UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14C
INFORMATION STATEMENT PURSUANT TO SECTION 14(C)
OF THE SECURITIES EXCHANGE ACT OF 1934
Check the appropriate box:
/x/ Preliminary Information Statement
/ / Confidential, For Use of the Commission Only (as permitted by Rule
14c-5(d)(2))
/ / Definitive Information Statement
AGE RESEARCH INC.
(Name of Registrant As Specified In Charter)
Not Applicable
(Name of Person(s) Filing the Information Statement if other than Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14c-5(g) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
4) Proposed maximum aggregate value of transaction:
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
1
AGE RESEARCH, INC.
31003 Rancho Viejo Road, #2102
San Juan Capistrano, California, 912675
NOTICE OF WRITTEN CONSENT OF SHAREHOLDERS
July 28, 2003
To Shareholders of AGE RESEARCH, Inc.:
NOTICE IS HEREBY GIVEN that the following actions will be taken pursuant to the
written consent of a majority of our shareholders, dated May 28, 2003, in lieu
of a special meeting of the shareholders. The following actions will be
effective on or about August, 19, 2003:
1. To approve the acquisition of The Varsity Group, Inc., a Missouri
corporation, where the total consideration paid is 9,343,920
authorized and unissued post reverse split common shares, where that
number of shares is to equal 80% of the total outstanding after the
acquisition.
2. Amend our certificate of incorporation to change the Company name from
AGE Research, Inc. to Enstruxis, Inc., and concurrently to change the
Company's OTCBB trading symbol.
3. Amend our certificate of incorporation to provide for a stock
combination (reverse split) of the Common Stock in an exchange ratio
to be approved by the Board, ranging from one newly issued share for
each two outstanding shares of Common Stock to one newly issued share
for each thirty outstanding shares of Common Stock.
4. Amend our Certificate of Incorporation to increase the authorized
number of shares of our common stock from 100,000,000 to 750,000,000.
This Notice and the attached Information Statement are being circulated to
advise the shareholders of certain actions already approved by written consent
of the shareholders who collectively hold a majority of the voting power of our
common stock. Pursuant to Rule 14c-2 under the Securities Exchange Act of 1934,
as amended, the proposals will not be effective until 20 days after the date
this Information Statement is mailed to the shareholders. Therefore, this Notice
and the attached Information Statement are being sent to you for informational
purposes only.
By Order of the Board of Directors,
/s/ Richard F. Holt
---------------------------------
Richard F. Holt, Chief Accounting
Officer and Director.
2
AGE RESEARCH, INC.
31003 Rancho Viejo Road, #2102
San Juan Capistrano, California, 912675
INFORMATION STATEMENT
WRITTEN CONSENT OF SHAREHOLDERS
WE ARE NOT ASKING YOU FOR A PROXY
AND YOU ARE REQUESTED NOT TO SEND US A PROXY
This Information Statement is furnished in accordance with the requirements of
Regulation 14C promulgated under the Securities Exchange Act of 1934, as
Amended, by AGE RESEARCH INC., a Delaware corporation, in connection with
certain actions to be taken by the written consent by the majority shareholders
of AGE RESEARCH, dated May 28, 2003.
Pursuant to Rule 14c-2 under the Securities Exchange Act of 1934, as amended,
the actions will not be effective until 20 days after the date of this
Information Statement is mailed to the shareholders.
THE APPROXIMATE DATE OF MAILING OF THIS INFORMATION STATEMENT IS July 29 2003.
We anticipate that the actions contemplated by this Information Statement will
be affected on or about the close of business on August 14, 2003.
The actions to be effective twenty days after the mailing of this Information
Statement are as follows:
1. To approve the acquisition of The Varsity Group, Inc., a Missouri
corporation, where the total consideration to be paid is 9,343,920
authorized and unissued post reverse split common shares, where that
number of shares is to equal 80% of the total outstanding after the
acquisition.
2. Amend our certificate of incorporation to change the Company name from
AGE Research, Inc. to Enstruxis, Inc., and concurrently to change the
Company's OTCBB trading symbol.
3. Amend our certificate of incorporation to provide for a stock
combination (reverse split) of the Common Stock in an exchange ratio
to be approved by the Board, ranging from one newly issued share for
each two outstanding shares of Common Stock to one newly issued share
for each thirty outstanding shares of Common Stock.
