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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A-1
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 28, 2000
XML - GLOBAL TECHNOLOGIES, INC.
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(Exact name of registrant as specified in its charter)
Colorado 0-23391 84-1434313
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(State or other jurisdiction (Commission file number) (IRS Employer
of incorporation or Identification No.)
organization)
1818 Cornwall, Suite 9, Vancouver, British Columbia, Canada V6J 1C7
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (800) 201-1848
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(Former name or former address, if changed since last report)
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ITEM 7: FINANCIAL STATEMENTS AND EXHIBITS
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(a) Financial Statements
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Pursuant to Item 7(a)(4), the Registrant files herewith the following
financial statements of the acquired business:
Independent Auditor's Report
DataXchg, Inc. Balance Sheet as of June 30, 2000
DataXchg, Inc. Statements of Operations for the period from October 27,
1999 (Date of Inception) to June 30, 2000
DataXchg, Inc. Statements of Stockholders' Equity for the period from
October 27, 1999 (Date of Inception) to June 30, 2000
DataXchg, Inc. Statements of Cash Flows for the period from October 27,
1999 (Date of Inception to June 30, 2000
Notes to Financial Statements
(b) Pro Forma Financial Information
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Pursuant to Item 7(b) and Item 7(a)(4), the Registrant has determined
that no pro forma adjustments are required.
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INDEPENDENT AUDITOR'S REPORT
To the Board of Directors and Stockholders
DataXchg, Inc.
We have audited the accompanying balance sheet of DataXchg, Inc. (a
development stage company and a subsidiary of XML-Global Technologies, Inc.)
as of June 30, 2000, and the related statements of operations, stockholders'
equity, and cash flows for the period October 27, 1999 (date of inception)
through June 30, 2000. 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 generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides 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 DataXchg, Inc. as of June 30,
2000, and the results of its operations and its cash flows for the
period October 27, 1999 (date of inception) through June 30, 2000 in
conformity with generally accepted accounting principles.
/s/ MOSS ADAMS LLP
Bellingham, Washington
September 7, 2000
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<TABLE>
<CAPTION>
DATAXCHG, INC.
(A DEVELOPMENT STAGE COMPANY)
(A SUBSIDIARY OF XML - GLOBAL TECHNOLOGIES, INC.)
BALANCE SHEET
JUNE 30, 2000
ASSETS
<S> <C>
TOTAL ASSETS $ -
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LIABILITIES AND STOCKHOLDERS' EQUITY
TOTAL LIABILITIES $ -
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STOCKHOLDERS' DEFICIT
Preferred stock, $0.01 par value
50,000,000 shares authorized,
-0- shares issued and outstanding -
Common stock, $0.001 par value, 100,000,000
shares authorized; 100 shares issued
and outstanding -
Deficit accumulated during the development
stage -
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Total stockholders' equity -
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TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $ -
==========
</TABLE>
See accompanying notes to these financial statements.
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<TABLE>
<CAPTION>
DATAXCHG, INC.
(A DEVELOPMENT STAGE COMPANY)
(A SUBSIDIARY OF XML - GLOBAL TECHNOLOGIES, INC.)
STATEMENT OF OPERATIONS
PERIOD FROM OCTOBER 27, 1999 (DATE OF INCEPTION) TO JUNE 30, 2000
10/27/99 (Date of
Inception)
to 6/30/00
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<S> <C>
Revenue $ -
Operating Expenses -
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Net Loss $ -
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Earnings (Loss) Per Share
Basic and diluted $ -
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</TABLE>
See accompanying notes to these financial statements.
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<TABLE>
<CAPTION>
DATAXCHG, INC.
(A DEVELOPMENT STAGE COMPANY)
(A SUBSIDIARY OF XML - GLOBAL TECHNOLOGIES, INC.)
STATEMENT OF STOCKHOLDERS' EQUITY
PERIOD FROM OCTOBER 27, 1999 (DATE OF INCEPTION) TO JUNE 30, 2000
Deficit
Accumulated
During the
Date of Common Stock Development
Transactions Shares Amount Stage Total
------------ ------ ------ ------------ -----
<S> <C> <C> <C> <C> <C>
Inception 10/27/99 - $ - $ - $ -
Stock issued for
technology rights
and future
services 10/27/99 100 - - -
---------- --------- ---------- --------
Balance, June 30,
2000 100 $ - $ - $ -
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</TABLE>
See accompanying notes to these financial statements.
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<TABLE>
<CAPTION>
DATAXCHG, INC.
(A DEVELOPMENT STAGE COMPANY)
(A SUBSIDIARY OF XML - GLOBAL TECHNOLOGIES, INC.)
