UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q/A
(Amendment No. 1)
(Mark One)
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2008.
OR
/ / TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
FOR THE TRANSITION FROM _______ TO ________.
COMMISSION FILE NUMBER: 333-147045
TEEN EDUCATION GROUP, INC.
_________________________________________________________________
(Exact Name of Small Business Issuer as Specified in its Charter)
DELAWARE 26-032648
_______________________________ ___________________
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
70707 Frank Sinatra Drive, Unit 59
Rancho Mirage, CA 92270
________________________________________ __________
(Address of principal executive offices) (Zip code)
Issuer's telephone number: (702) 248-1027
N/A
______________________________________________
(Former name, former address and former fiscal
year, if changed since last report.)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes /X/ No / /
-1-
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer or a smaller reporting company. See
definitions of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act. (Check one):
________________________________________________________________________________
Non-accelerated filer Smaller
Large accelerated (Do not check if a smaller reporting
filer Accelerated filer reporting company) company
[ ] [ ] [ ] [X]
________________________________________________________________________________
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes /X/ No / /
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date:
At March 31, 2008, and as of the date hereof, there were outstanding
2,250,000 shares of the Registrant's Common Stock, $.001 par value.
Transitional Small Business Disclosure Format: Yes / / No /X/
-2-
PART I
FINANCIAL INFORMATION
ITEM 1. Financial Statements
TEEN EDUCATION GROUP, INC.
(A Development Stage Enterprise)
MARCH 31, 2008
DECEMBER 31, 2007
-3-
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
CONTENTS
____________________________________________________________________________
FINANCIAL STATEMENTS
Balance Sheets 5
Statements of Operations 6
Statements of Stockholders' Equity 7
Statements of Cash Flows 8
Notes to Financial Statements 9-13
____________________________________________________________________________
-4-
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
BALANCE SHEETS
March 31, December 31,
2008 2007
_________ ____________
ASSETS
CURRENT ASSETS
Cash $ 26,002 $ 26,002
_________ ________
Total current assets $ 26,002 $ 26,002
_________ ________
Total assets $ 26,002 $ 26,002
========= ========
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES
Accounts payable $ 2,100 $ 0
Officers advances 6,118 5,118
_________ ________
Total current liabilities $ 8,218 $ 5,118
_________ ________
STOCKHOLDERS' EQUITY
Preferred stock: $.001 par value;
authorized 5,000,000 shares; none issued
and outstanding at March 31, 2008 and
December 31, 2007. 0 0
Common stock: $.001 par value;
authorized 100,000,000 shares; issued
and outstanding: 2,250,000 shares at
March 31, 2008 and December 31, 2007 2,250 2,250
Additional paid-in capital 27,750 27,750
Accumulated deficit during development stage (12,216) (9,116)
_________ ________
Total stockholders' equity $ 17,784 $ 20,884
_________ ________
Total liabilities and
stockholders' equity $ 26,002 $ 26,002
========= ========
See Accompanying Notes to Financial Statements.
-5-
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENTS OF OPERATIONS
Apr. 19, 2006
Quarter Ended Year Ended (inception) to
March 31, December 31, March 31,
2008 2007 2008
____________ ____________ ______________
Revenues $ 0 $ 0 $ 0
Cost of revenue 0 0 0
__________ __________ __________
Gross profit $ 0 $ 0 $ 0
General, selling and
administrative expenses 3,100 9,118 12,218
__________ __________ __________
Operating loss $ (3,100) $ (9,118) $ (12,218)
Interest income 0 2 2
__________ __________ __________
Net loss $ (1,997) $ (17,446) $ (12,216)
========== ========== ==========
Net loss per share, basic
and diluted $ (0.00) $ (0.00)
========== ==========
Average number of shares
of common stock outstanding 2,250,000 2,250,000
========== ==========
See Accompanying Notes to Financial Statements.