4. Amend our Certificate of Incorporation to increase the authorized
number of shares of our common stock from 100,000,000 to 750,000,000.
Shareholders of record at the close of business on May 28, 2003 (the "Record
Date") are entitled to notice of the action to be effective on or about August
14, 2003. As of the Record Date, our authorized capitalization consisted of
100,000,000 shares of common stock, par value $0.001 per share, of which
68,759,301 were issued and outstanding. Each share of our common stock entitles
its holder to one vote on each matter submitted to the shareholders. However,
3
because the shareholders holding at least a majority of the voting rights of all
outstanding shares of capital stock as of the Record Date have voted in favor of
the foregoing actions by resolution dated May 28, 2003; and having sufficient
voting power to approve such proposals through their ownership of the capital
stock, no other consents will be solicited in connection with this Information
Statement.
Shareholders of record at the close of business on May 28, 2003 are being
furnished copies of this Information Statement. The principal executive office
of the Company is located at 31103 Rancho Viejo Road, #2102, San Juan
Capistrano, California 92675 and the Company's telephone number is (800)
597-1970.
SHAREHOLDER DISSENTER'S RIGHT OF APPRAISAL
The General Corporate Law of Delaware does not provide for dissenter's rights of
appraisal in connection with the proposed actions.
THIS IS NOT A NOTICE OF A SPECIAL MEETING OF SHAREHOLDERS AND NO SHAREHOLDER
MEETING WILL BE HELD TO CONSIDER ANY MATTER WHICH WILL BE DESCRIBED IN THIS
INFORMATION STATEMENT.
MATTERS SET FORTH IN THE WRITTEN CONSENTS
The Written Consents contain:
(i) A Resolution dated May 28, 2003, to amend the Certificate of Incorporation
in order to provide for 1) change the Company name from AGE Research, Inc. to
Enstruxis, Inc., 2) to provide for a stock combination (reverse split) of the
Common Stock in an exchange ratio to be approved by the Board, ranging from one
newly issued share for each two outstanding shares of Common Stock to one newly
issued share for each thirty outstanding shares of Common Stock, and 3) to
increase the authorized number of shares of our common stock from 100,000,000
shares to 750,000,000 shares.
(ii) a Resolution dated May 28, 2003, to approve the acquisition of The Varsity
Group, Inc., a Missouri corporation, where the total consideration to be paid is
9,343,920 authorized and unissued post reverse split common shares, where that
number of shares is to equal 80% of the total outstanding after the acquisition.
Shareholders representing 59.5% of the votes of the currently issued and
outstanding shares of Common Stock have executed the Written Consents, thereby
ensuring the stock combination. See "Other Information Regarding The Company -
Security Ownership of Certain Beneficial Owners and Management."
Set forth below is a table of the stockholders who have executed the Written
Consents and, to the best of the Company's knowledge, the number of shares of
Common Stock beneficially owned by such stockholders as of March 28, 2003:
Common Shr's Votes/Shr. Common Votes % of Total
Votes
- ------------------------------------------ -------------- ---------- -------------------------
Total Common Issued and Outstanding
Votes Possible 1 68,759,301 100.00%
4
Votes by Written Consent For all proposals
Beneficial Owner
- ----------------------------------------------------------------------------------------------------
Wendy Holt 5,000,000 1 5,000,000 %
Bonnie Holt 10,651,833 1 10,651,833 %
Richard Holt 5,400,000 1 5,400,000 %
Jean S. Armstrong 8,665,050 1 8,665,050 %
Mark Scharmann 5,193,100 1 5,193,100 %
Eldridge D. Huntington 6,000,000 1 6,000,000 %
Total 40,909,983 1 40,909,983 59.5%
VOTE REQUIRED
As of May 28, 2003 (the dates of the Written Consents), 68,759,301
shares of Common Stock were issued and outstanding with 40,909,983 votes
acquired thus, Stockholders representing no less than 34,379,651 votes from
Common Stock were required to execute the Written Consents to effect the matter
set forth therein. As discussed under "Matters Set Forth in the Written
Consents," shareholders owning approximately 40,909,986 votes, or 59.5% of the
votes of Common Stock, have executed the Written Consents and delivered them to
the Company as required by law within the 60 day period, thereby ensuring the
approval of the proposals.