STATEMENT OF CASH FLOWS
PERIOD FROM OCTOBER 27, 1999 (DATE OF INCEPTION) TO JUNE 30, 2000
Increase (Decrease) in Cash
10/27/99 (Date of
Inception)
to 6/30/00
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<S> <C>
Cash Flows From Operating Activities
Net loss $ -
Adjustments to reconcile net loss to net
cash from operating activities -
------------
Net cash from operating activities -
Net Cash from Investing Activities -
Net Cash from Financing Activities -
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Net Change In Cash -
Cash, beginning of period -
------------
Cash, end of period $ -
============
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DATAXCHG, INC.
(A DEVELOPMENT STAGE COMPANY)
(A SUBSIDIARY OF XML - GLOBAL TECHNOLOGIES, INC.)
NOTES TO FINANCIAL STATEMENTS
PERIOD FROM OCTOBER 27, 1999 (DATE OF INCEPTION) TO JUNE 30, 2000
NOTE 1 - ORGANIZATION AND DEVELOPMENT STAGE OPERATIONS
Organization
DataXchg, Inc. ("DataXchg" or the "Company") was incorporated October 27,
1999 in the state of Delaware for the purpose of holding and exploiting the
rights to Internet-based technology related to B2B (Business-to-Business) and
XML-EDI (eXtensible Mark-up Language-Electronic Data Interchange) solutions.
Upon its organization, the Company committed to issue to David Webber 60 shares
in exchange for the rights to certain technology under development called
"ExpressXchg." It also committed to issue to XML-Global Technologies, Inc.
("XML") 40 shares in exchange for XML providing the use of certain of its
technology, its services, and its financial resources.
David Webber had no historical cost basis in the technology rights that
were transferred to DataXchg; and, accordingly, no value was assigned to the
shares issued for the rights.
In conjunction with its formation, DataXchg and XML entered into a license
agreement, whereby DataXchg granted XML the right to use, develop, and
sublicense its technology. Pursuant to the license agreement, XML will pay
royalties to DataXchg equal to 80% of net revenues derived from the sale and
licensing of products that are either based on the technology owned by DataXchg
or jointly developed by XML and DataXchg. XML will pay the Company royalties
equal to 20% of net revenues derived from third party use of the technology.
Effective June 28, 2000, XML acquired in a tax-free exchange Mr. Webber's
60% interest in DataXchg in exchange for the issuance of 1,000,000 shares of
XML's common stock. As a result of the acquisition, the Company is now a
wholly-owned subsidiary of XML.
Development Stage Operations
For the period October 27, 1999 through June 30, 2000, the Company's
efforts have been devoted to corporate structuring, financial and business
planning, and recruiting directors and advisors. The Company's organizational
costs were borne by XML. The Company has recognized no obligation for these
costs, as the amounts were not significant and XML does not intend to be
reimbursed. The Company has incurred no other expenses since inception.
Future operations will be limited to earning royalties under the license
agreement described above and incurring a minimal amount of general and
administrative expenses.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.
Software Development Costs
Costs incurred for research and development of software developed for resale or
licensing are expensed until either technological feasibility is proven or a
working copy of the software is completed. Costs incurred once feasibility has
been established, but prior to release to customers, are caitalized and
amortized on a product-by-product basis.
Earnings Per Share
Basic earnings per share amounts are computed based on the weighted average
number of shares outstanding during the period, after giving retroactive
effect to stock splits. Diluted earnings per share are computed by determining
the number of additional shares that are deemed outstanding due to share
equivalents.
New Accounting Standard
In June 1998, the Financial Accounting Standards Board issued SFAS No. 133,
Accounting for Derivative Instruments and Hedging Activities. Among other
provisions, SFAS No. 133 requires that entities recognize all derivatives as
either assets or liabilities in the balance sheet and measure those financial
instruments at fair value. Accounting for changes in fair value is dependent on
the use of the derivatives and whether such use qualifies as hedging activity.
The new standard, as amended, becomes effective for the Company in fiscal 2001,
and management is currently assessing the impact, if any, it may have on
financial position and results of operations.
NOTE 3 - EARNINGS PER SHARE
The numerators and denominators of basic and diluted earnings per share are
as follows:
</TABLE>
<TABLE>
<CAPTION>
10/27/99 (Date of
Inception)
to 6/30/00
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<S> <C>
Numerator - net loss $ -
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Denominator - weighted average
number of shares outstanding 100
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</TABLE>
At June 30, 2000, the Company had no potential common shares that would have
had a dilutive effect.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
XML - GLOBAL TECHNOLOGIES, INC.
Date: September 11, 2000 By: /s/ Peter Shandro
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Peter Shandro, Chief Executive Officer