-6-
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENTS OF STOCKHOLDERS'EQUITY
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
December 27, 2007, issued
SB-2 common stock 250,000 250 24,750 0 25,000
Net loss, December 31, 2007 (9,116) (9,116)
_________ _______ ________ ________ ________
Balance, December 31, 2007 2,250,000 $ 2,250 $ 27,750 $ (9,116) $ 20,884
Net loss, March 31, 2008 (3,100) (3,100)
_________ _______ ________ ________ ________
Balance, March 31, 2008 2,250,000 $ 2,250 $ 27,750 $(12,216) $ 17,784
========= ======= ======== ======== ========
See Accompanying Notes to Financial Statements.
-7-
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENTS OF CASH FLOWS
Apr. 19, 2006
Quarter Ended Year Ended (inception) to
March 31, December 31, March 31,
2008 2007 2008
_____________ ____________ ______________
Cash Flows From
Operating Activities
Net loss $(3,100) $ (9,116) $(12,216)
Adjustments to reconcile net loss
to cash used in operating activities:
Changes in assets and liabilities
Increase (decrease) in accounts payable 2,100 0 2,100
_______ ________ ________
Net cash used in
operating activities $(1,000) $ (9,116) $(10,116)
_______ ________ ________
Cash Flows From
Investing Activities $ 0 $ 0 $ 0
_______ ________ ________
Cash Flows From
Financing Activities
Issuance of common stock $ 0 $ 30,000 $ 30,000
Increase in officer advances 1,000 5,118 6,118
_______ ________ ________
Net cash provided by
financing activities $ 1,000 $ 35,118 $ 36,118
_______ ________ ________
Net increase (decrease)
in cash $ 0 $ 26,002 $ 26,002
Cash, beginning of period 26,002 0 0
_______ ________ ________
Cash, end of period $26,002 $ 26,002 $ 26,002
======= ======== ========
Supplemental Information and Non-monetary
Transactions:
Interest paid $ 0 $ 0 $ 0
======= ======== ========
Taxes paid $ 0 $ 0 $ 0
======= ======== ========
See Accompanying Notes to Financial Statements.
-8-
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. The Company had
$26,002 in an interest bearing savings account as of March 31, 2008. The account
is federally insured.
INCOME TAXES
Income taxes are provided for using the liability method of accounting in
accordance with SFAS No. 109 "ACCOUNTING FOR INCOME TAXES," and clarified by FIN
48, "ACCOUNTING FOR UNCERTAINTY IN INCOME TAXES--AN INTERPRETATION OF FASB
STATEMENT NO. 109." 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.
SHARE BASED EXPENSES
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. The Company adopted SFAS
No. 123R upon creation of the company and expenses share based costs in the
period incurred.
-9-
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
SFAS NO. 141R
In November 2007, the FASB issued SFAS No. 141R, "Business Combinations -- a
replacement of FASB Statement No. 141", which continues to require that all
business combinations be accounted for by applying the acquisition method. Under
the acquisition method, the acquirer recognizes and measures the identifiable
assets acquired, the liabilities assumed, and any contingent consideration and
contractual contingencies, as a whole, at their fair value as of the acquisition
date. Under SFAS No. 141R, all transaction costs are expensed as incurred. SFAS
No. 141R rescinds EITF 93-7. Under EITF 93-7, the effect of any subsequent
adjustments to uncertain tax positions were generally applied to goodwill,
except for post-acquisition interest on uncertain tax positions, which was
recognized as an adjustment to income tax expense. Under SFAS No. 141R, all
subsequent adjustments to these uncertain tax positions that otherwise would
have impacted goodwill will be recognized in the income statement. The guidance
in SFAS No. 141R will be applied prospectively to business combinations for
which the acquisition date is on or after the beginning of the first annual
reporting period beginning after December 15, 2008.
SFAS NO. 157
In September 2006, the FASB issued SFAS No. 157, "Fair Value Measurements"
("SFAS No. 157"). SFAS No. 157 defines fair value, establishes a framework for
measuring fair value and expands disclosure about fair value measurements. SFAS
No. 157 is effective for financial assets and liabilities in fiscal years
beginning after November 15, 2007 and for nonfinancial assets and liabilities in
fiscal years beginning after March 15, 2008. We do not expect the adoption of
SFAS No. 157 to have a material impact on our consolidated financial statements.
