SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Act of 1934
Date of Report (Date of earliest event reported): April 7, 1999
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amdiv.com, inc.
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(Exact name of registrant as specified in its charter)
NEVADA 000-23615 86-0854150
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(State or other (Commission (I.R.S. Employer
jurisdiction File Number) Identification No.)
of incorporation)
10900 Wilshire Boulevard, Suite 930
Los Angeles, California 90004
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (310) 209-5090
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ITEM 5. OTHER EVENTS.
The Company has discovered evidence of apparent irregularities in the
status of its principal banking account in Europe which, as of February 28,
1999, according to the bank statements provided to the Company's officers in
the United States, had a balance in excess of 15 million Deutsche marks
(U.S.$ 8.2 million). The Company's preliminary investigation has indicated
that this account was false and did not exist in the Company's name, and that
an alleged predecessor account established in the Company's name in Germany in
the amount of 17,500,000 Deutsche marks (U.S. $9.58 million) was also false
and non-existent. The original account was allegedly established in the
Company's name to receive the proceeds from the closing of an escrow account
on October 12, 1998 from the capital contributions of a group of founding
shareholders. The information provided to the Company and its independent
accountants, in connection with preparation of the financial statements for
the fiscal year ended August 31, 1998, to confirm these accounts was
apparently false.
The Company's Board of Directors has authorized an investigation to trace
the proceeds of the alleged escrow account. The Board of Directors has
established a Special Investigating Committee to investigate the matter and to
take appropriate action to locate and recover any missing funds and pursue
claims against any persons responsible for providing false information to the
Company.
The Company has further been advised that a petition in bankruptcy under
German law is being filed for its principal subsidiary in Germany, American
Diversified AG.
The Company has also been notified by its independent accountants,
McGladrey & Pullen, LLP, of the withdrawal of their auditor's report dated
October 16, 1998 issued in connection with the Company's August 31, 1998
consolidated financial statements. A copy of a letter from McGladrey &
Pullen, LLP dated April 6, 1999, is filed as an Exhibit to this report.
The Company will take action to restate its audited financial statements
for the fiscal year ended August 31, 1998, as reported in the Company's Form
10-K, and the unaudited financial statements, as reported in the Company's
Form 10-Q for the fiscal quarter ended November 30, 1998.
If the Company is unable to recover the funds, the Company will not have
operating capital sufficient to continue operations.
ITEM 7(c) EXHIBITS
The following exhibit is filed as part of this report in accordance with
the provisions of Item 601 of Regulation S-B:
Exhibit Name of Exhibit
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99.1 McGladrey & Pullen, LLP letter withdrawing
auditor's report dated October 16,1998
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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.
amdiv.com, inc.
Date: April 7, 1999 By: /s/ James B. Rea, Jr.
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James B. Rea, Jr.
President and Chief Executive Officer
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EXHIBIT INDEX
Exhibit Name of Exhibit
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99.1 McGladrey & Pullen, LLP letter withdrawing
auditor's report dated October 16,1998
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EXHIBIT 99.1
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April 6, 1999
Board of Directors
amdiv.com, inc.
10900 Wilshire Boulevard, 9th Floor
Los Angeles, CA 90024
You have informed us that information has come to the attention of management
and the Board of Directors of amdiv.com, inc. (the "Company") which indicates
the Company's August 31, 1998 consolidated financial statements may be
materially misstated. We understand the Company is in the process of
investigating whether there has been a misappropriation of cash proceeds from
the sale of a note receivable. We also understand that the Company will be
informing the public on April 7, 1999 that those financial statements are
possibly in error and should no longer be relied upon.
Because of the significance of the information brought to our attention
indicating the August 31, 1998 consolidated financial statements may be
materially misstated, we hereby withdraw our auditor's report dated October
16, 1998, except for note 10 as to which the date is December 3, 1998 on the
August 31, 1998 consolidated financial statements of amdiv.com, inc. and
subsidiaries. You should notify those parties known to be relying or who are
likely to rely on the financial statements and our report thereon that they
should no longer be relied upon and that our report should no longer be
associated with those financial statements. Please provide us by April 9,
1999 a copy of the Company's communication making such notification.
When the Company has completed its investigation of this matter, please advise
us of the Company's findings so that we may determine whether or not we would
agree to reissue our report.
McGladrey & Pullen, LLP
/s/ Kenneth R. Stoll
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Kenneth R. Stoll
Partner
