<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
AMENDMENT TO CURRENT REPORT ON FORM 8-K FOR REPORT DATED MAY 18, 1999
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
New World Publishing, Inc.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Colorado
- --------------------------------------------------------------------------------
(State or other jurisdiction of incorporation)
0-23365 84-1290152
- ------------------------ ---------------------------------
(Commission File Number) (IRS Employer Identification No.)
11872 La Grange Ave., 2nd Floor, Los Angeles CA 90025
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (877) 733-1333
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<PAGE>
The Registrant has previously filed its Current Report on Form
8-K, dated May 18, 1999, without certain financial information required by Item
7 of such Form 8-K. The Registrant hereby amends the Current Report on Form 8-K
to file such financial information. Item 7, subparagraph (a) of the Report dated
May 18, 1999, is hereby amended to read as follows:
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
- ------- -------------------------------------------------------------------
(a) Report of Singer Lewak Greenbaum & Goldstein LLP.,
Independent Public Accountants.
Consolidated Balance Sheets as of March 31, 1999
(audited) and as of June 30, 1999 (unaudited)
Consolidated Statements of Operations for
the period from July 20, 1998 (inception) to
March 31, 1999 (audited), for the three
months ended June 30, 1999, and for the
period from July 20, 1998 to June 30, 1999
(unaudited).
Consolidated Statement of Shareholders'
Equity for the period from July 20, 1998 to
March 31, 1999 (audited) and for the three
months ended June 30, 1999 (unaudited).
Consolidated Statements of Cash Flows for the
period from July 20, 1998 to March 31, 1999
(audited), for the three months ended June 30,
1999, and for the period from July 20, 1998 to
June 30, 1999 (unaudited).
Notes to Consolidated Financial Statements.
ITEM 8. CHANGE IN FISCAL YEAR
- ------- ---------------------
As of May 18, 1999, the Board of Directors of the Registrant
determined to change its fiscal year end from its current fiscal year end of
January 31 to March 31. The Registrant is adopting the fiscal year end of
Communications Television, Inc., ("CTV") which was acquired by the Registrant as
of May 18, 1999. The transaction has been treated as a recapitalization of CTV,
with CTV as the accounting acquirer (reverse acquisition). The Registrant will
file a report on Form 10-QSB for the three months period ended June 30, 1999.
2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
Dated: August 1 , 1999 NEW WORLD PUBLISHING, INC.
By: /S/ David Baeza
----------------------------
David Baeza
Chief Executive Officer and
President
3
<PAGE>
NEW WORLD PUBLISHING, INC.
AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JULY 20, 1998
(INCEPTION) TO MARCH 31, 1999 AND
FOR THE THREE MONTHS ENDED
JUNE 30, 1999 (UNAUDITED)
<PAGE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
CONTENTS
MARCH 31, 1999 AND JUNE 30, 1999 (UNAUDITED)
- --------------------------------------------------------------------------------
Page
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS 1
FINANCIAL STATEMENTS
Consolidated Balance Sheets 2 - 3
Consolidated Statements of Operations 4
Consolidated Statements of Shareholders' Equity 5
Consolidated Statements of Cash Flows 6 - 7
Notes to Consolidated Financial Statements 8 - 19
<PAGE>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Board of Directors and Shareholders
New World Publishing, Inc.
We have audited the accompanying consolidated balance sheet of New World
Publishing, Inc. (a development stage company) and subsidiary as of March 31,
1999, and the related consolidated statements of operations, shareholders'
equity, and cash flows for the period from July 20, 1998 (inception) to March
31, 1999. 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 consolidated financial position of New World
Publishing, Inc. and subsidiary as of March 31, 1999, and the consolidated
results of their operations and their consolidated cash flows for the period
from July 20, 1998 (inception) to March 31, 1999 in conformity with 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 2 to the
financial statements, the Company incurred a net loss of $1,689,222 during the
period from July 20, 1998 (inception) to March 31, 1999, and it had negative
cash flows from operations of $995,091. These factors, among others, as
discussed in Note 2 to the financial statements, raise substantial doubt about
the Company's ability to continue as a going concern. Management's plans in
regard to these matters are also described in Note 2. The financial statements
do not include any adjustments that might result from the outcome of this
uncertainty.
SINGER LEWAK GREENBAUM & GOLDSTEIN LLP
Los Angeles, California
July 8, 1999
<PAGE>
<TABLE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED BALANCE SHEETS
MARCH 31, 1999 AND JUNE 30, 1999 (UNAUDITED)
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
ASSETS
March 31, June 30,
1999 1999
--------------- ----------------
(unaudited)
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ 127,654 $ 238,937
Note receivable 45,000 -
Due from related parties 9,383 35,975
Deferred financing costs 303,685 638,820
Prepaid services 59,375 62,790
Prepaid expenses and other current assets 17,918 38,700
--------------- ----------------
Total current assets 563,015 1,015,222
FURNITURE AND EQUIPMENT, net 10,682 24,103
--------------- ----------------
TOTAL ASSETS $ 573,697 $ 1,039,325
=============== ================
</TABLE>
The accompanying notes are an integral part of these financial statements.