SFAS NO. 159
In February 2007, FASB issued SFAS No. 159, "The Fair Value Option for Financial
Assets and Financial Liabilities," which provides the option to report certain
financial assets and liabilities at fair value, with the intent to mitigate
volatility in financial reporting that can occur when related assets and
liabilities are recorded on different bases. SFAS No. 159 amends FASB Statement
No. 95, "Statement of Cash Flows" ("SFAS No. 95") and FASB Statement No. 115,
"Accounting for Certain Investments in Debt and Equity Securities" ("SFAS No.
115"). SFAS No. 159 specifies that cash flows from trading securities, including
securities for which an entity has elected the fair value option, should be
classified in the statement of cash flows based on the nature of and purpose for
which the securities were acquired. Before this amendment, SFAS No. 95 and SFAS
No. 115 specified that cash flows from trading securities must be classified as
cash flows from operating activities. This statement is effective for us
beginning January 1, 2008. Upon adoption, we will reclassify proceeds from sales
of trading securities within our statement of cash flows as an investing
activity. We do not expect any of the other provisions of SFAS No. 159 to have a
material impact on our consolidated financial statements.
-10-
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
NOTE 1. NATURE OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
SFAS NO. 160
In November 2007, the FASB issued SFAS No. 160, "Accounting and Reporting of
Noncontrolling Interest" ("SFAS No. 160"). SFAS No. 160 requires that a
noncontrolling interest (previously referred to as a minority interest) be
separately reported in the equity section of the consolidated entity's balance
sheet. SFAS No. 160 also established accounting and reporting standards for: (i)
ownership interests in subsidiaries held by parties other than the parent, (ii)
the amount of consolidated net income attributable to the parent and to the
noncontrolling interest, (iii) changes in a parent's ownership interest and (iv)
the valuation of retained noncontrolling equity investments when a subsidiary is
deconsolidated. SFAS No. 160 is effective for us beginning January 1, 2009. We
are currently assessing the potential impact that the adoption of SFAS No. 160
will have on our consolidated financial statements.
EITF ISSUE NO. 06-10
In March 2007, the EITF reached a consensus on EITF Issue No. 06-10, "Accounting
for Deferred Compensation and Postretirement Benefit Aspects of Collateral
Assignment Split-Dollar Life Insurance Arrangements" ("EITF 06-10"). EITF 06-10
provides that an employer should recognize a liability for the postretirement
benefit related to collateral assignment split-dollar life insurance
arrangements in accordance with either SFAS No. 106, "Employers' Accounting for
Postretirement Benefits Other Than Pensions," or APB No. 12, "Omnibus Opinion."
We expect to record a liability of approximately $130 million related to the
adoption of EITF 06-10 as of January 1, 2008, by an adjustment to retained
earnings.
NOTE 2. STOCKHOLDERS' 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.
On December 12, 2007 the Company initiated an SB-2 offering, selling 250,000
common shares at $0.10 per share, raising $25,000. On December 12, 2007 the
offering was completed. The 250,000 common shares were delivered December 31,
2007.
PREFERRED STOCK
The authorized preferred stock of the Company consists of 5,000,000 shares with
a par value of $.001. No preferred shares are issued or outstanding.
-11-
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
NOTE 2. STOCKHOLDERS' EQUITY (CONTINUED)
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.
Basic net loss per common share is based on the weighted average number of
shares of common stock outstanding of 2,000,000 during 2008 and since inception.
As of March 31, 2008 and December 31, 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. Per Statement of Accounting Standard No. 109 -
Accounting for Income Tax and FASB Interpretation No. 48 - Accounting for
Uncertainty in Income Taxes an interpretation of FASB Statement No.109, when it
is more likely than not that a tax asset cannot be realized through future
income the Company must allow for this future tax benefit. 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 December 31, 2007 are
as follows:
2007
________
Net operating loss $ 3,191
Valuation allowance (3,191)
________
Net deferred tax asset $ 0
========
-12-
TEEN EDUCATION GROUP, INC.
