UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A1
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) May 25, 2001 (May 15, 2001)
VICTOR EBNER ENTERPRISES, INC.
(Exact name or registrant as specified in its charter)
Florida 65-0853816
------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
c/o Troutman Sanders Mays & Valentine LLP 22102
----------------------------------------- -----
1660 International Drive, Suite 600 (Zip code)
-----------------------------------
McLean, Virginia
----------------
(Address of principal executive offices)
Registrant's telephone number, including area code: (703) 734-4334
INFORMATION TO BE INCLUDED IN REPORT
EXPLANATORY NOTE: This Current Report on Form 8-K/A1 amends Items 7(a)
and 7(b) of the Registrant's Current Report on Form
8-K, filed on May 25, 2001, to provide the
Registrant's Financials and Unaudited Pro Forma
Financial Statements. The remaining Items have not
been amended herein.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Financial Statements of Business Acquired.
VICTOR EBNER ENTERPRISES, INC.
(A development Stage Company)
DECEMBER 31,2000 AND 1999
FINANCIAL STATEMENTS WITH
AUDIT REPORT OF
CERTIFIED PUBLIC ACCOUNTANTS
VICTOR EBNER ENTERPRISES, INC.
Index to Financial Statements
- --------------------------------------------------------------------------------
Page
----
Report of Independent Certified Public Accountants F-3
Balance Sheet at December 31, 2000 and 1999 F-4
Statement of Losses for the years ended December 31, 2000 and
1999 and for the period November 16, 1998 (date of inception)
to December 31, 2000 F-5
Statement of Deficiency in Stockholders' Equity for the years
ended December 31, 2000 and 1999 and for the period
November 16, 1998 (date of inception) to December 31, 2000 F-6
Statements of Cash Flows for the years ended December 31, 2000 and
1999 and for the period November 16, 1998 (date of inception) to
December 31, 2000 F-7
Notes to Financial Statements F-8 to F-13
INTERIM CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
Condensed Balance Sheet as of March 31, 2001 and December 31, 2000 F-14
Condensed Statement of Losses for the three months ended
March 31, 2001 and 2000 and for the period November 16, 1998
(date of inception) to March 31, 2001 F-15
Condensed Statement of Stockholders' Equity for the period
November 16, 1998 (date of inception) to March 31, 2001 F-16
Condensed Statement of Cash Flows for the three months ended
March 31, 2001 and 2000 and for the period November 16, 1998
(date of inception) to March 31, 2001 F-17
Condensed Notes to Financial Statements at March 31, 2001 F-18 to F-19
F-2
Stefanou & Company, LLP
Certified Public Accountants
1360 Beverly Road
Suite 305
McLean, VA 22101-3621
(703) 448-9200
(703) 448-3515 (fax)
Philadelphia, PA
- --------------------------------------------------------------------------------
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Board of Directors
Victor Ebner Enterprises, Inc.
New York, New York
We have audited the accompanying balance sheet of Victor Ebner
Enterprises, Inc. (a development stage company) as of December 31, 2000 and 1999
and the related statements of losses, deficiency in stockholders' equity, and
cash flows for the years then ended and for the period November 16, 1998 (date
of inception) through December 31, 2000. These financial statements are the
responsibility of the company's management. Our responsibility is to express an
opinion on the financial statements based upon our audits.
We have conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Victor Ebner
Enterprises, Inc. (a development stage company) at December 31, 2000 and 1999
and the results of its operations and its cash flows for the two years then
ended and the period November 16, 1998 (date of inception) to December 31, 2000,
in conformity with generally accepted accounting principles.
The accompanying financial statements have been prepared assuming the
company will continue as a going concern. As discussed in the Note H to the
accompanying financial statements, the company is in the development stage and
has not established a source of revenues. This raises substantial doubt about
the company's ability to continue as a going concern. The financial statements
do not include any adjustments that might result from the outcome of this
uncertainty.
