SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
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Quarterly Report Under Section 13 or 15(d)
Of the Securities and Exchange Act of 1934
For the Quarter Ended Commission File Number
--------------------- ----------------------
September 30, 2002 000-29605
Cyberexcellence, Inc.
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(Name of Small Business Issuer in Its Charter)
Nevada 88-0356052
------ ----------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
4114 Splendor Way, Salt Lake City, Utah 84124
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(Address of Principal Executive Offices) (Zip Code)
(801) 243-4498
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(Issuer's Telephone Number, Including Area Code)
Securities registered under Section 12(b) of the Exchange Act:
Title of Each Class Name of each Exchange on Which Registered
------------------- ------------------------------------------
Common Stock ($0.001 Par Value) None
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 [X] No [ ]
State the number of shares outstanding of each of the registrants classes of
common equity, as of the latest practicable date:
At September 30, 2002, the number of shares outstanding of the registrant's
Common Stock, $0.001 par value (the only class of voting stock), was 2,042,000.
TABLE OF CONTENTS
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PART I
Page
Item 1. Description of Business......................................1
Item 2. Description of Property......................................5
Item 3. Legal Proceedings............................................5
Item 4. Submission of Matters to a Vote of Security-Holders..........5
PART II
Item 5. Market for Common Equity and Related Stockholder Matters.....6
Item 6. Management's Discussion and Analysis or Plan of Operation....6
Item 7. Financial Statements.........................................7
Item 8. Exhibits and Reports on Form 8-K.............................8
Signatures...................................................9
PART I
ITEM 1. DESCRIPTION OF BUSINESS
History
Cyberexcellence, Inc. (the "Company") was formed as a Nevada corporation on
February 15, 1996, for the purpose of specializing in Internet "virtual mall"
development. The Company was one of over 40 related companies whose plan was to
create a virtual mall with theme based stores to sell merchandise over the
Internet. The Company's former parent, Axia Group, Inc. (f/k/a CyberAmerica
Corporation), a fully reporting company under the Exchange Act of 1934, through
its now defunct subsidiary CyberMalls, Inc. was in the process of developing a
specialized search engine. This search engine was designed to assist consumers
in the purchase of products by narrowing the number of responses received when
searching for a specific product. However, due to a lack of necessary funding
CyberMalls, Inc.'s plans to create the search engine were discontinued.
Consequently, the plans to create a virtual mall with at least 40 theme based
stores with the 40 related companies including the Company's theme based virtual
store were abandoned. The Company became a "blank check" or "shell" company
during the last quarter of 1996 as a result of the inability of the Company's
then parent to sufficiently fund the Company's planned operations and is
currently seeking a business or businesses to acquire.
General
The Company is a "blank check" or "shell" corporation that seeks to identify and
complete a merger or acquisition with a private entity whose business presents
an opportunity for Company shareholders. The Company's management will review
and evaluate business ventures for possible mergers or acquisitions. The Company
has not yet entered into any agreement, nor does it have any commitment or
understanding to enter into or become engaged in a transaction, as of the date
of this filing. Further, the business objectives discussed herein are extremely
general and are not intended to restrict the discretion of the Company's
management.
A decision to participate in a specific business opportunity will be made based
upon a Company analysis of the quality of the prospective business opportunity's
management and personnel, asset base, the anticipated acceptability of business'
products or marketing concepts, the merit of a business plan, and numerous other
factors which are difficult, if not impossible, to analyze using any objective
criteria.
