Delaware
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20-8046599
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|
(State
or other jurisdiction of
incorporation
or organization)
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(I.R.S.
Employer
Identification
Number)
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Large
accelerated filer o
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Accelerated
filer o
|
Non-accelerated
filer o
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Smaller
reporting company x
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PAGE
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PART
I
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|||
FINANCIAL
INFORMATION
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|||
Item
1.
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Financial
Statements – Unaudited
|
||
Condensed
Consolidated Balance Sheet As of October 31, 2010 and January
31, 2010
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3
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||
Condensed
Consolidated Statements of Operations For the Three and Nine
months ended October 31, 2010 and
2009
|
4
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||
Condensed
Consolidated Statements of Cash Flows For the Nine months ended October
31, 2010 and 2009
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6
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||
Notes
to Condensed Consolidated Financial Statements
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7-14
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||
Item
2.
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Management’s
Discussion and Analysis of Financial Condition and Results of
Operations
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15-18
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|
Item
3.
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Quantitative
and Qualitative Disclosures about Market Risk
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19
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Item
4.
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Control
and Procedures.
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19
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PART
II
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OTHER
INFORMATION
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|||
Item
1.
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Legal
Proceedings
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20
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|
Item
2.
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Unregistered
Sales of Equity Securities and the Use of Proceeds
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20
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|
Item
3.
|
Defaults
upon Senior Securities
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20
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|
Item
4.
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Submission
of Matters to a Vote of Security Holders
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20
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|
Item
5.
|
Other
Information
|
20
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|
Item
6.
|
Exhibits
|
20
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October 31, 2010
|
January 31, 2010
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|||||||
ASSETS
|
||||||||
CURRENT
ASSETS
|
||||||||
Cash
and cash equivalents
|
$ | 501,639 | $ | 665,737 | ||||
Accounts
receivable, net
|
643,107 | 457,517 | ||||||
Receivable
from officers
|
8,616 | 23,483 | ||||||
Due
from affiliate
|
3,900 | 2,850 | ||||||
Prepaid
expenses
|
46,235 | 30,165 | ||||||
Total
current assets
|
1,203,497 | 1,179,752 | ||||||
Deferred
commission cost, net
|
85,938 | 114,063 | ||||||
Property
and equipment, net
|
7,865 | 11,627 | ||||||
TOTAL
ASSETS
|
$ | 1,297,300 | $ | 1,305,442 | ||||
LIABILITIES
AND STOCKHOLDERS' DEFICIT
|
||||||||
CURRENT
LIABILITIES:
|
||||||||
Accounts
payable and accrued liabilities
|
$ | 150,116 | $ | 104,252 | ||||
Total
current liabilities
|