2
<PAGE>
<TABLE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
MARCH 31, 1999 AND JUNE 30, 1999 (UNAUDITED)
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
LIABILITIES AND SHAREHOLDERS' EQUITY
March 31, June 30,
1999 1999
--------------- ----------------
(unaudited)
<S> <C> <C>
CURRENT LIABILITIES
Accounts payable $ 50,923 $ 46,592
Accrued expenses 27,577 21,201
Notes payable 370,000 370,000
--------------- ----------------
Total current liabilities 448,500 437,793
CONVERTIBLE PROMISSORY NOTES - 500,000
--------------- ----------------
Total liabilities 448,500 937,793
--------------- ----------------
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY
Preferred stock, no par value
10,000,000 shares authorized
1,072,505 and 0 shares (unaudited) issued and
outstanding 742,550 -
Common stock, $0.0001 par value
100,000,000 shares authorized
20,743,258 and 22,376,667 (unaudited) shares issued
and outstanding 2,074 2,237
Additional paid-in capital 1,069,795 2,875,682
Deficit accumulated during the development stage (1,689,222) (2,776,387)
--------------- ----------------
Total shareholders' equity 125,197 101,532
--------------- ----------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 573,697 $ 1,039,325
=============== ================
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
<TABLE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO MARCH 31, 1999,
FOR THE THREE MONTHS ENDED JUNE 30, 1999 (UNAUDITED), AND
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 (UNAUDITED)
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
For the For the For the
Period from Three Period from
July 20, 1998 Months July 20, 1998
(Inception) Ended (Inception)
to March 31, June 30, to June 30,
1999 1999 1999
---------------- ---------------- ----------------
(unaudited) (unaudited)
<S> <C> <C> <C>
OPERATING EXPENSES
General and administrative $ 1,249,388 $ 698,999 $ 1,948,387
Consulting - related parties 193,150 120,000 313,150
---------------- ---------------- ----------------
Total operating expenses 1,442,538 818,999 2,261,537
---------------- ---------------- ----------------
LOSS FROM OPERATIONS (1,442,538) (818,999) (2,261,537)
---------------- ---------------- ----------------
OTHER INCOME (EXPENSE)
Interest expense (247,376) (270,680) (518,056)
Interest income 692 2,514 3,206
---------------- ---------------- ----------------
Total other income (expense) (246,684) (268,166) (514,850)
---------------- ---------------- ----------------
NET LOSS $ (1,689,222) $ (1,087,165) $ (2,776,387)
================ ================ ================
BASIC LOSS PER SHARE $ (0.09) $ (0.05) $ (0.14)
================ ================ ================
WEIGHTED-AVERAGE COMMON SHARES OUTSTANDING 19,613,949 21,519,678 20,166,620
================ ================ ================
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
<TABLE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO MARCH 31, 1999,
AND FOR THE THREE MONTHS ENDED JUNE 30, 1999 (UNAUDITED)
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Deficit
Accumulated
Additional During the
Preferred Stock Common Stock Paid-In Development
Shares Amount Shares Amount Capital Stage Total
----------- ----------- ----------- ----------- ----------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE, JULY 20, 1998 - $ - - $ - $ - $ - $ -
INITIAL CAPITALIZATION 3,356,500 336 (336) -
PREFERRED STOCK ISSUED FOR CASH 1,072,505 924,500 924,500
OFFERING COSTS (181,950) (181,950)
OPTIONS ISSUED FOR SERVICES RENDERED 464,975 464,975
COMMON STOCK ISSUED FOR
Notes receivable from founders 15,994,648 1,599 5,295 6,894
Deferred financing costs 1,102,087 110 474,890 475,000
Services rendered 290,023 29 124,971 125,000
NET LOSS (1,689,222) (1,689,222)
----------- ----------- ----------- ----------- ----------- ------------ ------------
BALANCE, MARCH 31, 1999 1,072,505 742,550 20,743,258 2,074 1,069,795 (1,689,222) 125,197
PREFERRED STOCK ISSUED FOR CASH (unaudited) 549,303 473,500 473,500
OPTIONS ISSUED FOR SERVICES RENDERED
(unaudited) 35,000 35,000
INTEREST FROM FIXED CONVERSION FEATURES
(unaudited) 550,000 550,000
COMMON STOCK ISSUED FOR
Conversion of preferred stock (unaudited)(1,621,808) 1,216,050) 1,621,808 162 1,215,888 -
Deferred financing costs (unaudited) 11,601 1 4,999 5,000
NET LOSS (unaudited) (1,087,165) (1,087,165)
----------- ----------- ----------- ----------- ----------- ------------ ------------
BALANCE, JUNE 30, 1999 (UNAUDITED) - $ - 22,376,667 $ 2,237 $2,875,682 $(2,776,387) $ 101,532
=========== =========== =========== =========== =========== ============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
<TABLE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO MARCH 31, 1999,
FOR THE THREE MONTHS ENDED JUNE 30, 1999 (UNAUDITED), AND
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 (UNAUDITED)
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
For the For the For the
Period from Three Period from
July 20, 1998 Months July 20, 1998
(Inception) Ended (Inception)
to March 31, June 30, to June 30,
1999 1999 1999
---------------- ---------------- ----------------
(unaudited) (unaudited)