Selection of a Business
The Company anticipates that potential business opportunities will be referred
from various sources, including its officers and directors, professional
advisors, securities broker-dealers, venture capitalists, persons involved in
the financial community, and others who may present unsolicited proposals. The
Company will not engage in any general solicitation or advertising for a
business opportunity, and will rely on the personal contacts of Management and
their affiliates, as well as indirect associations with other business and
professional people. Management's reliance on "word of mouth" may limit the
number of potential business opportunities identified. While it is not presently
1
anticipated that the Company will engage unaffiliated professional firms
specializing in business acquisitions or reorganizations, such firms may be
retained if management deems it in the best interest of the Company. Finder's
fees paid to professional acquisition firms could involve one-time cash
payments, payments based on a percentage of the business opportunity's evenues
or product sales volume, payments involving issuance of securities (including
those of the Company), or any combination these or other compensation
arrangements. Consequently, the Company is unable to predict the cost of
utilizing such services. As of the filing date there have been no discussions,
agreements or understandings with any professional advisors, financial
consultants, broker-dealers or venture capitalists. The Company's present
intentions are to rely upon its president to effect those services normally
provided by professional advisors or financial consultants.
The Company will not restrict its search to any particular business, industry,
or geographical location. Management reserves the right to evaluate and enter
into any type of business in any location. In seeking a business venture, the
decision of management will not be controlled by an attempt to take advantage of
any anticipated or perceived appeal of a specific industry, management group,
product, or industry, but will be based on the business objective of seeking
long-term capital appreciation. The Company may participate in a newly organized
business venture or in a more established business. Participation in a new
business venture entails greater risks since, in many instances, management of
such a venture may not have a proven track record; the eventual market for such
venture's product or services will likely not be established; and the
profitability of the venture will be untested and impossible to accurately
forecast. Should the Company participate in a more established venture that is
experiencing financial difficulty, risks may stem from the Company's inability
to generate sufficient funds to manage or reverse the circumstances causing such
financial problems.
The analysis of new businesses will be undertaken by management. In analyzing
prospective businesses, management will consider, to the extent applicable, the
available technical, financial and managerial resources of any given business
venture. Management will also consider the nature of present and expected
competition; potential advances in research and development or exploration; the
potential for growth and expansion; the likelihood of sustaining a profit within
given time frames; the perceived public recognition or acceptance of products,
services, trade or service marks; name identification; and other relevant
factors. The Company anticipates that the results of operations of a specific
business venture may not necessarily be indicative of the potential for future
earnings, which may be impacted by a change in marketing strategies, business
expansion, modifying product emphasis, changing or substantially augmenting
management, and other factors.
The Company will analyze all relevant factors and make a determination based on
a composite of available information, without reliance on any single factor. The
period within which the Company will decide to participate in a given business
venture cannot be predicted and will depend on certain factors, including the
time involved in identifying businesses, the time required for the Company to
complete its analysis of such businesses, the time required to prepare
appropriate documentation to effect a merger or acquisition, and other
circumstances.
Acquisition of a Business
The implementing of a structure that will effect any given business transaction,
may cause the Company to become party to a merger, consolidation, purchase and
sale of assets, purchase or sale of stock, or other reorganization involving
2
another corporation, joint venture, partnership or licensee. The exact structure
of the anticipated business transaction cannot yet be determined.
Notwithstanding the above, the Company does not intend to participate in a
business through the purchase of minority stock positions. In other words, the
Company does not intend to merely buy non-controlling interests in other
businesses. Rather, its current focus is to acquire a controlling interest in a
business. Upon the completion of a transaction, it is likely that the Company's
present management will no longer control Company affairs. Further, a majority
or all of the Company's present directors may, as part of the terms of a
prospective business transaction, resign and be replaced by new directors
without a vote of the Company's shareholders.
In connection with the Company's merger or acquisition of a business venture,
the present shareholders of the Company may, as a negotiated part of the
transaction, sell a portion or all of the Company's Common Stock held by them at
a significant premium over their original investment in the Company. If the
Company's current shareholders sell their stock as part of a merger/acquisition,
they may decide to sell a controlling interest (i.e., over 50%) of the Company
to the other entity (including such other entity's shareholders and affiliates)
which participates in the merger/acquisition. The other entity might only buy
enough shares to obtain a controlling interest in the Company. However, there is
no degree of certainty that the other entity will buy any of the Company's
shares. It is possible that the entity may pay a higher price for shares
belonging to insider shareholders than for shares belonging to non-insider
shareholders. Although the Company's insiders have no present intentions to buy
shares from other insiders, it is a possibility that insiders could buy shares
from other insiders. Management does not intend to actively negotiate for or
otherwise require the purchase of all or any portion of its stock as a condition
to or in connection with any proposed merger or acquisition. Although the
Company's present shareholders did not acquire their shares of Common Stock with
a view toward any subsequent sale in connection with a business reorganization,
it is not unusual for affiliates of the entity participating in the
reorganization to negotiate to purchase shares held by the present shareholders.
