Utah
|
13-3709558
|
|
(State
or Other Jurisdiction of Incorporation of Organization)
|
(I.R.S.
Employer Identification No.)
|
PART
I
|
PART
I
|
FINANCIAL
INFORMATION
|
BBM
HOLDINGS, INC. AND SUBSIDIARIES
|
|||||||
( A
Development Stage Company)
|
|||||||
Balance
Sheets
|
|||||||
(In
Thousands)
|
|||||||
ASSETS
|
|||||||
June
30,
|
September
30,
|
||||||
2008
|
2007
|
||||||
CURRENT
ASSETS
|
(Unaudited)
|
||||||
Cash
and cash equivalents
|
$
|
157
|
$
|
197
|
|||
Total
Current Assets
|
157
|
|
197
|
||||
OTHER
ASSETS
|
|||||||
Net
assets of discontinued operations
|
-
|
418
|
|||||
Security
deposits
|
85
|
87
|
|||||
Total
Other Assets
|
85
|
505
|
|||||
TOTAL
ASSETS
|
$
|
242
|
$
|
702
|
|||
LIABILITIES
AND STOCKHOLDERS' EQUITY (DEFICIT)
|
|||||||
CURRENT
LIABILITIES
|
|||||||
Accounts
payable
|
$
|
39
|
$
|
240
|
|||
Net
liabilities of discontinued operations
|
160
|
356
|
|||||
Accrued
expenses
|
-
|
41
|
|||||
Total
Current Liabilities
|
199
|
637
|
|||||
LONG-TERM
LIABILITIES, Dividend payable
|
-
|
328
|
|||||
TOTAL
LIABILITIES
|
199
|
965
|
|||||
STOCKHOLDERS'
EQUITY (DEFICIT)
|
|||||||
Preferred
stock, series A; 10,000,000 shares authorized,
|
|||||||
at
no par value, no shares and 1,454,090
|
|||||||
shares
issued and outstanding, respectively
|
-
|
-
|
|||||
Common
stock; 50,000,000 shares authorized,
|
|||||||
at
no par value, 25,247,006 and 25,247,006
|
|
||||||
shares
issued and outstanding, respectively
|
21,366
|
21,366
|
|||||
Accumulated
deficit
|
(20,975)
|
(21,629)
|
|||||
Deficit
accumulated during the development stage
|
(348)
|
0
|
|||||
Total
Stockholders' Equity (Deficit)
|
43
|
(263)
|
|||||
TOTAL
LIABILITIES AND
|
|||||||
STOCKHOLDERS'
EQUITY (DEFICIT)
|
$
|
242
|
$
|
702
|
|||
The
accompanying notes are an integral part of these financial
statements.
|
BBM
HOLDINGS, INC. AND SUBSIDIARIES
|
||||||||||||||||
(A
Development Stage Company)
|
||||||||||||||||
Statements
of Operations
|
||||||||||||||||
(In
Thousands)
|
||||||||||||||||
(unaudited)
|
||||||||||||||||
From
Inception of
|
||||||||||||||||
the
Development
|
||||||||||||||||
Stage
on
|
||||||||||||||||
October
16,
|
||||||||||||||||
For
the Three Months Ended
|
For
the Nine Months Ended
|
2007
Through
|
||||||||||||||
June
30,
|
June
30,
|
June
30,
|
||||||||||||||
2008
|
2007
|
2008
|
2007
|
2008
|
||||||||||||
REVENUES
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
-
|
||||||
COST
OF SALES
|
-
|
-
|
-
|
-
|
-
|
|||||||||||
GROSS
PROFIT
|
-
|
-
|
-
|
-
|
-
|
|||||||||||
OPERATING
EXPENSES
|
||||||||||||||||
General
and administrative
|
14
|
-
|
354
|
-
|
354
|
|||||||||||
Total
Operating Expenses
|
14
|
-
|
354
|
-
|
354
|
|||||||||||
OPERATING
LOSS
|
(14)
|
-
|
(354)
|
-
|
(354)
|
|||||||||||
OTHER
INCOME AND EXPENSE
|
||||||||||||||||
Other
