-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, B21WqU8+wstvXSFJU1Mr2FhycpWnoVB+ABfqmwJ6debVCtetniX5lQtKKZBbykmX KykTYvSmTMIKvmqG4TRi0g== 0001000459-07-000008.txt : 20070829 0001000459-07-000008.hdr.sgml : 20070829 20070829151244 ACCESSION NUMBER: 0001000459-07-000008 CONFORMED SUBMISSION TYPE: 10KSB PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20070531 FILED AS OF DATE: 20070829 DATE AS OF CHANGE: 20070829 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ECOM ECOM COM INC CENTRAL INDEX KEY: 0001000459 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 650538051 STATE OF INCORPORATION: FL FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: 10KSB SEC ACT: 1934 Act SEC FILE NUMBER: 000-23617 FILM NUMBER: 071087373 BUSINESS ADDRESS: STREET 1: 1016 CLEMMONS ST STREET 2: SUITE 302 CITY: JUPITER STATE: FL ZIP: 33477 BUSINESS PHONE: 561-880-0004 MAIL ADDRESS: STREET 1: 1016 CLEMMONS ST STREET 2: SUITE 302 CITY: JUPITER STATE: FL ZIP: 33477 FORMER COMPANY: FORMER CONFORMED NAME: US AMATEUR SPORTS INC DATE OF NAME CHANGE: 19950912 10KSB 1 ecom0507.txt ECOM ECOM.COM FORM 10KSB FOR MAY 31, 2007 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 Form 10-KSB (Mark One) [X] ANNUAL REPORT UNDER SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended May 31, 2007 [ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from__________to__________ Commission File Number 000-23617 eCom eCom.com, Inc. - ------------------------------------------------------------------------ (Exact name of small business issuer as specified in its charter) Florida 65-0538051 - ------------------------------------- ---------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1016 Clemmons St., Suite 302 Jupiter, Florida 33477 ---------------------------------------- (Address of principal executive offices) (Issuer's telephone number) (561) 745-6789 Securities registered under Section 12(b) of the Exchange Act: None Securities registered under Section 12(g) of the Exchange Act: None Check whether the issuer is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act. Yes [X] No [ ] Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ] Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B contained in this form, and no disclosure will be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB. [ ] Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X] State issuer's revenue for its most recent fiscal year. [ $ 0 ] State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was sold, or the average bid and asked price of such common equity, as of a specified date within the past 60 days. (See definition of affiliate in Rule 12b-2 of the Exchange Act.) [ $ 311,666 ] (ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS) Check whether the issuer has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court Yes [X] No [ ] State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date. [As of May 31, 2007, the issuer had 89,707,821 shares of common stock, $.0001 Par Value, outstanding.] Documents incorporated by reference: None Transitional Small Business Disclosure Format: Yes [ ] No [X] TABLE OF CONTENTS Page PART I Item 1. Description of Business 3 Item 2. Description of Properties 5 Item 3. Legal Proceedings 5 Item 4. Submission of Matters to a Vote of Security Holders 6 PART II Item 5. Market for the Registrant's Common Equity and Related Shareholder Matters 6 Item 6. Management's Discussion and Analysis of Financial Conditions and Results of Operations 7 Item 7. Financial Statements F-3 Item 8. Disagreements on Accounting and Financial Disclosures 26 Item 8A Controls and Procedures 26 PART III Item 9. Directors and Executive Officers of the Registrant 27 Item 10. Executive Compensation 29 Item 11. Security Ownership of Certain Beneficial Owners and Management 30 Item 12. Certain Relationships and Related Transactions 30 Item 13. Exhibits, Financial Statements and Reports on Form 8-K 31 Additional Information Item 14. Principal Accountant Fees & Services 35 Signatures 35 Certification 36 Exhibit 31.1 Certification required under Section 302 of 36 The Sarbanes-Oxley Act of 2002 by the CEO Exhibit 31.2 Certification required under Section 302 of 37 The Sarbanes-Oxley Act of 2002 by the CFO Exhibit 32 Certification of CEO and CFO Pursuant to 38 Section 906 of the Sarbanes-Oxley Act * This document incorporates into a single document the