This is done in order to reduce the amount of shares held by persons no longer
affiliated with the Company and thereby reduce the potential adverse impact on
the public market in the Company's common stock that could result from
substantial sales of such shares after the business reorganization. Public
investors will not receive any portion of the premium that may be paid in the
foregoing circumstances. Furthermore, the Company's shareholders may not be
afforded an opportunity to approve or consent to any particular stock buy-out
transaction.
In the event sales of shares by present shareholders of the Company are a
negotiated part of a future merger or acquisition, a conflict of interest may
arise since management / shareholders will be negotiating for the merger or
acquisition on behalf of the Company and for the sale of their shares for their
own respective accounts. Where a business opportunity is well suited for merger
or acquisition by the Company, but affiliates of the prospective business
opportunity impose a condition that management sell its shares at a price which
is unacceptable to them, management may not sacrifice its financial interest for
the Company to complete the transaction. Where the business opportunity is not
well suited, but the price offered management for its shares is high, management
may be inclined to effect the acquisition in order to realize a substantial gain
on its shares in the Company. Management has not adopted any policy for
resolving the foregoing potential conflicts, should they arise, and does not
intend to obtain an independent appraisal to determine whether any price that
may be offered for its shares is fair. Shareholders must rely, instead, on the
obligation of management to fulfill its fiduciary duty under state law to act in
the best interests of the Company and its shareholders.
3
Although the terms of any registration rights and the number of securities, if
any, which may be registered cannot be determined at this time, it may be
expected that any registration of securities by the Company would entail
substantial expense to the Company.
The issuance of substantial additional securities and their potential sale into
any trading market which may develop in the Company's securities may have a
depressive effect on such market.
While the actual terms of a transaction to which the Company may be a party
cannot be determined at this time, it may be expected that the parties to any
business transaction will find it desirable to structure the merger or
acquisition as a so-called "tax-free" event under sections 351 or 368(a) of the
Internal Revenue Code of 1986 (the "Code"). In order to obtain tax-free
treatment under section 351 of the Code, it would be necessary for the owners of
the acquired business to own 80% or more of the voting stock of the surviving
entity. In such event, the shareholders of the Company would retain less than
20% of the issued and outstanding shares of the surviving entity. Section
368(a)(1) of the Code provides for tax-free treatment of certain business
reorganizations between corporate entities where one corporation is merged with
or acquires the securities or assets of another corporation. Generally, the
Company expects to be the acquiring corporation in such a business
reorganization, and the tax-free status of the transaction will not depend on
the issuance of any specific amount of the Company's voting securities under
Section 368. The acquiring corporation will issue securities in such an amount
that the shareholders of the acquired corporation will hold 50% or more of the
voting stock of the surviving entity. Consequently, there is a substantial
possibility that the shareholders of the Company immediately prior to the
transaction would retain less than 50% of the issued and outstanding shares of
the surviving entity. Therefore, regardless of the form of the business
acquisition, it may be anticipated that stockholders immediately prior to the
transaction will experience a significant reduction in their percentage of
ownership in the Company.
Notwithstanding the fact that the Company is technically the merging or
acquiring entity in the foregoing circumstances, generally accepted accounting
principles will ordinarily require that such transaction be accounted for as if
the Company had been acquired by the other entity owning the business and,
therefore, will not permit a write-up in the carrying value of the assets of the
other company.
The manner in which the Company participates in a business will depend on the
nature of the business, the respective needs and desires of the Company and
other parties, the management of the business, and the relative negotiating
strength of the Company and such other management.
