SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) July 8, 1999
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WORLDWIDEWEB INSTITUTE.COM, INC.
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(Exact name of registrant as specified in its charter)
Florida 33-40808-A 65-0260247
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(State or other jurisdiction (Commission File (IRS Employer
or incorporation) Number) Identification No.)
6245 N.W. 9th Avenue, Suite 201, Fort Lauderdale, Florida 33309
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(Address of principal executive offices, including zip code)
Registrant's telephone number, including area code (954) 776-8444
Spectrum Pharmaceutical Corp., 16910 Dallas Parkway, Suite 100, Dallas,
Texas 75248
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(Former name or former address, if changed since last report)
1
<PAGE>
ITEM 7.
Audited Financial Statements of the WorldWideWeb
Institute.com, Inc.
2
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned herein duly authorized.
WORLDWIDEWEB INSTITUTE.COM, INC.
By: /s/ Ernest Chu
-------------------------
Name: Ernest Chu
Title: Chief Financial Officer
Dated: August 11, 1999
3
<PAGE>
WORLDWIDEWEB INSTITUTE, INC.
FINANCIAL STATEMENTS
MARCH 31, 1999 AND 1998
<PAGE>
WORLDWIDEWEB, INSTITUTE, INC.
CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS
Balance Sheets 2-3
Statements of Income 4
Statements of Changes in Shareholders' Equity 5
Statements of Cash Flows 6
Notes to Financial Statements 7-10
</TABLE>
<PAGE>
INDEPENDENT AUDITORS' REPORT
----------------------------
To the Board of Directors and Stockholders of
WorldWideWeb Institute, Inc.
We have audited the accompanying balance sheets of WorldWideWeb Institute, Inc.
as of March 31, 1999 and 1998 and the related statements of income, changes in
shareholders' equity earnings and cash flows for the year ended March 31, 1999
and for the period from February 12, 1998 through March 31, 1998. These
financial statements are the responsibility of Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits 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 audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of WorldWideWeb Institute, Inc. as
of March 31, 1999 and 1998, and the results of its operations and its cash flows
for the year ended March 31, 1999 and for the period from February 12, 1998
through March 31, 1998 in conformity with generally accepted accounting
principles.
/ s / Gerstle, Rosen & Associates, P.A.
Boca Raton, Florida
June 5, 1999
1
<PAGE>
WORLDWIDEWEB INSTITUTE, INC.
BALANCE SHEETS
MARCH 31, 1999 AND 1998
<TABLE>
<CAPTION>
ASSETS
1999 1998
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<S> <C> <C>
CURRENT ASSETS
Cash $ 56,153 $ 100
Accounts Receivable-Trade 41,251
Accounts Receivable-Other 10,000
Prepaid Expenses 48,577
Deferred Expenses 74,000
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TOTAL CURRENT ASSETS 229,981 100
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PROPERTY AND EQUIPMENT
Furniture and Fixtures 31,547
Computer Equipment 176,237
Office Equipment 10,150
Leasehold Improvements 9,574
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227,508
Less Accumulated Depreciation 42,130
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NET PROPERTY AND EQUIPMENT 185,378
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OTHER ASSETS
Due from Related Entities 64,995
Security Deposit 5,014
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TOTAL OTHER ASSETS 70,009
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TOTAL ASSETS $ 485,368 $ 100
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</TABLE>
The accompanying Notes to Financial Statements are an integral part of these
Financial Statements.
2
<PAGE>
WORLDWIDEWEB INSTITUTE, INC.
BALANCE SHEETS
MARCH 31, 1999 AND 1998
<TABLE>
<CAPTION>
LIABILITIES & STOCKHOLDERS' EQUITY
1999 1998
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<S> <C> <C>
CURRENT LIABILITIES
Accounts Payable $ 50,381 $
Accrued Payroll Payable 16,641
Accrued Vacations Payable 17,162
Income Taxes Payable 50,750
Payroll Taxes Payable 61,357
Deferred Revenue 185,128
Note Payable-Capital Lease 1,379
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TOTAL CURRENT LIABILITIES 382,798
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STOCKHOLDERS' EQUITY
Common Stock, $1 Par Value, 1,000 Shares Authorized,
Issued, and Outstanding 1,000 1,000
Retained Earnings 102,470
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103,470 1,000
Less Stock Subscriptions Receivable (900) (900)
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TOTAL STOCKHOLDERS' EQUITY 102,570 100
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TOTAL LIABILITIES & STOCKHOLDERS'
EQUITY $ 485,368 $ 100
============ =============
</TABLE>
The accompanying Notes to Financial Statements are an integral part of these
Financial Statements.
3
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WORLDWIDEWEB INSTITUTE, INC.