requirements of the Securities and Exchange Commission for the Annual Report to Stockholders and the Form 10-KSB. ECOM ECOM.COM, INC. Special Note Regarding Forward-Looking Statements: This Form 10-KSB may contain forward-looking statements. These statements relate to our expectations for future events and future financial performance. Generally, the words "intend", "expect", "anticipate", "estimate", or continue", and similar expressions identify forward-looking statements. Forward-looking statements involve risks and uncertainties, and future events and circumstances could differ significantly from those anticipated in the forward-looking statements. These statements are only predictions. Factors which could affect our financial results are described in Item 6 of Part II of this Form 10-KSB. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. We do not, nor have we authorized any other person to, assume responsibility for the accuracy and completeness of the forward-looking statements. We undertake no duty to update any of the forward-looking statements after the date of this report. PART I ITEM 1. DESCRIPTION OF BUSINESS The Company was incorporated in the State of Florida on June 14, 1994. eCom.Com, Inc. ("eCom") is referred to as "the Company", "it" or "eCom". On March 8, 2007 the Company moved its main office to 1016 Clemmons St., Suite 302, Jupiter, FL 33477-3305, and the telephone number changed to (561) 745-6789. During the fiscal year ending May 31, 2005 eCom focused on separating all ten of its current business segments, USA SportsNet, Inc., USA Performance Products, Inc., eSecureSoft Corp., USAS Digital, Inc., Pro Card Corporation, AAB National Company, A Classified Ad, Inc., Swap and Shop.net Corp., A Super Deal.com, Inc. and MyZipSoft, Inc. This plan was undertaken for the purposes of allowing the management and employees the opportunity to operate each segment independently. Also, to have the ability for each segment, to raise its own funding for growth and expansion. On June 4, 2004 the Company spun-off each of the above listed companies into separate public companies. On December 1, 2003, the Board of Directors of eCom approved the spin-off of eCom's ten (10) operating subsidiary companies, pursuant to SEC Staff Legal Bulletin No. 4. On December 18, 2003, USA SportsNet, Inc. entered into a definitive Asset Acquisition Agreement with American Capital Holdings, Inc., ("ACHI") The Date of Record for the first spin-off, USA SportsNet, Inc. (later renamed American Capital Holdings, Inc., Cusip No. 02503V 10 9/SEC CIK No. 0001288010)was January 5, 2004. The Date of Record for the second spin-off, MyZipSoft, Inc. (Standard & Poor's Cusip No. 628703 10 0/SEC CIK No. 0001290785) was February 23, 2004, and the shares of MyZipSoft were distributed to its shareholders on June 2, 2005. On March 2, 2004, the Board of Directors of eCom approved the spin off of the remaining eight (8) spin off companies in which the Board of Directors voted to issue to their shareholders one (1) share of the company for every one (1) share of eCom owned with a record date to be announced, pursuant to the advice of SEC Staff Legal Bulletin No. 4. 3 ECOM ECOM.COM, INC. ITEM 1. DESCRIPTION OF BUSINESS (CONTINUED) On November 29, 2004 an involuntary petition was filed against eCom eCom.com, Inc. in the United States Southern District Bankruptcy Court (In Re: Case No. 04-34535 BKC-SHF)under Title 11, Chapter 11 of the United States Bankruptcy Code by petitioning creditors, American Capital Holdings, Inc., Richard Turner, Barney A. Richmond, and ACHI, Inc. The Bankruptcy proceedings were initiated in an effort to implement a viable plan for reimbursement of costs incurred by American Capital Holdings, Inc., the petitioning creditors, and all other creditors/vendors who have not been paid. Most importantly, the proceedings will enable Mr. Richmond to initiate reorganization plans in an effort to restore the shareholder value lost by approximately 6,000 shareholders. A copy of the June 2, 2005 Chapter 11, Title 11 Amended Involuntary Petition of eCom is posted on eCom's website, www.ecomecom.net. A detailed history is available on eCom eCom.com's 10KSB filing of May 31, 2006, SEC accession number 0001000459-06-000005. On August 18, 2006 the 'Joint Plan of Reorganization of Debtor and American Capital Holdings, Inc.' was filed with the United States