
|
$
|
(214
|
) |
$
|
306
|
Gain
on sale of assets
|
$
|
381,000
|
||
Reversal
of accrued claims (a)
|
225,000
|
|||
Vendor
settlements (b)
|
23,000
|
|||
$
|
629,000
|
includes $45,000 of accrued commissions not included in
|
|
the foregoing summary of restructing reserve activity
|
|
(b) -
|
|
the foregoing summary of restructing reserve activity
|
· |
The
principal transaction involves the sale by BBM of substantially all
of its
assets (primarily intellectual property and technology) of its sole
subsidiary Broadband.
|
· |
Upon
completion of the sale, BBM will continue on as an inactive public
company
seeking various merger, acquisition or other reorganization
possibilities.
|
1. |
There
is no assurance that the Company can continue as an inactive public
reporting entity. BBM will not be able to sustain itself and pay
the
required accounting, auditing or other reporting costs necessary
to
continue as a public entity for the indefinite future. Further, there
is
no assurance or warranty that additional interim funding can be obtained
to maintain the company as a public entity after its reserve funds
are
exhausted.
|
2. |
Future
regulations by various state or federal securities agencies, such
as the
State of Utah, Division of Securities or the SEC could make it difficult
or impossible for the Company to continue as an inactive public Company
through adoption of various administrative regulations and filing
requirements which make it impossible or very difficult for the Company
to
continue as a non-operating public
company.
|
3. |
Only
minimal management, time and expertise is being devoted to the operation
of the Company now that it is inactive. Initial reviews of merger
and
acquisition opportunities are being completed by the Board, who have
committed to devote their best efforts to search out and attempt
to locate
various merger or acquisition candidates or proposals for the Company.
There is no assurance that the Board will be successful in ongoing
efforts
to find a merger or acquisition
candidate.
|
4. |
Any
completion of a merger or acquisition agreement would be approved
by the
existing controlling shareholders. Further, it is likely that existing
shareholders will incur a significant dilution to their aggregate
shareholder percentages.
|
5. |
Any
completed merger or acquisition may result in new management being
appointed to control the Company and a new business activity being
selected over which the existing shareholders would essentially have
no
control or meaningful voice, other than the potential exercise of
dissenting shareholder rights under Utah law under certain circumstances
but even then no under all merger or acquisition
structures.
|
6. |
The
Company will have no ongoing revenues or income to support it during
this
interim period.
|
2007
|
2006
|
Increase (Decrease)
|
||||||||
Net
Revenues
|
-
|
462,000
|
(462,000
|
)
|
||||||
Cost
of Revenues
|
-
|
(587,000
|
)
|
(587,000
|
)
|
|||||
Selling,General
& Administrative Expense
|
(243,000
|
)
|
(773,000
|
)
|
(530,000
|
)
|
||||
Research
& Development
|
-
|
(357,000
|
)
|
(357,000
|
)
|
|||||
Gain
from Sale of Assets
|
630,000
|
-
|
630,000
|
|||||||
Income
(Loss)
from
Operations
|
386,000
|
(1,255,000
|
)
|
1,641,000
|
||||||
Other
Income
|
1,000
|
-
|
1,000
|
|||||||
Net
Income (Loss)
|
387,000
|
(1,255,000
|
)
|
1,642,000
|
PART II |
OTHER
INFORMATION
|
Item 1. |
Legal
Proceedings
|
Item 2. |
Sales
of Unregistered Securities and Use of
Proceeds.
|
Item 3. |
Defaults
Upon Senior Securities.
|
Item 4. |
Submission
of Matters to a Vote of Security
Holders.
|
Item 5. |
Other
Information
|
Item 6. |
Exhibits
|
31. |
Certification
of Chief Executive Officer and Chief Financial Officer pursuant to
Section
13a - 14 of the Securities Exchange
Act.
|
32. |
Certification
pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
906 of
the Sarbanes-Oxley Act of 2002.
|
BBM
HOLDINGS, INC.
|
|
By:
|
/s/
Andrew Limpert
|
Andrew
Limpert
|
|
President
and Chief Executive Officer
|