ACQUISITION OF THE VARSITY GROUP, INC.,
AGE Research over the last two years has been basically a non operating public
shell. Since December 1987, the Company has marketed its RejuvenAge products to
physicians practicing skin therapy medical specialties. The RejuvenAge products
are non-prescription skin care products that do not contain Retin-A or any other
prescription drug. In addition to the RejuvenAge products, the Registrant sells
a proprietary moisturizing shaving cream for sensitive or irritated beard
conditions called Bladium.
The Company owns the formulations for both the RejuvenAge and Bladium products.
The products are manufactured by independent contractors. In order to increase
its profitability and reduce expenses, in fiscal 1998 the Company reduced its
office expenses to a minimum and eliminated its advertising and salary expenses.
In May 2000, the Company vacated its warehouse facility. The remaining minimal
inventory is stored at the president's house.
In order to create value for AGE's shareholders, we felt that putting a private
company into this shell would give the shareholders their best change to realize
value from their investment.
As a result the shareholders holding a majority of Age's common stock approved
the acquisition of The Varsity Group, Inc., a Missouri corporation, where the
total consideration to be paid is 9,343,920 authorized and unissued post reverse
split common shares, where that number of shares is to equal 80% of the total
outstanding after the acquisition.
The Varsity Group, Inc., based in St. Louis, Missouri. The Varsity Group
provides Human Resources services including payroll, benefits and
employee-related administration and support services to small business clients
primarily
5
in the Midwest. The Varsity Group is incorporated in Missouri and has been in
business since 1992.
The acquisition calls for consideration to be 9,343,920 of the Company's common
stock that will be issued post reverse split. The shares issued are to equal 80%
of the Company's total outstanding shares after the acquisition.
Proforma financials are included as exhibits B and C.
CHANGE IN COMPANY NAME
To reflect the new business and direction of the Company, we felt that a name
change was appropriate. The name chosen by shareholders holding a majority of
Age's common stock was Enstruxis, Inc.
PURPOSES OF THE REVERSE SPLIT
The main purpose for the Reverse Split would be to provide enough
shares for the acquisition of the Varsity Group. A reverse split would reduce
the number of the shares outstanding thus providing more shares to be available
for the acquisition.
Another purpose of the Reverse Split would be to increase the market
price of our Common Stock. We believe a reverse split may increase the market
price of our stock which may help in making our common stock a more viable tool
to attract working capital and as a form of consideration for potential
acquisitions.
THERE CAN BE NO ASSURANCE, HOWEVER, THAT, EVEN AFTER CONSUMMATING THE REVERSE
SPLIT, THE COMPANY WILL BE ABLE TO MAINTAIN ITS MARKET PRICE PER SHARE AND THUS
UTILIZE ITS COMMON STOCK IN ORDER TO EFFECTUATE FINANCING OR ACQUISITION
TRANSACTIONS.
The Reverse Split will not change the proportionate equity interests of
the Company's stockholders at the time of the split, nor will the respective
voting rights and other rights of stockholders be altered, except for possible
immaterial changes due to rounding up to eliminate fractional shares. However,
shares issued in connection with the conversion of remaining debt, or for
working capital, or acquisitions, would most likely dilute the value of shares
held by individual shareholders. There are no anti-dilution protections for the
debt holders. The Common Stock issued pursuant to the Reverse Split will remain
fully paid and non-assessable. The Company will continue to be subject to the
periodic reporting requirements of the Securities Exchange Act of 1934, as
amended.
CERTAIN EFFECTS OF THE REVERSE SPLIT
The following table illustrates the effect that the Reverse Split would have on
the 68,759,301 shares of Common Stock that were outstanding on May 28, 2003:
COMMON SHARES:
--------------
PRIOR TO AFTER 1 FOR 2 AFTER 1 FOR 35
NUMBER OF SHARES REVERSE REVERSE REVERSE
STOCK SPLIT STOCK SPLIT STOCK SPLIT
Common Stock:
Authorized ................. 100,000,000 100,000,000 100,000,000
Shares Outstanding (1) .... 68,759,301 34,379,651 1,964,551
Shares Available for Future
Issuance .................. 31,240,699 65,620,349 98,035,449
6
(1) Gives effect to the Reverse Split, excluding New Shares to be issued in
lieu of fractional shares. Stockholders should recognize that, the Reverse
Split will reduce the number of shares they own by a number equal to the
number of shares owned immediately prior to the filing of the amendment
regarding the Reverse Split divided by the Exchange Number (i.e. divide by
2 if the reverse is two to one, as adjusted to include New Shares to be
issued in lieu of fractional shares.