Southern District Bankruptcy Court. On August 25, 2006 the accompanying 'Disclosure Statement for Joint Plan of Reorganization of Debtor and American Capital Holdings, Inc.' was filed with the U.S. Bankruptcy Court. On December 28, 2006 the 'First Amended Joint Plan of Reorganization of Debtor and American Capital Holdings, Inc.' and 'First Amended Disclosure Statement for First Amended Joint Plan of Reorganization of Debtor and American Capital Holdings, Inc.' were filed with the Unites States Bankruptcy Court, Southern District of Florida, West Palm Beach Division, see exhibits 99.1 and 99.2. The plan, which is subject to Bankruptcy Court approval, calls for the issuance of Thirty One Million Five Hundred Ninety Three Thousand Sixty Four (39,093,064) Common Shares to the Creditors listed in Exhibit "A" of the Plan. It is the intent of American Capital Holdings, Inc., if the Plan of Reorganization is confirmed by the Bankruptcy Court, to distribute Twenty Three Million Two Hundred Eight Thousand Three Hundred Eight One (23,280,381) common shares as a dividend to American Capital Holdings, Inc's shareholders. The proposed date of record for this proposed stock dividend, which is subject to Bankruptcy Court approval, will be five (5) business days subsequent to the Plan of Reorganization's final hearing by the Bankruptcy Court. A status conference is scheduled for September 10, 2007. Prior to the distribution of the eCom shares, American Capital Holdings is going to verify that it is not deemed an underwriter by the SEC. If American Capital Holdings is deemed to be an underwriter of securities, additional registrations may be required which could delay the stock distribution. A transcript of the March 12, 2007 confirmation hearing is attached to the 10QSB filing of February 28, 2007 as Exhibit 99.1, SEC accession number 0001000459-07- 000007. The Order Confirming the First Amended Joint Plan of Reorganization of Debtor and American Capital Holdings, Inc. as Modified was signed by Judge Friedman on March 23, 2007 and is attached to the 10QSB filing of February 28, 4 ECOM ECOM.COM, INC. ITEM 1. DESCRIPTION OF BUSINESS (CONTINUED) 2007 as Exhibit 99.2, SEC accession number 0001000459-07-000007. This order may also be viewed at the eCom website www.ecomecom.net under the bankruptcy news information link. Two post confirmation status conferences were held on May 14, 2007 and June 12, 2007 to consider the fee applications of the attorney fees of Kluger, Peretz, Kaplan & Berlin, PL and the outside auditor fees of Wieseneck, Andres & Co. A motion for entry of final decree and order closing case has been set for September 10, 2007 at 2:30 pm at 1515 North Flagler Drive, Room 801, West Palm Beach, Florida. The Company does not have any off-balance sheet arrangements. Employees. The Company has no employees. ITEM 2. DESCRIPTION OF PROPERTIES The company does not own any real property. On March 8, 2007 the company moved from 100 Village Square Crossings, Inc. Suite 202, Palm Beach Gardens, FL to 1016 Clemmons St. Suite 302, Jupiter, FL 33477. The Jupiter property consists of approximately 1,277 square feet of office space. The company shares the office with United States Financial Group, Inc.(USFG). USFG incurred the cost and full responsibility of the leases. The Palm Beach Gardens lease was for a term of one year, expired on March 15, 2007 at a rental of $2,567 per month including sales tax covering 784 square feet of office space. On March 15, 2007 a new lease was signed by USFG for a term of two years at a rental of $2,213 per month. ITEM 3. LEGAL PROCEEDINGS On November 29, 2004, an involuntary petition was filed against eCom eCom.com, Inc. in the United States Southern District Bankruptcy Court (In Re: Case No. 04-34535 BKC- SHF)under Title 11, Chapter 11 of the United States Bankruptcy Code by petitioning creditors, American Capital Holdings, Inc., Richard Turner, Barney A. Richmond, and ACHI, Inc. The Bankruptcy proceedings were initiated in an effort to restore the shareholder value lost by approximately 6,000+ shareholders as well as implement a viable plan for reimbursement of costs incurred by American Capital Holdings, Inc., the petitioning creditors, and all other creditors/vendors who have not been paid. The aforementioned creditors are owed in excess of $1 million dollars. A copy of the June 2, 2005 Chapter 11, Title 11 Amended