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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM SB-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
TEEN EDUCATION GROUP, INC.
______________________________________________
(Name of small business issuer in its charter)
DELAWARE 8200 26-032648
________________________________________________________________________________
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification No.)
Teen Education Group, Inc.
70707 Frank Sinatra Drive
Unit 59
Rancho Mirage, California 92270
(702) 248-1027
_____________________________________________________________
(Address and telephone number of principal executive offices)
The Company Corporation
2711 Center Road
Suite 400
Wilmington, Delaware 19809
(800) 818-0204
__________________________________________________________
(Name, address and telephone numbers of agent for service)
COPIES OF ALL COMMUNICATIONS TO:
Ronald J. Stauber, Esq.,
Ronald J. Stauber, Inc.
1880 Century Park East, Suite 300, Los Angeles, CA 90067
(310) 556-0080 - Fax (310) 556-3687
Approximate date of commencement of proposed sale to the public: As soon as
practicable after this Registration Statement becomes effective.
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering.[ ]
If this Form is a post effective amendment filed pursuant to Rule 462(d) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434, check
the following box. [ ]
CALCULATION OF REGISTRATION FEE
________________________________________________________________________________
Title of Proposed Proposed
Each Class of Maximum Maximum Amount of
Securities To Amount To Be Offering Price Aggregate Registration
Be Registered Registered(1) Per Unit Offering Price Fee
________________________________________________________________________________
Common 250,000 $0.10 $25,000.00 $6.14
________________________________________________________________________________
(1) Estimated solely for the purpose of computing the registration fee pursuant
to Rule 457(o) under the Securities Act.
The registrant hereby amends this registration statement on such date or dates
as may be necessary to delay its effective date until the registrant shall file
a further amendment which specifically states that this registration statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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________________________________________________________________________________
Prospectus
TEEN EDUCATION GROUP, INC.
Up to 250,000 Shares of Common Stock
Offering price of $0.10
This offering by Teen Education Group, Inc. (sometimes "Teen") consists
of a new issue of up to 250,000 shares of common stock, $0.001 par value
(sometimes "shares") of Teen at a price of $ 0.10 per share for a period of 3
months from the effective date of this prospectus.
There is no minimum number of shares being offered and we have two
classes of shares authorized (common and preferred). There are no preferred
shares of stock issued or outstanding. Only the shares of common stock are being
sold.
The shares are not listed on any national securities exchange and the
Nasdaq Stock Market does not list the shares being offered.
THIS OFFERING IS HIGHLY SPECULATIVE AND INVOLVES A HIGH DEGREE OF RISK
TO THE PUBLIC INVESTORS AND SHOULD BE PURCHASED ONLY BY PERSONS WHO CAN
AFFORD TO LOSE THEIR ENTIRE INVESTMENT (SEE RISK FACTORS AND DILUTION).
This offering involves a high degree of risk; see "RISK FACTORS"
beginning on page 7 to read about factors you should consider before buying
shares of the common stock.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION,
NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE OR
PROVINCIAL SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
The Offering:
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250,000 SHARES OFFERED PRICE PER SHARE TOTAL
Public Price $0.10 $ 25,000
Underwriting Discounts
and Commissions -- 0.00
_____ ________
Total $0.10 $ 25,000
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This is a best efforts public offering, with no minimum purchase
requirement.
1. Teen is not using an underwriter for this offering.
2. There is no arrangement to place the proceeds from this offering in an
escrow, trust or similar account. Delaware law does not require that funds
raised pursuant to the sale of securities be placed into an escrow account.
Any funds raised from this offering will be immediately available to Teen
for its use.
3. The closing date for this offering is November __, 2007.
The information in this prospectus is not complete and may be changed. Teen may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
The date of this Prospectus is November __, 2007.
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TABLE OF CONTENTS
Item No. Item in Form SB-2 Prospectus Caption Page No.
1 Front of Registration Statement and Outside Front Cover
Page of Prospectus
2 Prospectus Cover Page
3 Prospectus Summary 5
4 Risk Factors 7
5 Use of Proceeds 13
6 Determination of Offering Price 16
7 Dilution 16
8 Selling Security Holders 18
9 Plan of Distribution 18
10 Legal Proceedings 19
11 Directors, Executive Officers, Promoters and Control
Persons 19
12 Security Ownership of Certain Beneficial Owners and
Management 19
13 Description of Securities 20
14 Interest of Named Experts and Counsel 20
15 Disclosure of Commission Position on Indemnification
for Securities Act Liabilities 21
16 Organization within Last Five Years
17 Description of Business 21
18 Plan of Operation 25
19 Description of Property 28
20 Certain Relationships and Related Transactions 28
21 Market for Common Equity and Related Shareholder Matters 29
22 Executive Compensation 32
23 Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure 32
24 Financial Statements 33
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Securities offered through this prospectus will not be sold through dealers, but
will be sold on a direct participation basis only.
Prospectus Summary and Risk Factors
SUMMARY INFORMATION
This is a summary and the information is selective, it does not contain
all information that may be important to you. The summary highlights the more
detailed information and financial statements appearing elsewhere in this
document. It is only a summary. We urge you to read the entire prospectus
carefully. Your attention is specifically called to the Risk Factors beginning
on page 6 and the financial statements and the explanatory notes before making
any investment decision.
The Company: TEEN EDUCATION GROUP, INC. was incorporated
on April 16, 2007 in the State of Delaware.
Our principal executive offices are located
at 70707 Frank Sinatra Drive, Unit 59,
Rancho Mirage, California 92270 (702)
248-1027. As of the date of this prospectus,
we have no revenues or operations.
We are a development stage company. We have
not had any revenues or operations and we
have few assets. We do not expect to have
revenues until at least three months after
our registration statement becomes
effective.
Since incorporation, we have not made any
purchases or sale of assets nor have we been
involved in any mergers, acquisitions or
consolidations. Teen has never declared
bankruptcy, has never been in receivership,
and has never been involved in any legal
action or proceedings.
We are in the process of establishing
ourselves as providing financial literacy
and money management educational programs
for teenagers on a fee for service offered
basis.
Securities Offered: Up to 250,000 shares of common stock with no
minimum number of shares are being offered.
There is no minimum on the number of shares
that have been designated for sale.
Accordingly, once our securities are
purchased, the investor will not be able to
obtain a return of the investment,
regardless of the number of shares sold.
5
Offering Price Per $0.10 per share of common share with a par
Share: value of $0.001 per share.
Offering: Our shares are being offered on a self
underwriting basis by Robert L. Wilson for a
period not to exceed three months from the
effective date of this prospectus, on a best
effort basis.
Determination of The offering price has been arbitrarily
Offering Price: determined by us based upon what we believe
purchasers of such speculative issues would
be willing to pay for our securities and
bears no relationship whatsoever to assets,
earnings, book value or any other
established criteria of value
Net Proceeds: Approximately $25,000 with all of the
proceeds will be going to us.
Use of Proceeds: The following table indicates how our
company intends to use these proceeds of
this offering.
Proceeds from Sale of Common Stock $25,000
Expenses
Curriculum Development 7,000
Educational and Training Material 3,000
Training Expense 1,000
Website Development 2,000
Marketing and Promotional Expenses 2,000
Legal and Accounting Fees 5,000
Furniture and Equipment 2,000
Miscellaneous Administrative Costs 3,000
_______
Total $25,000
Number of Shares of
the Common Stock
Outstanding: Before the Offering: 2,000,000
Shares being Offered: 250,000
_________
After the Offering: 2,250,000
Risk Factors: Our securities being offered involve a high
degree of risk and immediate substantial
dilution and should not be purchased by
investors who cannot afford to lose their
entire investment. Such risk factors
include, among others, lack of operating
history and limited resources, no escrow of
proceeds, and lack of a viable market for
the securities (See "Risk Factors" on page
7.)
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Summary of Financial Information:
AS AT SEPTEMBER 30, 2007
Current Assets $ 0
Current Liabilities $2,232
Loans from Shareholders $2,232
FROM APRIL 16, 2007 TO SEPTEMBER 30, 2007
Revenue $0
Net Loss $7,232
We have not begun operations and are currently without revenues. We
have no full-time employees at the present time. As at September 30, 2007, our
accumulated deficit was $7,232. We anticipate that we will operate in a deficit
position and continue to sustain net losses for the foreseeable future.
RISK FACTORS
THE PURCHASE OF THE SECURITIES BEING OFFERED BY THIS PROSPECTUS INVOLVES A HIGH
DEGREE OF RISK TO THE INVESTORS AND SHOULD BE PURCHASED ONLY BY PERSONS WHO CAN
AFFORD TO LOSE THEIR ENTIRE INVESTMENT. THE OFFERING PRICE HAS BEEN ARBITRARILY
DETERMINED ON WHAT WE BELIEVE PURCHASERS OF A SPECULATIVE OFFERING WOULD BE
WILLING TO PAY FOR THE SECURITIES AND BEARS NO RELATIONSHIP WHATSOEVER TO
ASSETS, EARNINGS, BOOK VALUE OR ANY OTHER ESTABLISHED CRITERIA OF VALUE.
Prior to investing in the shares, a prospective investor should
consider carefully the following risks and highly speculative factors that may
affect our business. In analyzing this offering, prospective investors should
carefully consider, among other factors, the following:
1. As a start-up or development stage company, our business and prospects
are difficult to evaluate because we have no operating history and our
business model is evolving, an investment in us is considered a high
risk investment whereby you could lose your entire investment.
We have just commenced operations and, therefore, we are considered a
"start-up" or "development stage" company. We have not yet owned and/or operated
and/or provided any educational services. We will incur significant expenses in
order to implement our business plan. As an investor, you should be aware of the
difficulties, delays and expenses normally encountered by an enterprise in its
development stage, many of which are beyond our control, including unanticipated
developmental expenses, and advertising and marketing expenses. We cannot assure
you that our proposed business plan as described in this prospectus will
materialize or prove successful, or that we will ever be able to operate
profitably. If we cannot operate profitably, you could lose your entire
investment.
7
We face the challenge of successfully implementing our business plan.
There is, therefore, nothing at this time on which to base an assumption that
our business will prove successful, and there is no assurance that we will be
able to operate profitably if or when operations commence. You may lose your
entire investment do to our lack of experience.
Our plan of operation is our best estimate and analysis of the
potential market, opportunities and difficulties that we face. There can be no
assurances that the underlying assumptions accurately reflect our opportunities
and potential for success. Competition for the delivery of education skills is
intense, and with other economic forces, this makes forecasting of revenues and
costs difficult and unpredictable. If our estimates and analysis is incorrect,
you could lose your entire investment.
2. Our working capital will be limited. We will need additional capital to
fund our operations and finance future growth, and we may not be able
to obtain it on terms acceptable to us or at all. This will impede our
growth and operating results.
There is no minimum amount that must be sold in this offering. Although
we will be able to commence operations without raising any funds in this
offering, we will have little or no working capital on hand. Our ability to
commence and continue operations and operate as a going concern may be
contingent on the successful completion of all or part of this offering, it may
depend on our ability to borrow funds from Robert L. Wilson and unrelated third
parties, and the receipt of proceeds from those enrolling in the educational
program on commencement of operations. As of this date, we have generated no
income and there can be no assurance that any such income will be forthcoming in
the future. Our inability to fund our operations will impede our growth and
operating results and may also result in a loss of your investment.
3. We expect to incur losses in the future and, as a result, the value of
our shares and our ability to raise additional capital may adversely
affect our ability to sustain growth and our operations may suffer.
We have no operating history and, therefore, no revenues. We expect to
incur losses during our first year of operation. There can be no assurances that
we will achieve profitability in the future, or, if so, as to the timing or
amount of any such profits.
We plan to use any revenues received to support our plan of operations
and to commence our sales and marketing. Many of the expenses associated with
these activities are relatively fixed in the short-term. We may be unable to
adjust spending quickly enough to offset unexpected revenue shortfalls. If so,
our operational results will suffer.
We should have sufficient capital to meet our operating expenses for
the next twelve (12) months. After that time, we will either need to raise
additional funds or realize additional revenue from our business activities to
meet our cash requirements. There can be no guarantee that we will be successful
in securing additional financing should the need arise.
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Our inability to fund our operations will impede our growth and
operating results and may also result in a loss of your investment.
4. Failure to secure additional financing may result in termination of
Teen's operations and eliminate any value in Teen's stock.
We may require additional financing in order to establish profitable
operations. Such financing, if required, may not be forthcoming. Even if
additional financing is available, it may not be available on terms we find
favorable. Failure to secure the needed additional financing will have a very
serious, if not fatal, effect on our ability to survive. As of September 30,
2007, we had no working capital and our losses to that date totaled $7,232.
5. Teen's business model is unproven. Thus it is difficult for an investor
to determine the likelihood of success or risk to his investment.
Teen was formed on April 16, 2007. As of the date of this prospectus,
we do not have any revenues or operations, and we have no assets. We do not
expect to have revenues until at least three months after this prospectus
becomes effective.