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (1,689,222) $ (1,087,165) $ (2,776,387)
Adjustments to reconcile net loss to net cash
used in operating activities
Depreciation 6,634 2,949 9,583
Amortization 223,940 141,740 365,680
Interest charges on convertible promissory
notes - 137,500 137,500
Issuance of stock for services rendered 125,000 - 125,000
Issuance of options for services rendered 464,975 35,000 499,975
(Increase) decrease in
Deferred financing costs (37,000) (50,000) (87,000)
Prepaid services (75,000) - (75,000)
Prepaid expenses (17,918) (33,572) (51,490)
Increase (decrease) in
Accounts payable 50,923 (4,331) 46,592
Accrued expenses 27,577 (6,376) 21,201
---------------- ---------------- ----------------
Net cash used in operating activities (920,091) (864,255) (1,784,346)
---------------- ---------------- ----------------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of furniture and equipment (17,316) (16,370) (33,686)
Disbursement on note receivable (45,000) - (45,000)
Repayment of note receivable - 45,000 45,000
Repayments from related parties - 6,894 6,894
Payments to related parties (2,489) (33,486) (35,975)
---------------- ---------------- ----------------
Net cash used in investing activities (64,805) 2,038 (62,767)
---------------- ---------------- ----------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
6
<PAGE>
<TABLE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO MARCH 31, 1999,
FOR THE THREE MONTHS ENDED JUNE 30, 1999 (UNAUDITED), AND
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 (UNAUDITED)
- ------------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
For the For the For the
Period from Three Period from
July 20, 1998 Months July 20, 1998
(Inception) Ended (Inception)
to March 31, June 30, to June 30,
1999 1999 1999
---------------- ---------------- ----------------
(unaudited) (unaudited)
<S> <C> <C> <C>
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from notes payable $ 370,000 $ - $ 370,000
Proceeds from convertible promissory notes - 500,000 500,000
Proceeds from preferred stock, net 742,550 473,500 1,216,050
---------------- --------------- ----------------
Net cash provided by financing activities 1,112,550 973,500 2,086,050
---------------- ---------------- ----------------
Net increase in cash and cash equivalents 127,654 111,283 238,937
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD - 127,654 -
---------------- ---------------- ----------------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 127,654 $ 238,937 $ 238,937
================ ================ ================
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
INTEREST PAID $ 54,547 $ 12,250 $ 66,797
================ ================ ================
</TABLE>
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES
During the period from July 20, 1998 (inception) to March 31, 1999 and the three
months ended June 30, 1999, the Company issued 1,102,087 shares and 11,601
shares (unaudited), respectively, of common stock valued at $475,000 and $5,000
(unaudited), respectively, to the holders of the notes payable as additional
financing costs.
During the period form July 20, 1998 (inception) to March 31, 1999, the Company
issued 174,014 shares of common stock valued at $75,000 to a third party for
services rendered in connection with the issuance of the preferred stock and
116,009 shares of common stock valued at $50,000 to a third party for services
rendered.
During the period form July 20, 1998 (inception) to March 31, 1999, the Company
issued 15,994,648 shares of common stock valued at $6,894 to founders of the
Company in exchange for notes receivable. These notes were repaid on June 30,
1999.
The accompanying notes are an integral part of these financial statements.
7
<PAGE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO MARCH 31, 1999,
FOR THE THREE MONTHS ENDED JUNE 30, 1999 (UNAUDITED), AND
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 (UNAUDITED)
(THE INFORMATION WITH RESPECT TO THE THREE MONTHS ENDED JUNE 30, 1999 AND
THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 IS UNAUDITED.)
- --------------------------------------------------------------------------------
NOTE 1 - DESCRIPTION OF BUSINESS
New World Publishing, Inc. ("New World"), a Colorado publicly-traded
corporation, is in the design and development stage of becoming an
Internet service provider that will offer local dial-up Internet access
nationwide to 81 cities through the use of its network of 96 points of
presence. New World also plans to develop, market, and operate Internet
communities or portals, including one for senior citizens and one for
pre-teens. New World will acquire subscribers through the use of
television advertising, Internet advertising, direct mail, and
telemarketing campaigns. New World's revenue streams will be generated
from monthly subscriber fees, monthly web-hosting service fees, and
portal advertising fees. New World is also planning to use direct
response television marketing techniques, combined with toll-free
interactive audio text services to create a membership program. The
primary products will be club memberships, telecommunication products,
and live operator consultations.