Involuntary Petition of eCom is posted on the eCom's website, www.ecomecom.net. On August 18, 2006 the 'Joint Plan of Reorganization of Debtor and American Capital Holdings, Inc.' was filed with the United States Southern District Bankruptcy Court by Kluger, Peretz, Kaplan & Berlin, the attorneys for the Debtor, eCom eCom.com, Inc. and Schiff-Hardin LLP, the attorneys for American Capital Holdings, Inc. Information regarding the Joint Plan of Reorganization can be reviewed on eComeCom.com, Inc's website at www.ecomecom.net/banknews.htm. 5 ECOM ECOM.COM, INC. The plan, which is subject to Bankruptcy Court approval, calls for the issuance of Thirty One Million Five Hundred Ninety Three Thousand Sixty Four (31,593,064) Common Shares to the Creditors listed in Exhibit "A" of the Plan. It is the intent of American Capital Holdings, Inc., if the Plan of Reorganization is confirmed by the Bankruptcy Court, to distribute the Twenty Three Million Two Hundred Eight Thousand Three Hundred Eight One (23,280,381) common shares as a dividend to American Capital Holdings, Inc's shareholders. The proposed date of record for this proposed stock dividend, which is subject to Bankruptcy Court approval, will be five (5) business days subsequent to the Plan of Reorganization's confirmation by the Bankruptcy Court. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS At its last annual shareholders' meeting held on April 26, 2001, the shareholders of the Company voted to reappoint Wieseneck, Andres & Co., P.A. as the Company's independent accountants. On April 26, 2001 the following directors were elected to serve one-year terms or until replaced: David J. Panaia, Richard C. Turner, and Robert C. Wilson. In 2003 Robert C. Wilson resigned. In 2004, Barney A. Richmond was appointed to fill the unexpired term of Mr. Wilson. On November 22, 2004, Barney A. Richmond resigned as President and Director. On March 20, 2005, David J. Panaia died. On June 16, 2005 Barney A. Richmond was appointed by the U.S. Bankruptcy court as acting CEO. PART II ITEM 5. MARKET FOR THE COMPANY'S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS (a) Market for Common Equity The Company's common stock is traded on the Over the Counter - Pink Sheets under the symbol "ECEC". The CUSIP number is 27889U-10-2. Equitrade Securities Corporation of Lake Forest, California was the lead market maker for the stock. However, Equitrade closed its doors during 2005.The following is a table of the high and low bid prices of the Company's stock for each of the four quarters of the fiscal year ended May 31, 2007: Quarter Ended High Low 5/2007 $0.012 $0.007 2/2007 0.015 0.009 11/2006 0.027 0.014 8/2006 0.031 0.012 These quotations reflect interdealer prices, without retail mark-up, mark-down or commission and may not represent actual transactions. (b) Security Holders The Company has approximately 4,700 shareholders of record. (c) Dividends There have been no cash dividends declared or paid since the inception of the Company, and no cash dividends are contemplated to be paid in the foreseeable future. The Company may consider a potential dividend in the future in either common stock or the stock of future operating subsidiaries. 6 ECOM ECOM.COM, INC. ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS AND PLAN OF OPERATION On December 1, 2003, the Board of Directors of eCom approved the spin-off eCom's ten (10) operating subsidiary companies. On December 18, 2003, USA SportsNet, Inc. entered into a definitive Asset Acquisition Agreement with American Capital Holdings, Inc.("American Capital.") The Date of Record for the first spin-off, USA SportsNet, Inc. (later renamed American Capital Holdings, Inc., Cusip No. 02503V 10 9/SEC CIK No. 0001288010) was January 5, 2004. The Date of Record for the second spin-off, MyZipSoft, Inc. (Standard & Poor's Cusip No. 628703 10 0/SEC CIK No. 0001290785) was February 23, 2004, and the shares of MyZipSoft were distributed to its shareholders on June 2, 2005. On March 2, 2004, the Board of Directors of eCom approved the spinoff of the remaining eight (8) spin off companies in which the Board of Directors voted to issue to their shareholders one (1) share of the company for every one (1) share of eCom owned with a record date to be announced, pursuant to the advice of SEC Staff Legal Bulletin No. 4. On May 24, 2004, American Capital Holdings, Inc., a