Due to our lack of operating history, the revenue and income potential
of our business is unproven. If we cannot successfully implement our business
strategies of creating and marketing of an educational curriculum to teach
personal financial management skills to teenagers, we may not be able to
generate sufficient revenues to operate profitably. Consequently our investors
may lose a substantial portion of or their entire investment.
6. We have no minimum share purchase requirement thus early investors may
face the loss of their investment if Teen's operations are not
commenced due to the failure of this offering.
The offering is not subject to any minimum share purchase requirement.
Consequently, the early investor is not assured of any other, later shares being
sold. You may be the only purchaser.
We are dependent upon this offering to be able to implement our
business plan and our lack of revenues and profits may make our obtaining
additional capital more difficult. We presently have no significant operating
capital and we are totally dependent upon receipt of the proceeds of this
offering to provide the capital necessary to commence our proposed business.
Upon completion of the offering, the amount of capital available to us will
still be extremely limited, especially if less than the total amount of the
offering is raised since this is not an underwritten offering. We have no
commitments for additional cash funding beyond the proceeds expected to be
received from this offering. If we need and are unable to raise additional
capital, then you may lose your entire investment.
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7. Teen shareholders' investment will be illiquid due to a lack of a
public trading market and thus our shareholders may not be able to
recover all of their investment in Teen.
There is presently no public trading market for our common stock, and
it is unlikely that an active public trading market can be established or
sustained in the foreseeable future. Even if a public market were to develop,
our shareholders may never realize any value from their investment in our stock.
We intend to have our common stock quoted on the OTC Bulletin Board as soon as
practicable. However, there can be no assurance that our shares will be quoted
on the OTC Bulletin Board. Until there is an established trading market, holders
of our common stock may find it difficult to sell their stock or to obtain
accurate quotations for the price of the common stock. If a market for our
common stock does develop, our stock price may be volatile.
8. Teen's auditor has expressed doubts as to our ability to continue as a
going concern.
In the opinion of our auditor, since we have not generated revenue from
operations, it raises substantial doubt about Teen's ability to continue as a
going concern.
9. Teen's curriculum material may not be sufficient to ensure Teen's
success in its intended market resulting in the termination of Teen's
operations and a loss of shareholders' investment.
Initially, the only course Teen will be offering is a financial
literacy and money management program for teenagers on a fee for service offered
basis for our course. As such, our survival is dependent upon the market
acceptance of this sole course material. Should this course material be too
narrowly focused or should the target market be not as responsive as Teen
anticipates, we will not have any other course material that can be offered to
ensure our survival in the educational marketplace.
While we believe that our course material and providing a financial
literacy and money management program for teenagers on a fee for service offered
basis, this view may not be shared by their parents. In such an event, we may
not be able to attract sufficient students to make it a viable business
operation, and we may subsequently fail due to this lack of acceptance in our
course material.
10. The loss of Robert L. Wilson or our inability to attract and retain
qualified personnel could significantly disrupt or harm our business
and our operating results would suffer.
We are wholly dependent, at present, on the personal efforts and
abilities of Robert L. Wilson, our sole officer and director. The loss of
services of Robert L. Wilson will disrupt if not stop our operations. In
addition, our success will depend on our ability to attract and retain highly
motivated, well-qualified lecturers or employees. Our inability to recruit and
retain such individuals may delay the planned commencement of operations and or
result in high employee turnover, which could have a material adverse effect on
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our business or results of operations once commenced. Accordingly, without
suitable replacements and employees to operate Teen, our operations will suffer.
11. Robert L. Wilson will own approximately 89% of our shares after the
offering that permits him to exert influence over us or to prevent a
change of control.
After giving effect to this offering, Robert L. Wilson, our sole
director and officer, will beneficially own approximately 89% of our outstanding
shares of common stock, if all of the shares are sold in this offering. As a
result of this stock ownership, Robert L. Wilson will continue to influence the
vote on all matters submitted to a vote of our shareholders, including the
election of directors, amendments to the certificate of incorporation and the
by-laws, and the approval of significant corporate transactions. This
consolidation of voting power could also delay, deter or prevent a change of our
control that might be otherwise beneficial to shareholders.
12. You will not receive dividend income from an investment in the shares
and as a result, the purchase of the shares should only be made by an
investor who does not expect a dividend return on the investment.
We have never declared or paid a cash dividend on our shares nor will
we in the foreseeable future. We currently intend to retain future earnings, if
any, to finance the operation and expansion of our business. Accordingly,
investors who anticipate the need for immediate income from their investments by
way of cash dividends should refrain from purchasing any of our securities. As
we do not intend to declare dividends in the future, you may never see a return
on your investment and you indeed may lose your entire investment.
13. We have arbitrarily determined the initial public offering price and
this may not be the market price of the shares after the offering, as a
result, future sales of the stock could be at a lesser price than the
offering price.
The offering price of the shares has been arbitrarily determined by us
based on what we believe purchasers of such speculative issues would be willing
to pay for the shares of Teen and does not necessarily bear any material
relationship to book value, par value, or any other established criterion of
value. As a result, it may be difficult for you to resell your shares at or
above the offering price. You may also lose your entire investment if the price
of the shares being sold is too high.
14. You may not be able to resell any shares you purchased in this
offering.
There is no trading market for our common stock at present and there
has been no trading market to date. We have not undertaken any discussions,
preliminary or otherwise, with any prospective market maker concerning the
participation of such market maker in the aftermarket our common stock. There is
no assurance that a trading market will ever develop or, if such a market does
develop, that it will continue. This means that it may be hard or impossible for
11
you to find a willing buyer for your shares should you decide t sell then in the
future or to resell the shares at or above the offering price.
15. Our issuance of further shares will dilute our common stock and could
cause our stock price to decline.
The shares, if all are sold, being offered in this prospectus
represents approximately 11% of our total issued and outstanding shares on a
fully-diluted basis. If you invest in our shares, your interest will be diluted
to the extent of the differences between the price per share you pay for the
common stock of $0.10 per share and the pro forma as adjusted net tangible book
value per share which would be $.01 at the time of sale which is a dilution of
90% of your investment. We calculate net tangible book value per share by
subtracting from our total assets all intangible assets and total liabilities,
and dividing the result by the number of outstanding shares of common stock.
Furthermore, we may issue additional shares, options and warrants and we may
grant stock options to our employees, officers, directors and consultants under
our future stock option plans, all of which may further dilute our net tangible
book value. The dilution of our shares could lower the price a willing buyer
would pay for our shares based on the fact our net asset value per share and/or
our earnings ratio per share would be reduced.
16. Future sales of restricted shares could decrease the price a willing
buyer would pay for shares of our common stock, could cause our price
to decline and could impair our ability to raise capital.
We currently have 2,000,000 shares of common stock issued and
outstanding, all of which is held by Robert L. Wilson, our sole officer and
director. These shares are considered restricted securities pursuant to Rule 144
promulgated under the Securities Act of 1933, as amended. These shares in the
future may be available for sale under exemptions from registration. Future
sales of common stock by Robert L. Wilson under exemptions from registration or
through a subsequent registered offering could materially adversely affect the
market price of our common stock and could materially impair our future ability
to raise capital through an offering of equity securities. We are unable to
predict the effect, if any, that market sales of these shares, or the
availability of these shares for future sale, will have on the prevailing market
price of our common stock at any given time.
17. Our common stock has no public market and the value may decline after
the offering and our common stock may never be public traded and you
may have no ability to sell the shares.
There is no established public trading market or market maker for our
securities. There can be no assurance that a market for our common stock will be
established or that, if established, a market will be sustained. Therefore, if
you purchase our securities you may be unable to sell them. Accordingly, you
should be able to bear the financial risk of losing your entire investment. We
plan to seek a listing on the OTC Bulletin Board once our registration statement
has been declared effective. We will contact a market maker to seek the listing
on our behalf.
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Only market makers can apply to quote securities. Market makers who
desire to initiate quotations in the OTC Bulletin Board system must complete an
application (Form 211) and by doing so, will have to represent that it has
satisfied all applicable requirements of the Securities and Exchange Commission
Rule 15c2-11 and the filing and information requirements promulgated under the
Financial Industry Regulatory Authority, Inc. ("FINRA") Bylaws. The OTC Bulletin
Board will not charge us with a fee for being quoted on the service. FINRA rules
prohibit market makers from accepting any remuneration in return for quoting
issuers' securities on the OTC Bulletin Board or any similar medium. We intended
to be subject to the reporting requirements of the Securities Exchange Act of
1934, as amended, and, as such, we may be deemed compliant with Rule 15c2-11.
The FINRA will review the market maker's application and if cleared, it cannot
be assumed by any investor that any federal, state or self-regulatory
requirements other than certain FINRA rules and Rule 15c2-11 have been
considered by the FINRA. Furthermore, the clearance should not construed by any
investor as indicating that the FINRA, the Securities and Exchange Commission or
any state securities commission has passed upon the accuracy or adequacy of the
documents contained in the submission.
18. We have not contacted any market maker for sponsorship of our shares on
the OTC Bulletin Board.
The OTC Bulletin Board is a market maker or dealer-driven system
offering quotation and trading reporting capabilities-a regulated quotation
service - that displays real-time quotes, last-sale prices, and volume
information in OTC equity securities. The OTC Bulletin Board securities are not
listed and traded on the floor of an organized national or regional stock
exchanges. Instead, OTC Bulletin Board securities transactions are conducted
through a telephone and computer network connecting market makers or dealers in
stocks.
If we are unable to obtain a market maker to sponsor ourapproval for
trading, we will be unable to develop a trading market for our common stock. We
may be unable to locate a market maker that will agree to sponsor our shares.
Even if we do locate a market maker, there is no assurance that our shares will
be able to meet the requirements for a quotation or that the shares will be
accepted for inclusion on the OTC Bulletin Board.
19. If our common stock does not meet blue sky resale requirements, you may
be unable to resell your securities.
The common stock being offered must meet the blue sky resale
requirements in the states in which the proposed purchasers reside. If we are
unable to qualify the securities offered and there is no exemption from
qualification in certain states, the holders of the securities or the purchasers
of the securities may be unable to sell them.
Use of Proceeds
We intend to raise $25,000 from the sale of 250,000 shares of common
stock at $0.10 per share. This offering has a maximum amount of $25,000 and no
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minimum. Teen has no intention to return any stock sales proceeds to investors
if the maximum amount is not raised.
As of today, Teen has already raised a total of $5,000 from the sale of
common stock. This of $5,000 has been raised from the sale of stock to our sole
officer and director this stock is restricted and is not being registered in
this offering. The offering expenses associated with this offering are estimated
to be $10,510. As at September 30, 2007, we had no cash. We had accounts payable
of $2,232. Robert L. Wilson has orally agreed that he will advance Teen any
funds which it may need to pay the expenses of this offering and Robert L.
Wilson has advanced $282. Although no additional funds are currently
contemplated, such advances will be made interest-free with no fixed terms of
repayment and without any repayment from the proceeds of this offering. This
will allow us to pay the remainder of the expenses of this offering from cash on
hand. Teen will rely instead upon the anticipation of repayment from future
revenues, if any, generated by Teen's proposed business activities. None of the
offering expenses or shareholder loans are to be paid out of the proceeds of
this offering. The entire sum of monies we raise from this offering will be used
to finance our plan of operations. One of the purposes of the offering is to
create an equity market, which allows us to more easily raise capital, since a
publicly traded company has more flexibility in its financing offerings than one
that does not.
The following table indicates how our company intends to use these
proceeds of this offering.
Proceeds from Sale of Common Stock $25,000
Expenses
Curriculum Development 7,000
Educational and Training Material 2,000
Training Expense 1,000
Website Development 2,000
Marketing and Promotional Expenses 5,000
Legal and Accounting Fees 1,000
Furniture and Equipment 2,000
Miscellaneous Administrative Costs 4,000
_______
Total $25,000
The above expenditure items are defined as follows:
Curriculum Development: This expense refers to the cost of development
of the curriculum to operate our student training sessions.
Educational and Training Material: This expense will provide the funds
necessary to develop the student manuals as well as visual aids for use during
classroom instruction.
Training Expense: This expense will provide the funds necessary for a
minimal amount of service specific training for personnel. It will cover items
such as room and equipment rental for training seminars, copying and printing
costs for training manuals and other material.
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Website Development: This expense is the cost associated with
development of our website. Since the website will be used as a means to promote
our service, preliminary website development will begin as soon as we have the
funds available.
Marketing and Promotional Expenses: This item refers to the cost of a
basic marketing campaign and the provision of a minimal amount of educational
product information to and interested parents and individuals. We expect to
begin incur these costs during the second month of operations after the
effective date of this prospectus, and to continue throughout the remainder of
the year.
Legal and Accounting Fees: This expenditure item refers to the normal
legal and accounting costs associated with maintaining a publicly traded
company. We expect to be making these expenditures throughout the year,
commencing on the effective date of this registration.
Furniture and Equipment: This expenditure refers to items such as a
computer, visual aid equipment, tables and chairs, and other similar items. We
expect to be making these purchases during the second month of operation after
the effective date of this prospectus.
Miscellaneous Administrative Costs: This expense refers to any small
miscellaneous costs that have not been otherwise listed - such as bank service
charges and sundry items. This amount will cover such costs during the first
year of operation.