/s/ Stefanou & Company, LLP
--------------------------------
Stefanou & Company, LLP
Certified Public Accountants
McLean, Virginia
February 4, 2001, except as to Note I which is as of
June 18, 2001
F-3
VICTOR EBNER ENTERPRISES, INC
(A development stage company)
BALANCE SHEET
DECEMBER 31, 2000 AND 1999
2000 1999
-------- --------
ASSETS
------
Current Assets:
Prepaid Expenses $ 15,550 $ --
-------- --------
Total current assets 15,550 --
-------- --------
15,550 --
======== ========
LIABILITIES AND DEFICIENCY IN
-----------------------------
STOCKHOLDER'S EQUITY
--------------------
Current Liabilities:
Advance from shareholder (Note B) $ 21,965 $ --
Accounts payable and accrued expenses 25,376 --
-------- --------
Total current liabilities 47,341 --
Commitments & contingencies (Note I) -- --
DEFICIENCY IN STOCKHOLDER'S EQUITY
(Note C):
Common Stock, no par value; authorized 200 shares; 1 share
issued and outstanding as of December 31, 2000 and 1999 10 10
Deficit accumulated during the development stage (31,801) (10)
-------- --------
Deficiency in stockholder's equity (31,791) --
-------- --------
$ 15,550 $ --
======== ========
See accompanying notes to financial statements
F-4
VICTOR EBNER ENTERPRISES, INC
(A development stage company)
STATEMENT OF LOSSES
FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999 AND FROM
NOVEMBER 16,1998 (Date of Inception) THROUGH DECEMBER 31,2000
November 16,
1998 (Date of
December 31, December 31, Inception) to
2000 1999 December 31, 2000
------------ ------------ -----------------
Costs and expenses:
General and administrative $ 31,791 $ -- $ 31,801
-------- -------- --------
Total costs and expenses 31,791 -- 31,801
-------- -------- --------
Loss before income taxes (31,791) -- (31,801)
-------- -------- --------
Income (taxes) benefit -- -- --
-------- -------- --------
Net loss $(31,791) $ -- $(31,801)
======== ======== ========
Basic and diluted loss per
common share (Note G) $(31,791) $ -- $(31,801)
======== ======== ========
Weighted average common shares
outstanding 1 1 1
See accompanying notes to financial statements
F-5
VICTOR EBNER ENTERPRISES, INC.
(A development stage company)
STATEMENT OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999 AND FROM
NOVEMBER 16, 1998 (Date of Inception) THROUGH DECEMBER 31, 2000
November 16, 1998
(Date of Inception)
December 31, December 31, to
2000 1999 December 31, 2000
------------ ------------ -----------------
Cash flows from operating activities:
Net losses $(31,791) $ -- $(31,801)
Common stock issued in exchange for
services -- -- 10
Increase in prepaid expenses (15,550) (15,550)
Increase in accrued expenses and
accounts payable 25,646 -- 25,646
-------- -------- --------
Net cash used in operating activities (21,695) -- (21,695)
Cash flows from financing activities:
Advance from shareholder 21,695 -- 21,695
-------- -------- --------
Net cash provided by financing activities $ 21,695 $ -- $ 21,695
Net increase (decrease) in cash and
equivalents -- -- --
-------- -------- --------
Cash and equivalents at beginning of
period -- -- --
-------- -------- --------
Cash and equivalents at end of period $ -- $ -- $ --
======== ======== ========
Supplemental disclosures of cash flow information:
Cash paid during the period for interest $ -- $ -- $ --
Cash paid during the period for taxes -- -- --
Common stock issued in exchange for
services -- -- 10
See accompanying notes to financial statements
F-6
VICTOR EBNER ENTERPRISES, INC
(A development stage company)
STATEMENT OF DEFICIENCY IN STOCKHOLDER'S EQUITY
FOR THE PERIOD NOVEMBER 16, 1998 (Date of Inception) THROUGH DECEMBER 31, 2000
Deficit
Accumulated
Common During
Common Stock Development
Shares Amount Stage Total
-------- -------- ----------- --------
Issuance of common stock to
Founder in exchange for services on
November 16, 1998, 1998 at $ 10 per
share 1 $ 10 $ -- $ 10
Net Loss -- -- (10) (10)
-------- -------- -------- --------
Balance at December 31, 1998 1 10 (10) --
-------- -------- -------- --------
Balance at December 31, 1999 1 10 (10) --
-------- -------- -------- --------
Net Loss -- -- (31,791) (31,791)
-------- -------- -------- --------
Balance at December 31, 2000 1 $ 10 $(31,801) $(31,791)
======== ======== ======== ========
See accompanying notes to financial statements
F-7
VICTOR EBNER ENTERPRISES, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 and 1999
NOTE A - SUMMARY OF ACCOUNTING POLICIES
A summary of the significant accounting policies applied in the preparation of
the accompanying financial statements follows.
Business and Basis of Presentation
- ----------------------------------
On November 16, 1998, Victor Ebner Enterprises, Inc. (the "Company") was
incorporated under the laws of the State of New York. Victor Ebner is in the
development stage , as defined by Statement of Financial Accounting Standards
No. 7 ("SFAS No. 7") and its efforts have been principally devoted to developing
audio-visual language instruction systems in the United States. To date, Victor
Ebner has generated no sales revenues, has incurred expenses and has sustained
losses. Consequently, its operations are subject to all the risks inherent in
the establishment of a new business enterprise. For the period from inception
through December 31, 2000, Victor Ebner has accumulated losses of $31,801.