Communications Television, Inc. ("CTV") was formed under the laws of
California on July 20, 1998. On May 18, 1999, New World entered into an
Agreement and Plan of Reorganization whereby it acquired all of the
outstanding common stock of CTV in exchange for an aggregate of
19,020,167 shares of newly issued common stock. For accounting
purposes, the transaction has been treated as a recapitalization of
CTV, with CTV as the accounting acquirer (reverse acquisition), and has
been accounted for in a manner similar to a pooling of interests. The
operations of New World have been included with those of the CTV from
the acquisition date.
New World was incorporated in Colorado on December 28, 1994. New World
had minimal assets and liabilities at the date of the acquisition and
did not have significant operations prior to the acquisition.
Therefore, no pro forma information is presented. Since this was the
first year of operations for CTV, it has selected March 31 as its
fiscal year end.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation
---------------------------
The consolidated financial statements include the accounts of New World
Publishing, Inc. and its wholly-owned subsidiary, CTV (collectively,
the "Company"). All intercompany accounts and transactions have been
eliminated.
8
<PAGE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO MARCH 31, 1999,
FOR THE THREE MONTHS ENDED JUNE 30, 1999 (UNAUDITED), AND
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 (UNAUDITED)
(THE INFORMATION WITH RESPECT TO THE THREE MONTHS ENDED JUNE 30, 1999 AND
THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 IS UNAUDITED.)
- --------------------------------------------------------------------------------
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Basis of Presentation
---------------------
The accompanying financial statements have been prepared in conformity
with generally accepted accounting principles which contemplate
continuation of the Company as a going concern. However, during the
period from July 20, 1998 (inception) to March 31, 1999, the Company
incurred a net loss of $1,689,222, and it had negative cash flows from
operations of $995,091. These factors raise substantial doubt about the
Company's ability to continue as a going concern.
Recovery of the Company's assets is dependent upon future events, the
outcome of which is indeterminable. Successful completion of the
Company's development program and its transition to the attainment of
profitable operations is dependent upon the Company achieving a level
of sales adequate to support the Company's cost structure. In addition,
realization of a major portion of the assets in the accompanying
balance sheet is dependent upon the Company's ability to meet its
financing requirements and the success of its plans to sell products.
The financial statements do not include any adjustments relating to the
recoverability and classification of recorded asset amounts or amounts
and classification of liabilities that might be necessary should the
Company be unable to continue in existence.
Management plans to achieve a level of sales adequate to support the
Company's cost structure. The Company believes that its subscription
base will grow considerably once its Internet service provider network
infrastructure has been launched and aggressive advertising can begin.
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 disclosures of contingent assets and liabilities at the
date of the financial statements, as well as the reported amounts of
revenues and expenses during the reporting period. Actual results could
differ from those estimates.
Cash and Cash Equivalents
-------------------------
For the purpose of the statements of cash flows, the Company considers
all highly-liquid investments purchased with original maturities of
three months or less to be cash equivalents.
9
<PAGE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO MARCH 31, 1999,
FOR THE THREE MONTHS ENDED JUNE 30, 1999 (UNAUDITED), AND
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 (UNAUDITED)
(THE INFORMATION WITH RESPECT TO THE THREE MONTHS ENDED JUNE 30, 1999 AND
THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 IS UNAUDITED.)
- --------------------------------------------------------------------------------
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Furniture and Equipment
-----------------------
Furniture and equipment are recorded at cost, less accumulated
depreciation and amortization. Depreciation and amortization are
provided using the straight-line method over estimated useful lives as
follows:
Furniture and fixtures 5 years
Office equipment 5 to 7 years
Leasehold improvements 13 months
Maintenance and minor replacements are charged to expense as incurred.
Gains and losses on disposals are included in the results of
operations. Leasehold improvements are amortized over the lease period
or the useful life of the asset, whichever is shorter.
Deferred Offering Costs
-----------------------
Amounts paid for costs associated with an anticipated private placement
of common stock are capitalized and will be recorded as a reduction to
additional paid-in capital upon the completion of the private
placement. In the event the private placement is not successful, the
deferred offering costs will be charged to expense.
Development Stage Enterprise
----------------------------
The Company is a development stage company as defined in Statement of
Financial Accounting Standards ("SFAS") No. 7, "Accounting and
Reporting by Development Stage Enterprises." The Company is devoting
substantially all of its present efforts to establish a new business,
and its planned principal operations have not yet commenced. All losses
accumulated since inception have been considered as part of the
Company's development stage activities.