There is no assurance that Teen will raise the full $25,000 as
anticipated. The following is the break down of how we intend to use the
proceeds if only 10 percent, 50 percent, or 75 percent of the total offering
amount is raised:
Expenditure Item 10% 50% 75% 100%
Curriculum Development 1,000 3,500 5,250 7,000
Educational and Training Material 500 1,500 2,250 3,000
Training Expense 0 500 750 1,000
Website Development 500 1,000 1,500 2,000
Marketing and Promotional Expenses 2,500 3,750 5,000
Legal and Accounting Fees 0 500 750 1,000
Furniture and Equipment 0 1,500 2,250 2,000
Miscellaneous Administrative Costs 250 1,500 2,250 4,000
Total $ 2,500 $12,500 $18,750 $25,000
If only 10% of the offering is sold, we will continue with our
development plans. However, only the most necessary tasks will be
undertaken. Most of the curriculum development and educational and
training material will be placed on hold until sufficient capital
becomes available. We anticipate that the $2,500 plus cash on hand will
15
be sufficient to sustain us during the short-term. However, there would
be insufficient funds available for furtherance of the plan of
operations.
In the event that only 50% of the offering amount is raised, we would
be able to further our plan of operation; however, our activities will
be severely restricted. We would develop our basic curriculum and
produce some training material. However, marketing would be severely
restricted. Only a minimal amount would be spent on professional fees.
Without the ability to aggressively pursue our plan of operations, it
is likely that we will take much longer to build a profitable business.
If 75% of the total offering amount is raised, there will be sufficient
funds to pay a significant portion of all budgeted expenditure items.
The funds that we have has raised thus far from selling stock to our
sole officer are not sufficient to pay all expenses of this offering, which we
estimate to be approximately $10,500. Robert L. Wilson has agreed to loan us
sufficient funds to pay the expenses of the offering. The total amount of the
money raised from the sale of the 250,000 shares we are offering will be used
for the purpose of furthering our plan of operation.
Determination of Offering Price
There is no established market for our stock. The offering price for
shares sold pursuant to this offering is set at $0.10. Of the 2,000,000 shares
of stock already purchased by our sole officer and director, these shares were
sold for $0.0025 per share.
Dilution
"Net tangible book value" is the amount that results from subtracting
the total liabilities and intangible assets from the total assets of an entity.
Dilution occurs because we determined the offering price based on factors other
than those used in computing book value of our stock. Dilution exists because
the book value of shares held by existing shareholders is lower than the
offering price offered to new investors.
Teen is offering shares of its common stock for $0.10 per share through
this offering. Since formation, our sole officer and director has purchased
shares of our common stock for $0.0025 per share. As at September 30, 2007, the
net tangible book value of Teen was approximately zero ($0) per share. If we are
successful in selling all of the offered shares at the public offering price,
the pro forma net tangible book value of Teen would be approximately $25,000
(before offering expenses) or approximately $.01 per share, which would
represent an immediate increase of $0.09 in net tangible book value per share
and $.09 or 90% per share dilution to new investors, assuming all the shares are
sold at the offering price of $0.10 per share.
16
Following is a table detailing approximate dilution to investors if
10%, 50%, 75% or 100% of the offering is sold.
10% 50% 75% 100%
Net Tangible Book Value
PerShare Prior to Stock Sale
Net Tangible Book Value Per $.00 $.00 $.00 $.00
Share After Stock Sale NIL NIL NIL .01
Increase in Net Book Value $.10 $.10 $.10 $.10
Per Share Due to Stock Sale
Immediate Dilution $.10 $.10 $.10 $.10
(subscription price of $.10
less net tangible book value
per share)
Assuming all the shares are sold, the following table illustrates the
pro forma per share dilution:
Price to the Public (1) $ .10
Net tangible book value per share before offering (2) $ .00
Increase attributable to purchase of stock by new
Investors (5) $ .09
Net tangible book value per share after offering (3),(4) $ .01
Dilution to new investors (6) $ .09
Percent immediate dilution to new investors (7) 90%
(1) Offering price per equivalent common share.
(2) The net tangible book value per share before the offering is
determined by dividing the number of shares of common stock
outstanding into the net tangible book value of Teen.
(3) The net tangible book value after the offering is determined
by adding the net tangible book value before the offering to
the estimated proceeds to Teen from the current offering.
(4) The net tangible book value per share after the offering is
determined by dividing the number of shares that will be
outstanding after the offering into the net tangible book
value after the offering.
(5) The increase attributable to purchase of stock by new
investors is derived by taking the net tangible book value per
share after the offering and subtracting from it the net
tangible book value per share before the offering.
17
(6) The dilution to new investors is determined by subtracting the
net tangible book value per share after the offering from the
public offering price, giving a dilution value.
(7) The percent of immediate dilution to new investors is
determined by dividing the dilution to new investors by the
price to the public.
These tables compare the differences of your investment in our shares
with the share investment of our existing shareholder. Robert L. Wilson has
purchased a total of 2,000,000 shares for an aggregate amount of $5,000, or an
average cost of $0.0025 per share. Your investment in our shares will cost you
$0.10 per share. In the event that this offering is fully subscribed, the book
value of the stock held by Robert L. Wilson will increase by almost $.10 per
share, while your investment will decrease by over $.09 per share.
If this offering is fully subscribed, the total capital contributed by
new investors will be $25,000. The percentage of capital contribution will then
be approximately 7% for the existing shareholder and approximately 93% for the
new investors. Robert L. Wilson will then hold, as a percentage, approximately
89% of the issued and outstanding shares of Teen, while the new investors will
hold, as a percentage 11%.
Selling Security Holders
Our current shareholder is not selling any of the shares being offered
in this prospectus.
Plan of Distribution
There will be no underwriters used, no dealer's commissions and no
finder's fees paid. Our sole officer and director of Teen, Robert L. Wilson,
will sell securities on behalf of Teen in this offering. He will rely on Rule
3a4-1 to sell our securities without registering as a broker-dealer. He
primarily performs substantial duties as our sole officer and director for or on
behalf of the issuer otherwise than in connection with transactions in
securities, and has not been a broker or dealer, or an associated person of a
broker or dealer, within the preceding 12 months, and has not nor will not
participate in the sale of securities for any issuer more than once every twelve
months.
We plan to offer our shares to the public at a price of $0.10 per
share, with no minimum amount to be sold. Our officer and director will sell the
shares through the distribution of Teen's prospectus to interested individuals
and corporations through personal contact. Our sole officer and director will
receive no commission from the sale of any shares. Robert L. Wilson will not
purchase any shares under this offering. We will keep the offering open until we
sell all of the shares registered, or three months from the date of this
prospectus, which ever occurs first.
Regulation M of the Securities Exchange Act of 1934 may prohibit
distribution participants of Teen's stock from engaging in any market making
activities with regard to its securities. We do not intend to engage in any
18
market making activities deemed unlawful by Regulation M subsequent to the
effectiveness of this registration statement.
Legal Proceedings
We are not a party to any pending legal proceedings.
Directors, Executive Officers, Promoters and Control Persons
Robert L. Wilson's background information is as follows:
Innovation Treatment Centers, Inc.
1991-Present-Assistant Administrator/CFO/Child Care Worker
Duties include Board of Directors Meetings, cash disbursements, receipt
journals, set up computer programs, purchases, setting up and preparing books
through financial statements for the Board of Directors and Auditor, staff
scheduling, hiring, training and terminating staff, evaluate staff, preparing
time cards, interact with residents, staff and family members, conduct milieu
group therapy, supervise child related expenditures, coordinate recreational
activities, attend IEPs, consult with therapists, social workers, psychiatrists,
and licensing, coordinate family visits, organize medication trainings with
pharmacy. Ensure that treatment and maintenance of facility adheres to and
exceeds all standards as set forth by ITC and Title XXII and contractual
obligations. Monitor log entries and incident reports. Oversee maintaining the
building and grounds and equipment.
FEMA
2003-Present-Administrative Officer- Duties payroll paperwork and employee
paperwork are done correctly and turned in to the proper departments, coordinate
staff and deploy accordingly, logistical support, handle arrangements for
lodging, food travel, vehicles and supplies. Interact with other agencies local,
state and federal. Supervise team and make sure that everyone is safe and
accounted for all personnel.
Wilson Schools
2002-2005-Administration/Accountant- Duties include preparing financials,
supervising staff, interact with students, prepare work schedules, prepare
billing paperwork, prepare payroll, hire employees, file paperwork with state
agencies, employee evaluations, staff trainings.
Security Ownership of Certain Beneficial Owners and Management
The following is a table detailing the current shareholder of Teen
owning 5% or more of the common stock, and shares owned by the Teen's sole
director and officer:
Title of Name and Address of Amount and Percent
Class Beneficial Owner Nature of of Class
Beneficial
Ownership
Common Robert L. Wilson 2,000,000 100%
Common Directors and officers 2,000,000 100%
as a group (1)
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Description of Securities
Common Stock
Our Certificate of Incorporation authorize the issuance of 100,000,000
shares of common stock with $.001 par value and 5,000,000 shares with preferred
stock will $.001 par value. Each record holder of common stock is entitled to
one vote for each share held in all matters properly submitted to the
shareholders for their vote. Cumulative voting for the election of directors is
not permitted by the By-Laws of Teen.
Holders of outstanding shares of common stock are entitled to such
dividends as may be declared from time to time by the Board of Directors out of
legally available funds; and, in the event of liquidation, dissolution or
winding up of the affairs of Teen, holders are entitled to receive, ratably, the
net assets of Teen available to shareholders after distribution is made to the
preferred shareholders, if any, who are given preferred rights upon liquidation.
Holders of outstanding shares of common stock have no preemptive, conversion or
redemptive rights. To the extent that additional shares of Teen's common stock
are issued, the relative interest of then existing shareholders may be diluted.
Robert L. Wilson has sole investment power and sole voting power over
the shares that he owns.
Interest of Named Experts and Counsel
Teen has not hired or retained any experts or counsel on a contingent
basis, who would receive a direct or indirect interest in Teen, or who is, or
was, a promoter, underwriter, voting trustee, director, officer or employee, of
Teen.
Legal Matters
Certain legal matters with respect to Teen and the validity of the
securities offered hereby will be passed upon for us by Ronald J. Stauber, of
Ronald J. Stauber, Inc., a Law Corporation, Los Angeles, California.
Experts
The financial statements of Teen as at June 30, 2007, appearing in this
registration statement have been audited by Kyle L. Tingle, independent
certified public accountant, as set forth in his report appearing elsewhere
herein, and are included in reliance upon such report given upon the authority
of such firm as experts in accounting and auditing.
20
Disclosure of Commission Position of Indemnification for Securities Liabilities
According to Article 5, Section 6 of Teen's Certificate of
Incorporation and bylaws, we are authorized to indemnify our directors,
officers, agents and employees to the fullest extent authorized under Nevada Law
subject to certain specified limitations. Teen may indemnify its directors and
officers against expenses and liabilities they incur to defend, settle, or
satisfy any civil or criminal action brought against them on account of their
being, or having been Teen directors or officers unless, in any such action,
they are adjudged to have acted with gross negligence, or willful misconduct.
Insofar as indemnification for liabilities originates under the Securities Act
of 1933, as amended, may be permitted to directors, officers or persons
controlling Teen pursuant to the foregoing provisions, Teen has been informed
that, in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in that Act and is,
therefore, unenforceable.
Description of Business
Business Development
Teen was incorporated on April 16, 2007 in the State of Delaware. We
have a specific business plan or purpose. Should our business plan be
successfully implemented, we may be expanding our operations in the south
western portion of the United States. We have not yet begun our educational
operations and we currently have no revenues and no significant assets. Teen has
never declared bankruptcy, has never been in receivership, and has never been
involved in any legal action or proceedings. Since formation, Teen has not made
any significant purchase or sale of assets, nor has it been involved in any
mergers, acquisitions or consolidations.
Neither Teen nor its sole officer, director, promoter or any
affiliates, have had preliminary contact or discussions with, nor do we have any
present plans, proposals, arrangements or understandings with any
representatives of the owners of any business or company regarding the
possibility of an acquisition or merger.
Business of Issuer
Our business is to provide a financial literacy and money management
program for teenagers on a fee for service offered basis with specialized
educational programs designed to maximize profit potential and customer loyalty.
We believe that there is a need to train teenagers who we believe lack the basic
skills in the management of personal financial affairs. Located in a fluent
area, many are unable to balance a checkbook and most simply have insight into
the basic survival principals involved with earning, spending, saving and
investing.
Principal Services
We are in the process of establishing ourselves as providing a
financial literacy and money management educational program for teenagers on a
fee for service offered basis. We intend to provide such topics which would
include budgeting, the importance of saving, bank accounts and services,
establishing and maintaining credit, planning for college, buying a car, basic
investing, with related ancillary topics.
21
We will earn our revenues by charging a fee for individuals to complete
our training course. Our marketing is going to be the parents of teenagers who
understand that many young people fail in the management of the first consumer
credit experience, establish bad financial management habits, and fail to take
direction from their parents, who realize that it makes no sense for their
teenager to learn by trial and error. Our instruction will include practical
information preparing them in planning and understanding their financial future.