150,116 | 104,252 | ||||||
Convertible
notes, net
|
1,248,186 | 1,247,582 | ||||||
Total
liabilities
|
1,398,302 | 1,351,834 | ||||||
STOCKHOLDERS'
DEFICIT:
|
||||||||
Preferred
stock, par value $0.001 ;
|
||||||||
5,000,000 shares
authorized; none issued
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- | - | ||||||
Common
Stock, par value $0.001; 100,000,000 shares authorized,
|
||||||||
27,635,774
and 27,041,328 shares issued and outstanding
|
||||||||
as
of October 31, 2010 and January 31, 2010
|
27,636 | 27,041 | ||||||
Additional
paid-in-capital
|
986,266 | 939,483 | ||||||
Accumulated
deficit
|
(1,343,019 | ) | (1,241,031 | ) | ||||
Total
|
(329,117 | ) | (274,507 | ) | ||||
Non-controlling
interest
|
228,115 | 228,115 | ||||||
Total
stockholders' deficit
|
(101,002 | ) | (46,392 | ) | ||||
TOTAL
LIABILITIES AND STOCKHOLDERS' DEFICIT
|
$ | 1,297,300 | $ | 1,305,442 |
For
the Three Month Periods Ended
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For
the Nine Month Periods Ended
|
|||||||||||||||
October 31,
|
October 31,
|
|||||||||||||||
2010
|
2009
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2010
|
2009
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|||||||||||||
NET
REVENUE
|
$ | 1,019,078 | $ | 616,975 | $ | 2,861,658 | $ | 1,699,100 | ||||||||
COST
OF REVENUE
|
868,119 | 455,183 | 2,407,524 | 1,262,430 | ||||||||||||
GROSS
PROFIT
|
150,959 | 161,792 | 454,134 | 436,670 | ||||||||||||
Operating
expenses:
|
||||||||||||||||
General
and administrative
|
152,013 | 139,557 | 427,720 | 434,225 | ||||||||||||
Depreciation
|
2,330 | 9,622 | 8,330 | 30,297 | ||||||||||||
Total
operating expenses
|
154,343 | 149,179 | 436,050 | 464,522 | ||||||||||||
INCOME/(LOSS)
FROM OPERATIONS
|
(3,384 | ) | 12,613 | 18,084 | (27,852 | ) | ||||||||||
OTHER
INCOME/(EXPENSES):
|
||||||||||||||||
Interest
expense
|
(31,748 | ) | (15,738 | ) | (94,736 | ) | (25,546 | ) | ||||||||
Financing
cost
|
(9,375 | ) | (25,000 | ) | (28,125 | ) | (25,000 | ) | ||||||||
Other
income
|
4,292 | - | 4,389 | - | ||||||||||||
Total
other expenses
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(36,831 | ) | (40,738 | ) | (118,472 | ) | (50,546 | ) | ||||||||
LOSS
BEFORE INCOME TAXES
|
(40,215 | ) | (28,125 | ) | (100,388 | ) | (78,398 | ) | ||||||||
Provision
for Income Tax
|
800 | 800 | 1,600 | 1,600 | ||||||||||||
NET
LOSS
|
$ | (41,015 | ) | $ | (28,925 | ) | $ | (101,988 | ) | $ | (79,998 | ) | ||||
WEIGHTED
AVERAGE SHARES OF COMMON STOCK OUTSTANDING,
|
||||||||||||||||
BASIC
AND DILUTED
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27,635,774 | 26,805,493 | 27,370,367 | 26,260,574 | ||||||||||||
*BASIC
AND DILUTED NET LOSS PER SHARE
|
$ | (0.00 | ) | $ | (0.00 | ) | $ | (0.00 | ) | $ | (0.00 | ) |
Nine
months ended October 31,
|
||||||||
2010
|
2009
|
|||||||
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
||||||||
Net
loss
|
$ | (101,988 | ) | $ | (79,998 | ) | ||
Adjustments
to reconcile net loss to net cash used in operating
activities:
|
||||||||
Depreciation
|
8,330 | 30,298 | ||||||
Bad
debt expense
|
(76,231 | ) | 4,954 | |||||
Issuance
of shares for services
|
47,166 | 101,455 | ||||||
Warrant
discount
|
- | 9,642 | ||||||
Amortization
of deferred commission cost
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28,125 | - | ||||||
Amortization
of debt discount
|
604 | - | ||||||
Changes
in assets and liabilities:
|
||||||||
Accounts
receivable
|
(109,361 | ) | (165,874 | ) | ||||
Receivable
from officers
|
14,867 | - | ||||||
Prepaid
expenses
|
(16,070 | ) | (10,822 | ) | ||||
Prepaid
commission
|
(123,438 | ) | ||||||
Accounts
payable and accrued liabilities
|
45,866 | 46,458 | ||||||
Net
cash used in operating activities
|
(158,691 | ) | (187,326 | ) | ||||
CASH
FLOWS FROM INVESTING ACTIVITIES:
|
||||||||
Property
and equipment
|
(4,568 | ) | - | |||||
Due
from related parties
|
(1,050 | ) | (800 | ) | ||||
Net
cash used in operating activities
|
(5,618 | ) | (800 | ) | ||||
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
||||||||
Proceeds
from issuance of shares
|
211 | - | ||||||
Payments
of notes payable - related parties
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- | (75,000 | ) | |||||
Proceeds
