U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
Amendment No. 1 to
Current Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): August 22, 2003
X-NET SERVICES CORP.
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(Exact Name of Registrant as Specified in its Charter)
Nevada 000-49722 87-0671807
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(State or Other Jurisdiction of (Commission File Number) (IRS Employer
Incorporation) No.) Identification
4933 East Highway 60
Rogersville, MO 65742
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(Address of Principal Executive (Zip Code)
Offices)
(417) 890-6556
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(Registrant's telephone number, including area code)
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(Former Name or Former Address, if Changed Since Last Report)
The undersigned Registrant hereby amends Item 7 of its current report on
Form 8-K dated August 22, 2003 to file the following additional financial
statements:
ITEM 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Financial statements of businesses acquired.
The following unaudited financial statements are included in this
amendment no. 1 to the current report on Form 8-K dated August 22, 2003
immediately following the signature page:
Unaudited Financial Statements of Third Millennium Industries,
Inc. as of June 30, 2003 and for the six months then ended.
Unaudited Financial Statements of Campers World, Inc. as of
June 30, 2003 and for the six months then ended.
Unaudited Financial Statements of Clear Lake Trailers, Inc. as
of June 30, 2003 and for the six months then ended.
Unaudited Financial Statements of Twister Trailers
Manufacturing, Inc. as of June 30, 2003 and for the six months
then ended.
(b) Pro forma financial information.
The following unaudited pro forma financial information is included in
this amendment no. 1 to the current report on Form 8-K dated August 22,
2003 immediately following the unaudited financial statements described
above:
The Unaudited Pro-forma Condensed Combined Balance Sheet as of
June 30, 2003, and the related Unaudited Pro-forma Condensed
Combined Statements of Operations for the six months ended
June 30, 2003 and the year ended December 31, 2002, which give
effect to the acquisition by X-Net Services Corp. of all
issued and outstanding shares of capital stock of Third
Millennium Industries, Inc. in a transaction accounted for as
a reverse acquisition.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
X-Net Services Corp.
Dated: October 31, 2003 By /s/ Dennis K. DePriest
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Dennis K. DePriest
President
2
THIRD MILLENIUM INDUSTRIES, INC.
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
JUNE 30, 2003
ASSETS
Current Assets:
Cash 7,676
Accounts receivable, net -
Inventory -
Other current assets 153,752
Total current assets 161,428
Property and equipment, net 368,337
Other long-term assets, net -
Total Assets 529,765
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Notes payable 388,875
Accounts payable 420,685
Total current liabilities 809,560
Long-term debt -
Total liabilities 809,560
Stockholders' Equity
Common stock, par value $.0001,
50,000,000 shares authorized,
10,200,000 shares issued and
outstanding 1,000
Additional paid-in capital 462,350
Accumulated deficit (743,145)
Total stockholders' equity (279,795)
Total Liabilities and Stockholders' Equity 529,765
THIRD MILLENIUM INDUSTRIES, INC.
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS
THROUGH JUNE 30, 2003
REVENUES
Sales -
Cost of Sales -
Gross Profit -
OPERATING EXPENSES
Selling, general and administrative
expenses 366,468
Other expenses -
Total Operating Expenses 366,468
Other Income (Expense) -
Net (loss) income (366,468)
CAMPERS WORLD, INC.
BALANCE SHEET
JUNE 30, 2003
ASSETS
Current Assets:
Cash 17,497
Accounts receivable, net 740,658
Inventory 3,933,048
Other current assets 5,744
Total current assets 4,696,947
Property and equipment, net 261,006
Other long-term assets, net 11,319
Total Assets 4,969,272
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Notes payable -
Accounts payable 1,058,127
Total current liabilities 1,058,127
Long-term debt 3,919,338
Total liabilities 4,977,465
Stockholders' Equity
Common stock 5,000
Additional paid-in capital 296,305
Accumulated deficit (309,498)
Total stockholders' equity (8,193)
Total Liabilities and Stockholders'
Equity 4,969,272
CAMPERS WORLD, INC.
STATEMENT OF OPERATIONS
THROUGH JUNE 30, 2003
REVENUES
Sales 9,161,539
Cost of Sales 7,944,585
Gross Profit 1,216,954
OPERATING EXPENSES
Selling, general and administrative
expenses 865,285
Other expenses 178,229
Total Operating Expenses 1,043,514
Other Income (Expense) -
Net (loss) income 173,440
CLEAR LAKE TRAILERS, INC.
BALANCE SHEET
JUNE 30, 2003
ASSETS
Current Assets:
Cash (35,431)
Accounts receivable, net 25,676
Inventory 325,404
Other current assets 3,449
Total current assets 319,098
Property and equipment, net 95,912
Other long-term assets, net 53,683
Total Assets 468,693
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Notes payable 61,182
Accounts payable 342,963
Total current liabilities 404,145
Long-term debt 247,716
Total liabilities 651,861
Stockholders' Equity
Common stock 70,000
Additional paid-in capital 645,728
Accumulated deficit (898,896)
Total stockholders' equity (183,168)
Total Liabilities and Stockholders'
Equity 468,693
CLEAR LAKE TRAILERS, INC.