The Company will participate in a business only after the negotiation and
execution of appropriate written agreements. Although the terms of such
agreements cannot be determined at this time, generally such agreements will
require specific representations and warranties by all of the parties thereto,
will specify certain events of default, will detail the terms of closing and the
conditions which must be satisfied by each of the parties prior to such closing,
will outline the manner of bearing costs if the transaction is not closed, will
set forth remedies on default, and will include miscellaneous other terms.
4
Operation of Business After Acquisition
The Company's operation following its merger or acquisition of a business will
be dependent on the nature of the business and the interest acquired. The
Company is unable to determine at this time whether the Company will be in
control of the business or whether present management will be in control of the
Company following the acquisition. It may be expected that the business will
present various risks, which cannot be predicted at the present time.
Government Regulation
It is impossible to anticipate government regulations, if any, to which the
Company may be subject until it has acquired an interest in a business. The use
of assets to conduct a business which the Company may acquire could subject it
to environmental, public health and safety, land use, trade, or other
governmental regulations and state or local taxation. In selecting a business in
which to acquire an interest, management will endeavor to ascertain, to the
extent of the limited resources of the Company, the effects of such government
regulation on the prospective business of the Company. In certain circumstances,
however, such as the acquisition of an interest in a new or start-up business
activity, it may not be possible to predict with any degree of accuracy the
impact of government regulation. The inability to ascertain the effect of
government regulation on a prospective business activity will make the
acquisition of an interest in such business a higher risk.
Competition
The Company will be involved in intense competition with other business
entities, many of which will have a competitive edge over the Company by virtue
of their stronger financial resources and prior experience in business. There is
no assurance that the Company will be successful in obtaining suitable business
opportunities.
Employees
The Company is a development stage company and currently has no employees.
Executive officers will devote only such time to the affairs of the Company as
they deem appropriate, which is estimated to be approximately 5 hours per month.
Management of the Company expects to use consultants, attorneys, and accountants
as necessary, and does not anticipate a need to engage any full-time employees
so long as it is identifying and evaluating businesses. The need for employees
and their availability will be addressed in connection with a decision whether
or not to acquire or participate in a specific business venture.
ITEM 2. DESCRIPTION OF PROPERTY
The Company currently maintains its offices at the home of F. Briton McConkie, a
director of the Company,4114 Splendor Way, Salt Lake City, Utah 84124. The
Company pays no rent for the use of this address. The Company does not believe
that it will need to maintain an office at any time in the foreseeable future in
order to carry out the plan of operation described herein.
ITEM 3. LEGAL PROCEEDINGS
The Company is currently not a party to any legal proceedings.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matter was submitted during the fiscal year covered by this report to a vote
of security holders, therefore rendering this item inapplicable.
5
PART II
ITEM 5. MARKET PRICE OF AND DIVIDENDS ON THE REGISTRANT'S COMMON
EQUITY AND OTHER SHAREHOLDER MATTERS
The Company currently has no public trading market. The Company intends to have
Form 15c-(2)(11) filed on its behalf once a suitable business acquisition or
merger has been completed in an effort to obtain a listing on the NASD over the
counter bulletin board and create a public market. Management believes that the
creation of a public trading market for the Company's securities would make the
Company a more attractive acquisition or merger candidate. However, there is no
guarantee that the Company will obtain a listing on the NASD over-the-counter
bulletin board or that a public market for the Company's securities will develop
or, if such a market does develop, that it will continue, even if a listing on
the NASD over the counter bulletin board is obtained.
Recent Sales of Unregistered Securities
There were no sales of unregistered securities during the quarter ended
September 30, 2002.
Record Holders
As of September 30, 2002, there were seventy-seven (77) shareholders of record
holding a total of 2,042,000 shares of Common Stock. The holders of the Common
Stock are entitled to one vote for each share held of record on all matters
submitted to a vote of stockholders. Holders of the Common Stock have no
preemptive rights and no right to convert their Common Stock into any other
securities. There are no redemption or sinking fund provisions applicable to the
Common Stock.
