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U.S. Securities and Exchange Commission
Washington, D.C. 20549
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FORM 10-QSB
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(Mark One)
[X] Quarterly Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the quarterly period ended September 30, 2001
[ ] Transition Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act
For the transition period from N/A to N/A
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Commission File No. 0-25474
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MEDCOM USA, INCORPORATED
(Name of small business issuer as specified in its charter)
DELAWARE 65-0287558
State of Incorporation IRS Employer Identification No.
7975 NORTH HAYDEN ROAD, SUITE C-260
SCOTTSDALE, AZ 85258
(Address of principal executive offices)
(480) 675-8865
(Issuer's telephone number)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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 No X
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The number of shares of the issuer's common equity outstanding as of
October 31, 2001 was 21,577,940 shares of common stock.
Transitional Small Business Disclosure Format (check one):
Yes No X
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1
MEDCOM USA, INC.
INDEX TO FORM 10-QSB FILING
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2001
TABLE OF CONTENTS
PART I
FINANCIAL INFORMATION PAGE
Item 1. Financial Statements
Balance Sheet
As of September 30, 2001 . . . . . . . . . . . . . . . . . . . 3
Statements of Operations
For the Three Months Ended September 30, 2001
and 2000 . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Statements of Cash Flows
For the Three Months Ended September 30, 2001
and 2000 . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 -6
Notes to the Financial Statements. . . . . . . . . . . . . . . . . 7 - 9
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations. . . . . . . . . . . . . . . . . . . . . . . 10 - 13
PART II
OTHER INFORMATION
Item 1. Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SIGNATURES
2
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
MEDCOM USA, INC.
CONSOLIDATED BALANCE SHEET (UNAUDITED)
SEPTEMBER 30, 2001
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ASSETS
CURRENT ASSETS
Cash $ 21,576
Accounts receivable, net of allowance of $331,238 94,969
Note Receivable 32,000
Inventories 106,171
Prepaid expenses and other current assets 48,016
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Total current assets 302,732
PROPERTY AND EQUIPMENT, net 538,004
GOODWILL, net of accumulated amortization of $208,725 550,273
OTHER ASSETS 43,561
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TOTAL ASSETS $ 1,434,570
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LIABILITIES AND STOCKHOLDERS' EQUITY:
CURRENT LIABILITIES:
Accounts payable $ 1,178,069
Accrued expenses and other liabilities 1,453,006
Dividend payable 52,250
Notes payable 106,589
Capital lease obligations -
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Total liabilities 2,789,914
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STOCKHOLDERS' EQUITY:
Convertible preferred stock, Series A $.001par value, 52,900 shares
designated, 4,250 issued and outstanding 4
Convertible preferred stock, Series D $.01par value, 50,000 shares
designated, 2,850 issued and outstanding 29
Common stock, $.0001 par value, 80,000,000 shares authorized,
14,594,200 issued and outstanding 1,459
Paid in capital 61,647,492
Accumulated deficit (63,004,328)
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Total stockholders' equity (1,355,344)
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 1,434,570
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See the accompanying notes to these unaudited financial statements.
3
MEDCOM USA, INC.
CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
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2001 2000
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REVENUES:
Terminal sales $ 67,152 $ 50,778
Service 47,891 71,874
Miscellaneous revenue 6,829 -
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Total 121,872 122,652
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OPERATING EXPENSES:
Cost of terminals and services 13,073 47,233
General and administrative expenses 786,174 1,294,239
Sales and marketing expenses 442 185,705
Research and development - 92,534
Professional and consulting fees 27,760 -
Depreciation and amortization 124,481 193,247
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Total operating expenses 951,930 1,812,958
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OPERATING LOSS (830,058) (1,690,306)
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OTHER (INCOME) AND EXPENSES
Interest expense (7,376) (9,780)
Loss on disposal of assets (135,762) -
Interest income - 11,881
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Total other expense (143,138) 2,101
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INCOME TAX (BENEFIT) PROVISION - (6,228)
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LOSS FROM CONTINUING OPERATIONS (973,196) (1,694,433)
LOSS FROM DISCONTINUED OPERATIONS (23,189) (99,287)
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NET LOSS (996,385) (1,793,720)
Prefered stock dividend (28,500) (28,500)
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NET LOSS AVAILABLE TO COMMON SHAREHOLDERS (1,024,885) (1,822,220)
Foreign currency translation - 16,091
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TOTAL NET COMPREHENSIVE LOSS $(1,024,885) $(1,806,129)
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NET LOSS PER SHARE:
Basic:
Continuing operations $ (0.07) $ (0.27)
Discontinued operations * (0.02)
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Total Basic $ (0.07) $ (0.29)
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Diluted:
Continuing operations $ - $ (0.27)
Discontinued operations * (0.02)
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Total Diluted $ - $ (0.29)
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WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic 14,300,775 6,468,840
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Diluted 14,300,775 6,468,840
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* - LESS THAN $0.01 PER SHARE
See the accompanying notes to these unaudited financial statements.
4
MEDCOM USA, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
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2001 2000
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CASH FLOWS FROM OPERATING ACTIVITIES:
NET LOSS $(996,385) $(1,793,720)
Adjustments to reconcile net income to net cash
(used in) operating activities:
Loss on disposal of assets 135,762 -
Discontinued operations 23,189 99,287
Depreciation and amortization 124,481 516,370
Value of common stock warrants granted as compensation for services - 17,107
Other - (166,131)
Changes in assets and liabilities:
Trade accounts receivable (2,166) 33,614
Inventories 29,914 (13,089)
Royalty advances - 18,749
Prepaid and other current assets 33,537 (41,437)
Other assets 37,949 (50,481)
Accounts payable 209,073 (108,804)
Accrued liabilities 120,865 (149,796)
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Net cash used in continuing operations (283,781) (1,638,331)
Net cash used in discontinued operations (19,321) (118,575)
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Net cash provided (used in) operating activities (303,102) (1,756,906)
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CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of equipment - (317,839)
Advances on note receivable (32,000)
Repayments under notes receivable - (36,882)
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Net cash (used in) investing activities (32,000) (354,721)
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CASH FLOWS FROM FINANCING ACTIVITIES: -
Principal repayments on capital leases - (13,990)
Principal repayments on notes payable (2,848)
Proceeds from the exercise of options and warrants - 587,703
Payment on bank overdraft (60,574)
Proceeds from sale of common stock 420,100 -
Currency translation loss - 16,091
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Net cash provided by financing activities 356,678 589,804
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INCREASE (DECREASE) IN CASH 21,576 (1,521,823)
CASH, BEGINNING OF PERIOD - 2,043,603
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CASH, END OF PERIOD $ 21,576 $ 521,780
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See the accompanying notes to these unaudited financial statements.
5
MEDCOM USA, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS, (CONTINUED)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
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SUPPLEMENTAL CASH FLOW INFORMATION:
2001 2000
Interest paid $ 7,376 $ 9,124
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Income taxes paid $---0--- $12,321
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See the accompanying notes to these unaudited financial statements.
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
1. Basis of Presentation
The accompanying unaudited financial statements represent the financial position
of MedCom USA, Inc. ("Company") as of September 30, 2001 and include results of
operations of the Company and cash flows for the three months ended September
30, 2001. These statements have been prepared in accordance with generally
accepted accounting principles for interim financial information and the
instructions for Form 10-QSB. Accordingly, they do not include all the
information and footnotes required by generally accepted accounting principles
("GAAP") for complete financial statements. In the opinion of management, all
adjustments to these unaudited financial statements necessary for a fair
presentation of the results for the interim period presented have been made.
The results for the three months ended September 30, 2001 may not necessarily be
indicative of the results for the entire fiscal year. These financial
statements should be read in conjunction with the Company's Form 10-KSB for the
year ended June 30, 2001, including specifically the financial statements and
notes to such financial statements contained therein.