Loss per Share
--------------
During the period from July 20, 1998 (inception) to March 31, 1999, the
Company adopted SFAS No. 128, "Earnings per Share." Basic loss per
share is computed by dividing the loss available to common shareholders
by the weighted-average number of common shares outstanding. Diluted
loss per share is computed similar to basic loss per share except that
the denominator is increased to include the number of additional common
shares that would have been outstanding if the potential common shares
had been issued and if the additional common shares were dilutive.
Because the Company has incurred net losses, basic and diluted loss per
share are the same.
10
<PAGE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO MARCH 31, 1999,
FOR THE THREE MONTHS ENDED JUNE 30, 1999 (UNAUDITED), AND
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 (UNAUDITED)
(THE INFORMATION WITH RESPECT TO THE THREE MONTHS ENDED JUNE 30, 1999 AND
THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 IS UNAUDITED.)
- --------------------------------------------------------------------------------
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Income Taxes
------------
The Company accounts for income taxes under the asset and liability
method, which requires the recognition of deferred tax assets and
liabilities for the expected future tax consequences of events that
have been included in the financial statements or tax returns. Under
this method, deferred income taxes are recognized for the tax
consequences in future years of differences between the tax bases of
assets and liabilities and their financial reporting amounts at each
period-end based on enacted tax laws and statutory tax rates applicable
to the periods in which the differences are expected to affect taxable
income. Valuation allowances are established, when necessary, to reduce
deferred tax assets to the amount expected to be realized. The
provision for income taxes, if applicable, represents the tax payable
for the period and the change during the period in deferred tax assets
and liabilities.
Stock Options
-------------
SFAS No. 123, "Accounting for Stock-Based Compensation," establishes
and encourages the use of the fair value based method of accounting for
stock-based compensation arrangements under which compensation cost is
determined using the fair value of stock-based compensation determined
as of the date of grant and is recognized over the periods in which the
related services are rendered. The statement also permits companies to
elect to continue using the current implicit value accounting method
specified in Accounting Principles Bulletin ("APB") Opinion No. 25,
"Accounting for Stock Issued to Employees," to account for stock-based
compensation. The Company has elected to use the implicit value based
method and has disclosed the pro forma effect of using the fair value
based method to account for its stock-based compensation.
Impairment of Long-Lived Assets
-------------------------------
The Company reviews its long-lived assets for impairment whenever
events or changes in circumstances indicate that the carrying amount of
an asset may not be recoverable. Recoverability of assets to be held
and used is measured by a comparison of the carrying amount of the
assets to future net cash flows expected to be generated by the assets.
If the assets are considered to be impaired, the impairment to be
recognized is measured by the amount by which the carrying amount
exceeds the fair value of the assets. To date, no impairment has
occurred.
11
<PAGE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO MARCH 31, 1999,
FOR THE THREE MONTHS ENDED JUNE 30, 1999 (UNAUDITED), AND
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 (UNAUDITED)
(THE INFORMATION WITH RESPECT TO THE THREE MONTHS ENDED JUNE 30, 1999 AND
THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 IS UNAUDITED.)
- --------------------------------------------------------------------------------
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Comprehensive Income
--------------------
For the period from July 20, 1998 (inception to March 31, 1999, the
Company adopted SFAS No. 130, "Reporting Comprehensive Income." This
statement establishes standards for reporting comprehensive income and
its components in a financial statement. Comprehensive income as
defined includes all changes in equity (net assets) during a period
from non-owner sources. Examples of items to be included in
comprehensive income, which are excluded from net income, include
foreign currency translation adjustments and unrealized gains and
losses on available-for-sale securities. Comprehensive income is not
presented in the Company's financials statements since the Company did
not have any of the items of comprehensive income in any period
presented.
Fair Value of Financial Instruments
-----------------------------------
The Company measures its financial assets and liabilities in accordance
with generally accepted accounting principles. For certain of the
Company's financial instruments, including cash and cash equivalents,
note receivable, accounts payable, and accrued expenses, the carrying
amounts approximate fair value due to their short maturities. The
amounts shown for notes payable also approximate fair value because
current interest rates offered to the Company for debt of similar
maturities are substantially the same or the difference is immaterial.
NOTE 3 - CASH AND CASH EQUIVALENTS
The Company maintains cash balances at financial institutions located
in California. Accounts at each institution are insured by the Federal
Deposit Insurance Corporation up to $100,000. Uninsured balances
aggregated to $405,270 and $189,376 (unaudited) at March 31, 1999 and
June 30, 1999, respectively. The Company has not experienced any losses
in such accounts and believes it is not exposed to any significant
credit risk on cash and cash equivalents.
NOTE 4 - NOTE RECEIVABLE
The note receivable bears interest at prime (7.75% at March 31, 1999),
plus 1%. Principal and interest were paid at maturity on June 30,
1999.
12
<PAGE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO MARCH 31, 1999,
FOR THE THREE MONTHS ENDED JUNE 30, 1999 (UNAUDITED), AND
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 (UNAUDITED)
(THE INFORMATION WITH RESPECT TO THE THREE MONTHS ENDED JUNE 30, 1999 AND
THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 IS UNAUDITED.)