While a Reverse Split may result in an increase in the market price of the
Common Stock, there can be no assurance that the Reverse Split will
increase the market price of the Common Stock by a multiple equal to the
Exchange Number or result in a permanent increase in the market price
(which is dependent upon many factors, including the Company's performance
and prospects). Also, should the market price of the Company's Common Stock
decline after the Reverse Split, the percentage decline may be greater than
would be the case in the absence of the Reverse Split.
The possibility exists that liquidity in the market price of the Common
Stock could be adversely affected by the reduced number of shares that
would be outstanding after the Reverse Split. In addition, the Reverse
Split will increase the number of stockholders of the Company who own
odd-lots (less than 100 shares). Stockholders who hold odd-lots typically
will experience an increase in the cost of selling their shares, as well as
greater difficulty in effecting such sales. Consequently, there can be no
assurance that the Reverse Split will achieve the desired results that have
been outlined above.
INCREASE THE AUTHORIZED NUMBER OF SHARES OF OUR COMMON STOCK FROM
100,000,000 TO 750,000,000.
The holders of a majority of the shares of our outstanding common stock approved
in writing an amendment to our Certificate of Incorporation to increase our
authorized capital from 100,000,000 shares to 750,000,000 shares.
The increase in authorized capital was approved by shareholders who deemed it
advisable and in the company's best interests for reasons including the
following
o to have available additional authorized shares of our common stock in an
amount adequate to provide for our future needs.
o we may have future opportunities to engage in a private offering of our
securities in order to raise additional capital and carry out our
business objectives, however, our existing Certificate of Incorporation
does not authorize a sufficient number of shares of common stock to
close any such offering.
In addition to any proposed private offering, we may from time to time consider
acquisitions or other transactions which may require further issuance of shares
of our common stock. Currently, there are no definitive agreements respecting
7
any merger or consolidation with or acquisition of another business, however, a
majority in interest of the shareholders believes that the increase in the
number of authorized shares of common stock is in our best interest and that of
our shareholders because additional shares of common stock will provide us with
the ability to raise additional capital through a private offering.
Because of the Board of Directors' discretion in connection with an issuance of
additional shares of our common stock, the Board of Directors may, under certain
circumstances, possess timing and other advantages in responding to a tender
offer or other attempt to gain control of us, which may make such attempts more
difficult and less attractive. Any additional shares of common stock issued
would have the same rights and privileges as the currently outstanding shares of
common stock. For example, issuance of additional shares would increase the
number of shares outstanding and could necessitate the acquisition of a greater
number of shares by a person making a tender offer and could make such
acquisition more difficult since the recipient of such additional shares may
favor the incumbent management. Moreover, these advantages give the Board of
Directors the ability to provide any such holders with a veto power over actions
proposed to be taken by the holders of our common stock. This could have the
effect of insulating existing management from removal, even if it is in the best
interest of the common shareholders. Our management is not aware of any existing
or threatened efforts to obtain control of AGE Research Inc. other than the
proposed acquisition of The Varsity group. The issuance of any additional shares
of our common stock would also have the effect of diluting the equity interests
of existing shareholders and the earnings per share of existing shares of common
stock. Such dilution may be substantial, depending upon the number of shares
issued.
The increase in the authorized capital shall be effective on or about August 19,
2003, approximately twenty days after the mailing of this Information Statement,
and the amendment to our Certificate of Incorporation will thereupon be filed.
OTHER INFORMATION REGARDING THE COMPANY
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following tables sets forth the number of shares of the Company's Common
Stock, par value $0.001, held by each person who is believed to be the
beneficial owner of 5% or more of the 68,759,301 shares of the Company's common
stock outstanding at March 19, 2003, based on the Company's transfer agent's
list, and the names and number of shares held by each of the Company's officers
and directors and by all officers and directors as a group.