2. Summary of Significant Accounting Policies
The accounting policies followed by the Company, and the methods of applying
those policies, which affect the determination of its financial position,
results of operations or cash flows are summarized below:
Cash and Cash Equivalents
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Cash and cash equivalents include all short-term liquid investments that are
readily convertible to known amounts of cash and have original maturities of
three months or less. At times cash deposits may exceed government insured
limits.
Concentration of Credit Risk
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The Company maintains its cash balances in two banks in Islandia, New York, and
one bank in Scottsdale, Arizona. The Federal Depository Insurance Corporation
(FDIC) insures accounts at each institution up to $100,000.
Inventories
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Inventories consist primarily of movie videocassettes that remain from a
discontinued segment that was divested, and Point-of-Sale terminals and spare
parts that are held for sale. Inventories are recorded at the lower of cost or
market on a first-in, first-out basis.
Property and Equipment
----------------------
Property and equipment is stated at cost less accumulated depreciation.
Depreciation is recorded on a straight-line basis over the estimated useful
lives of the assets ranging from 3 to 5 years. Depreciation expense for the
three months ended September 30, 2001 was $86,531.
7
Revenue Recognition
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Sales Revenue: The Company's revenues are derived from the sale of MedCard
terminals, computer equipment and other items and are recognized upon shipment.
Revenue from the licensing of software is recognized upon acceptance by the
customer, if the license agreement includes such an acceptance provision,
otherwise it is recognized upon shipment.
Service Fee Revenue: Revenue related to the processing of insurance eligibility
verification and medical claim processing is recorded at the time the
transaction is completed. Financial transactions involve approvals of credit
card and debit card payments from the use of the terminals or personal computer
and are recorded at the time the transaction is completed.
Income Taxes
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The Company provides for income taxes based on the provisions of Statement of
Financial Accounting Standards No. 109, Accounting for Income Taxes, which,
among other things, requires that recognition of deferred income taxes be
measured by the provisions of enacted tax laws in effect at the date of
financial statements.
Fair Value of Financial Instruments
-----------------------------------
Financial instruments consist primarily of accounts receivable, and obligations
under accounts payable, accrued expenses, capital lease obligations and notes
payable. The carrying amounts of accounts receivable, accounts payable, accrued
expenses and notes payable approximate fair value because of the short maturity
of those instruments. The carrying value of the Company's capital lease
arrangements approximates fair value because the instruments were valued at the
retail cost of the equipment at the time the Company entered into the
arrangements. The Company has applied certain assumptions in estimating these
fair values. The use of different assumptions or methodologies may have a
material effect on the estimates of fair values.
Net Loss Per Share
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Net loss per share is calculated using the weighted average number of shares of
common stock outstanding during the year. The Company has adopted the provisions
of Statement of Financial Accounting Standards No. 128, Earnings Per Share.
Use of Estimates
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The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions.
This may affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements, and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
Stock-Based Compensation
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Statements of Financial Accounting Standards No. 123, Accounting for Stock-Based
Compensation, ("SFAS 123") established accounting and disclosure requirements
using a fair-value based method of accounting for stock-based employee
compensation. In accordance with SFAS 123, the Company has elected to continue
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accounting for stock based compensation using the intrinsic value method
prescribed by Accounting Principles Board Opinion No. 25, "Accounting for Stock
Issued to Employees."
Intangible Assets
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Intangible assets at September 30, 2001 consist of goodwill associated with the
Company's acquisition of MedCard for the difference between the purchase price
of the acquired business and the fair value of the identifiable net assets.
Goodwill is amortized on a straight-line basis over 5 years.
Research and Development Expenditures
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Research and development costs are expensed as incurred.
Impairment of Assets
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The Company performs an assessment of impairment of long-lived assets
periodically whenever there is an indication that the carrying amount of the
asset may not be recoverable. Recoverability of these assets is determined by
comparing the forecasted undiscounted cash flows generated by those assets to
the assets' net carrying value. The amount of impairment loss, if any, is
measured as the difference between the net book value of the assets and the
estimated fair value of the related assets.