income and expense
|
1
|
-
|
6
|
-
|
6
|
|||||||||||
LOSS
FROM CONTINUING OPERATIONS
|
||||||||||||||||
BEFORE
INCOME TAXES
|
(13)
|
-
|
(348)
|
-
|
(348)
|
|||||||||||
PROVISION
FOR INCOME TAXES
|
-
|
-
|
-
|
-
|
-
|
|||||||||||
LOSS
FROM CONTINUING OPERATIONS
|
(13)
|
-
|
(348)
|
-
|
(348)
|
|||||||||||
DISCONTINUED
OPERATIONS
|
||||||||||||||||
Income
(loss) from discontinued
|
||||||||||||||||
operations
(including gain on
|
||||||||||||||||
disposal
of $606)
|
24
|
(3,230)
|
654
|
(6,112)
|
(20,975)
|
|||||||||||
Income
tax benefit
|
-
|
-
|
-
|
-
|
-
|
|||||||||||
GAIN
(LOSS) ON
|
||||||||||||||||
DISCONTINUED
OPERATIONS
|
24
|
(3,230)
|
654
|
(6,112)
|
(20,975)
|
|||||||||||
NET
INCOME (LOSS)
|
$
|
11
|
$
|
(3,230)
|
$
|
306
|
$
|
(6,112)
|
$
|
(21,323)
|
||||||
BASIC
INCOME (LOSS) PER SHARE
|
||||||||||||||||
Continuing
operations
|
$
|
(0.00)
|
$
|
0.00
|
$
|
(0.01)
|
$
|
0.00
|
||||||||
Discontinued
operations
|
0.00
|
(0.13)
|
0.03
|
(0.64)
|
||||||||||||
$
|
0.00
|
$
|
(0.13)
|
$
|
0.02
|
$
|
(0.64)
|
|||||||||
DILUTED
INCOME (LOSS) PER SHARE
|
||||||||||||||||
Continuing
operations
|
$
|
(0.00)
|
$
|
0.00
|
$
|
(0.01)
|
$
|
0.00
|
||||||||
Discontinued
operations
|
0.00
|
(0.13)
|
0.02
|
(0.64)
|
||||||||||||
$
|
0.00
|
$
|
(0.13)
|
$
|
0.01
|
$
|
(0.64)
|
|||||||||
WEIGHTED
AVERAGE NUMBER
|
||||||||||||||||
OF
SHARES OUTSTANDING:
|
||||||||||||||||
BASIC
|
25,247
|
25,230
|
25,247
|
9,588
|
||||||||||||
DILUTED
|
38,323
|
25,230
|
38,323
|
9,588
|
||||||||||||
The
accompanying notes are an integral part of these financial
statements.
|
BBM
HOLDINGS, INC. AND SUBSIDIARIES
|
|||||||||||
(A
Development Stage Company)
|
|||||||||||
Statements
of Cash Flows
|
|||||||||||
(In
Thousands)
|
|||||||||||
From
Inception
|
|||||||||||
of
the
|
|||||||||||
Development
|
|||||||||||
Stage
on
|
|||||||||||
October
16,
|
|||||||||||
For
the Nine Months Ended
|
2007
Through
|
||||||||||
June
30,
|
June
30,
|
||||||||||
OPERATING
ACTIVITIES
|
2008
|
2007
|
2008
|
||||||||
Net
income (loss)
|
$
|
306
|
$
|
(6,112)
|
$
|
306
|
|||||
Adjustments
to reconcile net loss to net cash
|
|||||||||||
used
by operating activities:
|
|||||||||||
Discontinued
operations
|
(1,046)
|
958
|
(1,046)
|
||||||||
Changes
in operating assets and liabilities
|
|||||||||||
Change
in accounts payable
|
102
|
-
|
102
|
||||||||
Increase
in accrued expenses
|
138
|
-
|
138
|
||||||||
Net
Cash Used by Operating Activities
|
(500)
|
(5,154)
|
(500)
|
||||||||
INVESTING
ACTIVITIES
|
|||||||||||
Discontinued
operations
|
460
|
(366)
|
460
|
||||||||
Net
Cash Used by Investing Activities
|
460
|
(366)
|
460
|
||||||||
FINANCING
ACTIVITIES
|
|||||||||||
Discontinued
operations
|
-
|
5,906
|
-
|
||||||||
Net
Cash Provided by Financing Activities
|
-
|
5,906
|
-
|
||||||||