Title of Name and Address Amount and Nature of Percent
Class Of Beneficial Owner Beneficial Ownership of Class
- -------- ------------------- --------------------- --------
Common Mark A. Scharmann(1) 5,193,100 7.55
1661 Lakeview Circle
Ogden, UT 84403
Common Wendy E. Holt (2) 5,000,000 7.27
205 1/2 Agate Street
Balboa Island, CA 92662
8
Title of Name and Address Amount and Nature of Percent
Class Of Beneficial Owner Beneficial Ownership of Class
- -------- ------------------- --------------------- --------
Common Richard B. Holt (3) 5,400,000 7.85
24382 Antilles Way
Dana Point, CA 92629
Common Jean Armstrong 8,026,050 11.67
P.O. Box 6743
Pine MTN. Club, CA 93222
Common Eldridge D. Huntington 6,000,000 8.73
5314 Anaheim Road
Long Beach, CA 90815
Common Richard F. Holt (4) 10,651,833 15.49
1 Strawberry Lane
San Juan Capistrano, CA 92675
Officers and Directors
- ----------------------
Common Richard F. Holt, ---- see above ----
President/director
Common Wendy E. Holt (2) ---- see above ----
Vice-president/director
All Officers, Directors,
as a Group (2 Persons) 15,651,833 22.76
==================== =====
- -----------------------
(1) Includes 13,100 held of record by Troika Capital Investments, an entity
controlled by Mr. Scharmann.
(2) Wendy E. Holt is the adult daughter of Richard F. Holt.
(3) Richard B. Holt is the adult son of Richard F. Holt.
(4) Richard F. Holt's share numbers include 6,537,290 shares held in a family
trust and 50,000 shares held in a trust by his spouse.
BOARD COMMITTEES
The Board of Directors does not currently maintain an Audit Committee or a
Compensation Committee, but plans to appoint an Audit Committee and a
Compensation Committee in the near future. During the fiscal year ended December
31, 2002, the Board of Directors held one meeting.
COMPENSATION OF DIRECTORS
The Company's Directors are not currently compensated for attendance at Board of
Directors meetings.
EXECUTIVE COMPENSATION
The Company has not had a bonus, profit sharing, or deferred compensation plan
for the benefit of its employees, officers or directors. Except as noted below,
the Company has not paid any salaries or other compensation to its officers,
directors or employees for the years ended December 31, 2002, 2001
9
and 2000, nor at any time during 2002, 2001 or 2000. Further, the Company has
not entered into an employment agreement with any of its officers, directors or
any other persons and no such agreements are anticipated in the immediate
future. It is intended that the Company's directors may be compensated for
services provided to the Company. As of the date hereof, no person has accrued
any compensation from the Company.
The following tables set forth certain summary information concerning the
compensation paid or accrued for each of the Company's last three completed
fiscal years to the Company's or its principal subsidiaries chief executive
officer and each of its other executive officers that received compensation in
excess of $100,000 during such period (as determined at December 31, 2002, the
end of the Company's last completed fiscal year):
SUMMARY COMPENSATION TABLE
Long Term Compensation
----------------------
Annual Compensation Awards Payouts
Other Restricted
Name and Annual Stock Options LTIP All other
Principal Position Year Salary Bonus($) Compensation Awards /SARs Payout Compensation
- ------------------ ---- ------ -------- ------------ ------ ------- ------ ------------
Richard F. Holt 2002 $ -0- -0- -0- -0- -0- -0- -0-
President 2001 $ -0- -0- -0- -0- -0- -0- -0-
2000 $ -0- -0- -0- -0- -0- -0- -0-
Options/SAR Grants in Last Fiscal Year
None.
Bonuses and Deferred Compensation
None.
Compensation Pursuant to Plans
None.
Pension Table
Not Applicable.
Other Compensation
None.
LEGAL PROCEEDINGS
None
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Our president, Richard F. Holt, is currently making payments to purchase
inventory on behalf of the Company. As of December 31, 2002 and 2001, the
10
balance due him related the purchases were $1,231 and $223. The Company also has
notes payable to him in the amount of $8,500, accruing interest at 6% per annum.
OTHER MATTERS
The Board of Directors of the Company is not aware that any matter other than
those described in this Information Statement is to be presented for the consent
of the shareholders.
ADDITIONAL INFORMATION
We are subject to the informational requirements of the Securities Exchange Act
of 1934 and in accordance with the requirements thereof, file reports, proxy
statements and other information with the Securities and Exchange Commission
("SEC"). Copies of these reports, proxy statements and other information can be
obtained at the SEC's public reference facilities at Judiciary Plaza, Room 1024,
450 Fifth Street, N.W., Washington, D.C., 20549. Additionally, these filings may
be viewed at the SEC's website at http://www.sec.gov.