Reclassifications
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Certain reclassifications have been made to the financial statements for the
three months ended September 30, 2001, to conform with the presentation for
accounts in the September 30, 2000 financial statements.
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ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Except for historical information contained herein, the following
discussion contains forward-looking statements that involve risks and
uncertainties. Such forward-looking statements include, but are not limited to,
statements regarding future events and plans and expectations. Actual results
could differ materially from those discussed herein. Factors that could cause or
contribute to such differences include, but are not limited to, those discussed
elsewhere in this Form 10-QSB (incorporated herein Forward-Looking Statements).
OVERVIEW
MedCom USA, Inc.(the "Company") a Delaware corporation was formed in August
1991 under the name Sims Communications, Inc. The Company's primary business was
providing telecommunications services. In 1996 the Company introduced four
programs to broaden the Company's product and service mix: (a) cellular
telephone activation, (b) sale of prepaid calling cards, (c) sale of long
distance telephone service and (d) rental of cellular telephones using an
overnight courier service. With the exception of the sale of prepaid calling
cards, these four programs were discontinued in December 1997. During the fiscal
year of 1998, the Company diversified its operations and moved into the area of
medical information processing.
The Company changed its name to MedCom USA, Inc. in October 1999. During
the fiscal years of 1999 and continuing through 2000, the Company directed its
efforts in medical information processing. As of September 30, 2001, the Company
currently operates the MedCard System (MedCard) that is deployed through a
point-of-sale terminal or personal computer offering electronic transaction
processing, as well as insurance eligibility verification. The Company has
aggressively focused on its primary operations and core business in electronic
Medical Transaction Processing.
MEDICAL TRANSACTION PROCESSING
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MEDCARD SYSTEM
The Company provides innovative technology-based solutions for the
healthcare industry that enable users to efficiently collect, utilize, analyze
and disseminate data from payers, health care providers and patients. The
MedCard System currently operates through a point-of-sale terminal or a personal
computer. The point-of-sale terminals are purchased from Hypercom Corporation
(Hypercom). The MedCard System also operates in a PC version and an on-line
version is under development. The Company is in the process of assessing the
feasibility of offering a service bundled package that would include an on-line
enabled computer that has the capability of processing unlimited claims and
eligibility verification for monthly fees. This application will be made
available after the on-line version is available.
FINANCIAL SERVICES
The Company's credit card center and check services, provides the
healthcare industry an unprecedented combination of services designed to improve
collection and approvals of credit/debit card payments along with the added
benefit and convenience of personal check guarantee from financial institutions.
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Flex-pay is an accounts receivable management program that allows a
provider to swipe a patient's credit card and store the patient's signature in
the terminals, and bill the patient's card at a later date when it is determined
what services rendered were not covered by the patient's insurance. Also, an
easy-pay option is offered which allows patient's the added benefit and
convenience of a one-time payment option or a recurring installment payments
that will be processed on a specified date determined by the provider and
patient. These options insure providers that payments are timely processed with
the features of electronic accounts receivable management. These services are
all deployed thorough point-of-sale terminals or a personal computer. Using the
MedCard system, medical providers are relieved of the problems associated with
billings and account management and lowers administrative documentation and
costs.
PATIENT ELIGIBILITY
The MedCard System is also an electronic processing system that
consolidates insurance eligibility verification, processes medical claims, and
monitors referrals. The MedCard System allows a patient's primary care
physician to request approval from the patient's insurance carrier or managed
care plan for a referral to a secondary physician or specialist. The secondary
physician or specialist can use the MedCard system to verify that referrals are
approved by the patient's insurance carrier. The MedCard system's referral
capabilities reduce documentation and administrative costs which results in
increased productivity and greater patient information for the specialist, as
well as a written record of the referral authorization.
The MedCard System can record and track encounters between patients and
health care providers for performance evaluation and maintenance of records.
After examining a patient a physician enters the patient's name, procedure code
and diagnostic code at a nearby terminal. This information is then uploaded to
MedCom's computer network, processed and transmitted back to the provider
formatted in both summary and/or detailed reports, and as a result healthcare
providers' reimbursements are accelerated and account receivables are reduced.