STATEMENT OF OPERATIONS
THROUGH JUNE 30, 2003
REVENUES
Sales 1,106,647
Cost of Sales 929,487
Gross Profit 177,160
OPERATING EXPENSES
Selling, general and administrative
expenses 186,747
Other expenses 86,534
Total Operating Expenses 273,281
Other Income (Expense) -
Net (loss) income (96,121)
TWISTER TRAILER MANUFACTURING, INC.
BALANCE SHEET
JUNE 30, 2003
ASSETS
Current Assets:
Cash 7,275
Accounts receivable, net -
Inventory 71,525
Other current assets -
Total current assets 78,800
Property and equipment, net 22,810
Other long-term assets, net -
Total Assets 101,610
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Notes payable 92,848
Accounts payable 27,070
Total current liabilities 119,918
Long-term debt 165,887
Total liabilities 285,805
Stockholders' Equity
Common stock 54,196
Additional paid-in capital -
Accumulated deficit (238,391)
Total stockholders' equity (184,195)
Total Liabilities and Stockholders' Equity 101,610
TWISTER TRAILER MANUFACTURING, INC.
STATEMENT OF OPERATIONS
THROUGH JUNE 30, 2003
REVENUES
Sales 201,283
Cost of Sales 136,244
Gross Profit 65,039
OPERATING EXPENSES
Selling, general and administrative
expenses 54,263
Other expenses -
Total Operating Expenses 54,263
Other Income (Expense) -
Net (loss) income 10,776
UNAUDITED PRO-FORMA FINANCIAL STATEMENTS
The following unaudited pro-forma condensed combined balance sheet aggregates
the balance sheet of X-Net Services Corp. (a Nevada corporation) ("X-Net") and
the balance sheet of Third Millennium Industries, Inc. (a Nevada corporation)
("Third") as of June 30, 2003, accounting for the transaction as a
recapitalization of Third with the issuance of shares for the net assets of
X-Net (a reverse acquisition) and using the assumptions described in the
accompanying notes, giving effect to the transaction as if the transaction had
occurred as of the end of the period. The transaction was not completed as of
June 30, 2003.
The following unaudited pro forma condensed combined statements of operations
combine the results of operations of X-Net and Third for the six months ended
June 30, 2003 and the year ended December 31, 2002 as if the transaction had
occurred as of the beginning of each of the respective periods.
The pro-forma condensed combined financial statements are presented for
information purposes only and do not purport to represent what X-Net's financial
position or results of operations would have been had the Third acquisition in
fact occurred on the dates assumed or that may result from future operations.
These pro-forma financial statements should be read in conjunction with the
historical financial statements included in X-Net's previous filings with the
Securities and Exchange Commission, and the audited financial statements of
Third Millennium Industries, Inc., Campers World, Inc., Clear Lake Trailers,
Inc., and Twister Trailers Manufacturing, Inc., included therein.
X-NET SERVICES CORPORATION
(A DEVELOPMENT STAGE COMPANY)
UNAUDITED PRO-FORMA CONDENSED COMBINED BALANCE SHEET
JUNE 30, 2003
Third Campers Clear Lake Twisters Pro-forma
X-Net Millenium World Trailers Trailers Adjustments Pro-forma
------- --------- ------- ---------- -------- ----------- ---------
ASSETS
Current Assets:
Cash 201,130 7,676 17,497 (35,431) 7,275 - 198,147
Accounts receivable, net 4,284 - 740,658 25,676 - - 770,618
Inventory - - 3,933,048 325,404 71,525 - 4,329,977
Other current assets 15,000 153,752 5,744 3,449 - - 177,945
Total current assets 220,414 161,428 4,696,947 319,098 78,800 - 5,476,687
Property and equipment, net 3,666 368,337 261,006 95,912 22,810 - 751,731
Goodwill - - - - - - [A] -
Investment in subsidiary - - - - - - -
Other long-term assets, net - - 11,319 53,683 - - 65,002
Total Assets 224,080 529,765 4,969,272 468,693 101,610 - 6,293,420
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Notes payable - 463,875 - 61,182 92,848 281,333 [B] 899,238
Accounts payable - 345,685 1,058,127 342,963 27,070 - 1,773,845
Total current liabilities - 809,560 1,058,127 404,145 119,918 281,333 2,673,083
Long-term debt - - 3,919,338 247,716 165,887 266,667 [B] 4,599,608
Total liabilities - 809,560 4,977,465 651,861 285,805 548,000 7,272,691
Stockholders' Equity
Common stock - par value $.001,
25,000,000 shares authorized,
11,700,000 shares issued and
outstanding 1,500 1,000 5,000 70,000 54,196 (119,963) [C] 11,733
Additional paid-in capital 268,392 462,350 296,305 645,728 - (1,672,775) [C] -
Accumulated deficit (45,812) (743,145) (309,498) (898,896) (238,391) 1,244,738 [C] (991,004)
Total stockholders' equity 224,080 (279,795) (8,193) (183,168) (184,195) (548,000) (979,271)