from convertible notes
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- | 1,240,358 | ||||||
Payments
of line of credit
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- | (198,000 | ) | |||||
Net
cash provided by financing activities
|
211 | 967,358 | ||||||
NET
INCREASE/(DECREASE) IN CASH & CASH EQUIVALENTS
|
(164,098 | ) | 779,233 | |||||
CASH
& CASH EQUIVALENTS, BEGINNING BALANCE
|
665,737 | 84,161 | ||||||
CASH
& CASH EQUIVALENTS, ENDING BALANCE
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$ | 501,639 | $ | 863,394 | ||||
SUPPLEMENTARY
DISCLOSURES OF CASH FLOW INFORMATION
|
||||||||
Interest
paid during the nine month period
|
$ | 62,815 | $ | 13,153 | ||||
Taxes
paid during the nine month period
|
$ | 1,600 | $ | 1,600 | ||||
SUPPLEMENTARY
DISCLOSURES OF NON-CASH ITEMS
|
||||||||
Conversion
of notes payable to equity
|
$ | - | $ | 200,000 |
October 31,
2010
|
January 31,
2010
|
|||||||
Website
|
$ | 4,568 | $ | |||||
Computers
|
13,912 | 13,912 | ||||||
Software
|
138,443 | 138,443 | ||||||
Machinery
and equipment
|
50,815 | 50,815 | ||||||
Gross
Property and Equipment
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207,738 | 203,170 | ||||||
Less
accumulated depreciation
|
(199,873 | ) | (191,543 | ) | ||||
Net
Property and Equipment
|
$ | 7,865 | $ | 11,627 |
October 31,
2010
|
|
|
January 31,
2010
|
|||||
Accounts payable
|
$
|
57,649
|
$
|
32,460
|
||||
D&O
insurance payable
|
18,956
|
8,210
|
||||||
Accrued
interest payable
|
31,250
|
|||||||
Accrued
professional fees
|
5,000
|
22,141
|
||||||
Accrued
payroll and income taxes
|
37,261
|
41,441
|
||||||
Total
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$
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150,116
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$
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104,252
|
October 31,
|
|
|
January 30,
|
|
||||
2010
|
2010
|
|||||||
Subordinated
Borrowings:
|
||||||||
10%
Senior Subordinated Convertible Notes due January 31, 2013
|
$
|
1,248,186
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$
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1,247,582
|
||||
Total
long-term debt
|
$
|
1,248,186
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$
|
1,247,582
|
||||
Less:
Current Portion
|
-
|
-
|
||||||
Total
|
$
|
1,248,186
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$
|
1,247,582
|
Aggregate
intrinsic value
|
Number of
warrants
|
|||||||
Outstanding
at January 31, 2010
|
$
|
—
|
2,125,803
|
|||||
Granted
|
—
|
-
|
||||||
Exercised
|
—
|
—
|
||||||
Lapsed
|
—
|
165,620
|
||||||
Outstanding
at October 31, 2010
|
$
|
—
|
1,960,183
|
Exercise Price
|
Warrants
outstanding
|
Weighted
average
remaining
contractual life
|
Warrants
exercisable
|
Weighted
average
exercise price
|
|||||||||||||||
$ | 1.100 | 304,850 | 0.25 | 304,850 | $ | 1.10 | |||||||||||||
$ | 1.500 | 155,333 | 0.99 | 155,333 | $ | 1.50 | |||||||||||||
$ | 0.250 | 1,250,000 | 4.00 | 1,250,000 | $ | 0.25 | |||||||||||||
$ | 0.250 | 250,000 | 4.00 | 250,000 | $ | 0.25 |
Exhibit Number
|
|
Description
|
31.1
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Certification
by Chief Executive Officer, required by Rule 13a-14(a) or Rule 15d-14(a)
of the Exchange Act.
|
|
31.2
|
Certification
by Chief Financial Officer, required by Rule 13a-14(a) or Rule 15d-14(a)
of the Exchange Act.
|
|
32.1
|
Certification
by Chief Executive Officer, required by Rule 13a-14(b) or Rule 15d-14(b)
of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the
United States Code.
|
|
32.2
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Certification
by Chief Financial Officer, required by Rule 13a-14(b) or Rule 15d-14(b)
of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the
United States
Code.
|
APOLLO
MEDICAL HOLDINGS, INC.
|
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Dated:
December 10, 2010
|
By:
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/s/ Warren Hosseinion
|
Warren
Hosseinion
|
||
Chief
Executive Officer and Director
|
||
Dated:
December 10, 2010
|
By:
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/s/ A. Noel DeWinter
|
A.
Noel DeWinter
|
||
Chief
Financial Officer and Principal Accounting
Officer
|