Further, we anticipate that our instruction will also be useful in
teaching the managing of the teenagers money, establish the basics of budgeting,
savings and checking accounts, responsible borrowing and will extend to buying
an automobile, renting an apartment and the responsible use of day to day
credit. Further topics that will be addressed, include surrounding yourself with
professionals in connection with starting and managing a small business,
investing for the future, and basic knowledge on commencing a plan for
retirement, although the retirement age is in the far distant future for the
teenagers.
Our intensive two-week training will involve 20 hours of classroom
instruction for groups of not to exceed 8 students. The instruction time will
address the needs and requirements of each of the interested parties. The
specific curriculum will be developed as funds become available.
Probably the most important aspect of our training will be in
developing positive financial responsibility and commitment. Effective
inter-personal skills will reap personal satisfaction as well as financial
gratification through increased tips.
Classroom instruction will be held at rented office space or in a hotel
facility. Classroom space can be arranged on an "as needed" and "as available"
basis at normal costs.
The Market
We will use a direct market approach. We intend to begin with a small
number of students that will be drawn from the local high schools This will be
accomplished by placing information articles and advertising in the student
magazines as well as advertising in local newspapers directed at the parent.
As soon as funds are available from this offering, we intend to design
and build our website. The website will provide basic information and facts
about the services we are offering. It will provide us with exposure to the
general marketplace within our target market area. The website will have the
facility for prospective students to contact us with questions and inquiries,
and will eventually allow for on-line course registration.
22
Competition and Competitive Strategy
Presently there is very little, if any, general training and
instruction available to teenagers living in the higher social economic or
higher net worth demographics. We have been informed and believe that certain
schools, banks and brokerage firms do provide personal financial training for
free or at a very low cost. The providers of these services usually direct their
efforts to only narrow areas that may be beneficial to them. For example, a
brokerage firm is not going to train a teenager on the economics of maintaining
an apartment.
Competition from Other Educational Institutions
While Teen's course material presented to our students may be fully
protected by intellectual property laws, our course concept will not.
Consequently, other financial or educational institutions, based upon any
success Teen may enjoy in its educational material presentation, may decide to
offer similar course material based on Teen's model. These financial or
educational institutions have greater resources than Teen, and as such will be
able to compete successfully against Teen. We may not be able to survive in the
educational marketplace against such competition.
Sources and Availability of Products and Supplies
Robert L. Wilson intends to develop the entire course of studies for
our students. Robert L. Wilson has extensive industry-related experience as well
as access to numerous educational materials.
Dependence on One or a Few Major Customers
This business is not the type of business that is, or can be, dominated
by one or a small number of customers.
Patent, Trademark, License & Franchise Restrictions and Contractual Obligations
& Concessions
There are no inherent factors or circumstances associated with the
educational trading services that we plan to provide that would give cause for
any patent, trademark or license infringements or violations. Teen has also not
entered into any franchise agreements or other contracts that have given, or
could give rise to obligations or concessions. Our course materials, where
applicable, will be fully protected by copyright.
Existing or Probable Government Regulations
There are no other types of government regulations existing or being
contemplated that would adversely affect Teen's ability to operate.
Research and Development Activities and Costs
Teen has no plans to undertake any research and development activities.
Compliance With Environmental Laws
There are no environmental laws that have been enacted, nor are we
aware of any such laws being contemplated for the future, that address issues
specific to our business.
23
Facilities
We do not own or rent facilities of any kind. At present we are
operating from our principal office address that is located within the home of
our President, who provides this space free of charge We will continue to use
this space for our executive offices for the foreseeable future.
Employees
Teen's only employee at the present time is Robert L. Wilson and we are
dependent on him. We rely on his entrepreneurial skills and experience to
implement our business plan. Robert L. Wilson is responsible for all planning,
developing and operational duties, and will continue to do so throughout the
early stages of our growth.
We have no intention of hiring further employees until the business has
been successfully launched and we have sufficient, reliable tuition revenue
flowing into Teen from our educational operations. We believe that we will be
able to secure guest lectures from financial instructions such as banks and
brokerage firms and local accountants and attorney's at no cost. Robert L.
Wilson will do whatever work is necessary to bring our business to the point of
being in positive cash flow. We do not expect to hire any other employees within
the first year of operation.
The Curriculum
Teen has developed an outline that will be the basis for the curriculum
for use in its early sessions. Of particular importance to Teen will be the
student response and input to its curriculum material. We intend to conduct
these early sessions on an interactive basis with our students, carefully noting
student responses to the curriculum material such as comprehension, interest,
clarity of presentation, order of curriculum format, and ability of students to
absorb material presented. Subsequent curriculum development will be based to a
great extent upon the student response and input received regarding our initial
curriculum material and their suggestions for effective delivery modes.
A general outline of our initial curriculum is set out below. It will
consist of 20 hours of classroom instruction. This outline presently consists of
three parts:
Part One - the Fundamentals (approximately eight hours)
Money and Money Management
Basics of Budgeting
Savings and Checking Accounts
Using Credit Cards and The Cost of Borrowing
Responsible Borrowing and Maintaining Good Crdit
24
Part Two - The Next Step (approximately eight hours)
Living Within your Means
Savings and Paying for College
Buying a Car-Auto Finance
Renting an Apartment
Responsible Use of Credit
Part Three - "Old Folks" (approximately four hours)
Banking and Credit Essentials
Buying a Home
The Small Business
Investing for the Future
Plans for Retirement
Forward-Looking Statements
This prospectus contains forward-looking statements that involve risks
and uncertainties. We use words such as: anticipate, believe, plan, expect,
future, intend and similar expressions, to identify such forward-looking
statements. You should not place too much reliance on these forward-looking
statements. Actual results are most likely to differ materially from those
anticipated in these forward-looking statements for many reasons, including the
risks faced as described in this Risk Factors section and elsewhere in this
prospectus. Factors which may cause the actual results or the actual plan of
operations to vary include, among other things, decisions of the board of
directors not to pursue a specific course of action based on its re-assessment
of the facts or new facts, changes in the food and beverage/restaurant industry
or general economic conditions and those other factors set out in this
prospectus.
Reports to Security Holders
We will make available to our shareholders an annual report, including
audited financials on Form 10-K or Form 10-KSB. We are not currently a reporting
company with the Securities and Exchange Commission, but upon effectiveness of
this registration statement, we will be required to file reports with the
Securities and Exchange Commission pursuant to the Securities Exchange Act of
1934, as amended.
The public may read and copy any materials filed with the Securities
and Exchange Commission at its Public Reference Room at 450 Fifth Street, N.W.,
Washington, D.C. 20549. The public may obtain information about the operation of
the Public Reference Room by calling the Securities and Exchange Commission at
1-800-SEC-0330. The Securities and Exchange Commission maintains an Internet
site that contains reports, proxy and information statements, and other
information regarding issuers that file electronically with the SEC at
HTTP://WWW.SEC.GOV.
Plan of Operation
Teen is a development stage company with no operations, no revenue, no
financial backing and few assets. Our plan of operations is to establishing
25
ourselves as a provider of financial literacy and money management programs for
teenagers on a fee for service offered basis.
We currently do not have the funds needed to develop our web site or
market our service. Nor do we have a source to supply the necessary funding if
we are unsuccessful in raising the capital through this offering. Teen believes
it will take between two and three months to raise capital for completion of the
development of the business after this prospectus becomes effective.
We intend to design and build our website as soon as sufficient funds
are available from this offering. A decision has been made regarding a domain
name and registration of our website domain name www.teeneducate.com has been
implemented. The preliminary design work of our website has begun and we intend
to have an information page available on the internet shortly.
The website will provide basic information and facts about the services
we are offering. It will provide us with exposure to the general marketplace.
The website will have the facility for students or their parents to contact us
with questions and inquiries.
Web server space will be contracted from a local internet service
provider (ISP) which has recently been chosen. We will be required to purchase a
computer during the first year of operations.
During the first stages of Teen's growth, our sole officer and director
will provide all the labor required to develop the curriculum and lead the
educational sessions - at no charge. We believe that we will be able to secure
guest lecturers from financial instructions such as real estate and stock
brokerage firms and from local accountants and attorney's at no cost. Since we
intend to operate with very limited administrative support, our sole officer and
director will continue to be responsible for these duties for at least the first
year of operations.
Our marketing strategy will be directed to the parents of the teenager
who understand that the average student graduates from high school lacks basic
skills in the management of personal financial affairs. These parents understand
that many young people fail in the management of their first consumer credit
experience, establish bad financial management habits, and stumble through their
early financial lives learning by trial and error. We will inform the parents,
in our marketing presentation, that each of the various subjects taught may also
have visiting guest lecturers, with sufficient credentials and experience to
give the program creditability. We believe that we will be able to secure these
individual's to act as guest lecturers predicated upon the possible additional
business that may be obtained from the parent, after being informed of the
presentation by the student and business obtained from the student.
How long we will be able to satisfy its cash requirements, and whether
we will require additional outside funding in the next twelve months depends on
how quickly our company can generate tuition revenue and how much revenue can be
generated. At the present time, we only have funds available to complete the
26
expenses of this offering. However, should we raise the entire $25,000 we are
seeking from this offering, we are of the opinion that no further funds will be
required for the operation of our business for the twelve month period following
the completion of this offering. Since our offering expenses will be paid for by
Robert L. Wilson
If we are unable to raise funding through this offering, we will not be
able to survive more than several months. In that event, we will require
additional funding from either outside sources, such as traditional banking or
venture capital institutions, or a private placement financial instructions
owners who recognize the value of the market niche we are planning to serve.
We are confident we can meet our financial obligations and pursue our
plan of operations if we can raise additional funding through this offering.
Robert L. Wilson has undertaken research in establishing the basis of
our development of a training programs specifically designed for teenagers. An
outline that will be the basis for the content of the curriculum has been
developed.
Teen's present concern is not only student response and input as well
as curriculum material development at this stage, but also effective delivery of
this material. These delivery systems, whether they be printed matter,
audio-visual presentation, interactive computer teaching programs, or television
teaching systems, all have a cost of implementation that we wish to address,
both from its profit perspective as well as student acceptance and information
delivery. Teen through his initial sessions will be able to determine the
maximum form of information delivery and consequently avoid spending large sums
on delivery systems that are ineffective.
We have no plans to undertake product research and development during
the term covered by this prospectus. There are also no plans or expectations to
purchase or sell any significant equipment in the first year of operations.
Management also has no intention of hiring any employees during the first year
of operations.
During the first year of operations, we will concentrate our efforts
exclusively on obtaining our teenager students in the more affluent cities and
communities within the County of Los Angeles, California. Initially, we intend
to concentrate on the West Los Angeles area of Los Angeles County (Beverly
Hills, Century City, West Los Angeles and Santa Monica). As we gain experience,
and develop sufficient revenues from sales, we may consider expanding our
business within the region and possibly to other locations within the south
western United States.
Expenditures
It is anticipated that the funds raised from this offering will be
sufficient to cover our expenditures for the twelve (12) month period upon
effectiveness of this prospectus. The discussion is based on the premise we will
raise the entire $25,000 we are seeking from this offering.
27
Milestones
As soon as the funds are available, Robert L. Wilson will begin to
further develop our curriculum. We plan to hold our first class session three
months after the effective date of this prospectus. Our first class will be held
in Beverly Hills, California, and will be small by design, with a maximum of six
students. It will be a focus group to confirm that our course of studies is
appropriate for the requirements of our students. This initial session will
provide us with revenue from operations ($3,000) to cover our anticipated cost
of $1,000.
Using the first session as a model, we will refine the emphasis of each
aspect of our training program over the next month.
The second session will be held within three months of the effective
date of this prospectus with an estimated cost of $1500. It is our intention to
hold two student sessions every month thereafter at an estimated cost of $500.00
per session with not to exceed eight students. We will utilize the time between
the 20-hour instruction periods to market our service, plan future sessions, and
perfect our curriculum. The amount spent on these activities will be directly
related to the funds available, both from this offering as well as revenue
earned from completed sessions.
Within three months of the effective date of this prospectus, we intend
to design and build our website. The website will provide basic information and
facts about the services we are offering. It will provide us with exposure to
the general marketplace. The website will have the facility for prospective
parents and students to contact us with questions and inquiries.
The estimated cost of website development is $2,000. Should we fail to raise
any proceeds from this offering, the development of our website will be placed
on hold.
Description of Property
Teen does not own any property, real or otherwise. For the first year,
we will conduct our administrative affairs from the President's home, at no cost
to Teen.
We do not have any investments or interests in any real estate. Teen
does not invest in real estate mortgages, nor does it invest in securities of,
or interests in, persons primarily engaged in real estate activities.
Certain Relationships and Related Transactions
With the exception of Robert L. Wilson, there are no promoters being
used in relation to this offering. By the definition of Rule 405 of the
Securities Act of 1933, as amended, Robert L. Wilson is a promoter of Teen in
that he is a "person who, acting alone or in conjunction with one or more other
persons, directly or indirectly takes initiative in founding and organizing the
28
business or enterprise of an issuer". Robert L. Wilson has not, nor will he,
receive anything of value or other consideration as a promoter of Teen.