- --------------------------------------------------------------------------------
NOTE 5 - DUE FROM RELATED PARTIES
Due from related parties represents amounts advanced by the Company to
various officers and employees, as well as notes receivable from
certain officers and employees for the purchase of founders' shares of
the Company. These amounts are non-interest bearing and have no stated
maturity dates.
NOTE 6 - FURNITURE AND EQUIPMENT
<TABLE>
<CAPTION>
Furniture and equipment consisted of the following:
March 31, June 30,
1999 1999
--------------- ----------------
(unaudited)
<S> <C> <C>
Furniture and fixtures $ 518 $ 3,177
Office equipment 7,513 21,224
Leasehold improvements 9,285 9,285
--------------- ----------------
17,316 33,686
Less accumulated depreciation and amortization 6,634 9,583
--------------- ----------------
TOTAL $ 10,682 $ 24,103
=============== ================
</TABLE>
Depreciation and amortization expense for the period from July 20,
1998 (inception) to March 31, 1999 and for the three months ended June
30, 1999 was $6,634 and $2,949 (unaudited), respectively.
NOTE 7 - NOTES PAYABLE
<TABLE>
<CAPTION>
Notes payable consisted of the following:
March 31, June 30,
1999 1999
--------------- ----------------
(unaudited)
<S> <C> <C>
Notes payable, interest at 10%, unsecured.
The notes are due on October 1, 1999. $ 370,000 $ 370,000
Less current portion 370,000 370,000
--------------- ----------------
LONG-TERM PORTION $ - $ -
=============== ================
</TABLE>
13
<PAGE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO MARCH 31, 1999,
FOR THE THREE MONTHS ENDED JUNE 30, 1999 (UNAUDITED), AND
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 (UNAUDITED)
(THE INFORMATION WITH RESPECT TO THE THREE MONTHS ENDED JUNE 30, 1999 AND
THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 IS UNAUDITED.)
- --------------------------------------------------------------------------------
NOTE 7 - NOTES PAYABLE (Continued)
During the period from July 20, 1998 (inception) to March 31, 1999 and
the three months ended June 30, 1999, the Company issued 1,102,087 and
11,601 shares, respectively, of common stock valued at $475,000 and
$5,000, respectively, to the holders of these notes payable. The value
of the shares is considered to be an additional financing cost and is
being amortized over the life of the notes.
NOTE 8 - CONVERTIBLE PROMISSORY NOTES
On May 31, 1999, the Company entered into a Subscription Agreement for
ten, 10% Convertible Promissory Notes (the "Notes") for $50,000 each.
The Company incurred offering costs of $50,000 in connection with the
issuance of the Notes. Interest is due on each Note on January 1 and
July 1. Principal and any unpaid interest are due on May 31, 2001 if
the Notes have not been converted prior to such date by either party to
the Notes. The holders of the Notes have the option to convert the
Notes at the earlier of the effective date of a registration statement
or 120 days from the date of the Notes. The Notes are convertible at
the lesser of $2.50 or 75% of the average closing bid price of the
Company's common stock for the five trading days prior to conversion.
In accordance with generally accepted accounting principles, the
difference between the conversion price of $2.50 and the Company's
stock price on the date of issuance of the Notes is considered to be
interest expense and is recognized in the statement of operations
during the period from the issuance of the debt to the time at which
the debt first becomes convertible. In connection with the issuance of
the Notes, the Company recorded deferred financing costs of $550,000 as
a current asset and interest expense of $137,500 in the accompanying
statement of operations for the three months ended June 30, 1999.
NOTE 9 - COMMITMENTS AND CONTINGENCIES
Leases
------
The Company leases its corporate offices under a one-year operating
lease agreement that expires July 1, 1999. Rent expense was $44,000 and
$16,845 (unaudited) for the period from July 20, 1998 (inception) to
March 31, 1999 and for the three months ended June 30, 1999,
respectively.
14
<PAGE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO MARCH 31, 1999,
FOR THE THREE MONTHS ENDED JUNE 30, 1999 (UNAUDITED), AND
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 (UNAUDITED)
(THE INFORMATION WITH RESPECT TO THE THREE MONTHS ENDED JUNE 30, 1999 AND
THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 IS UNAUDITED.)
- --------------------------------------------------------------------------------
NOTE 9 - COMMITMENTS AND CONTINGENCIES (Continued)
Leases (Continued)
------------------
The Company has entered into a three-year lease, commencing September
1, 1999 for new corporate offices. Monthly rent under this agreement
will be $8,715.
The Company leases a vehicle under a three-year operating lease
agreement. Rent expense for the period from July 20, 1998 (inception)
to March 31, 1999 and for the three months ended June 30, 1999 was
$2,082 and $2,176 (unaudited), respectively.