STATEMENTS OF INCOME
FOR THE YEAR ENDED MARCH 31, 1999 AND
FOR THE PERIOD FROM FEBRUARY 12, 1998 THROUGH MARCH 31, 1998
<TABLE>
<CAPTION>
1999 1998
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<S> <C> <C>
SALES $ 2,597,240 $
COST OF SALES 1,040,000
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GROSS PROFIT 1,557,240
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OPERATING EXPENSES
Selling 286,866
General 667,536
Administrative 447,224
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TOTAL OPERATING EXPENSES 1,401,626
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INCOME FROM OPERATIONS 155,614
OTHER EXPENSE
Interest Expense 394
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INCOME BEFORE PROVISION
FOR INCOME TAXES 155,220
PROVISION FOR INCOME TAXES 50,750
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NET INCOME $ 104,470 $
=============== ================
</TABLE>
The accompanying Notes to Financial Statements are an integral part of these
Financial Statements.
4
<PAGE>
<TABLE>
<CAPTION>
WORLDWIDEWEB INSTITUTE, INC.
STATEMENTS OF CHANGES IN SHAREHOLDER'S EQUITY
YEAR ENDED MARCH 31, 1999 AND
FOR THE PERIOD FROM FEBRUARY 12, 1998 THROUGH MARCH 31, 1998
Stock Total
Common Stock Treasury Retained Subscriptions Shareholders'
# Shares Amount Stock Earnings Receivable Equity
-------- ------ ----- -------- ---------- ------
<S> <C> <C> <C> <C> <C> <C>
Balance At February 12, 1998 1,000 $ 1,000 $ - $ - $ (1,000) $ -
Payments Received
On Stock Subscriptions - - - - 100 100
Net Income For The Year - - - - - -
---------- ------------ ------------ ------------- ------------- ------------
Balance At March 31, 1998 1,000 1,000 - - (900) 100
Purchase Of Treasury Stock
(150 Shares) - - (2,150) - 150 (2,000)
Reissue Shares From
Treasury Stock
(150 Shares) - - 2,150 (2,000) (150) -
Net Income For The Year - - - 104,470 - 104,470
---------- ------------ ------------ ------------- ------------- ------------
Balance At March 31, 1999 1,000 $ 1,000 $ - $ 102,470 $ (900) $ 102,570
========== ============ ============ ============= ============= ============
</TABLE>
The accompanying Notes to Financial Statements are an integral part of these
Financial Statements.
5
<PAGE>
WORLDWIDEWEB INSTITUTE, INC.
STATEMENTS OF CASH FLOWS
FOR THE YEAR ENDED MARCH 31, 1999 AND
FOR THE PERIOD FROM FEBRUARY 12, 1998 THROUGH MARCH 31, 1998
<TABLE>
<CAPTION>
1999 1998
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<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income $ 104,470 $
Adjustments to Reconcile Net Income to
Net Cash Provided by Operating Activities
Depreciation 42,130
Increase in Accounts Receivable-Trade (41,251)
Increase in Accounts Receivable-Other (10,000)
Increase in Prepaid Expenses (48,577)
Increase in Deferred Expenses (74,000)
Increase in Due from Related Entities (64,995)
Increase in Security Deposit (5,014)
Increase in Accounts Payable 50,381
Increase in Accrued Payroll Payable 16,641
Increase in Accrued Vacations Payable 17,162
Increase in Income Taxes Payable 50,750
Increase in Payroll Taxes Payable 61,357
Increase in Deferred Revenue 185,128
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NET CASH PROVIDED BY
OPERATING ACTIVITIES 284,182
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CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of Property and Equipment (219,558)
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NET CASH USED IN
INVESTING ACTIVITIES (219,558)
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CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from Sale of Common Stock 100
Principal Payments on Capital Lease (6,571)
Purchase of Treasury Stock (2,000)
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NET CASH PROVIDED BY (USED IN)
FINANCING ACTIVITIES (8,571) 100
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NET INCREASE IN CASH 56,053 100
CASH, BEGINNING OF PERIOD 100
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CASH, END OF PERIOD $ 56,153 $ 100
================ ==============
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during the year for:
Interest $ 394 $
================ ==============
</TABLE>
The accompanying Notes to Financial Statements are an integral part of these
Financial Statements.
6
<PAGE>
WORLDWIDEWEB INSTITUTE, INC.
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1999 AND 1998
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Business
------------------
WorldWideWeb Institute, Inc. (the "Company") was incorporated February
12, 1998 under the laws of the State of Florida. The Company is engaged
in the sale, development, and hosting of internet web sites for
businesses and the general public throughout the United States.
Cash and Cash Equivalents
-------------------------
For purposes of the statement of cash flows, the Company considers all
instruments with an original maturity of three months or less to be
cash equivalents. There were no cash equivalents at March 31, 1999 and
1998.
Sources of Supplies
-------------------
The Company relies on third-party networks, local telephone companies,
and other companies to provide data communications capacity. Although
management feels alternative telecommunications facilities could be
found in a timely manner, any disruption of these services could have
an adverse effect on operating results.