No person who may, in the future, be considered a promoter of this
offering, will receive or expect to receive assets, services or other
considerations from us. No assets will be, nor are expected to be, acquired from
any promoter on behalf of our company. We have not entered into any agreements
that require disclosure to our shareholders.
MARKET FOR COMMON STOCK AND RELATED SHAREHOLDER MATTERS
Market Information and Price.
Our common stock is not quoted at the present time.
We plan to eventually seek listing in the OTC Bulletin Board System,
once our registration statement has been declared effective with the Securities
and Exchange Commission and we have raised all or substantially all of the funds
need to commence operations. We cannot guarantee that we will obtain approval.
There is no trading activity in our securities, and there can be no assurance
that a regular trading market for our common stock will ever be developed.
There is no trading market for our common stock at present and there
has been no trading market to date. There is no assurance that a trading market
will ever develop or, if such a market does develop, that it will continue. We
intend to request a broker-dealer to make application to the FINRA to have the
company's securities traded in the OTC Bulletin Board System or published, in
print and electronic media, or either, in the Pink Sheets LLC so-called "Pink
Sheets."
The Securities and Exchange Commission adopted Rule 15g-9, which
established the definition of a "penny stock," for purposes relevant to the
company, as any equity security that has a market price of less than $5.00 per
share or with an exercise price of less than $5.00 per share, subject to certain
exceptions. For any transaction involving a penny stock, unless exempt, the
rules require: (i) that a broker or dealer approve a person's account for
transactions in penny stocks; and (ii) the broker or dealer receive from the
investor a written agreement to the transaction, setting forth the identity and
quantity of the penny stock to be purchased. In order to approve a person's
account for transactions in penny stocks, the broker or dealer must (i) obtain
financial information and investment experience and objectives of the person;
and (ii) make a reasonable determination that the transactions in penny stocks
are suitable for that person and that person has sufficient knowledge and
experience in financial matters to be capable of evaluating the risks of
transactions in penny stocks. The broker or dealer must also deliver, prior to
any transaction in a penny stock, a disclosure schedule prepared by the
Commission relating to the penny stock market, which, in highlight form, (i)
sets forth the basis on which the broker or dealer made the suitability
determination; and (ii) that the broker or dealer received a signed, written
agreement from the investor prior to the transaction. Disclosure also has to be
made about the risks of investing in penny stock in both public offering and in
secondary trading, and about commissions payable to both the broker-dealer and
the registered representative, current quotations for the securities and the
29
rights and remedies available to an investor in cases of fraud in penny stock
transactions. Finally, monthly statements have to be sent disclosing recent
price information for the penny stock held in the account and information on the
limited market in penny stocks.
As a result of our offering price and being a penny stock, the market
liquidity for our common stock may be adversely affected since the regulations
on penny stocks could limit the ability of broker-dealers to sell our common
stock and thus your ability to sell our common stock in the secondary market.
The rules governing penny stock require the delivery, prior to any
penny stock transaction, of a disclosure schedule explaining the penny stock
market and the risks associated therewith, and impose various sales practice
requirements on broker-dealers who sell penny stocks to persons other than
established customers and accredited investors (generally defined as an investor
with a net worth in excess of $1,000,000 or annual income exceeding $250,000,
$300,000 together with a spouse). For these types of transactions, the
broker-dealer must make a special suitability determination for the purchaser
and have received the purchaser's written consent to the transaction prior to
sale. The broker-dealer also must disclose the commissions payable to the
broker-dealer, current bid and offer quotations for the penny stock and, if the
broker-dealer is the sole market-maker, the broker-dealer must disclose this
fact and the broker-dealer's presumed control over the market. Such information
must be provided to the customer orally or in writing prior to effecting the
transaction and in writing before or with the customer confirmation. Monthly
statements must be sent disclosing recent price information for the penny stock
held in the account and information on the limited market in penny stocks. The
additional burdens imposed on broker-dealers by such requirements may discourage
them from effecting transactions in the securities underlying the shares, which
could severely limit the liquidity of the securities underlying the shares and
the ability of purchasers in this offering to sell the securities underlying the
shares in the secondary market.
For the initial listing in the Nasdaq SmallCap market, a company must
have net tangible assets of $4 million or market capitalization of $50 million
or a net income (in the latest fiscal year or two of the last fiscal years) of
$750,000, a public float of 1,000,000 shares with a market value of $5 million.
The minimum bid price must be $4.00 and there must be 3 market makers. In
addition, there must be 300 shareholders holding 100 shares or more, and the
company must have an operating history of at least one year or a market
capitalization of $50 million.
For continued listing in the Nasdaq SmallCap market, a company must
have net tangible assets of $2 million or market capitalization of $35 million
or a net income (in the latest fiscal year or two of the last fiscal years) of
$500,000, a public float of 500,000 shares with a market value of $1 million.
The minimum bid price must be $1.00 and there must be 2 market makers. In
addition, there must be 300 shareholders holding 100 shares or more.
30
We intend to request a broker-dealer to make application to the FINRA
to have our securities traded in the OTC Bulletin Board Systems or published, in
print and electronic media, or either, in the Pink Sheets LLC "Pink Sheets," or
either.
Shareholders May Face Significant Restrictions on the Sale of Teen Stock due to
State "Blue Sky" Laws
Each state has its own securities laws, often called "blue sky laws"
which: (a) limit sales of stock to a state's resident unless the stock is
registered in that state or qualifies for an exemption from registration; and
(b) governs the reporting requirements for broker-dealers and stockbrokers doing
business directly or indirectly in the state. Before a security can be sold in a
state, there must be a registration in place to cover the transaction, and the
broker must be registered in that state or otherwise be exempt from
registration. We do not know whether our stock will be registered under the laws
of any states. A determination regarding registration will be made by the
broker-dealers, if any, who agree to serve as the market makers for our stock.
You should be aware that there has been no market for our stock and
there is no assurance that an active market will develop. No broker-dealers act
as market makers for our stock and our securities have not been registered for
sale in any state.
Therefore, you may be unable to sell our stock without registering, or
otherwise qualifying it for sale, within your specific state.
There may be significant state blue sky law restrictions on the ability
of shareholders to sell, or on purchasers to buy, our stock. Accordingly,
shareholders should consider the secondary market for our stock to be a limited
one. Shareholders may be unable to resell their stock, or may be unable to sell
it without the significant expense of state registration or qualification.
Shareholders May Face Significant Restrictions on the Resale of Teen Stock due
to Federal Regulations Regarding Penny Stock
In the event that Teen registers its securities for sale and acquires a
broker-dealer as a market maker, our stock would differ from many stocks in that
it would likely be a "penny stock." The Securities and Exchange Commission has
adopted a number of rules to regulate "penny stocks." These rules include, but
are not limited to, Rules 3a51-1, 15g-2, 15g-3, 15g-4, 15g-5, 15g-6 and 15g-9
under the Securities and Exchange Act of 1934, as amended. Because our stock
would probably constitute "penny stock" within the meaning of the rules, the
rules would apply to Teen and its securities. The rules may further affect the
ability of owners of our stock to sell their securities in any market that may
develop for them. There may be a limited market for penny stocks, due to the
regulatory burdens on broker-dealers. The market among dealers may not be
active. Shareholders in penny stocks are often unable to sell stock back to the
dealers that sold them the stock. The mark-ups or commissions charged by the
broker-dealers may be greater than any profit a seller may make. Because of
large dealer spreads, shareholders may be unable to sell the stock immediately
back to the dealer at the same price the dealer sold the stock to the investor.
In some cases, the stock may fall quickly in value. Shareholders may be unable
to reap any profit from any sale of stock, if they can sell at all.
31
Investors should be aware that, according to the Securities and
Exchange Commission Release No. 34-29093, the market for penny stocks has
suffered from patterns of abuse and fraud in recent years. These patterns
include:
manipulation of prices through pre-arranged matching of purchases and
sales and false and misleading press releases;
control of the market for the security by one or a few broker-dealers
that are often related to the promoter or issuer;
`boiler room' practices involving high pressure sales tactics and
unrealistic price projections by inexperienced sales persons;
excessive and undisclosed bid-ask differentials and markups by selling
broker-dealers; and the wholesale dumping of the same securities by
promoters and broker-dealers after prices have been manipulated to a
desired level, along with the inevitable collapse of those prices with
consequent investor losses.
No cash compensation, deferred compensation or long-term incentive plan
awards were paid, issued, or granted to Teen's management since its inception on
April 16, 2007. Further, the Teen's has not granted any option or stock
appreciation rights.
Compensation of Director
There are no arrangements pursuant to which the Teen's sole director
will be compensated for any services provided as a director. No additional
amounts are payable for committee participation or special assignments.
Employment Contracts and Termination of Employment and Change-in-Control
Arrangements
There are no employment contracts, compensatory plans or arrangements,
including payments to be received from Teen, with respect to any director or
executive officer of Teen which would in any way result in payments to any such
person because of his or her resignation, retirement or other termination of
employment with Teen, any change in control of Teen, or a change in the person's
responsibilities following a change in control of Teen.
Changes In and Disagreements With Accountants on Accounting and Financial
Disclosures
There have been no disagreements on any matter of accounting principles
or practices, financial statement disclosures, or auditing scope or procedure.
Financial Statements
Teen engaged Kyle L. Tingle, CPA as our independent auditor.
32
TEEN EDUCATION GROUP, INC.
(A Development Stage Enterprise)
JUNE 30, 2007
33
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
CONTENTS
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM F-1
________________________________________________________________________________
FINANCIAL STATEMENTS
Balance Sheet F-2
Statement of Operations F-3
Statement of Stockholder's Deficit F-4
Statement of Cash Flows F-5
Notes to Financial Statements F-6-10
________________________________________________________________________________
34
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors
Teen Education Group, Inc.
Las Vegas, Nevada
We have audited the accompanying balance sheets of Teen Education Group, Inc. (A
Development Stage Enterprise) as of June 30, 2007 the related statements of
operations, stockholder's deficit, and cash flows for the period April 16, 2007
(inception) through June 30, 2007. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. The Company is not required to
have, nor were we engaged to perform, an audit of its internal control over
financial reporting. Our audit included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's internal control over financial
reporting. Accordingly, we express no such opinion. 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 that our audit 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 Teen Education Group, Inc. (A
Development Stage Enterprise) as of June 30, 2007 and the results of its
operations and cash flows for period April 16, 2007 (inception) through June 30,
2007, in conformity with U.S. generally accepted accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company has limited operations and has no established
source of revenue. This raises substantial doubt about its ability to continue
as a going concern. Management's plan in regard to these matters is also
described in Note 1. The financial statements do not include any adjustments
that might result from the outcome of this uncertainty.
Kyle L. Tingle, CPA, LLC
July 31, 2007
Las Vegas, Nevada
F-1
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
BALANCE SHEET
June 30, 2007
_____________
ASSETS
CURRENT ASSETS $ 0
________
Total current assets $ 0
________
Total assets $ 0
========
LIABILITIES AND STOCKHOLDER'S DEFICIT
CURRENT LIABILITIES
Officers advances $ 282
________
Total current liabilities $ 282
________
STOCKHOLDER'S DEFICIT
Common stock: $.001 par value;
authorized 100,000,000 shares; issued
and outstanding: 2,000,000 shares at
June 30, 2007 2,000
Preferred stock: $.001 par value;
authorized 5,000,000 shares; none issued
or outstanding at June 30, 2007 0
Additional paid in capital 3,000
Accumulated deficit during development stage (5,282)
________
Total stockholder's deficit $ (282)
________
Total liabilities and
stockholder's deficit $ 0
========
See Accompanying Notes to Financial Statements.
F-2
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF OPERATIONS
Apr.16, 2007
(inception) to
June 30, 2007
Revenues $ 0
Cost of revenue 0
__________
Gross profit $ 0
General, selling and
administrative expenses 5,282
__________
Operating loss $ (5,282)
Nonoperating income (expense) 0
__________
Net loss $ (5,282)
==========
Net loss per share, basic
and diluted $ (0.00)
==========
Average number of shares
of common stock outstanding 2,000,000
==========
See Accompanying Notes to Financial Statements.
F-3
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF STOCKHOLDER'S DEFICIT
Accumulated
Deficit
Common Stock Additional During
__________________ Paid-In Development
Shares Amount Capital Stage Total
_________ ______ __________ ___________ _______
April 17, 2007, issue
common stock 2,000,000 $2,000 $3,000 $ 0 $ 5,000
Net loss, June 30, 2007 (5,282) (5,282)
_________ ______ __________ ___________ _______
Balance, June 30, 2007 2,000,000 $2,000 $3,000 $ (5,282) $ (282)
========= ====== ========== =========== =======
See Accompanying Notes to Financial Statements.