Dividends
The Company has not declared any dividends since inception and does not
anticipate paying any dividends in the foreseeable future. The payment of
dividends is within the discretion of the Board of Directors and will depend on
the Company's earnings, capital requirements, financial condition, and other
relevant factors. There are no restrictions that currently limit the Company's
ability to pay dividends on its Common Stock other than those generally imposed
by applicable state law.
ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
Plan of Operations
The Company's plan of operation for the coming year, as discussed above, is to
identify and acquire a favorable business opportunity. The Company does not plan
to limit its options to any particular industry, but will evaluate each
opportunity on its merits. The Company anticipates that its owners, affiliates,
and consultants will provide it with sufficient capital to continue operations
until the end of the year 2003, but there can be no assurance that this
expectation will be fully realized.
6
Results of Operations
The Company had no revenue from continuing operations from inception through
period ended September 30, 2002.
General and administrative expenses for the three months and nine months ended
September 30, 2002 were $500.00 and $1,500.00 respectively . General and
administrative expenses consisted of expenses to keep the Company in good
corporate standing.
The Company had a net loss of $500.00 and $1,500.00 for the three and nine
months ended September 30, 2002 respectively. The Company's net loss for the
period was attributable to general and administrative expenses.
The Company does not expect to generate any meaningful revenue or incur
operating expenses, other than minimal expenses to keep the company in good
corporate standing unless and until it acquires an interest in an operating
company.
Liquidity and Capital Resources
As of September 30, 2002, the Company had no major assets. The Company is
currently authorized to issue 20,000,000 shares of common stock, of which
2,042,000 shares are issued and outstanding, and 5,000,000 shares of preferred
stock, none of which is outstanding as of September 30, 2002. Management is
hopeful that becoming a reporting company will increase the number of
prospective business ventures that may be available to the Company. Management
believes that the Company has sufficient resources to meet the anticipated needs
of the Company's operations through at least the calendar year ending December
31, 2003. The Company anticipates that its major shareholders will contribute
sufficient funds to satisfy the cash needs of the Company through calendar year
ending December 31, 2003. However, there can be no assurances to that effect, as
the Company has no revenues and the Company's need for capital may change
dramatically if it acquires an interest in a business opportunity during that
period. Further, the Company has no plans to raise additional capital through
private placements or public registration of its securities until a merger or
acquisition candidate is identified. Upon consummation of a merger, the Company
may decide to file the necessary and appropriate registration statements to
register the affiliates' shares. In addition, it is the position of the small
business division the securities and exchange commission that promoters or
affiliates of blank check companies, as well as their transferees, are deemed to
be "underwriters" of the securities issued both before and after any business
combination.
The Company projects that its operating requirements will not exceed $15,000
over the next twelve months. If no acquisition candidate is found for the
Company during this time, Management will loan the Company sufficient funds to
cover these costs over the next twelve months. Management will prepare the
necessary documentation to keep the Company current with its reporting
requirements with the Securities & Exchange Commission and those costs will
accrue on the Company's balance sheet. In the event that a merger or acquisition
occurs over the next twelve months, the target company will be responsible for
paying these costs back to the major shareholders, or the major shareholders may
waive these costs depending on the nature of the acquisition or merger
transaction.
ITEM 7. FINANCIAL STATEMENTS
The Company's unaudited financial statements for the Quarter ended September 30,
2002 are attached hereto as F-1 through F-9.
7
Cyberexcellence, Inc
Unaudited Financial Statements
September 30, 2002
F-1
INDEX TO FINANCIAL STATEMENTS
Page
Balance Sheet as of September 30, 2002 ..................................... F-3
Statement of Operations for the Six Months ended September 30, 2002 and 2001
and February 15, 1996 (Date of Inception) to September 30, 2001..............F-4
Statement of Stockholder's Equity ...........................................F-5
Notes to Condensed Financial Statements......................................F-6
F-2
CYBEREXCELLENCE, INC.