(A DEVELOPMENT STAGE ENTERPRISE)
NOTES TO FINANCIAL STATEMENTS
NOTE 3. INCOME TAXES (CONTINUED)
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%) $ 3,191 $ 3,191
Increase in valuation allowance (3,191) (3,191)
________ ________
Net deferred tax asset $ 0 $ 0
======== ========
The net federal operating loss carry forward will expire between 2016 and 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.
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 March 31, 2008 and December 31, 2007, the company owed officers
$5,118 and $6,118 respectively.
NOTE 5. WARRANTS AND OPTIONS
There are no warrants or options outstanding to acquire any additional shares of
common stock of the Company.
-13-
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Generally.
Teen Education Group, Inc. ("Teen") was incorporated on April 19, 2006 in
the State of Delaware.
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.
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.
Financial Condition.
Since we have had a limited operating history and have not achieved any
revenues or earnings from operations, with limited significant assets and
financial resources, we will in all likelihood sustain operating expenses
without corresponding revenues, at least until we commence our educational
activities.
Liquidity.
As of December 31, 2007, we had assets of $26,002 and total liabilities of
$8,584 and we had a net worth of $20,844. As of March 31, 2008, we had $26,002
in assets and total liabilities of $8,218 and a net worth of $17,784.
We have had no revenues from inception through December 31, 2007 and we had
no revenues for the period ended March 31, 2008. We have a loss from inception
through December 31, 2007 of $9,116 and a loss from inception through March 31,
2008 of $12,216.
We have officer's advances of $5,118 from inception to December 31, 2007
and $6,118 as at March 31, 2008.
-14-
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Not applicable to smaller reporting companies.
ITEM 4. CONTROLS AND PROCEDURES.
Internal control over financial reporting refers to the process designed
by, or under the supervision of, our Chief Executive Officer and Chief Financial
Officer, and effected by our Board of Directors, management and other personnel,
to provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles, and includes those policies and
procedures that:
o Pertain to the maintenance of records that in reasonable detail
accurately and fairly reflect the transactions and dispositions of our
assets;
o Provide reasonable assurance that transactions are recorded as
necessary to permit preparation of financial statements in accordance
with generally accepted accounting principles, and that our receipts
and expenditures are being made only in accordance with authorization
of our management and directors; and
o Provide reasonable assurance regarding prevention or timely detection
of unauthorized acquisitions, use or disposition of our assets that
could have a material effect on the financial statements.
Internal control over financial reporting cannot provide absolute assurance
of achieving financial reporting objectives because of its inherent limitations.
It is a process that involves human diligence and compliance and is subject to
lapses in judgment and breakdowns resulting from human failures. It also can be
circumvented by collusion or improper management override.
Because of such limitations, there is a risk that material misstatements
may not be prevented or detected on a timely basis by internal control over
financial reporting. However, these inherent limitations are known features of
the financial reporting process. Therefore, it is possible to design into the
process certain safeguards to reduce, thought not eliminate, this risk.
Management is responsible for establishing and maintaining adequate internal
control over our financial reporting. To avoid segregation of duty due to
management accounting size, management had engaged an outside CPA to assist in
the financial reporting.
Management has used the framework set forth in the report entitled Internal
Control - Integrated Framework published by the Committee of Sponsoring
Organizations of the Treadway Commission, known as COSO, to evaluate the
effectiveness of our internal control over financial reporting. Based upon this
assessment, management has concluded that our internal control over financial
reporting was effective as of and for the year ended December 31, 2007 with the
following exceptions:
o As a part of our year end review of our disclosure controls and
procedures, we determined that several of our procedures require
additional documentation; no sufficient testing where conducted and
further segregation of duties needs to be put in place. It is our
belief that those control procedures are being performed, however
documentation of their execution is not available. We are implementing
additional documentation procedures in order to address this weakness.