F-4
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF CASH FLOWS
Apr. 16, 2007
(inception) to
June 30, 2007
______________
Cash Flows From
Operating Activities
Net loss $(5,282)
_______
Net cash used in
operating activities $(5,282)
_______
Cash Flows From
Investing Activities $ 0
_______
Cash Flows From
Financing Activities
Issuance of common stock $ 5,000
Increase in officer advances 282
_______
Net cash provided by
financing activities $ 5,282
_______
Net increase (decrease)
in cash $ 0
Cash, beginning of period $ 0
_______
Cash, end of period $ 0
=======
Supplemental Information and Non-monetary Transactions:
Interest paid $ 0
=======
Taxes paid $ 0
=======
See Accompanying Notes to Financial Statements.
F-5
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
NOTE 1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES
NATURE OF BUSINESS:
Teen Education Group, Inc. ("Company") was organized April 16, 2007 under the
laws of the State of Delaware. The Company currently has no operations and, in
accordance with Statement of Financial Accounting Standard (SFAS) No. 7,
"ACCOUNTING AND REPORTING BY DEVELOPMENT STAGE ENTERPRISES," is considered a
Development Stage Enterprise.
A SUMMARY OF THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES IS AS FOLLOWS:
ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
CASH
For the Statements of Cash Flows, all highly liquid investments with maturity of
three months or less are considered to be cash equivalents. There were no cash
equivalents as of June 30, 2007.
INCOME TAXES
Income taxes are provided for using the liability method of accounting in
accordance with SFAS No. 109 "ACCOUNTING FOR INCOME TAXES." A deferred tax asset
or liability is recorded for all temporary differences between financial and tax
reporting. Temporary differences are the differences between the reported
amounts of assets and liabilities and their tax basis. Deferred tax assets are
reduced by a valuation allowance when, in the opinion of management, it is more
likely than not that some portion or all of the deferred tax assets will not be
realized. Deferred tax assets and liabilities are adjusted for the effect of
changes in tax laws and rates on the date of enactment.
GOING CONCERN
The Company's financial statements are prepared in accordance with generally
accepted accounting principles applicable to a going concern. This contemplates
the realization of assets and the liquidation of liabilities in the normal
course of business. Currently, the Company does not have cash nor material
assets, nor does it have operations or a source of revenue sufficient to cover
its operation costs and allow it to continue as a going concern. The Company
will be dependent upon the raising of additional capital through placement of
our common stock in order to implement its business plan, or merge with an
operating company. There can be no assurance that the Company will be successful
in either situation in order to continue as a going concern. The officers and
directors have committed to advancing certain operating costs of the Company.
F-6
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
NOTE 1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
RECENT ACCOUNTING PRONOUNCEMENTS
In December 2004, the Financial Accounting Standards Board ("FASB") issued SFAS
No. 123R "SHARE BASED PAYMENT." This statement is a revision to SFAS 123 and
supersedes Accounting Principles Board (APB) Opinion No. 25, "ACCOUNTING FOR
STOCK ISSUED TO EMPLOYEES," and amends FASB Statement No. 95, "STATEMENT OF CASH
FLOWS." This statement requires a public entity to expense the cost of employee
services received in exchange for an award of equity instruments. This statement
also provides guidance on valuing and expensing these awards, as well as
disclosure requirements of these equity arrangements. This statement is
effective for the first interim reporting period that begins after June 15,
2005.
SFAS 123R permits public companies to choose between the following two
adoption methods:
1. A "modified prospective" method in which compensation cost is
recognized beginning with the effective date (a) based on the
requirements of SFAS 123R for all share-based payments granted after
the effective date and (b) based on the requirements of Statement 123
for all awards granted to employees prior to the effective date of
SFAS 123R that remain unvested on the effective date, or
2. A "modified retrospective" method which includes the requirements of
the modified prospective method described above, but also permits
entities to restate based on the amounts previously recognized under
SFAS 123 for purposes of pro forma disclosures either (a) all prior
periods presented or (b) prior interim periods of the year of
adoption.
As we do not currently have share based payments, we expect no impact to the
financial statements due to the adoption of SFAS 123R.
In September 2006, the SEC Staff issued SEC Staff Accounting Bulletin 107,
"Implementation Guidance for FASB 123 (R)." The staff believes the guidance in
the SAB will assist issuers in their initial implementation of Statement 123R
and enhance the information received by investors and other users of financial
statements, thereby assisting them in making investment and other decisions.
This SAB includes interpretive guidance related to share-based payment
transactions with non-employees, the transition from nonpublic to public entity
status, valuation methods (including assumptions such as expected volatility and
expected term), the accounting for certain redeemable financials instruments
issued under share-based payment arrangements, the classification of
compensation expense, non-GAAP financial measures, first-time adoption of
Statement 123R in an interim period, capitalization of compensation cost related
to share-based payment arrangements, the accounting for income tax effects of
share-based payment arrangements upon adoption of Statement 123R and disclosures
of MD&A subsequent to adoption of Statement 123R.
In September 2006, the SEC Staff issued SEC Staff Accounting Bulletin 107,
"Implementation Guidance for FASB 123 (R)." The staff believes the guidance in
the SAB will assist issuers in their initial implementation of Statement 123R
and enhance the information received by investors and other users of financial
statements, thereby assisting them in making investment and other decisions.
This SAB includes interpretive guidance related to share-based payment
transactions with non-employees, the transition from nonpublic to public entity
F-7
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
NOTE 1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
status, valuation methods (including assumptions such as expected volatility and
expected term), the accounting for certain redeemable financials instruments
issued under share-based payment arrangements, the classification of
compensation expense, non-GAAP financial measures, first-time adoption of
Statement 123R in an interim period, capitalization of compensation cost related
to share-based payment arrangements, the accounting for income tax effects of
share-based payment arrangements upon adoption of Statement 123R and disclosures
of MD&A subsequent to adoption of Statement 123R.
In September 2006, the SEC Staff issued Staff Accounting Bulletin No. 108,
"Considering the Effects of Prior Year Misstatements when Quantifying
Misstatements in the Current Year Financial Statements" ("SAB No. 108"). SAB No.
108 requires the use of two alternative approaches in quantitatively evaluating
materiality of misstatements. If the misstatement as quantified under either
approach is material to the current year financial statements, the misstatement
must be corrected. If the effect of correcting the prior year misstatements, if
any, in the current year income statement is material, the prior year financial
statements should be corrected. In the year of adoption (fiscal years ending
after November 15, 2006 or calendar year 2006 for us), the misstatements may be
corrected as an accounting change by adjusting opening retained earnings rather
than being included in the current year income statement. We do not expect that
the adoption of SAB No. 108 will have a material impact on our financial
condition or results of operations.
In September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements" (SFAS
157). SFAS 157 provides guidance for using fair value to measure assets and
liabilities. SFAS 157 addresses the requests from investors for expanded
disclosure about the extent to which companies measure assets and liabilities at
fair value, the information used to measure fair value and the effect of fair
value measurements on earnings. SFAS 157 applies whenever other standards
require (or permit) assets or liabilities to be measured at fair value, and does
not expand the use of fair value in any new circumstances. SFAS 157 is effective
for financial statements issued for fiscal years beginning after November 15,
2007 and will be adopted by the Company in the first quarter of fiscal year
2009. We do not expect that the adoption of SFAS 157 will have a material impact
on our financial condition or results of operations.
In September 2006, the FASB issued SFAS No. 158, "Employers' Accounting for
Defined Benefit Pension and Other Postretirement Plans" ("SFAS No. 158"). SFAS
No. 158 requires companies to recognize in their statement of financial position
an asset for a plan's overfunded status or a liability for a plan's underfunded
status and to measure a plan's assets and its obligations that determine its
funded status as of the end of the company's fiscal year. Additionally, SFAS No.
158 requires companies to recognize changes in the funded status of a defined
benefit postretirement plan in the year that the changes occur and those changes
will be reported in comprehensive income. The provision of SFAS No. 158 that
will require us to recognize the funded status of our postretirement plans, and
the disclosure requirements, will be effective for us as of December 31, 2006.
We do not expect that the adoption of SFAS No. 158 will have a material impact
on our consolidated financial statements.
F-8
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
NOTE 1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
FAS 123(R)-5 was issued on October 10, 2006. The FSP provides that instruments
that were originally issued as employee compensation and then modified, and that
modification is made to the terms of the instrument solely to reflect an equity
restructuring that occurs when the holders are no longer employees, then no
change in the recognition or the measurement (due to a change in classification)
of those instruments will result if both of the following conditions are met:
(a). There is no increase in fair value of the award (or the ratio of intrinsic
value to the exercise price of the award is preserved, that is, the holder is
made whole), or the antidilution provision is not added to the terms of the
award in contemplation of an equity restructuring; and (b). All holders of the
same class of equity instruments (for example, stock options) are treated in the
same manner. The provisions in this FSP shall be applied in the first reporting
period beginning after the date the FSP is posted to the FASB website. We will
evaluate whether the adoption will have any impact on your financial statements.
In February 2007, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 159, "The Fair Value Option for Financial
Assets and Financial Liabilities - Including an amendment of FASB Statement No.
115" (hereinafter "SFAS No. 159"). This statement permits entities to choose to
measure many financial instruments and certain other items at fair value. The
objective is to improve financial reporting by providing entities with the
opportunity to mitigate volatility in reported earnings caused by measuring
related assets and liabilities differently without having to apply complex hedge
accounting provisions. This statement is expected to expand the use of fair
value measurement, which is consistent with the Board's long-term measurement
objectives for accounting for financial instruments. This statement is effective
as of the beginning of an entity's first fiscal year that begins after November
15, 2007, although earlier adoption is permitted. Management has not determined
the effect that adopting this statement would have on the Company's financial
condition or results of operations.
NOTE 2. STOCKHOLDER'S EQUITY
COMMON STOCK
The authorized common stock of the Company consists of 100,000,000 shares with
par value of $0.001. On April 17, 2007 the Company authorized and issued
2,000,000 shares of its $.001 par value common stock in consideration of $5,000
in cash.
The authorized preferred stock of the Company consists of 5,000,000 shares with
a par value of $.001. The Company has no preferred stock issued or outstanding.
NET LOSS PER COMMON SHARE
Net loss per share is calculated in accordance with SFAS No. 128, "EARNINGS PER
SHARE." The weighted-average number of common shares outstanding during each
period is used to compute basic loss per share. Diluted loss per share is
computed using the weighted averaged number of shares and dilutive potential
common shares outstanding. Dilutive potential common shares are additional
common shares assumed to be exercised.
F-9
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
NOTE 2. STOCKHOLDER'S EQUITY (CONTINUED)
Basic net loss per common share is based on the weighted average number of
shares of common stock outstanding of 2,000,000 during 2007 and since inception.
As of June 30, 2007 and since inception, the Company had no dilutive potential
common shares.
NOTE 3. INCOME TAXES
We did not provide any current or deferred U.S. federal income tax provision or
benefit for any of the periods presented because we have experienced operating
losses since inception. We provided a full valuation allowance on the net
deferred tax asset, consisting of net operating loss carryforwards, because
management has determined that it is more likely than not that we will not earn
income sufficient to realize the deferred tax assets during the carryforward
period.
The components of the Company's deferred tax asset as of June 30, 2007 are as
follows:
2007
_______
Net operating loss carryforward $ 1,849
Valuation allowance (1,849)
_______
Net deferred tax asset $ 0
=======
A reconciliation of income taxes computed at the statutory rate to the income
tax amount recorded is as follows:
Since
2007 Inception
_______ _________
Tax at statutory rate (35%) $ 1,849 $ 1,849
Increase in valuation allowance (1,849) (1,849)
_______ _______
Net deferred tax asset $ 0 $ 0
======= =======
The net federal operating loss carry forward will expire in 2027. This carry
forward may be limited upon the consummation of a business combination under IRC
Section 381.
NOTE 4. RELATED PARTY TRANSACTIONS
The Company neither owns nor leases any real or personal property. An officer or
resident agent of the corporation provides office services without charge. Such
costs are immaterial to the financial statements and accordingly, have not been
reflected therein. The officers and directors for the Company are involved in
other business activities and may, in the future, become involved in other
business opportunities. If a specific business opportunity becomes available,
such persons may face a conflict in selecting between the Company and their
other business interest. The Company has not formulated a policy for the
resolution of such conflicts.
F-10
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
NOTE 5. WARRANTS AND OPTIONS
There are no warrants or options outstanding to acquire any additional shares of
common stock of the Company.
NOTE 6. OFFICERS ADVANCES
The Company has incurred costs while seeking additional capital through a merger
with an existing company. An officer of the Company has advanced funds on behalf
of the Company to pay for these costs. These funds have been advanced interest
free. As of June 30, 2007, the Company owed officers $282.
F-11
TEEN EDUCATION GROUP, INC.