DISTRIBUTION OF INFORMATION STATEMENT
The cost of distributing this Information Statement has been borne by us and
certain shareholders that consented to the action taken herein. The distribution
will be made by mail.
Pursuant to the requirements of the Exchange Act of 1934, as amended, the
Registrant has duly caused this Information Statement to be signed on its behalf
by the undersigned hereunto authorized.
By Order of the Board of Directors
/s/ Richard F. Holt
---------------------------------
Richard F. Holt, Chief Accounting
Officer and Director.
July 28, 2003
San Juan Capistrano, California
11
EXHIBIT A
AGE RESEARCH INC.
NOTICE PUSUANT TO SECTION 228 OF THE GENERAL CORPORATION LAW
OF THE STATE OF DELAWARE
TO: ALL STOCKHOLDERS
1. PLEASE TAKE NOTICE THAT Stockholders owning at least a majority of the
outstanding stock of AGE RESEARCH Inc., by written consent dated May 28, 2003
have duly adopted the following resolutions:
"a resolution approving the following:
1. To approve the acquisition of The Varsity Group, Inc., a Missouri
corporation, where the total consideration paid is 9,343,920
authorized and unissued post reverse split common shares, where that
number of shares is to equal 80% of the total outstanding after the
acquisition.
2. Amend our certificate of incorporation to change the Company name from
AGE Research, Inc. to Enstruxis, Inc., and concurrently to change the
Company's OTCBB trading symbol.
3. Amend our certificate of incorporation to provide for a stock
combination (reverse split) of the Common Stock in an exchange ratio
to be approved by the Board, ranging from one newly issued share for
each two outstanding shares of Common Stock to one newly issued share
for each thirty outstanding shares of Common Stock.
4. Amend our Certificate of Incorporation to increase the authorized
number of shares of our common stock from 100,000,000 to 750,000,000."
DATE: July 28, 2003
12
EXHIBIT B
UNAUDITED PROFORMAS
PERIOD ENDING MAY 31, 2003
13
SUBSIDIARY EXHIBIT B
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)
MAY 31, 2003
- --------------------------------------------------------------------------------
ASSETS "AGER" "VARS" Adjustments Pro Forma
------ -------------- -------------- --------------- ---------------
Cash $ 169 $ 222,776 $ 222,945
Accounts receivable 859 1,337,756 1,338,615
Prepaid expenses and other current assets - 450,008 450,008
------------------------------ ---------------
Total current assets 1,028 2,010,540 $2,011,568
Property and equipment, net - 163,230 (13,230) (1) 150,000
Goodwill - - 4,841,798 (1) 4,841,798
------------------------------ ---------------
TOTAL ASSETS $ 1,028 $ 2,173,770 $7,003,366
============================== ===============
LIABILITIES AND
SHAREHOLDERS' DEFICIT
---------------------
Accounts payable $ 4,074 $ 158,814 $ 162,888
Accrued expenses 1,839 1,536,830 1,538,669
Accrued payrolls and related taxes - 1,466,434 1,466,434
Short-term notes payable - 499,510 499,510
Notes payable to officers 13,700 70,378 84,078
------------------------------ ---------------
Total current liabilities 19,613 3,731,966 3,751,579
Shareholders' capital 823,333 49,721 3,220,651 (1) 4,093,705
Accumulated deficit (841,918) (1,607,917) 1,607,917 (1) (841,918)
------------------------------ ---------------
(18,585) (1,558,196) 3,251,787
$ 1,028 $ 2,173,770 $7,003,366
============================== ===============
See notes to unaudited pro forma condensed consolidated financial statements
14
AGE RESEARCH, INC. AND SUBSIDIARY
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
FOR FIVE MONTHS ENDED MAY 31, 2003
- --------------------------------------------------------------------------------
AGER VARS Adjustments Pro Forma
--------------- --------------- -------------- ---------------
Revenues $ 2,967 $ 21,222,346 $ 21,225,313
Cost and expenses:
Cost of revenues 418 20,814,918 20,815,336
Selling, general and administrative 23,320 726,907 750,227
-------------------------------- ---------------
23,738 21,541,825 21,565,563
Operating (loss) (20,771) (319,479) (340,250)
Other income (expenses) (257) 121,957 121,700
-------------------------------- ---------------
(Loss) before income taxes (21,028) (197,522) (218,550)
Income taxes 800 - 800
-------------------------------- ---------------
Net (loss) $ (21,828) $ (197,522) $ (217,750)
================================ ===============
Net (loss) per share-basic and diluted $ (0.01) $ (0.02)
=============== ===============
Weighted average number of shares 2,038,837 11,382,757
See notes to unaudited pro forma condensed consolidated financial statements
15
AGE RESEARCH, INC. AND SUBSIDIARY
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR FIVE MONTHS ENDED MAY 31, 2003
- --------------------------------------------------------------------------------
NOTE 1 - BASIS OF PRESENTATION
On May 22, 2003, Age Research, Inc. ("the Company" or "AGER") acquired all the
issued and outstanding shares of common stock of The Varsity Group, Inc.