Total Liabilities and Stockholders'
Equity 224,080 529,765 4,969,272 468,693 101,610 - 6,293,420
X-NET SERVICES CORPORATION
(A DEVELOPMENT STAGE COMPANY)
UNAUDITED PRO-FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2002
Third Campers Clear Lake Twisters Pro-forma
X-Net Millenium World Trailers Trailers Adjustments Pro-forma
------- --------- ------- ---------- -------- ----------- ---------
REVENUES
Sales 18,370 - 17,641,514 4,059,096 479,151 - 22,198,131
Cost of Sales - - 15,661,221 3,490,592 380,198 - 19,532,011
Gross Profit 18,370 - 1,980,293 568,504 98,953 - 2,666,120
OPERATING EXPENSES
Selling, general and
administrative expenses 40,903 376,677 1,868,522 786,614 100,425 - 3,173,141
Other operating expenses - - - - - - -
Total Operating Expenses 40,903 376,677 1,524,908 786,614 100,425 - 2,829,527
Other Income (Expense) 3,355 - (363,853) (367,143) (22,815) (35,840) [D] (786,296)
Net (loss) income (19,178) (376,677) 91,532 (585,253) (24,287) - (913,863)
Basic loss per common share (0.01) (0.08)
Diluted loss per common share (0.01) (0.07)
Shares used in basic loss per
common share 1,500,000 11,700,000
Shares used in diluted loss
per common share 2,383,333 12,583,333
X-NET SERVICES CORPORATION
(A DEVELOPMENT STAGE COMPANY)
UNAUDITED PRO-FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 2003
Third Campers Clear Lake Twisters Pro-forma
X-Net Millenium World Trailers Trailers Adjustments Pro-forma
------- --------- ------- ---------- -------- ----------- ---------
REVENUES
Sales - - 9,161,539 1,106,647 201,283 - 10,469,469
Cost of Sales - - 7,944,585 929,487 136,244 - 9,010,316
Gross Profit - - 1,216,954 177,160 65,039 - 1,459,153
OPERATING EXPENSES
Selling, general and
administrative expenses 2,288 366,468 865,285 186,747 54,263 - 1,475,051
Other expenses - - 178,229 86,534 - 264,763
Total Operating Expenses 2,288 366,468 1,043,514 273,281 54,263 - 1,739,814
Other Income (Expense) 1,104 - - (17,920) [D] (16,816)
Net (loss) income (1,184) (366,468) 173,440 (96,121) 10,776 - (279,557)
Basic loss per common share (0.00) (0.02)
Diluted loss per common share (0.00) (0.02)
Shares used in basic loss per
common share 1,500,000 11,700,000
Shares used in diluted loss per
common share 2,383,333 12,583,333
NOTES TO THE UNAUDITED PRO-FORMA FINANCIAL STATEMENTS
1) The acquisition of Millenium by X-Net is considered a "reverse merger
transaction" and is accounted for under the purchase method of accounting. Under
the purchase method of accounting, assets acquired and liabilities assumed are
recorded at their fair values. No adjustments have been made in the pro forma
balance sheet to the carrying values of the X-Net assets acquired and
liabilities assumed since management believes that their carrying values
approximate their fair values.
2) Purchase price allocations:
Third Millenium Campers Clear Lake Twister
(consolidated) World Trailers Trailers
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Current assets 5,256,273 4,696,947 319,098 78,800
Property and equipment, net 748,065 261,006 95,912 22,810
Other long-term assets, net 65,002 11,319 53,683 -
Total assets acquired 6,069,340 4,969,272 468,693 101,610
Current liabilities 2,673,083 1,058,127 404,145 119,918
Long-term liabilities 4,599,608 3,919,338 247,716 165,887
Total liabilities assumed 7,272,691 4,977,465 651,861 285,805
Purchase price 10,200,000 1,148,000 150,000 225,000
Goodwill [E] 1,156,192 333,168 409,195
3) Adjustments:
[A] To record goodwill resulting from the excess of the cost of the acquired
entities over the net amounts assigned to assets acquired and liabilities
assumed. Also, to eliminate previously recorded goodwill as a result of the
reverse merger transaction between X-Net and Third Millenium.
[B] To record consideration given by Third Millenium to Campers World in the
form of notes payable.
[C] To record the issuance of common stock as consideration for the
acquisitions, and to record entries to eliminate stockholders' equity and
results of operations of subsidiaries. Also, as the merger between X-Net and
Third Millenium is considered a capital transaction, with no recording of
goodwill, these entries reflect the necessary reduction to additional paid-in
capital and increase in the accumulated deficit.
[D] Pro forma adjustments to interest expense arising from notes issued as
consideration for the acquisition of Campers World by Third Millenium.
[E] As the merger between X-Net and Third Millennium is deemed to be a capital
transaction in substance, rather than a business combination, no goodwill is
recorded.