The average time it takes the healthcare providers to collect payments from
insurance carriers and plans decreases from an average of 89 days to 7 to 21
days. Health care providers will benefit from a 100% paperless claim processing
system.
CUSTOMER SERVICE
The Company offers multiple training options for its products and services.
Onsite training and teleconferencing, and a 24-hour technical support assistance
are also features offered to Health care providers. Also, a 24-hour terminal
replacement program and system upgrades are offered.
MARKETING STRATEGY
The MedCard System is marketed through the Company's sales personnel, and
independent sales representatives and institutions such as EFS National Bank,
Physicians Management Group, and Healthtech Systems. Company sales personnel
generally receive a commission for the initial sale of the terminals, and
collect a portion of residual income for the processing of insurance claims and
verifying insurance eligibility. Independent sales representatives purchase the
terminals directly from the Company and receive residual income.
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REVENUES
Revenues from the MedCard system are generated through the sale of
terminals, and processing insurance eligibility/verification, insurance claims,
and financial transaction processing. The Company receives a fixed amount per
terminal if the Company's sales personnel do not make sales. The Company also
receives fees for each transaction processed through the MedCard System.
Revenue sources include fees for financial transactions processed through the
terminal, fees for collection of receivables if the Company provides billing
services, fees associated with reimbursements made by insurance carriers for
submitting claims that are processed electronically, fees for using the system's
referral program and, fees for processing uploaded data. The Company also
markets a complete billing service using the MedCard System for hospitals and
large practice groups. The Company receives a percentage of the billing amount
collected under these arrangements.
ADDITIONAL INFORMATION
Medcom files reports and other materials with the Securities and Exchange
Commission. These documents may be inspected and copied at the Commission's
Public Reference Room at 450 Fifth Street, N.W., Washington, D.C., 20549. You
can obtain information on the operation of the Public Reference Room by calling
the Commission at 1-800-SEC-0330. You can also get copies of documents that the
Company files with the Commission through the Commission's Internet site at
www.sec.gov.
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RESULTS OF OPERATIONS
Revenues for the quarter ended September 30, 2001 were $121,872 as compared
to during the quarter ended September 30, 2000 of $122,652. The Company
divested in all of its business segments other than the MedCard business. The
Company did not experience any significant changes in the volume in this segment
as it concentrated on divesting of the other segments.
Cost of sales for the quarter ended September 30, 2001 was $13,073 as
compared to quarter ended September 30, 2000 of $47,233. The Company's cost of
sales has decreased and as a result the Company has been able to lower
purchasing costs of terminals and reduced staffing.
Selling expenses for the quarter ended September 30, 2000 was $442 as
compared quarter ended September 30, 2000 of $185,705. The decrease was
primarily the result of cost curtailment efforts and discontinued marketing
expenditures for unprofitable business segments.
General and administrative expenses for quarter ended September 30, 2001
was $786,174 as compared to quarter ended September 30, 2000 of $1,294,239.
These expenditures have been reduced due to reductions in personnel and
consultant fees.
Interest expense for the quarter ended September 30, 2001 was $7,376 as
compared to September 30, 2000 of $9,780. Interest expense increased slightly as
a result of as increase of debt by the company.
No tax benefit was recorded on the expected operating loss for the quarter
ended September 30, 2001 as required by Statement of Financial Accounting
Standards No. 109, Accounting for Income Taxes. For the year ended we do not
expect to realize the deferred tax asset and it is uncertain therefore we have
12
provided a 100% valuation of the tax benefit and assets until we are certain to
experience net profits in the future to fully realize the tax benefit and tax
assets.
Net loss for the quarter ended September 30, 2001 was ($996,385) or ($0.07)
per diluted share compared Net loss for quarter ended September 30, 2000 of
($1,793,720) or ($0.29) per diluted share.