Estimates
- ---------
The preparation of the financial statement in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect certain reported amounts and disclosures. Accordingly, actual results
could differ from those estimates.
Revenue Recognition
- -------------------
Victor Ebner will follow a policy of recognizing income as revenue in the period
the services are provided and the products shipped.
Cash Equivalents
- ----------------
For the purpose of the accompanying financial statements, all highly liquid
investments with a maturity of three months or less are considered to be cash
equivalents.
Income Taxes
- ------------
Victor Ebner has adopted Financial Accounting Standard No. 109 (SFAS 109) which
requires the recognition of deferred tax liabilities and assets for the expected
future tax consequences of events that have been included in the financial
statement or tax returns. Under this method, deferred tax liabilities and assets
are determined based on the difference between financial statements and tax
basis of assets and liabilities using enacted tax rates in effect for the year
in which the differences are expected to reverse. Temporary differences between
taxable income reported for financial reporting purposes and income tax purposes
are insignificant.
F-8
VICTOR EBNER ENTERPRISES, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 and 1999
NOTE A - SUMMARY OF ACCOUNTING POLICIES (continued)
Impairment of Long-Lived Assets
- -------------------------------
Victor Ebner has adopted Statement of Financial Accounting Standards No. 121
(SFAS 121). The Statement requires that long-lived assets and certain
identifiable intangibles held and used by Victor Ebner be reviewed for
impairment whenever events or changes in circumstances indicate that the
carrying amount of an asset may not be recoverable. SFAS No. 121 also requires
assets to be disposed of be reported at the lower of the carrying amount or the
fair value less costs to sell.
Intangible Assets
- -----------------
Organization costs incurred after December 31, 1999 have been expensed as
incurred in accordance with AICPA Statement of Position 98-5.
Comprehensive Income
- --------------------
Victor Ebner does not have any items of comprehensive income in any of the
periods presented.
Segment Information
- -------------------
Victor Ebner adopted Statement of Financial Accounting Standards No. 131,
Disclosures about Segments of an Enterprise and Related Information ("SFAS 131")
in the year ended December 31, 1998. SFAS establishes standards for reporting
information regarding operating segments in annual financial statements and
requires selected information for those segments to be presented in interim
financial reports issued to stockholders. SFAS 131 also establishes standards
for related disclosures about products and services and geographic areas.
Operating segments are identified as components of an enterprise about which
separate discrete financial information is available for evaluation by the chief
operating decision maker, or decision making group, in making decisions how to
allocate resources and assess performance. The information disclosed herein,
materially represents all of the financial information related to Victor Ebner's
principal operating segment.
Net Loss Per Share
- ------------------
Victor Ebner has adopted Statement of Financial Accounting Standard No. 128,
"Earnings Per Share," specifying the computation, presentation and disclosure
requirements of earnings per share information. Basic earnings per share has
been calculated based upon the weighted average number of common shares
outstanding. Stock options and warrant's have been excluded as common stock
equivalents in the diluted earnings per share because they are either
antidilutive, or their effect is not material. There is no effect on earnings
per share information for the year ended December 31, 1999 relating to the
adoption of this standard.
F-9
VICTOR EBNER ENTERPRISES, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 and 1999
NOTE A - SUMMARY OF ACCOUNTING POLICIES (continued)
Stock Based Compensation
- ------------------------
Victor Ebner accounts for stock transactions in accordance with APB Opinion 25,
"Accounting for Stock Issued to Employees." In accordance with statement of
Financial Accounting Standards No. 123, "Accounting for Stock Based
Compensation," Victor Ebner has adopted the proforma disclosure requirements.
Liquidity
- ---------
As shown in the accompanying financial statements, Victor Ebner incurred a net
loss of $ 31,791 during the year ended December 31, 2000 and $ 0 during the year
ended December 31, 1999. Victor Ebner's current liabilities assets exceeded its
current assets by $ 31,791 as of December 31, 2000, and all of Victor Ebner's
assets are illiquid.
Concentrations of Credit Risk
- -----------------------------
Financial instruments and related items, which potentially subject Victor Ebner
to concentrations of credit risk, consist primarily of cash, cash equivalents
and trade receivables. Victor Ebner places its cash and temporary cash
investments with high credit quality institutions. At times, such investments
may be in excess of the FDIC insurance limit.
Research and Development
- ------------------------
Company-sponsored research and development costs related to both present and
future products will be expended in the period incurred.
Advertising
- -----------
Victor Ebner will follow a policy of charging the costs of advertising to
expenses incurred. The Company did not occur any advertising costs during the
years ended December 31, 2000 and 1999.