("VARS") in exchange for 9,343,920 post split shares of the Company's common
stock. The acquisition will be accounted for as a purchase, with the assets
acquired and liabilities assumed recorded at fair values, and the results of
VARS operations included in the Company's consolidated financial statements from
the date of acquisition.
In connection with the acquisition, the Board of Directors authorized a reverse
split of 1 for 35 shares of stock prior to the closing date of acquisition and
increase the capitalization to 750,000,000 shares.
The accompanying unaudited condensed consolidated financial statements
illustrate the effect of the acquisition ("Pro Forma") on the Company's
financial position and results of operations. The unaudited condensed
consolidated balance sheet as of May 31, 2003 is based on the historical balance
sheets of the Company and VARS as of that date and assumes the acquisition took
place on that date. The unaudited condensed consolidated statements of
operations for the five months then ended are based on the historical statements
of operations of the Company and VARS for those periods. The pro forma unaudited
condensed consolidated statements of operations assume the acquisition took
place on January 1, 2003.
The unauidted pro forma condensed consolidated financial statements may not be
indicative of the actual results of the acquisition. In particular, the
unaudited pro forma condensed consolidated financial statements are based on
management's current estimated of the allocation of the purchase price, the
actual allocation of which may differ.
The accompanying unaudited condensed consolidated pro forma financial statements
should be read in connection with the historical financial statements of the
Company and VARS.
NOTE 2 - PRO FORMA ADJUSTMENTS
The pro forma adjustments to the unaudited condensed consolidated balance sheet
are as follows:
(1) To reflect the acquisition of The Varsity Group, Inc. and the allocation of
the purchase price on the basis of the fair values of the assets acquired
and liabilities assumed.
The total purchase cost is as follows:
Value of common stock issued $ 3,270,372
-------------
Total purchase cost 3,270,372
The purchase price allocation is as follows:
Stockholders' equity of VARS 1,558,196
Decrease in property and equipment 13,230
-------------
1,571,426
Goodwill $ 4,841,798
=============
16
EXHIBIT C
UNAUDITED PROFORMAS
PERIOD ENDING DECEMBER 31, 2002
17
SUBSIDIARY EXHIBIT C
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)
DECEMBER 31, 2002
- --------------------------------------------------------------------------------
See notes to pro forma condensed consolidated financial statements (unaudited)
ASSETS "AGER" "VARS" Adjustments Pro Forma
------ -------------- ------------- --------------- ---------------
Cash $ 310 $ 423,914 $ 424,224
Accounts receivable 752 846,231 846,983
Loan receivable from officers - 2,575 2,575
Prepaid expenses and other current assets - 121,669 121,669
------------------------------ ---------------
Total current assets 1,062 1,394,389 $1,395,451
Property and equipment, net - 183,292 (33,292) (1) 150,000
Goodwill - - 1,487,406 (1) 1,487,406
------------------------------ ---------------
TOTAL ASSETS $ 1,062 $ 1,577,681 $3,032,857
============================== ===============
LIABILITIES AND
SHAREHOLDERS' DEFICIT
Accounts payable $ 6,678 $ 439,468 $ 446,145
Accrued expenses 1,751 931,698 933,450
Accrued payrolls and related taxes - 1,517,679 1,517,679
Short-term notes payable - 49,510 49,510
Notes payable to officers 8,500 - 8,500
------------------------------ ---------------
Total current liabilities 16,929 2,938,356 2,955,284
Shareholders' capital 805,023 49,721 43,718 (1) 898,462
Accumulated deficit (820,890) (1,410,395) 1,410,395 (1) (820,890)
------------------------------ ---------------
(15,866) (1,360,674) 77,573
$ 1,062 $ 1,577,681 $3,032,857
============================== ===============
See notes to pro forma condensed consolidated financial statements (unaudited)
18
AGE RESEARCH, INC. AND SUBSIDIARY
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)
FOR THE YEAR ENDED DECEMBER 31, 2002
- --------------------------------------------------------------------------------