spin-off of eCom formerly known as USA SportsNet, Inc., filed a Form 10SB, file number 000-50776, accession number 0001288012-04-000001,SEC CIK number 0001288012,with the United States Securities & Exchange Commission ("SEC"). On July 27, 2004 American Capital Holdings, Inc.'s Form 10SB was ruled effective by the SEC. On June 4, 2004, a corporate resolution was proposed, passed and signed by David Panaia, Chairman/Secretary/CEO, Richard C. Turner, Director and Treasurer and Barney A. Richmond, Director and President. Based on Mr. Richmond's past restructuring experience, the new Board of Directors re-adopted the December 1, 2003 spin-off plan, pursuant to SEC Staff Legal Bulletin No.4, for the remaining subsidiaries of eCom. The plan was to create individual public corporations, and take whatever actions necessary to complete the process of enhancing shareholder value, including acquisitions and/or mergers. The individual companies are listed below: USA Performance Products, Inc. FL Corp. No. P98000006586 Fed. ID. 65-0812050 eSecureSoft Company FL Corp. No. P03000138385 Fed. ID. 20-1068608 USAS Digital, Inc. FL Corp. No. P03000147667 Fed. ID. 20-1069232 Pro Card Corporation FL Corp. No. P04000015631 Fed. ID. 20-1442373 AAB National Company FL Corp. No. P04000019818 Fed. ID. 20-1442771 A Classified Ad, Inc. FL Corp. No. P04000038403 Fed. ID. 20-1447963 A Super Deal.com, Inc. FL Corp. No. P04000040174 Fed. ID. 20-1449410 Swap and Shop.net Corp. FL Corp. No. P04000040176 Fed. ID. 20-1449332 The motion in the above described June 4, 2004 Board Resolution included the instructions for the distribution of stock by its Transfer Agent, Florida Atlantic Stock Transfer (FAST) to the proper entities when the share certificates were properly exercised and costs relating to the issuance of these shares were paid in full. Notwithstanding, contrary to what board members Richard Turner and Barney A. Richmond had been previously advised by Chairman Panaia, eCom was not able to pay FAST the amounts required to send out 7 ECOM ECOM.COM, INC. ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS AND PLAN OF OPERATION - (CONTINUED) the Stock certificates to the shareholders, and accordingly, the shares were not issued as stated. On November 29, 2004 an involuntary petition was filed against eCom eCom.com, Inc. in the United States Southern District Bankruptcy Court (In Re: Case No. 04-34535 BKC-SHF)under Title 11, Chapter 11 of the United States Bankruptcy Code by petitioning creditors, American Capital Holdings, Inc., Richard Turner, Barney A. Richmond, and ACHI, Inc. The Bankruptcy proceedings were initiated in an effort to implement a viable plan for reimbursement of costs incurred by American Capital Holdings, Inc., the petitioning creditors, and all other creditors/vendors who have not been paid. Most importantly, the proceedings will enable Mr. Richmond to initiate reorganization plans in an effort to restore the shareholder value lost by approximately 6,000 shareholders. A copy of the June 2, 2005 Chapter 11, Title 11 Amended Involuntary Petition of eCom is posted on eCom's website, www.ecomecom.net. A detailed history is available on eCom eCom.com's 10KSB filing of May 31, 2006, SEC accession number 0001000459-06-000005. On August 18, 2006 the 'Joint Plan of Reorganization of Debtor and American Capital Holdings, Inc.' was filed with the United States Southern District Bankruptcy Court by Kluger, Peretz, Kaplan & Berlin, the attorneys for the Debtor, eCom eCom.com, Inc. and Schiff-Hardin LLP, the attorneys for American Capital Holdings, Inc. Information regarding the Joint Plan of Reorganization can be reviewed on eComeCom.com, Inc's website at www.ecomecom.net/banknews.htm. On August 25, 2006 the accompanying 'Disclosure Statement for Joint Plan of Reorganization of Debtor and American Capital Holdings, Inc.' was filed with the U.S. Bankruptcy Court The plan, which is subject to Bankruptcy Court approval, calls for the issuance of Thirty One Million Five Hundred Ninety Three Thousand Sixty Four (31,593,064) Common Shares to the Creditors listed in Exhibit "A" of the Plan. It is the intent of American Capital Holdings, Inc., if the Plan of Reorganization is confirmed by the Bankruptcy Court, to distribute the Twenty Three Million Two Hundred Eight Thousand Three Hundred Eight One (23,280,381) common shares as a dividend to American Capital