NET
DECREASE IN CASH
|
(40)
|
386
|
(40)
|
||||||||
CASH
AT BEGINNING OF PERIOD
|
197
|
34
|
197
|
||||||||
CASH
AT END OF PERIOD
|
$
|
157
|
$
|
420
|
$
|
157
|
|||||
SUPPLIMENTAL
DISCLOSURES OF
|
|||||||||||
CASH
FLOW INFORMATION
|
|||||||||||
CASH
PAID FOR:
|
|||||||||||
Interest
|
$
|
-
|
$
|
-
|
$
|
-
|
|||||
Income
Taxes
|
$
|
-
|
$
|
-
|
$
|
-
|
|||||
NON
CASH FINANCING ACTIVITIES:
|
|||||||||||
Preferred
stock converted to common stock
|
$
|
-
|
$
|
6,740
|
$
|
-
|
|||||
The
accompanying notes are an integral part of these financial
statements.
|
Warrants
|
13,075,935
|
Total
|
13,075,935
|
Present
value of future lease payments, net
|
$75,000
|
Customer
claims
|
15,000
|
Accrued
professional fees
|
9,000
|
Other
|
19,000
|
$118,000
|
|
Restructuring
Reserve
|
Accrual
Adjustment
|
Paid
or
Settled
|
Restructuring
Reserve
|
|
at
September 30, 2007
|
At
June 30, 2008
|
|||
Leases
|
$161,000
|
$164,000
|
$180,000
|
$145,000
|
Customer
Claims
|
$195,000
|
$180,000
|
$15,000
|
|
$356,000
|
$164,000
|
$360,000
|
$160,000
|
Gain
on sale of assets
|
$
|
381,000
|
|
Reversal
of accrued claims (a)
|
225,000
|
||
Vendor
settlements (b)
|
48,000
|
||
$
|
654,000
|
||
(a)
- includes $45,000 of accrued commissions not included
in
|
|||
the
foregoing summary of restructuring reserve activity
|
|||
(b)
- includes $2,000 of accrued professional fees not included
in
|
|||
the
foregoing summary of restructuring 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 not under all merger or acquisition
structures.
|
6.
|
The
Company will have no ongoing revenues or income to support it during this
interim period.
|
|
Results
of Operations
|
|
Three
months ended June 30, 2008 (“2008”) compared to the three months ended
June 30, 2007 (“2007”).
|
|
Results
of operations for the three months ended June 30, 2008 reflect the
following changes from the prior
period.
|
2008
|
2007
|
Increase
(Decrease)
|
|
Net
Revenues
|
-
|
-
|
-
|
Cost
of Revenues
|
-
|
-
|
-
|
Selling,
General & Administrative Expense
|
14,000
|
-
|
14,000
|
Other
Income
|
1,000
|
-
|
1,000
|
Income
(Loss) from Operations
|
(13,000)
|
-
|
13,000
|
Discontinued
Operations
|
24,000
|
(3,230,000)
|
3,254,000
|
Net
Income (Loss)
|
11,000
|
(3,230,000)
|
3,241,000
|
2008
|
2007
|
Increase
(Decrease)
|
|
Net
Revenues
|
-
|
-
|
-
|
Cost
of Revenues
|
-
|
-
|
-
|
Selling,
General & Administrative Expense
|
354,000
|
-
|
354,000
|
Other
Income (Expense)
|
6,000
|
-
|
6,000
|
Income
(Loss) from Operations
|
(348,000)
|
-
|
348,000
|
Discontinued
Operations
|
654,000
|
(6,112,000)
|
6,766,000
|
Net
Income (Loss)
|
306,000
|
(6,112,000)
|
6,418,000
|
31.
|
Certification
of Chief Executive Officer and Chief Financial Officer pursuant to Rule
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.
|