"AGER" "VARS" Adjustments Pro Forma
--------------- --------------- ----------------- ---------------
Revenues $ 7,894 $ 59,009,084 $ 59,016,978
Cost and expenses:
Cost of revenues 1,211 57,666,185 57,667,396
Selling, general and administrative 17,059 2,352,767 2,369,825
-------------------------------- ---------------
18,269 60,018,952 60,037,222
Operating (loss) (10,375) (1,009,868) (1,020,243)
Other income (expenses) (458) 222,350 221,892
-------------------------------- ---------------
(Loss) before income taxes (10,833) (787,518) (798,351)
Income taxes 800 - 800
-------------------------------- ---------------
Net (loss) $ (11,633) $ (787,518) $ (797,551)
================================ ===============
Net (loss) per share-basic and diluted $ (0.01) $ (0.07)
=============== ===============
Weighted average number of shares(2) 1,939,551 11,283,471
See notes to pro forma condensed consolidated financial statements (unaudited)
19
AGE RESEARCH, INC. AND SUBSIDIARY
NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
FOR THE YEAR ENDED DECEMBER 31, 2002
- --------------------------------------------------------------------------------
NOTE 1 - BASIS OF PRESENTATION
On May 22, 2003, Age Research, Inc. ("the Company" or "AGER") announced to
acquire all the issued and outstanding shares of common stock of The Varsity
Group, Inc. ("VARS") in exchange for 9,343,920 post split shares of the
Company's common stock. The acquisition will be accounted for as a purchase,
with the assets acquired and liabilities assumed recorded at fair values, and
the results of VARS operations included in the Company's consolidated financial
statements from the date of acquisition.
In connection with the acquisition, the Board of Directors authorized a reverse
split of 1 for 35 shares of stock prior to the closing date of acquisition and
increase the capitalization to 750,000,000 shares.
The accompanying condensed consolidated financial statements illustrate the
effect of the acquisition ("Pro Forma") on the Company's financial position and
results of operations. The condensed consolidated balance sheet as of December
31, 2002 is based on the historical balance sheets of the Company and VARS as of
that date and assumes the acquisition took place on that date. The condensed
consolidated statements of operations for the year then ended are based on the
historical statements of operations of the Company and VARS for those periods.
The pro forma condensed consolidated statements of operations assume the
acquisition took place on January 1, 2002.
The pro forma condensed consolidated financial statements may not be indicative
of the actual results of the acquisition. In particular, the pro forma condensed
consolidated financial statements are based on management's current estimated of
the allocation of the purchase price, the actual allocation of which may differ.
The accompanying condensed consolidated pro forma financial statements should be
read in connection with the historical financial statements of the Company and
VARS.
NOTE 2 - PRO FORMA ADJUSTMENTS
The pro forma adjustments to the unaudited condensed consolidated balance sheet
are as follows:
(1) To reflect the acquisition of The Varsity Group, Inc. and the
allocation of the purchase price on the basis of the fair values of the
assets acquired and liabilities assumed.
The total purchase cost is as follows:
Value of 9,343,920 common stock issued at $0.01 per share $ 93,439
---------------
Total purchase cost 93,439
Allocation of purchase price:
Stockholders' deficit of VARS 1,360,674
Decrease in property and equipment 33,292
---------------
Cost in excess of net assets acquired-Goodwill $1,487,406
===============
20
AGE RESEARCH, INC. AND SUBSIDIARY
NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
FOR THE YEAR ENDED DECEMBER 31, 2002
- --------------------------------------------------------------------------------
NOTE 2 - PRO FORMA ADJUSTMENTS (CONTINUED)
The pro forma adjustments to the condensed consolidated statements of operations
are as follows:
(2) To adjust retroactively to reflect the reverse split of 1 for 35 shares of
common stock in connection with the acquisition.
21