(A Development Stage Enterprise)
SEPTEMBER 30, 2007
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
CONTENTS
________________________________________________________________________________
FINANCIAL STATEMENTS
Balance Sheet F-1
Statement of Operations F-2
Statement of Stockholder's Deficit F-3
Statement of Cash Flows F-4
Notes to Financial Statements F-5 - F-10
________________________________________________________________________________
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
BALANCE SHEET
September 30,
2007
_____________
ASSETS
CURRENT ASSETS $ 0
________
Total current assets $ 0
________
Total assets $ 0
========
LIABILITIES AND STOCKHOLDER'S DEFICIT
CURRENT LIABILITIES
Officers advances $ 2,232
________
Total current liabilities $ 2,232
________
STOCKHOLDER'S DEFICIT
Common stock: $.001 par value;
authorized 100,000,000 shares; issued
and outstanding: 2,000,000 shares at
September 30, 2007 2,000
Preferred stock: $.001 par value;
authorized 5,000,000 shares; none issued
or outstanding at September 30, 2007 0
Additional paid in capital 3,000
Accumulated deficit during development stage (7,232)
________
Total stockholder's deficit $ (2,232)
________
Total liabilities and
stockholder's deficit $ 0
========
See Accompanying Notes to Financial Statements.
F-1
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF OPERATIONS
Apr.16, 2007
(inception) to
September 30,
2007
______________
Revenues $ 0
Cost of revenue 0
__________
Gross profit $ 0
General, selling and
administrative expenses 7,232
__________
Operating loss $ (7,232)
Nonoperating income (expense) 0
__________
Net loss $ (7,232)
==========
Net loss per share, basic
and diluted $ (0.00)
==========
Average number of shares
of common stock outstanding 2,000,000
==========
See Accompanying Notes to Financial Statements.
F-2
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF STOCKHOLDER'S DEFICIT
Accumulated
Deficit
Common Stock Additional During
__________________ Paid-In Development
Shares Amount Capital Stage Total
_________ ______ __________ ___________ _______
April 17, 2007, issue
common stock 2,000,000 $2,000 $3,000 $ 0 $ 5,000
Net loss, September 30,
2007 (7,232) (7,232)
_________ ______ __________ ___________ _______
Balance, September 30,
2007 2,000,000 $2,000 $3,000 $ (7,232) $(7,232)
========= ====== ========== =========== =======
See Accompanying Notes to Financial Statements.
F-3
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF CASH FLOWS
Apr. 16, 2007
(inception) to
September 30,
2007
______________
Cash Flows From
Operating Activities
Net loss $(7,232)
_______
Net cash used in
operating activities $(7,232)
_______
Cash Flows From
Investing Activities $ 0
_______
Cash Flows From
Financing Activities
Issuance of common stock $ 5,000
Increase in officer advances 2,232
_______
Net cash provided by
financing activities $ 7,232
_______
Net increase (decrease)
in cash $ 0
Cash, beginning of period $ 0
_______
Cash, end of period $ 0
=======
Supplemental Information and Non-monetary Transactions:
Interest paid $ 0
=======
Taxes paid $ 0
=======
See Accompanying Notes to Financial Statements.
F-4
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
NOTE 1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES
NATURE OF BUSINESS:
Teen Education Group, Inc. ("Company") was organized April 16, 2007 under the
laws of the State of Delaware. The Company currently has no operations and, in
accordance with Statement of Financial Accounting Standard (SFAS) No. 7,
"ACCOUNTING AND REPORTING BY DEVELOPMENT STAGE ENTERPRISES," is considered a
Development Stage Enterprise.
A SUMMARY OF THE COMPANY'S SIGNIFICANT ACCOUNTING POLICIES IS AS FOLLOWS:
ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
CASH
For the Statements of Cash Flows, all highly liquid investments with maturity of
three months or less are considered to be cash equivalents. There were no cash
equivalents as of September 30, 2007.
INCOME TAXES
Income taxes are provided for using the liability method of accounting in
accordance with SFAS No. 109 "ACCOUNTING FOR INCOME TAXES." A deferred tax asset
or liability is recorded for all temporary differences between financial and tax
reporting. Temporary differences are the differences between the reported
amounts of assets and liabilities and their tax basis. Deferred tax assets are
reduced by a valuation allowance when, in the opinion of management, it is more
likely than not that some portion or all of the deferred tax assets will not be
realized. Deferred tax assets and liabilities are adjusted for the effect of
changes in tax laws and rates on the date of enactment.
GOING CONCERN
The Company's financial statements are prepared in accordance with generally
accepted accounting principles applicable to a going concern. This contemplates
the realization of assets and the liquidation of liabilities in the normal
course of business. Currently, the Company does not have cash nor material
assets, nor does it have operations or a source of revenue sufficient to cover
its operation costs and allow it to continue as a going concern. The Company
will be dependent upon the raising of additional capital through placement of
our common stock in order to implement its business plan, or merge with an
operating company. There can be no assurance that the Company will be successful
in either situation in order to continue as a going concern. The officers and
directors have committed to advancing certain operating costs of the Company.
F-5
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
NOTE 1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
RECENT ACCOUNTING PRONOUNCEMENTS
In December 2004, the Financial Accounting Standards Board ("FASB") issued SFAS
No. 123R "SHARE BASED PAYMENT." This statement is a revision to SFAS 123 and
supersedes Accounting Principles Board (APB) Opinion No. 25, "ACCOUNTING FOR
STOCK ISSUED TO EMPLOYEES," and amends FASB Statement No. 95, "STATEMENT OF CASH
FLOWS." This statement requires a public entity to expense the cost of employee
services received in exchange for an award of equity instruments. This statement
also provides guidance on valuing and expensing these awards, as well as
disclosure requirements of these equity arrangements. This statement is
effective for the first interim reporting period that begins after June 15,
2005.
SFAS 123R permits public companies to choose between the following two
adoption methods:
1. A "modified prospective" method in which compensation cost is recognized
beginning with the effective date (a) based on the requirements of SFAS
123R for all share-based payments granted after the effective date and (b)
based on the requirements of Statement 123 for all awards granted to
employees prior to the effective date of SFAS 123R that remain unvested on
the effective date, or
2. A "modified retrospective" method which includes the requirements of the
modified prospective method described above, but also permits entities to
restate based on the amounts previously recognized under SFAS 123 for
purposes of pro forma disclosures either (a) all prior periods presented or
(b) prior interim periods of the year of adoption.
As we do not currently have share based payments, we expect no impact to the
financial statements due to the adoption of SFAS 123R.
In September 2006, the SEC Staff issued SEC Staff Accounting Bulletin 107,
"Implementation Guidance for FASB 123 (R)." The staff believes the guidance in
the SAB will assist issuers in their initial implementation of Statement 123R
and enhance the information received by investors and other users of financial
statements, thereby assisting them in making investment and other decisions.
This SAB includes interpretive guidance related to share-based payment
transactions with non-employees, the transition from nonpublic to public entity
status, valuation methods (including assumptions such as expected volatility and
expected term), the accounting for certain redeemable financials instruments
issued under share-based payment arrangements, the classification of
compensation expense, non-GAAP financial measures, first-time adoption of
Statement 123R in an interim period, capitalization of compensation cost related
to share-based payment arrangements, the accounting for income tax effects of
share-based payment arrangements upon adoption of Statement 123R and disclosures
of MD&A subsequent to adoption of Statement 123R.
In September 2006, the SEC Staff issued SEC Staff Accounting Bulletin 107,
"Implementation Guidance for FASB 123 (R)." The staff believes the guidance in
the SAB will assist issuers in their initial implementation of Statement 123R
and enhance the information received by investors and other users of financial
statements, thereby assisting them in making investment and other decisions.
F-6
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
NOTE 1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
This SAB includes interpretive guidance related to share-based payment
transactions with non-employees, the transition from nonpublic to public entity
status, valuation methods (including assumptions such as expected volatility and
expected term), the accounting for certain redeemable financials instruments
issued under share-based payment arrangements, the classification of
compensation expense, non-GAAP financial measures, first-time adoption of
Statement 123R in an interim period, capitalization of compensation cost related
to share-based payment arrangements, the accounting for income tax effects of
share-based payment arrangements upon adoption of Statement 123R and disclosures
of MD&A subsequent to adoption of Statement 123R.
In September 2006, the SEC Staff issued Staff Accounting Bulletin No. 108,
"Considering the Effects of Prior Year Misstatements when Quantifying
Misstatements in the Current Year Financial Statements" ("SAB No. 108"). SAB No.
108 requires the use of two alternative approaches in quantitatively evaluating
materiality of misstatements. If the misstatement as quantified under either
approach is material to the current year financial statements, the misstatement
must be corrected. If the effect of correcting the prior year misstatements, if
any, in the current year income statement is material, the prior year financial
statements should be corrected. In the year of adoption (fiscal years ending
after November 15, 2006 or calendar year 2006 for us), the misstatements may be
corrected as an accounting change by adjusting opening retained earnings rather
than being included in the current year income statement. We do not expect that
the adoption of SAB No. 108 will have a material impact on our financial
condition or results of operations.
In September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements" (SFAS
157). SFAS 157 provides guidance for using fair value to measure assets and
liabilities. SFAS 157 addresses the requests from investors for expanded
disclosure about the extent to which companies measure assets and liabilities at
fair value, the information used to measure fair value and the effect of fair
value measurements on earnings. SFAS 157 applies whenever other standards
require (or permit) assets or liabilities to be measured at fair value, and does
not expand the use of fair value in any new circumstances. SFAS 157 is effective
for financial statements issued for fiscal years beginning after November 15,
2007 and will be adopted by the Company in the first quarter of fiscal year
2009. We do not expect that the adoption of SFAS 157 will have a material impact
on our financial condition or results of operations.
In September 2006, the FASB issued SFAS No. 158, "Employers' Accounting for
Defined Benefit Pension and Other Postretirement Plans" ("SFAS No. 158"). SFAS
No. 158 requires companies to recognize in their statement of financial position
an asset for a plan's overfunded status or a liability for a plan's underfunded
status and to measure a plan's assets and its obligations that determine its
funded status as of the end of the company's fiscal year. Additionally, SFAS No.
158 requires companies to recognize changes in the funded status of a defined
benefit postretirement plan in the year that the changes occur and those changes
will be reported in comprehensive income. The provision of SFAS No. 158 that
will require us to recognize the funded status of our postretirement plans, and
the disclosure requirements, will be effective for us as of December 31, 2006.
We do not expect that the adoption of SFAS No. 158 will have a material impact
on our consolidated financial statements.
F-7
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
NOTE 1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
FAS 123(R)-5 was issued on October 10, 2006. The FSP provides that instruments
that were originally issued as employee compensation and then modified, and that
modification is made to the terms of the instrument solely to reflect an equity
restructuring that occurs when the holders are no longer employees, then no
change in the recognition or the measurement (due to a change in classification)
of those instruments will result if both of the following conditions are met:
(a). There is no increase in fair value of the award (or the ratio of intrinsic
value to the exercise price of the award is preserved, that is, the holder is
made whole), or the antidilution provision is not added to the terms of the
award in contemplation of an equity restructuring; and (b). All holders of the
same class of equity instruments (for example, stock options) are treated in the
same manner. The provisions in this FSP shall be applied in the first reporting
period beginning after the date the FSP is posted to the FASB website. We will
evaluate whether the adoption will have any impact on your financial statements.
In February 2007, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 159, "The Fair Value Option for Financial
Assets and Financial Liabilities - Including an amendment of FASB Statement No.
115" (hereinafter "SFAS No. 159"). This statement permits entities to choose to
measure many financial instruments and certain other items at fair value. The
objective is to improve financial reporting by providing entities with the
opportunity to mitigate volatility in reported earnings caused by measuring
related assets and liabilities differently without having to apply complex hedge
accounting provisions. This statement is expected to expand the use of fair
value measurement, which is consistent with the Board's long-term measurement
objectives for accounting for financial instruments. This statement is effective
as of the beginning of an entity's first fiscal year that begins after November
15, 2007, although earlier adoption is permitted. Management has not determined
the effect that adopting this statement would have on the Company's financial
condition or results of operations.
NOTE 2. STOCKHOLDER'S EQUITY
COMMON STOCK
The authorized common stock of the Company consists of 100,000,000 shares with
par value of $0.001. On April 17, 2007 the Company authorized and issued
2,000,000 shares of its $.001 par value common stock in consideration of $5,000
in cash.
The authorized preferred stock of the Company consists of 5,000,000 shares with
a par value of $.001. The Company has no preferred stock issued or outstanding.
NET LOSS PER COMMON SHARE
Net loss per share is calculated in accordance with SFAS No. 128, "EARNINGS PER
SHARE." The weighted-average number of common shares outstanding during each
period is used to compute basic loss per share. Diluted loss per share is
computed using the weighted averaged number of shares and dilutive potential
common shares outstanding. Dilutive potential common shares are additional
common shares assumed to be exercised.
F-8
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
NOTE 2. STOCKHOLDER'S EQUITY (CONTINUED)
Basic net loss per common share is based on the weighted average number of
shares of common stock outstanding of 2,000,000 during 2007 and since inception.
As of September 30, 2007 and since inception, the Company had no dilutive
potential common shares.
NOTE 3. INCOME TAXES
We did not provide any current or deferred U.S. federal income tax provision or
benefit for any of the periods presented because we have experienced operating
losses since inception. We provided a full valuation allowance on the net
deferred tax asset, consisting of net operating loss carryforwards, because
management has determined that it is more likely than not that we will not earn
income sufficient to realize the deferred tax assets during the carryforward
period.