New Accounting Pronouncements
- -----------------------------
Victor Ebner adopted Statement of Financial Accounting Standards No. 132,
Employers' Disclosures about Pension and Other-Post Employment Benefits ("SFAS
132"). SFAS No. 132 establishes disclosure requirements regarding pension and
post employment obligations. SFAS No. 132 does not effect the company as of
December 31, 2000.
In March 1998, Statement of Position No. 98-1 was issued, which specifies the
appropriate accounting for costs incurred to develop or obtain computer software
for internal use. The new pronouncement provides guidance on which costs should
be capitalized, and over what period such costs should be amortized and what
disclosures should be made regarding such costs. This pronouncement is effective
for fiscal years beginning after December 15, 1998, but earlier application is
acceptable. Previously capitalized costs will not be adjusted. Victor Ebner
believes that it is
F-10
VICTOR EBNER ENTERPRISES, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 and 1999
NOTE A - SUMMARY OF ACCOUNTING POLICIES (continued)
already in substantial compliance with the accounting requirements as set forth
in this new pronouncement, and therefore believes that adoption will not have a
material effect on financial condition or operating results.
Victor Ebner adopted Statement of Financial Standards No. 133, Accounting for
Derivative Instruments and for Hedging Activities ("SFAS No. 133") in the six
months ended June 30, 2000. SFAS No. 133 requires that certain derivative
instruments be recognized in balance sheets at fair value and for changes in
fair value to be recognized in operations. Additional guidance is also provided
to determine when hedge accounting treatment is appropriate whereby hedging
gains and losses are offset by losses and gains related directly to the hedged
item. SFAS No. 133's impact on Victor Ebner's consolidated financial statements
is not expected to be material as Victor Ebner has not historically used
derivative and hedge instruments.
In December 1999, the Securities and Exchange Commission issued Staff Accounting
Bulletin No. 101 (" SAB 101"), Revenue Recognition in Financial Statements,
which will become effective December 31, 2000. Victor Ebner does not expect the
standard to have a material effect on its financial condition or operating
results.
NOTE B - RELATED PARTY TRANSACTIONS
Included in accounts payable and accrued expenses is $21,965 at December 31,
2000 which represents advances from the stockholder of Victor Ebner. No formal
agreements or repayment terms exist.
NOTE C- CAPITAL STOCK
Victor Ebner is authorized to issue 200 shares of common stock , with no par
value per share (see Note I). During the period ended December 31, 1998, Victor
Ebner issued 1 share of common stock in exchange for reimbursement of services
aggregating $ 10 . The Company valued the stock issued based upon the fair value
of the services received.
NOTE D- INCOME TAXES
Victor Ebner has adopted Financial Accounting Standard number 109 which requires
the recognition of deferred tax liabilities and assets for the expected future
tax consequences of events that have been included in the financial statement or
tax returns. Under this method, deferred tax liabilities and assets are
determined based on the difference between financial statements and tax bases of
assets and liabilities using enacted tax rates in effect for the year in which
the differences are expected to reverse. Temporary differences between taxable
income reported for financial reporting purposes and income tax purposes are
insignificant.
F-11
VICTOR EBNER ENTERPRISES, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 and 1999
NOTE D- INCOME TAXES (continued)
At December 31, 2000, Victor Ebner has available for federal income tax purposes
a net operating loss carryforward of $31,800, expiring the year 2020, that may
be used to offset future taxable income. Victor Ebner has provided a valuation
reserve against the full amount of the net operating loss benefit, since in the
opinion of management based upon the earnings history of Victor Ebner, it is
more likely than not that the benefits will not be realized. Due to significant
changes in Victor Ebner's ownership, Victor Ebner's future use of its existing
net operating losses may be limited.
Components of deferred tax assets as of December 31, 2000 are as follows:
Non current:
Net operating loss carryforward $ 4,770
Valuation allowance (4,770)
-------
Net deferred tax asset $ 0
=======
NOTE G-LOSSES PER SHARE
The following table presents the computation of basic and diluted losses per
share:
2000 1999
---- ----
Loss available for common shareholders $(31,791) $ --
======== ========
Basic and fully diluted loss per share $(31,791) $ (.00)
======== ========
Weighted average common shares outstanding 1 1
======== ========
Net loss per share is based upon the weighted average of shares of common stock
outstanding
NOTE H- GOING CONCERN
The accompanying financial statements have been prepared on a going concern
basis, which contemplates the realization of assets and the satisfaction of
liabilities in the normal course of business. As shown in the accompanying
financial statements during the period November 16, 1998 through December 31,
2000, Victor Ebner incurred a loss of $31,801. In addition, Victor Ebner has a
deficiency in stockholder's equity of $31,791. These factors among others may
indicate that Victor Ebner will be unable to continue as a going concern for a
reasonable period of time.