Property, Equipment and Depreciation
------------------------------------
Property additions, major renewals and betterment's are included in the
assets accounts at cost. Maintenance, repairs and minor renewals are
charged to earnings when incurred.
Depreciation is computed using the double declining-balance method and
the straight-line method over estimated useful lives of the assets: 5
years for computers and equipment, 7 years for furniture, and 10 years
for leasehold improvements. Depreciation expense was $42,130 for the
year ended March 31, 1999. Depreciation expense for the year includes
amortization of assets recorded under capital leases of $1,590.
Long-Lived Assets
-----------------
The Company periodically reviews the values assigned to long-lived
assets, such as property and equipment and acquired customer bases, to
determine whether any impairments are other than temporary. Management
believes that the long-lived assets in the accompanying balance sheets
are appropriately valued.
Revenue Recognition
-------------------
The Company recognizes revenue when services are provided. Long-term
contracts for development and hosting of web sites are accounted for
using the percentage of completion method. Advance billings, including
7
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WORLDWIDEWEB INSTITUTE, INC.
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1999 AND 1998
prepaid implementation, development, and hosting services are recorded
as deferred revenue. Long-term contracts are generally for a term of
twelve months.
Advertising
-----------
Costs associated with advertising are expensed in the year the
advertising occurs. Advertising expense for the year ending March 31,
1999 was $81,878. Certain production and media costs totaling $20,500
were prepaid at March 31, 1999.
Income Taxes
------------
Since inception, the Company has maintained a fiscal year ending on
each 31st day of March. There are no timing differences which would
result in deferred tax liability or benefit in the years ended March
31, 1999 and 1998.
Recent Accounting Pronouncements
--------------------------------
In 1998, the Company was subject to the provisions of Statement of
Financial Accounting Standards No. 130 ("SFAS 130"), "Reporting
Comprehensive Income" and Statement of Financial Accounting Standards
No. 131 ("SFAS 131"), "Disclosures about Segments of an Enterprise and
Related Information." Neither statement had any impact on the Company's
financial statements as the Company does not have any "comprehensive
income" type earnings (losses) and its financial statements reflect how
the "key operating decisions maker" views the business. The Company
will continue to Review these statements over time, in particular SFAS
131, to determine if any additional disclosures are necessary based on
evolving circumstances.
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.
NOTE 2 - FAIR VALUE OF FINANCIAL INSTRUMENTS
The carrying amount of cash, accounts receivable and accounts payable
approximates fair value due to the short term maturity of these
instruments.
8
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WORLDWIDEWEB INSTITUTE, INC.
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1999 AND 1998
NOTE 3 - RELATED PARTY TRANSACTIONS
The Chief Operating Officer of the Company is an officer or principal
of three vendors which provide marketing and related services to the
Company. The Company purchased approximately $10,000 worth of services
from these companies in the year ended March 31, 1999. One company had
advances outstanding of $6,691 at March 31, 1999.
NOTE 4 - OBLIGATION UNDER CAPITAL LEASE
On June 23, 1998, the Company purchased a telephone system for $7,950
and financed the purchase with a note from a local finance company. The
note was payable in twelve monthly installments of $695.39, principal
plus interest at an effective annual rate of 11.46%. As of March 31,
1999, the Company had two payments remaining.
NOTE 5 - INCOME TAXES
The components of the provision for income taxes consist of the
following for the year ending March 31, 1999:
Federal
-------
Current $42,000
Deferred -
-----------
42,000
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State
-----
Current 8,750
Deferred -
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8,750
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Total $50,750
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9
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WORLDWIDEWEB INSTITUTE, INC.
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1999 AND 1998
NOTE 6 - COMMITMENTS
The Company conducts its operations in a leased facility. The lease has
been renewed through January 31, 2002. Rental expense was $33,229 for
the year ending March 31, 1999. The total amount due under this lease
is as follows for the years ending March 31:
2000 $ 56,999
2001 65,241
2002 50,952
---------
$173,192
=========
The Company is obligated for an office equipment lease which is
properly treated as a non-cancelable operating lease. The term of the
lease is 24 months with monthly payments of $58. The amounts due under
this operating lease are as follows for the year ending March 31:
2000 $ 696
===========
The Company has entered into an agreement with a telecommunications
vendor to provide telecommunications services to the Company. The
agreement is for a minimum monthly commitment of $36,750 for a term of
twelve months. At year-end, this agreement was pending acceptance
subsequent to performance of certain vendor obligations.
NOTE 6 - SUBSEQUENT EVENTS
After the close of the Company's fiscal year, the Company received
$100,000 in the form of a convertible note from an investor.
On July 2, 1999, the Company signed an agreement to merge with Spectrum
Pharmaceutical Corp., a Texas-based public company. The combined entity
will be named WorldWideWeb Institute.com, Inc. Under terms of the
agreement, the Company's shareholders will own approximately 90% of the
combined entity, and will designate officers and directors.
10