(A Development Stage Company)
Unaudited Balance Sheet
As of September 30, 2002
Assets
Current Assets:
Cash in bank $ 0
-----------
Total Assets $ 0
===========
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 1,573
Accounts payable - related parties 7,261
-----------
Total Current Liabilities 8,834
-----------
Stockholders' deficit
Preferred stock, $.001 par value; authorized 5,000,000 shares; -
no shares issued
Common stock, $.001 par value; authorized 20,000,000 shares; 2,042
shares issued and outstanding: 2,042,000
Additional paid-in capital 324
Deficit accumulated during development stage (11,200)
-----------
Total Stockholders' Deficit (8,834)
-----------
Total Liabilities and Stockholders' Deficit $ 0
===========
The accompanying notes are an integral part of these financial statements
F-3
CYBEREXCELLENCE, INC.
(A Development Stage Company)
Unaudited Statement of Operations
For The Nine Months ended September 30, 2002 and 2001 and
Period From February 15, 1996 (Date of Inception) to
September 30, 2002
Three months ended Nine months ended Inception to
September 30 September 30 Sept. 30, 2002
2002 2001 2002 2001
----------- ----------- ----------- ----------- -----------
Revenue:
None $ -- $ -- $ -- $ -- $ --
----------- ----------- ----------- ----------- -----------
Expenses:
General and Administrative Costs 500 1,306 1,500 207 11,200
----------- ----------- ----------- ----------- -----------
Operating Profit (Loss) (500) (1,306) (1,500) (207) (11,200)
----------- ----------- ----------- ----------- -----------
Provision for income taxes -- -- -- -- --
Net Loss $ (500) $ (1,306) $ (1,500) $ (207) $ (11,200)
=========== =========== =========== =========== ===========
Net loss per common share $ 0 $ 0 $ 0 $ 0
=========== =========== =========== ===========
Weighted average number of shares
outstanding - basic 2,042,000 2,042,822 2,042,000 2,042,822
=========== =========== =========== ===========
The accompanying notes are an integral part of these financial statements
F-4
CYBEREXCELLENCE, INC.
(A Developmental Stage Company)
Unaudited Statement of Changes In Stockholders' Equity
Period From February 15, 1996 (Date of Inception) to June 30, 2002
Additional
Common Stock Paid-in Accumulated
Shares Amount Capital Deficit Total
---------- --------- ------- --------- ---------
Issuance of common stock to incorporators
for cash - April 9, 1996 at $0.001 1,000,000 $ 1,000 $ -- $ -- $ 1,000
Net loss for the period from February 15, 1996
(date of inception) to December 31, 1997 -- -- -- (1,000) (1,000)
---------- ---------- ---------- ---------- ----------
Balance December 31, 1997 1,000,000 1,000 0 (1,000) 0
---------- ---------- ---------- ---------- ----------
Results of operations year ended December 31, 1998 -- -- -- -- 0
---------- ---------- ---------- ---------- ----------
Balance December 31, 1998 1,000,000 1,000 0 (1,000) 0
---------- ---------- ---------- ---------- ----------
Issuance of shares for services - Dec.16, 1999 at $0.001: 1,006,000 1,006 -- -- 1,006
Shares subscribed - Dec. 16, 1999 at $0.01 36,000 36 324 -- 360
Subscriptions not collected until February 3, 2000 -- -- -- -- (360)
Results of operations year ended December 31, 1999 -- -- -- (1,006) (1,006)
---------- ---------- ---------- ---------- ----------
Balance at December 31, 1999 2,042,000 2,042 324 (2,006) 0
Subscriptions collected February 3, 2000 -- -- -- -- 360
Results of operations year ended December 31, 2000 -- -- -- (2,931) (2,931)
---------- ---------- ---------- ---------- ----------
Balance at December 31, 2000 2,042,000 $ 2,042 $ 324 $ (4,937) $ (2,571)
---------- ---------- ---------- ---------- ----------
Results of operations year ended December 31, 2001 -- -- --
---------- ---------- ---------- ---------- ----------
Balance at December 31, 2001 2,042,000 $ 2,042 $ 324 $ (9,700) $ (7,334)
---------- ---------- ---------- ---------- ----------
Results of operations six months ended June 30, 2002
-- $ (1,000)
- ------- --------- --------- --------- ---------
Balance at September 30, 2002
$ 324 $ (11,200) $ (8,834) 2,042,000 $ 2,042
======= ========= ========= ========= =========
The accompany notes are an integral part of these financial statements
F-5
CYBEREXCELLENCE, INC.