Future minimum lease payments under these leases are as follows:
Year Ending
March 31,
-----------
2000 $ 67,502
2001 111,077
2002 109,994
2003 43,575
------------
TOTAL $ 332,148
============
NOTE 10 - SHAREHOLDERS' EQUITY
Preferred Stock
---------------
The Company has 10,000,000 authorized shares of no par value preferred
stock. The preferred stock may be issued in series, from time to time,
with such designations, rights, preferences, and limitations as the
Board of Directors may determine by resolution. During the period from
July 20, 1998 (inception) to March 31, 1999 and the three months ended
June 30, 1999, the Company issued 1,072,505 and 549,303 shares
(unaudited), respectively, valued at $924,500 and $473,500 (unaudited),
respectively, in a private placement. The Company incurred offering
costs of $181,950 related to the sale of the preferred stock. This
preferred stock was converted into common stock at the time of the
reverse merger.
15
<PAGE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO MARCH 31, 1999,
FOR THE THREE MONTHS ENDED JUNE 30, 1999 (UNAUDITED), AND
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 (UNAUDITED)
(THE INFORMATION WITH RESPECT TO THE THREE MONTHS ENDED JUNE 30, 1999 AND
THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 IS UNAUDITED.)
- --------------------------------------------------------------------------------
NOTE 10 - SHAREHOLDERS' EQUITY (Continued)
Common Stock
------------
During the period from July 20, 1998 (inception) to March 31, 1999,
the Company issued 15,994,648 shares of common stock as founders'
shares.
Stock Options
-------------
During the period from July 20, 1998 (inception) to March 31, 1999 and
the three months ended June 30, 1999, the Company granted 1,235,498 and
81,206 non-qualified stock options, respectively, to certain employees
and non-employees that may be exercised at prices ranging between $0.04
and $0.43 per share. These options vested immediately upon the date of
issuance and expire five years from the date of grant.
The following table summarizes certain information relative to stock
options:
<TABLE>
<CAPTION>
Weighted-
Average
Exercise
Shares Price
--------------- ---------------
<S> <C> <C>
Outstanding, July 20, 1998 - $ -
Granted 1,235,498 $ 0.11
---------------
Outstanding, March 31, 1999 1,235,498 $ 0.11
Granted (unaudited) 81,206 $ 0.28
---------------
OUTSTANDING, JUNE 30, 1999 (UNAUDITED) 1,316,704 $ 0.12
===============
EXERCISABLE, MARCH 31, 1999 1,235,498 $ 0.11
===============
</TABLE>
16
<PAGE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO MARCH 31, 1999,
FOR THE THREE MONTHS ENDED JUNE 30, 1999 (UNAUDITED), AND
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 (UNAUDITED)
(THE INFORMATION WITH RESPECT TO THE THREE MONTHS ENDED JUNE 30, 1999 AND
THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 IS UNAUDITED.)
- --------------------------------------------------------------------------------
NOTE 10 - SHAREHOLDERS' DEFICIT (CONTINUED)
Stock Options (Continued)
-------------------------
The weighted-average life of the options outstanding and exercisable at
March 31, 1999 is 3.31 years. The exercise prices for the options
outstanding at March 31, 1999 ranged from $0.04 to $0.43, and
information relating to these options is as follows:
<TABLE>
<CAPTION>
Weighted-
Average
Range of Stock Options Stock Options Remaining
Exercise Prices Outstanding Exercisable Contractual Life
--------------- -------------- -------------- ----------------
<S> <C> <C> <C>
$ 0.04 - 0.22 1,142,690 1,142,690 3.23 years
$ 0.43 92,808 92,808 4.29 years
-------------- --------------
1,235,498 1,235,498
============== ==============
</TABLE>
The Company has adopted the disclosure-only provisions of SFAS No. 123.
Accordingly, no compensation cost other than that required to be
recognized by APB Opinion No. 25 for the difference between the fair
value of the Company's common stock at the grant date and the exercise
price of the options has been recognized. Had compensation cost for the
Company's stock option plan been determined based on the fair value at
the grant date for awards consistent with the provisions of SFAS No.
123, the Company's net loss and loss per share for the period from July
20, 1998 (inception) to March 31, 1999 would have been increased to the
pro forma amounts indicated below:
Net loss as reported $ (1,689,222)
Net loss, pro forma $ (3,030,933)
Basic loss per share as reported $ (0.09)
Basic loss per share, pro forma $ (0.15)
The fair value of these options was estimated at the date of grant
using the Black-Scholes option-pricing model with the following
weighted-average assumptions for the period from July 20, 1998
(inception) to March 31, 1999: dividend yield of 0%, expected
volatility of 100%, risk-free interest rate of 5.2%, and expected life
of five years. The weighted-average exercise price was $0.11 at March
31, 1999.