F-12
VICTOR EBNER ENTERPRISES, Inc.
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 2000 and 1999
NOTE H- GOING CONCERN (continued)
Victor Ebner's existence is dependent upon management's ability to develop
profitable operations. Management is devoting substantially all of its efforts
to establishing its audio-visual language instruction systems in the United
States and there can be no assurance that Victor Ebner's efforts will be
successful.. However, the planned principal operations have not commenced and no
assurance can be given that management's actions will result in profitable
operations or the resolution of its liquidity problems. The accompanying
statements do not include any adjustments that might result should Victor Ebner
be unable to continue as a going concern.
In order to improve Victor Ebner's liquidity, Victor Ebner is actively pursing
additional equity financing through discussions with investment bankers and
private investors. There can be no assurance Victor Ebner will be successful in
its effort to secure additional equity financing (see Note I).
NOTE I- SUBSEQUENT EVENTS
On January 24, 2001, the Company amended its certificate of incorporation to
increase the number of authorized shares of common stock from 200 to 50,000,000,
with no par value.
On January 24, 2001, the Company entered into a Plan of Merger ("Merger")
whereby, subject to shareholder approval, the Company was to acquire, in
exchange for 50,000 shares of the Company's common stock and consideration of
$200,000 in the form of a promissory note, In Full Affect, Inc. ("In Full
Affect"), an inactive publicly registered shell corporation with no significant
assets or operations. The Merger Agreement was terminated by the Company in May,
2001
On May 18, 2001, the Company completed a Plan of Merger Agreement ("Merger")
with College Software, Inc. ("College") an inactive publicly registered shell
corporation with no significant assets or operations. For accounting purposes,
the Company shall be the surviving entity. The transaction is accounted for
using the purchase method of accounting. The total purchase price and carrying
value of net assets acquired of College was $7,036. From College's inception,
until the date of the merger, College was an inactive corporation with no assets
and liabilities
Subsequent to the date of the financial statements, outside investors subscribed
to purchase $1,369,975 of the Company's common stock priced at $2.50 per share
in connection with a private placement of its securities to sophisticated
investors outside the United States.
F-13
Victor Ebner Enterprises, Inc
(A Development Stage Company)
Condensed Balance Sheet
ASSETS
March 31, 2001 December 31, 2000
----------------- -----------------
(Unaudited)
Current assets:
Cash and equivalents $ 1,350,009 $ --
Prepaid expenses 262,022 15,550
----------------- -----------------
Total current assets 1,612,031 15,550
$ 1,612,031 $ 15,550
================= =================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses $ 83,923 $ 25,376
Advance from Stockholder 21,965 21,965
Notes Payable (Note C) 262,022 --
----------------- -----------------
Total current liabilities 367,910 47,341
Stockholders' equity:
Common stock 12,800 10
Common stock subscriptions 1,369,975 --
Additional paid-in-capital -- --
Deficit accumulated during development stage (138,654) (31,801)
----------------- -----------------
Stockholders' equity (deficiency) 1,244,121 (31,791)
----------------- -----------------
$ 1,612,031 $ 15,550
================= =================
See accompanying footnotes to the unaudited condensed financial statements
F-14
Victor Ebner Enterprises, Inc
(A Development Stage Company
Condensed Statement of Losses
Three months ended March 31,
--------------------------- Period from
November 16, 1998
Date of Inception)
2001 2000 to March 31, 2001
---- ---- -----------------
Operating expenses:
Selling, general and administrative $ 106,887 $ -- $ 138,688
Interest expense -- -- --
----------- ----------- -----------
Operating expense 106,887 -- 138,688
----------- ----------- -----------
Interest income 34 -- 34
----------- ----------- -----------
Net loss before taxes (106,853) -- (138,654)
Provision for income taxes -- -- --
----------- ----------- -----------
Net loss $ (106,853) $ -- $ (138,654)
=========== =========== ===========
Loss per common share $ (0.01) $ --
(Basic and assuming dilution) =========== ===========
Weighted average shares outstanding
Basic and diluted 9,955,555 1
See accompanying footnotes to the unaudited condensed financial statements
F-15
Victor Ebner Enterprises, Inc
(A developmental stage company)
CONDENSED STATEMENTS OF IN STOCKHOLDERS' EQUITY (DEFICIENCY)
FOR THE PERIOD NOVEMBER 16, 1998 (DATE OF INCEPTION) THROUGH MARCH 31, 2001
Deficit
Accumulated Total
Common Stock Additional during Stockholder's
------------------------- Common Stock Paid in Development Equity
Shares Amount Subscriptions Capital Stage (Deficit)