The components of the Company's deferred tax asset as of September 30, 2007 are
as follows:
2007
_____________
Net operating loss carryforward $ 2,531
Valuation allowance (2,531)
_____________
Net deferred tax asset $ 0
=============
A reconciliation of income taxes computed at the statutory rate to the income
tax amount recorded is as follows:
2007 Since Inception
_____________ _____________
Tax at statutory rate (35%) $ 2,531 $ 2,531
Increase in valuation allowance (2,531) (2,531)
_____________ _____________
Net deferred tax asset $ 0 $ 0
============= =============
The net federal operating loss carry forward will expire in 2027. This carry
forward may be limited upon the consummation of a business combination under IRC
Section 381.
NOTE 4. RELATED PARTY TRANSACTIONS
The Company neither owns nor leases any real or personal property. An officer or
resident agent of the corporation provides office services without charge. Such
costs are immaterial to the financial statements and accordingly, have not been
reflected therein. The officers and directors for the Company are involved in
other business activities and may, in the future, become involved in other
business opportunities. If a specific business opportunity becomes available,
such persons may face a conflict in selecting between the Company and their
other business interest. The Company has not formulated a policy for the
resolution of such conflicts.
F-9
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
NOTE 5. WARRANTS AND OPTIONS
There are no warrants or options outstanding to acquire any additional shares of
common stock of the Company.
NOTE 6. OFFICERS ADVANCES
The Company has incurred costs while seeking additional capital through a merger
with an existing company. An officer of the Company has advanced funds on behalf
of the Company to pay for these costs. These funds have been advanced interest
free. As of September 30, 2007, the Company owed officers $2,232.
F-10
OUTSIDE BACK COVER
DEALER PROSPECTUS DELIVERY OBLIGATION
Until ______, 2007, all dealers that effect transactions in these securities,
whether or not participating in this offering, may be required to deliver a
prospectus. This is in addition to any dealers' obligation to deliver a
prospectus if acting as underwriters and with respect to their unsold allotments
or subscriptions.
35
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
Item 24. Indemnification of Directors and Officers
Section 145 of the Delaware General Corporation Law provides that a
corporation may indemnify directors and officers as well as other employees and
individuals against expenses including attorneys' fees, judgments, fines and
amounts paid in settlement in connection with various actions, suits or
proceedings, whether civil, criminal, administrative or investigative other than
an action by or in the right of the corporation, a derivative action, if they
acted in good faith and in a manner they reasonably believed to be in or not
opposed to the best interests of the corporation, and, with respect to any
criminal action or proceeding, if they had no reasonable cause to believe their
conduct was unlawful. A similar standard is applicable in the case of derivative
actions, except that indemnification only extends to expenses including
attorneys' fees incurred in connection with the defense or settlement of such
action, and the statute requires court approval before there can be any
indemnification where the person seeking indemnification has been found liable
to the corporation. The statute provides that it is not exclusive of other
indemnification that may be granted by a corporation's certificate of
incorporation, bylaws, agreement, a vote of shareholders or disinterested
directors or otherwise.
The Company's Certificate of Incorporation provides that it will
indemnify and hold harmless, to the fullest extent permitted by Section 145 of
the Delaware General Corporation Law, as amended from time to time, each person
that such section grants us the power to indemnify.
The Delaware General Corporation Law permits a corporation to provide
in its certificate of incorporation that a director of the corporation shall not
be personally liable to the corporation or its shareholders for monetary damages
for breach of fiduciary duty as a director, except for liability for: (i) any
breach of the director's duty of loyalty to the corporation or its shareholders;
(ii) acts or omissions not in good faith or which involve intentional misconduct
or a knowing violation of law; (iii) payments of unlawful dividends or unlawful
stock repurchases or redemptions; or (iv) any transaction from which the
director derived an improper personal benefit.
Our Certificate of Incorporation provides that, to the fullest extent
permitted by applicable law, none of our directors will be personally liable to
us or our shareholders for monetary damages for breach of fiduciary duty as a
director. Any repeal or modification of this provision will be prospective only
and will not adversely affect any limitation, right or protection of a director
of our company existing at the time of such repeal or modification.
Our bylaws also provide for the right to indemnification. To summarize:
1. Right to Indemnification. Each person who was or is made a party or
is threatened to be made a party to or is otherwise involved in any action, suit
36
or proceeding, whether civil, criminal, administrative or investigative
(hereinafter a "proceeding"), by reason of the fact that he or she is or was a
director or an officer of the Company or is or was serving at the request of the
Company as a director, officer or trustee of another corporation or of a
partnership, joint venture, trust or other enterprise, including service with
respect to an employee benefit plan (hereinafter an "indemnitee"), shall be
indemnified and held harmless by the Company to the fullest extent authorized by
the General Corporation Law of the State of Delaware, as the same exists or may
hereafter be amended (but, in the case of any such amendment, only to the extent
that such amendment permits the Company to provide broader indemnification
rights than such law permitted the Company to provide prior to such amendment),
against all expense, liability and loss (including attorneys' fees, judgments,
fines, ERISA excise taxes or penalties and amounts paid in settlement)
reasonably incurred or suffered by such indemnitee in connection therewith;
provided, however, that, except as provided in Paragraph 3 with respect to
proceedings to enforce rights to indemnification, the Company shall indemnify
any such indemnitee in connection with a proceeding (or part thereof) initiated
by such indemnitee only if such proceeding (or part thereof) was authorized by
the Board of Directors of the Company.
2. Right to Advancement of Expenses. In addition to the right to
indemnification conferred in Paragraph 1 an indemnitee shall also have the right
to be paid by the Company the expenses (including attorney's fees) incurred in
defending any such proceeding in advance of its final disposition (hereinafter
an "advancement of expenses"); PROVIDED, HOWEVER, that, if the General
Corporation Law of the State of Delaware requires, an advancement of expenses
incurred by an indemnitee in his or her capacity as a director or officer (and
not in any other capacity in which service was or is rendered by such
indemnitee, including, without limitation, service to an employee benefit plan)
shall be made only upon delivery to the Company of an undertaking (hereinafter
an "undertaking"), by or on behalf of such indemnitee, to repay such amounts if
it shall ultimately be determined by final judicial decision from which there is
no further right to appeal (hereinafter a "final adjudication") that such
indemnitee is not entitled to be indemnified for such expenses under this
Section 2 or otherwise.
3. Right of Indemnitee to Bring Suit. If a claim under Paragraph 1 or 2
is not paid in full by the Company within sixty (60) days after a written claim
has been received by the Company, except in the case of a claim for an
advancement of expenses, in which case the applicable period shall be twenty
(20) days, the indemnitee may at any time thereafter bring suit against the
Company to recover the unpaid amount of the claim. If successful in whole or in
part in any such suit, or in a suit brought by the Company to recover an
advancement of expenses pursuant to the terms of an undertaking, the indemnitee
shall be entitled to be paid also the expense of prosecuting or defending such
suit. In (a) any suit brought by the indemnitee to enforce a right to
indemnification hereunder (but not in a suit brought by the indemnitee to
enforce a right to an advancement of expenses) it shall be a defense that, and
(b) in any suit brought by the Company to recover an advancement of expenses
pursuant to the terms of an undertaking, the Company shall be entitled to
recover such expenses upon a final adjudication that, the indemnitee has not met
37
any applicable standard for indemnification set forth in the General Corporation
Law of the State of Delaware. Neither the failure of the Company (including its
directors who are not parties to such action, a committee of such directors,
independent legal counsel, or its shareholders) to have made a determination
prior to the commencement of such suit that indemnification of the indemnitee is
proper in the circumstances because the indemnitee has met the applicable
standard of conduct set forth in the General Corporation Law of the State of
Delaware, nor an actual determination by the Company (including its directors
who are not parties to such action, a committee of such directors, independent
legal counsel, or its shareholders) that the indemnitee has not met such
applicable standard of conduct, shall create a presumption that the indemnitee
has not met the applicable standard of conduct or, in the case of such a suit
brought by the indemnitee, be a defense to such suit.
4. Non-Exclusivity of Rights. The rights to indemnification and to the
advancement of expenses conferred in the bylaws shall not be exclusive of any
other right which any person may have or hereafter acquire under any statute,
the Company's certificate of incorporation or Bylaws, agreement, vote of
shareholders or directors, or otherwise.
5. Insurance. The Company may maintain insurance, at its expense, to
protect itself and any director, officer, employee or agent of the Company, or
any person who is serving at the request of the Company as a director, officer,
employee, or agent of another corporation, partnership, joint venture, trust or
other enterprise, against any expense, liability or loss, whether or not the
Company would have the power to indemnify such person against such expense,
liability or loss under the General Corporation Law of the State of Delaware.
6. Indemnification of Employees and Agents of the Company. The Company
may, to the extent authorized from time to time by the Board of Directors, grant
rights to indemnification and to the advancement of expenses to any employee or
agent of the Company to the fullest extent of the provisions of the bylaws with
respect to the indemnification and advancement of expenses of directors and
officers of the Company.
7. Nature of Rights. The rights conferred upon indemnitees in the
bylaws shall be contract rights and such rights shall continue as to an
indemnitee who has ceased to be a director, officer or trustee and shall inure
to the benefit of the indemnitee's heirs, executors and administrators. Any
amendment, alteration or repeal of the bylaws that adversely affects any right
of an indemnitee or its successors shall be prospective only and shall not limit
or eliminate any such right with respect to any proceeding involving any
occurrence or alleged occurrence of any action or omission to act that took
place prior to such amendment or repeal.
No Securities Indemnification.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933, as amended, may be permitted to officers, directors or
persons controlling the Company pursuant to the foregoing, we have been informed
that in the opinion of the Commission such indemnification is against public
policy as expressed in the Securities Act of 1933, as amended, and is therefore
unenforceable.
38
Item 25. Other Expenses of Issuance and Distribution
We have or will expend fees in relation to this registration statement
as detailed below:
Expenditure Item Amount
Attorney Fees $ 7,500
Audit Fees 1,000
Transfer Agent Fees 700
Printing Fees 1,300
Registration Fees 10
_______
Total $10,510
Item 26. Recent Sales of Unregistered Securities
We have sold securities within the past three years on one occasion
without registering the securities under the Securities Act of 1933, as amended.
Robert L. Wilson purchased 2,000,000 shares of common stock from Teen on April
17, 2007 for $.0025 per share. No underwriters were used and no commissions or
other remuneration was paid except to Teen. The securities were sold in reliance
on Section 4(2) of the Securities Act of 1933 as amended. Robert L. Wilson
continues to be subject to Rule 144 of the Securities Act of 1933, as amended.
Item 27. Exhibits
NUMBER DESCRIPTION
3.1 Certificate of Incorporation
3.2 Bylaws
5 Opinion re: Legality
16.1 Letter from Kyle L. Tingle
23.2 Consent of Attorney (included In Exhibit 5)
99 Subscription Agreement
39
Item 28. Undertakings
Teen hereby undertakes the following:
To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(a) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933 as amended ("Securities Act")
(b) To reflect in the prospectus any facts or events arising after the
effective date of this registration statement, or most recent
post-effective amendment, which, individually or in the aggregate,
represent a fundamental change in the information set forth in this
registration statement; and
(c) To include any material information with respect to the plan of
distribution not previously disclosed in this registration statement or
any material change to such information in the registration statement.
That, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered herein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
To remove from registration by means of a post-effective amendment any
of the securities being registered hereby which remain unsold at the
termination of the offering.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to the directors, officers and controlling persons
pursuant to the provisions above, or otherwise, Teen has been advised
that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities
Act, and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities, other than the payment by us
of expenses incurred or paid by one of the directors, officers, or
controlling persons in the successful defense of any action, suit or
proceeding, is asserted by one of the directors, officers, or
controlling persons in connection with the securities being registered,
Teen will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification is against
public policy as expressed in the Securities Act, and Teen will be
governed by the final adjudication of such issue.
For determining liability under the Securities Act, to treat the
information omitted from the form of prospectus filed as part of this
Registration Statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the Registrant under Rule 424(b)(1) or (4)
or 497(h) under the Securities Act as part of this Registration
Statement as of the time the Commission declared it effective.
40
SIGNATURES
In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form SB-2 and authorized this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Rancho Mirage, California of the United States, on
October 31, 2007.
TEEN EDUCATION GROUP, INC.
/s/ ROBERT L. WILSON October 31, 2007
_________________________________________________
Robert L. Wilson
President (Principal Executive Officer), Director
/s/ ROBERT L. WILSON
_________________________________________________
Robert L. Wilson
Principal Financial Officer
In accordance with the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates stated.
/s/ ROBERT L. WILSON October 31, 2007
_________________________________________________
Robert L. Wilson
Secretary/Treasurer
/s/ ROBERT L. WILSON October 31, 2007
_________________________________________________
Robert L. Wilson
Sole Director
41
EXHIBIT INDEX
NUMBER DESCRIPTION
3.1 Certificate of Incorporation
3.2 Bylaws
5 Opinion re: Legality
23.1 Consent of Attorney (Included in Exhibit 5)
23.2 Consent of Accountant
42