Holdings, Inc's shareholders. The proposed date of record for this proposed stock dividend, which is subject to Bankruptcy Court approval, will be five (5) business days subsequent to the Plan of Reorganization's confirmation by the Bankruptcy Court. A transcript of the March 12, 2007 confirmation hearing is attached to the 10QSB filing of February 28, 2007 as Exhibit 99.1, SEC accession number 0001000459-07- 000007. The Order Confirming the First Amended Joint Plan of Reorganization of Debtor and American Capital Holdings, Inc. as Modified was signed by Judge Friedman on March 23, 2007 and is attached to the 10QSB filing of February 28, 2007 as Exhibit 99.2, SEC accession number 0001000459-07-000007. This order may also be viewed at the eCom website www.ecomecom.net under the bankruptcy news information link. Two post confirmation status conferences were held on May 14, 2007 and June 12, 2007 to consider the fee applications of the attorney fees of 8 ECOM ECOM.COM, INC. ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS AND PLAN OF OPERATION - (CONTINUED) Kluger, Peretz, Kaplan & Berlin, PL and the outside auditor fees of Wieseneck, Andres & Co. A motion for entry of final decree and order closing case has been set for September 10, 2007 at 2:30 pm at 1515 North Flagler Drive, Room 801, West Palm Beach, Florida. Comparison of Results of Operations - Years Ending May 31, 2007 and 2006. Revenue for the year ended May 31, 2006 and 2007 $0. Cost of sales decreased from $220 to $110 in the current year. Because of the decrease in depreciation expense due to the aging of the fixed assets. Total operating expenses for the year ended May 31, 2007 was $185,892 compared to $54,953 for the year ended May 31, 2006. The increase in costs was due to a $119,812 increase in legal fees for the bankruptcy proceedings and a $11,254 increase in postage as notices were delivered to creditors and shareholders of the Company. The operations for the year ended May 31, 2007 resulted in a net loss of $186,001 versus a net loss of $55,173 recorded in the year ended May 31, 2006. No provision for federal and state income taxes has been recorded because the Company has incurred net operating losses since inception. The net operating loss carry-forwards as of May 31, 2007 totals approximately $7,000,000. These carry-forwards will be available to offset future taxable income. If not used, the operating loss carry-forwards will expire from 2010 to 2026. The Company does not believe that the realization of the related deferred income tax assets meets the criteria required by generally accepted accounting principles and, accordingly, deferred income tax assets have remained at $0 as of May 31, 2007. Liquidity and Capital Resources As of May 31, 2007, current assets totaled $9,230 compared to $66,815 at the prior year-end. Prepaid assets decreased to $595 from $65,027 as the retainer paid to Kluger, Peretz as attorneys was approved by the court. Notes Receivable related party increased from $1,280 on May 31, 2006 to $8,544. Accounts Payable decreased from $107,450 to $18,398 from May 31, 2006 to May 31, 2007, the result of the bankruptcy plan confirming certain debts not submitting claims against the company. Current liabilities decreased from $876,287 at the end of the prior fiscal year to $147,824 at the end of the current year as a result of issuing shares for all claims against the estate as of November 24, 2004. One remaining debt still outstanding are the funds advanced to the bankruptcy escrow account of $129,000 on December 13, 2006. Net cash used in operating activities was $108,972 and $116,704 for the years ended May 31, 2007 and 2006 respectively. Financing activities provided $155,242 in cash during the current fiscal year compared to $117,212 during the prior fiscal year consisting primarily of loans from stockholders and related companies. 