----------- ----------- ------------- ----------- ----------- -----------
Issuance of Common Stock in exchange
for services on November 16, 1998 at
$ 10 per share 1 10 -- -- -- 10
Net Loss -- -- -- -- (10) (10)
----------- ----------- ----------- ----------- ----------- -----------
Balance at December 31, 1998 1 10 -- -- (10) --
----------- ----------- ----------- ----------- ----------- -----------
Balance at December 31, 1999 1 10 -- -- (10) --
Net Loss -- -- -- -- (31,791) (31,791)
----------- ----------- ----------- ----------- ----------- -----------
Balance at December 31, 2000 1 10 -- -- (31,801) (31,791)
Issuance of common stock on January
24, 2001 in exchange for services
(Note B) 12,799,999 12,790 -- -- -- 12,790
Common stock subscribed in March,
2001 at $2.50 per share (Note B) -- -- 1,369,975 -- -- 1,369,975
Net Loss -- -- -- -- (106,853) (106,853)
----------- ----------- ----------- ----------- ----------- -----------
Balance at March 31, 2001 12,800,000 $ 12,800 $ 1,369,975 $ -- $ (138,654) $ 1,244,121
=========== =========== =========== =========== =========== ===========
See accompanying footnotes to the unaudited condensed financial statements
F-16
Victor Ebner Enterprises, Inc
(A Development Stage Company)
Condensed Statement of Cash Flows
For the three months Period from
ended March 31, November 16, 1998
-------------------------- (Date of Inception)
2001 2000 to March 31, 2001
---- ---- -----------------
Cash flows from operating activities:
Net income from operating activities $ (106,853) $ -- $ (138,654)
Adjustments to reconcile net income to net cash:
Common Stock Issued in exchange for services 12,790 -- 12,800
Change in:
Prepaid expenses and other assets, net (246,472) -- (262,022)
Accounts payable and accrued expenses 320,569 -- 345,945
----------- ----------- -----------
Net cash from operating activities (19,966) -- (41,931)
Cash flows (used in)/provided by financing activities:
Proceeds from loans from stockholders -- -- 21,965
Proceeds from common stock subscriptions 1,369,975 1,369,975
----------- ----------- -----------
Net cash used in financing activities 1,369,975 -- 1,391,940
----------- ----------- -----------
Net increase in cash and cash equivalents 1,350,009 -- 1,350,009
Cash and cash equivalents at January 1 -- -- --
----------- ----------- -----------
Cash and cash equivalents at March 31 $ 1,350,009 $ -- $ 1,350,009
=========== =========== ===========
Supplemental Information:
Interest Paid $ -- $ -- $ --
Income Tax Paid -- -- --
Common stock issued in exchange for services 12,790 -- 12,800
See accompanying footnotes to the unaudited condensed financial statements
F-17
VICTOR EBNER ENTERPRISES, Inc.
(A Development Stage Company)
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2001
(UNAUDITED)
NOTE A-SUMMARY OF ACCOUNTING POLICIES
General
The accompanying unaudited consolidated financial statements have been prepared
in accordance with the instructions to Rule 310(b) of Regulation S-B, and
therefore, do not include all the information necessary for a fair presentation
of financial position, results of operations and cash flows in conformity with
generally accepted accounting principles.
In the opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
Operating results for the three month period ended March 31, 2001 are not
necessarily indicative of the results that may be expected for the year ended
December 31, 2001. The unaudited condensed consolidated financial statements
should be read in conjunction with the consolidated financial statements and
footnotes thereto included in the Company's SEC Form 8-K, as amended.
Business and Basis of Presentation
On November 16, 1998, Victor Ebner Enterprises, Inc. (the "Company") was
incorporated under the laws of the State of New York. The Company is in the
development stage , as defined by Statement of Financial Accounting Standards
No. 7 ("SFAS No. 7") and its efforts have been principally devoted to developing
audio-visual language instruction systems in the United States. To date, the
Company has generated no sales revenues, has incurred expenses and has sustained
losses. Consequently, its operations are subject to all the risks inherent in
the establishment of a new business enterprise. For the period from inception
through March 31, 2001, the Company has accumulated losses of $ 138,654.
NOTE B- CAPITAL STOCK
The Company is authorized to issue 50,000,000 shares of common stock , with no
par value per share. On January 24, 2001, the Company issued 12,799,999 shares
of its common stock to its principal shareholder in exchange for reimbursement
of services aggregating $12,790. The Company valued the stock issued based upon
the fair value of the services received. In March , 2001 outside investors
subscribed to purchase $1,369,975 of the Company's common stock priced at $2.50
per share in connection with a private placement of its securities to
sophisticated investors outside the United States (see Note E).
F-18
VICTOR EBNER ENTERPRISES, Inc.