LIQUIDITY AND CAPITAL RESOURCES
Cash used in operating activities for the quarter ended September 30, 2001,
was ($303,102) as compared to cash used in operating activities for quarter
ended September 30, 2000 of ($1,756,906). The Company has significantly reduced
its operating cash requirements as staffing was cut and other cost cutting
measures were implemented. The Company increased its obligations under trade
accounts payable and accrued expenses. The Company may be required to raise
additional debt or equity capital to meet these obligations.
Cash used in investing activities for the quarter ended September 30, 2001,
was ($32,000) as compared to quarter ended September 30, 2000 of ($354,721).
Cash provided in financing activities was $356,678 in the quarter ended
September 30, 2001 compared to cash provided from financing activities for
quarter ended September 30, 2000 of $589,804. Cash provided by financing
activities is a result of proceeds received from the sale of common stock.
SOURCES OF CAPITAL
The Company has relied upon a shareholder to fund its operating cash flow
deficiencies since June 30, 2001. Management believes that current trends in
its electronic transaction processing to the health care industries business
will provide positive cash flow to be self-sustaining from operations sometime
in the near fiscal period. The Company will require capital to finance the
purchases of the electronic terminals. The amount of such requirement will be
dependent upon the rate of growth experienced. The Company has been successful
in obtaining lease financing for some of this equipment.
OTHER CONSIDERATIONS
There are numerous factors that affect our business and the results of its
operations. Sources of these factors include general economic and business
conditions, federal and state regulation of our business activities, the level
of demand for our product or services, the level and intensity of competition in
the medical transaction processing industry and the pricing pressures that may
result, the Company's ability to develop new services based on new or evolving
technology and the market's acceptance of those new services, the Company's
ability to timely and effectively manage periodic product transitions, the
services, customer and geographic sales mix of any particular period, and the
ability to continue to improve the infrastructure (including personnel and
systems) to keep pace with the growth in its overall business activities.
FORWARD-LOOKING STATEMENTS
Except for historical information contained herein, this Form 10-QSB
contains express or implied forward-looking statements within the meaning of
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Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act.
The Company intend that such forward-looking statements be subject to the safe
harbors created thereby. The Company may make written or oral forward-looking
statements from time to time in filings with the SEC, in press releases, or
otherwise. The words "believes," "expects," "anticipates," "intends,"
"forecasts," "project," "plans," "estimates" and similar expressions identify
forward-looking statements. Such statements reflect the current views with
respect to future events and financial performance or operations and speak only
as of the date the statements are made.
Forward-looking statements involve risks and uncertainties and readers are
cautioned not to place undue reliance on forward-looking statements. The
Company's actual results may differ materially from such statements. Factors
that cause or contribute to such differences include, but are not limited to,
those discussed elsewhere in this Form 10-QSB, as well as those discussed in our
Form 10-KSB which is incorporated by reference in this Form 10-QSB.
Although management believes that the assumptions underlying the
forward-looking statements are reasonable, any of the assumptions could prove
inaccurate and, therefore, there can be no assurance that the results
contemplated in such forward-looking statements will be realized. The inclusion
of such forward-looking information should not be regarded, as a representation
that the future events, plans, or expectations contemplated will be achieved.
The Company undertakes no obligation to publicly update, review, or revise any
forward-looking statements to reflect any change in our expectations or any
change in events, conditions, or circumstances on which any such statements
based. Our filings with the SEC, including the Form 10-KSB, may be accessed at
the SEC's web site, www.sec.gov.
------------
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
MedCom is involved in various legal proceedings and claims as described in
our Form 10-KSB for the year ended June 30, 2001. No material developments
occurred in any of these proceedings during the quarter ended September 30,
2001. The costs and results associated with these legal proceedings could be
significant and could affect the results of our future operations.
ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K
EXHIBITS
--------
16.1 Change in Certifying Accountants (1)
(1) Incorporated by reference to the same exhibit filed with the Company's
Annual Report on Form 10-KSB for the year ending June 30, 2001.
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SIGNATURES
In accordance with the requirements of the Securities Exchange Act of 1934, the
Registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
MEDCOM USA, INC.
By /s/ W.P. Williams
------------------
Chairman, President, CEO
Dated: August 6, 2002
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