17
<PAGE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO MARCH 31, 1999,
FOR THE THREE MONTHS ENDED JUNE 30, 1999 (UNAUDITED), AND
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 (UNAUDITED)
(THE INFORMATION WITH RESPECT TO THE THREE MONTHS ENDED JUNE 30, 1999 AND
THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 IS UNAUDITED.)
- --------------------------------------------------------------------------------
NOTE 10 - SHAREHOLDERS' DEFICIT (Continued)
Stock Options (Continued)
-------------------------
For options granted during the period from July 20, 1998 (inception) to
March 31, 1999 where the exercise price was less than the stock price
at the date of the grant, the weighted-average fair value of such
options was $1.96, and the weighted-average exercise price of such
options was $0.11. No options were issued during the period from July
20, 1998 (inception) to March 31, 1999 where the exercise price was
equal to or exceeded the stock price at the date of the grant.
The Black-Scholes option valuation model was developed for use in
estimating the fair value of traded options which have no vesting
restrictions and are fully transferable. In addition, option valuation
models require the input of highly subjective assumptions including the
expected stock price volatility. Because the Company's employee stock
options have characteristics significantly different from those of
traded options, and because changes in the subjective input assumptions
can materially affect the fair value estimate, in management's opinion,
the existing models do not necessarily provide a reliable single
measure of the fair value of its employee stock options.
NOTE 11 - INCOME TAXES
As of March 31, 1999, the Company had approximately $1,689,000 in net
operating loss carryforwards that may be offset against future taxable
income. No provision for income taxes for the period from July 20, 1998
(inception) to March 31, 1999 and the three months ended June 30, 1999
is required, except for minimum state taxes, since the Company incurred
losses during such periods. The deferred income tax benefit of the loss
carryforward is the only significant deferred income tax asset or
liability of the Company and has been offset by a valuation allowance
of the same amount since management does not believe the recoverability
of this deferred tax asset during the next fiscal year is more likely
than not. Accordingly, no deferred income tax benefit has been
recognized in these financial statements.
NOTE 12 - RELATED PARTY TRANSACTIONS
During the period from July 20, 1998 (inception) to March 31, 1999, the
Company received notes receivable for $6,894 from certain officers and
employees as payment for the founders' shares issued to them. These
notes were repaid on June 30, 1999.
18
<PAGE>
NEW WORLD PUBLISHING, INC. AND SUBSIDIARY
(A DEVELOPMENT STAGE COMPANY)
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO MARCH 31, 1999,
FOR THE THREE MONTHS ENDED JUNE 30, 1999 (UNAUDITED), AND
FOR THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 (UNAUDITED)
(THE INFORMATION WITH RESPECT TO THE THREE MONTHS ENDED JUNE 30, 1999 AND
THE PERIOD FROM JULY 20, 1998 (INCEPTION) TO JUNE 30, 1999 IS UNAUDITED.)
- --------------------------------------------------------------------------------
NOTE 12 - RELATED PARTY TRANSACTIONS (Continued)
During the period from July 20, 1998 (inception) to March 31, 1999 and
the three months ended June 30, 1999, the Company paid $79,250 and
$10,000 (unaudited), respectively, to a director for consulting
services rendered.
During the period from July 20, 1998 (inception) to March 31, 1999 and
the three months ended June 30, 1999, the Company paid $113,900 and
$110,000 (unaudited), respectively, to a company whose owner is a
director of the Company for business management services rendered.
NOTE 13 - YEAR 2000 ISSUE
The Company is conducting a comprehensive review of its computer
systems to identify the systems that could be affected by the Year 2000
Issue and is developing an implementation plan to resolve the Issue.
The Issue is whether computer systems will properly recognize
date-sensitive information when the year changes to 2000. Systems that
do not properly recognize such information could generate erroneous
data or cause a system to fail. The Company is dependent on computer
processing in the conduct of its business activities.
Based on the review of the computer systems, management does not
believe the cost of implementation will be material to the Company's
financial position and results of operations.
NOTE 14 - SUBSEQUENT EVENTS
Subsequent to June 30, 1999, the Company acquired 96 points of presence
valued at approximately $1,125,000 that it will use to offer Internet
access in 81 cities in the United States in exchange for 300,000 shares
of restricted common stock.
19
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-2000
<PERIOD-START> APR-01-1999
<PERIOD-END> JUN-30-1999
<CASH> 238937
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1015222
<PP&E> 33686
<DEPRECIATION> 9583
<TOTAL-ASSETS> 1039325
<CURRENT-LIABILITIES> 437793
<BONDS> 500000
0
0
<COMMON> 2237
<OTHER-SE> 99295
<TOTAL-LIABILITY-AND-EQUITY> 1039325
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 818999
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 270680
<INCOME-PRETAX> (268166)
<INCOME-TAX> 0
<INCOME-CONTINUING> (268166)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (268166)
<EPS-BASIC> (.05)
<EPS-DILUTED> (.05)
</TABLE>