(A Development Stage Company)
NOTES TO CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2001
(UNAUDITED)
NOTE C - NOTE PAYABLE
Notes Payable at March 31, 2001 consists of the following:
Loan payable, secured by cash and cash equivalents , interest at
broker call rate (4.53% at March 31, 2001), payable on or
before March , 2002 $ 262,022
=========
NOTE D - LICENSE AGREEMENT
On January 24, 2001, Victor Ebner entered into a Licensing Agreement with Victor
Ebner Enterprises, SA, a Swiss company owned by the Company's sole shareholder.
The Licensing Agreement provides Victor Ebner with the right to use the Victor
Ebner Enterprises SA audio-visual language instruction systems exclusively in
the United States. The License Agreement provides for a term of 5 years and a
royalty payment equal to the greater of six per cent (6%) of net sales or
$25,000 per year.
NOTE E-SUBSEQUENT EVENT
On May 18, 2001, Victor Ebner Enterprises, Inc. ("Victor Ebner") completed an
Agreement and Plan of Reorganization ("Agreement") with College Software, Inc.
("College") an inactive publicly registered shell corporation with no
significant assets or operations. For accounting purposes, Victor Ebner shall be
the surviving entity. The transaction is accounted for using the purchase method
of accounting. The total purchase price and carrying value of net assets
acquired of College was $7,036. From College's inception, until the date of the
merger, College was an inactive corporation with no assets and liabilities.
Subsequent to the date of the financial statements, outside investors subscribed
to purchase $ 565,000 of the Company's common stock priced at $2.50 per share in
connection with a private placement of its securities to sophisticated investors
outside the United States.
F-19
(b) Pro Forma Financial Information.
Consolidated Pro Forma Unaudited Balance Sheet as of
March 31, 2001 F-21
Consolidated Pro Forma Unaudited Statement of Losses for
the Three Months ended March 31, 2001 F-22
Consolidated Pro Forma Unaudited Statement of Losses for
the Year ended December 31, 2000 F-23
Notes to Consolidated Pro Forma Unaudited Financial Statements F-24
Unaudited Pro Forma Condensed Financial Information
On May 18, 2001, Victor Ebner Enterprises, Inc. ("Victor Ebner") completed an
Agreement and Plan of Reorganization ("Agreement") with College Software, Inc.
("College") an inactive publicly registered shell corporation with no
significant assets or operations. For accounting purposes, Victor Ebner shall be
the surviving entity. The transaction is accounted for using the purchase method
of accounting. The total purchase price and carrying value of net assets
acquired of College was $7,036. From College's inception, until the date of the
merger, College was an inactive corporation with no assets and liabilities.
The Proforma Unaudited Financial Statements have been prepared by management of
Victor Ebner in order to present consolidated financial position and results of
operations of College and Victor Ebner as if the acquisition had occurred as of
March 31, 2001 for the pro forma condensed balance sheet and to give effect to
the acquisition of College , as if the transaction had taken place at January 1,
2000 for the pro forma condensed consolidated statements of losses for the year
ended December 31, 2000 and as of January 1, 2001 for the three month period
ended March 31, 2001
The pro forma information is based on historical financial statements giving
effect to the proposed transactions using the purchase method of accounting and
the assumptions and adjustments in the accompanying notes to the pro forma
financial statements. The unaudited pro forma financial information is not
necessarily indicative of the actual results of operations or the financial
position which would have been attained had the acquisitions been consummated at
either of the foregoing dates or which may be attained in the future. The pro
forma financial information should be read in conjunction with the historical
consolidated financial statements of Victor Ebner (including notes thereto)
included in this Form.
Effective with the Agreement, all previously outstanding common stock, preferred
stock, options and warrants owned by Victor Ebner stockholders were exchanged
for an aggregate of 12,800,000 shares of College common stock. The value of the
stock that was issued was the historical cost of Victor Ebner's net tangible
assets, which did not differ materially from their fair value. In accordance
with Accounting Principles Opinion No. 16, Victor Ebner is the acquiring entity.