Management has concluded that other than as described above, our internal
control over financial reporting was effective as of and for the year ended
December 31, 2007 and the current quarter then ended.
The Company is not an "accelerated filer" for the 2007 fiscal year because
it is qualified as a "small business issuer". Hence, under current law, the
internal controls certification and attestation requirements of Section 404 of
the Sarbanes-Oxley act will not apply to the Company.
-15-
PART II
OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS .................................................None
ITEM 1A. RISK FACTORS.
Prior to investing in the shares, a prospective investor should consider
carefully the following risks and highly speculative factors that may affect our
business. 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 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.
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. 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 nine (9) 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.
Our inability to fund our operations will impede our growth and operating
results and may also result in a loss of your investment.
-16-
3. 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 March 31, 2008,
we had cash of $26,002, liabilities of $8,218 and our losses to that date
totaled $12,216.
4. 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. 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.
5. 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.
6. 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 our
business or results of operations once commenced. Accordingly, without suitable
replacements and employees to operate Teen, our operations will suffer.
7. Robert L. Wilson owns approximately 89% of our shares and that permits him
to exert influence over us or to prevent a change of control.
Robert L. Wilson, our sole director and officer, beneficially owns
approximately 89% of our outstanding shares of common stock. 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.
8. 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.
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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.
9. 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 and we have contacted a market
maker to seek the listing on our behalf.
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.
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.
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.
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ITEM 2 - Unregistered Sales of Equity Securities and Use Proceeds...........None
ITEM 3 - Defaults Upon Senior Securities....................................None
ITEM 4 - Submission of Matter to a Vote of Security Holders.................None
ITEM 5 - Other Information
Board Meeting.
Our board held one meeting during the period covered by this current
report.
Audit Committee.
Our board of directors has not established an audit committee. In addition,
we do not have any other compensation or executive or similar committees. We
will not, in all likelihood, establish an audit committee until such time as the
Company generates a positive cash flow of which there can be no assurance. We
recognize that an audit committee, when established, will play a critical role
in our financial reporting system by overseeing and monitoring management's and
the independent auditors' participation in the financial reporting process. At
such time as we establish an audit committee, its additional disclosures with
our auditors and management may promote investor confidence in the integrity of
the financial reporting process.
Until such time as an audit committee has been established, the full board
of directors will undertake those tasks normally associated with an audit
committee to include, but not by way of limitation, the (i) review and
discussion of the audited financial statements with management, and (ii)
discussions with the independent auditors the matters required to be discussed
by the Statement On Auditing Standards No. 61 and No. 90, as may be modified or
supplemented.
Code of Ethics.
We have adopted a code of ethics that applies to our principal executive
officer, principal financial officer, principal accounting officer and persons
performing similar functions. The code of ethics will be posted on the investor
relations section of the Company's website. At such time as we have posted the
code of ethics on our website, we intend to satisfy the disclosure requirements
in our Form 8-K regarding an amendment to, or waiver from, a provision of the
code of ethics by posting such information on the website.
ITEM 6 - Exhibits
There were no reports on Form 8-K filed in the quarter for which this
report is filed. The following exhibits are filed with this report:
31.1 Rule 13a-14(a)/15d-14(a) - Certification of Chief Executive Officer.
31.2 Rule 13a-14(a)/15d-14(a) - Certification of Chief Financial Officer.
32.1 Section 1350 Certification - Chief Executive Officer.
32.1 Section 1350 Certification - Chief Financial Officer.
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SIGNATURES
In accordance with the requirements of the Securities Exchange Act of 1934,
the registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Dated: May 15, 2008
TEEN EDUCATION GROUP, INC.
By: /s/ ROBERT L. WILSON
____________________________________________
Robert L. Wilson
President (Principal Executive Officer),
and Director
By: /s/ ROBERT L. WILSON
____________________________________________
Robert L. Wilson
Principal Financial Officer
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