(A Development Stage Company)
Notes to Financial Statements
1. Organization
The Company was incorporated under the laws of the State of Nevada on February
15, 1996 with the name of "Cyberexcellence, Inc." with authorized common stock
of 20,000,000 shares at $0.001 par value, and authorized preferred stock of
5,000,000 shares at $0.001 par value.
The Company is in the development stage and has not commenced any significant
operations.
2. Summary of Significant Accounting Policies
Accounting Methods
The Company recognized income and expenses based on the accrual method of
accounting.
Dividend Policy
The Company has not adopted a policy regarding payment of dividends.
Income Taxes
At December 31, 2001, the Company had a net operating loss carryforward of
$9,700. The tax benefit from the loss carryforward has been fully offset by a
valuation reserve because use of future tax benefit is undetermined since the
Company has no operations. The net operating loss expires in increments
beginning in 2011.
Earnings (Loss) Per Share
Earnings (loss) per share amounts are computed based on the weighted-average
Number of shares actually outstanding in accordance with FASB No. 128.
Financial Instruments
The carrying amounts of financial instruments are considered by management to be
their estimated fair values.
F-6
CYBEREXCELLENCE, INC.
(A Development Stage Company)
Notes to Financial Statements
2. Summary of Significant Accounting Policies
Estimates and Assumptions
Management uses estimates and assumptions in preparing financial statements in
accordance with generally accepted accounting principles. Those estimates and
assumptions affect the reported amounts of the assets and liabilities, the
disclosure of contingent assets and liabilities, and the reported revenues and
expenses. Actual results could vary from the estimates that were assumed in
preparing these financial statements.
3. Related Party Transactions
The statement of changes in stockholders equity shows 2,042,000 shares of common
stock outstanding of which 2,000,000 shares were issued to related parties. At
March 31, 2002, the Company owed $6,361 to these related parties.
4. Going Concern
Continuation of the Company as a going concern is dependent upon obtaining
working capital for any future planned activity and management of the Company
will be required to develop a strategy which will accomplish this objective.
There can be no assurance that the Company can be successful in this effort.
ITEM 8. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits required to be attached by Item 601 of Regulation S-B are
listed in the Index to Exhibits on page 10 of this Form 10-QSB, and are
incorporated herein by this reference.
(b) Reports on Form 8-K. No reports on Form 8-K were filed during the
period covered by this Form 10-QSB.
F-7
SIGNATURES
----------
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized, this 28th day of January, 2003.
Cyberexcellence, Inc.
/s/ F. Briton McConkie, Jr.
---------------------------------------
F. Briton McConkie, Secretary
In accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
Signature Title Date
- --------- ----- ----
/s/ F. Briton McConkie, Jr.
- -----------------------------
F. Briton McConkie, Jr. Secretary, Director January 28, 2003
/s/ Stephen Wright
- -----------------------------
Stephen Wright President, Director January 28, 2003
8
INDEX TO EXHIBITS
-----------------
Exhib. Page
No. No. Description
3(i) * Articles of Incorporation of Cyberexcellence, Inc.,
a Nevada corporation, filed with the State of Nevada
on February 15, 1996
3(ii) * By-laws of the Company adopted on December 31, 1999.
4 * Employee Benefit Plan adopted on December 14, 1999.
* Incorporated by reference from Form 10-SB filed February 18, 2000.
9