F-20
VICTOR EBNER ENTERPRISES, INC
CONSOLIDATED PRO FORMA UNAUDITED BALANCE SHEET
MARCH 31, 2001
ASSETS
College Pro Forma Pro Forma
------- --------- ---------
Software Victor Ebner Adjustments Consolidated
----------- ------------ ----------- ------------
Current assets:
Cash and equivalents $ -- $ 1,350,009 $ 1,350,009
Prepaid expenses -- 262,022 262,022
----------- ----------- -----------
Total current assets -- 1,612,031 1,612,031
$ -- $ 1,612,031 $ 1,612,031
=========== =========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued expenses $ 5,851 $ 83,923 $ 89,774
Advances from Stockholders -- 21,965 21,965
Notes Payable -- 262,022 262,022
----------- ----------- -----------
Total current liabilities 5,851 367,910 373,761
Stockholders' equity: (12,800)(1)
12,800 (1)
Common stock 1,185 12,800 548 (3) 14,533
Common stock subscriptions -- 1,369,975 (1,369,975)(3) --
(24,169)(2)
Additional paid-in-capital 24,169 -- 1,369,427 (3) 1,369,427
(7,036)(2)
Deficiency in retained earnings (31,205) (138,654) 31,205 (2) (145,690)
----------- ----------- -----------
Total stockholders' equity (deficit) (5,851) 1,244,121 1,238,270
----------- ----------- -----------
$ -- $ 1,612,031 $ 1,612,031
=========== =========== ===========
See accompanying notes to the proforma unaudited consolidated financial
statements
F-21
VICTOR EBNER ENTERPRISES, INC
CONSOLIDATED PRO FORMA UNAUDITED STATEMENT OF LOSSES
FOR THE THREE MONTHS ENDED MARCH 31, 2001
College Pro Forma Pro Forma
------- --------- ---------
Software Victor Ebner Adjustments Consolidated
------------ ------------ ------------ ------------
Operating expenses:
Selling, general and administrative $ 1,546 $ 106,887 $ 7,036 (2) $ 115,469
------------ ------------ ------------
Operating expense 1,546 106,887 115,469
Other Income -- 34 34
------------ ------------ ------------
Net loss before taxes (1,546) (106,853) (115,435)
Provision for income taxes -- -- --
------------ ------------ ------------
Net loss $ (1,546) $ (106,853) $ (115,435)
============ ============ ============
Loss per common share $ (0.00) $ (.01) $ (0.00)
============ ============ ============
(basic and assuming dilution)
Weighted average shares outstanding
Basic and diluted 1,185,400 9,955,555 14,533,000
See accompanying notes to proforma unaudited consolidated financial statements
F-22
VICTOR EBNER ENTERPRISES, INC
CONSOLIDATED PRO FORMA UNAUDITED STATEMENT OF LOSSES
DECEMBER 31, 2000
College Pro Forma Pro Forma
------- --------- ---------
Software Victor Ebner Adjustments Consolidated
------------ ------------ ------------ ------------
Operating expenses:
Selling, general and administrative $ 18,705 $ 31,791 $ 7,036 (2) $ 57,532
Operating expense 18,705 31,791 57,532
------------ ------------ ------------
Net loss before taxes (18,705) (31,791) (57,532)
Provision for income taxes -- -- --
------------ ------------ ------------
Net loss $ (18,705) $ (31,791) $ (57,532)
============ ============ ============
Loss per common share $ (0.02) $ (31,791) $ (0.00)
============ ============ ============
(basic and assuming dilution)
Weighted average shares outstanding
Basic and diluted 1,116,300 1 14,533,000
See accompanying notes to proforma unaudited consolidated financial statements
F-23
VICTOR EBNER ENTERPRISES, INC
NOTES TO CONDENSED PRO FORMA UNAUDITED FINANCIAL STATEMENTS
Unaudited Pro Forma Condensed Financial Information
.
The Proforma Unaudited Financial Statements have been prepared in order to
present consolidated financial position and results of operations of College and
Victor Ebner as if the acquisition had occurred as of March 31, 2001 for the pro
forma condensed balance sheet and to give effect to the acquisition of College ,
as if the transaction had taken place at January 1, 2000 for the pro forma
condensed consolidated statements of losses for the year ended December 31, 2000
and as of January 1, 2001 for the three month period ended March 31, 2001
The following pro forma adjustments are incorporated into the pro forma
condensed consolidated balance sheet as of March 31, 2001 and the pro forma
condensed consolidated statements of income for the three month period ended
March 31, 2001 and for the year ended December 31, 2000
(1) To record the issuance of 12,800,000 shares of College common stock in
exchange for 12,800,000 shares of issued and outstanding shares of Victor Ebner.
(2) To record the acquisition of College for stock. The significant components
of this transaction are:
Common stock retained by College shareholders $ 1,185
Excess of liabilities assumed over assets acquired 5,851
-------
Total consideration paid $ 7,036
=======
In accordance with SOP 98-5, the Company will expense as organization costs
the $7,036.
(3) To record the issuance of common stock to subscribers subsequent to March
31, 2001 at the agreed upon price of $2.50 per share.
F-24
SIGNATURE
Pursuant to the requirements of Section 13 or 15(b) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
VICTOR EBNER ENTERPRISES, INC. Date: June 19, 2001
(Registrant)
By: /s/ Christian Ebner
---------------------
Christian Ebner
President