9 ECOM ECOM.COM, INC. To the extent that additional funds are required to support operations or to expand our business, we may sell additional equity, issue debt or obtain other credit facilities through financial institutions. Any sale of additional equity securities will result in dilution to our shareholders. ITEM 7. FINANCIAL STATEMENTS The audited balance sheet of the Company for its years ended May 31, 2007 and 2006 and related statements of operations, stockholders' equity and cash flows for the years ended May 31, 2007 and 2006 are included. The page numbers for the financial statement categories are as follows: Index Page Report of Independent Registered Public Accounting Firm F-1 Balance Sheets as of May 31, 2007 and 2006 F-2 Statements of Operations for the Years Ended May 31, 2007 and 2006 F-3 Statement of Shareholders' Deficit From May 31, 2004 through May 31, 2007 F-4 Statements of Cash Flows for the Years Ended May 31, 2007 and 2006 F-5 Notes to Financial Statements F-7 F-1 WIESENECK, ANDRES & COMPANY, P.A. Certified Public Accountants 772 U.S. HIGHWAY 1, SUITE 100 NORTH PALM BEACH, FLORIDA 33408 (561) 626-0400 THOMAS B. ANDRES, C.P.A.*, C.V.A. Facsimile (561) 626-3453 PAUL M. WIESENECK, C.P.A. *Regulated by the State of Florida REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Stockholders eCom eCom.com, Inc. Jupiter, Florida 33477 We have audited the accompanying balance sheets of eCom eCom.com, Inc. as of May 31, 2007 and 2006 and the related statements of operations, shareholders' deficit, and cash flows for the years then ended. 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 audits. We conducted our audits in accordance with standards established by the Public Company Accounting Oversight Board (United States). 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 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 eCom eCom.com, Inc. as of May 31, 2007 and 2006, and the results of their operations and their cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America. The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note L to the financial statements, the Company's current liabilities exceed current assets by $140,000 and the Company has incurred net operating losses since inception. These conditions raise substantial doubt about its ability to continue as a going concern. Management's plans regarding those matters are also described in Note L. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. /s/ Wieseneck, Andres & Company, P.A. North Palm Beach August 27, 2007 F-2 ECOM ECOM.COM, INC. BALANCE SHEETS MAY 31, 2007 AND 2006 2007 2006 ------------ ------------ ASSETS Current Assets Cash $ 91 $ 508 Notes receivable - related parties 8,544 1,280 Prepaid expenses 595 65,027 ------------ ------------ Total Current Assets 9,230 66,815 ------------ ------------ Property and Equipment, net - 109 ------------ ------------ Total Assets $ 9,230 $ 66,924 ============ ============ LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities Not Subject to Compromise Postpetition trade accounts payable $ 18,399 $ 3,405 Postpetition loans from related parties 124,738 140,693 Accrued postpetition expenses 4,686 11,220 ------------ ------------ Total Liabilities Not Subject to Compromise 147,823 155,318 ------------ ------------ Liabilities Subject to Compromise Prepetition trade accounts payable - 114,251 Prepetition accrued expenses - 44,000 Current portion of loans from related parties - 534,909 Prepetition interest accrued - 27,809 ------------ ------------ Total Liabilities Subject to Compromise - 720,969 ------------ ------------ Total Liabilities 147,823 876,287 ------------ ------------ Contingencies - - Stockholders' Equity Common stock, $.0001 par value, 200 million shares authorized, 89,707,821 and 49,955,112 shares issued and outstanding 8,970 4,995 Paid-in capital 7,359,283 6,569,537 Retained Earnings(Deficit) (7,506,846) (7,383,895) ------------ ------------ Total Stockholders' (Deficit) (138,593) (809,363) ------------ ------------ Total Liabilities and Stockholders' Equity $ 9,230 $ 66,924 ============ ============ The accompanying notes are an integral part of these financial statements. F-3 ECOM ECOM.COM, INC. STATEMENTS OF OPERATIONS FOR THE YEARS ENDED MAY 31, 2007 AND 2006 2007 2006 ------------ ------------ Revenues Net Sales $ - $ - Cost of Sales (110) (220) ------------ ------------ Gross Profit (110) (220) ------------ ------------ Other Operating Expenses General and administrative 185,891 54,953 Amortization - - ------------ ------------ Total Operating Expenses 185,891 54,953 ------------ ------------ Loss from Operations (186,001) (55,173) ------------ ------------ Other Income (Expense) Interest expense (4,695) (119) Loss on disposal of asset - (235,829) Gain on debt write off per Bankruptcy Order 67,745 - ------------ ------------ Net Other Expense 63,050 (235,948) ------------ ------------ Net Income (Loss) $ (122,951) $ (291,121) ============ ============ Basic and Diluted Loss Per Share $ (.002) $ (.006) ============ ============ Weighted Average Shares Outstanding 54,202,662 49,955,112 ============ ============ The accompanying notes are an integral part of these financial statements. F-4 ECOM ECOM.COM, INC. STATEMENTS OF SHAREHOLDERS' DEFICIT FROM MAY 31, 2004, THROUGH MAY 31, 2007 ---------- Common Stock ----------- Number At Add'l Total of Par Paid In Accumulated Stockholder Shares Value Capital (Deficit) (Deficit) ---------- ------ ------- ------------ ----------- Consolidated Balance at May 31, 2004 49,955,112 $4,995 $6,579,537 $(7,053,112) $(468,580) Elimination of Subsidiaries Consolidated Losses at Spin Off (see Note I) - - (10,000) 187,925 177,925 Assets Distributed as Dividends at Spin Off (see Note I) - - - (96,124) (96,124) Net Loss - - - (131,463) (131,463) ---------- ------ ---------- ----------- ----------- Balance, May 31, 2005 49,955,112 4,995 6,569,537 (7,092,774) (518,242) Net Loss - - - (291,121) (291,121) ---------- ------ --------- ----------- ---------- Balance, May 31, 2006 49,955,112 4,995 6,569,537 (7,383,895) (809,363) Stock issued per Bankrupcty order 39,752,709 3,975 789,746 - 793,721 Dated 3/23/07 Net Loss - - - (122,951) (122,951) ---------- ------ --------- ----------- ---------- Balance, May 31, 2007 89,707,821 $8,970 $7,359,283 $(7,506,846) $ (138,593) =========== ======= ========= =========== ========== The accompanying notes are an integral part of these financial statements. F-5 ECOM ECOM.COM, INC. STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED MAY 31, 2007 and 2006 2007 2006 ---------- ---------- Cash Flows From Operating Activities Cash received from customers $ - $ - Interest income - - Cash paid to suppliers and employees (108,972) (116,585) Interest paid - (119) Income taxes paid - - ---------- --------- Net Cash Flows Used in Operating Activities (108,972) (116,704) ---------- --------- Cash Flows Provided By (Used In) Investing Activities - - Cash Flows From Financing Activities Proceeds from New Loans 129,000 117,212 Proceeds of loans from Related Entities 26,242 - Repayment of loans (46,687) - ---------- --------- Net Cash Flows Provided By Financing Activities 108,555 117,212 ---------- --------- Net Increase (Decrease) in Cash (417) 508 Cash and Cash Equivalents at Beginning of Year 508 - ---------- --------- Cash and Cash Equivalents at End of Year $ 91 $ 508 ========== ========== The accompanying notes are an integral part of these financial statements. F-6 ECOM ECOM.COM, INC. STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED MAY 31, 2007 and 2006 2007 2006 ---------- ---------- Supplemental Schedule of Non-Cash Financing Activities Dividends were paid by the distribution of certain assets to the various spin-off companies $ - $ - Reconciliation of Net Loss to Net Cash Flows Used in Operating Account Net Loss $ (122,951) $ (291,121) Add items not requiring outlay of cash: Depreciation and amortization 110 220 Write off of Related Party Notes Receivable - 225,966 Discharge of Notes Payable (676,638) - Stock issued for payment of discharged debt 793,721 - Cash was increased by: Decrease in prepaid expenses 64,432 - Cash was decreased by: Increase in prepaid assets - (51,101) Decrease in accounts payable (89,303) (668) Decrease in accrued expenses (50,534) - Decrease in accrued interest payable (27,809) ---------- ---------- Net Cash Flows Used in Operating Activities $ (108,972) $ (116,704) ========== ========== The accompanying notes are an integral part of these financial statements. F-7 ECOM ECOM.COM, INC. NOTES TO FINANCIAL STATEMENTS NOTE A - NATURE OF OPERATIONS eCom eCom.com, Inc. ("eCom" or "the Company") was incorporated in the State of Florida on June 14, 1994. During the fiscal year ending May 31, 2005 eCom focused on separating all ten of its current business segments, USA SportsNet, Inc., USA Performance Products, Inc., eSecureSoft Corp., USAS Digital, Inc., Pro Card Corporation, AAB National Company, A Classified Ad, Inc., Swap and Shop.net Corp., A Super Deal.com, Inc. and MyZipSoft, Inc. This plan was undertaken for the purposes of allowing the management and employees the opportunity to operate each segment independently. Also, to have the ability for each segment, to raise its own funding for growth and expansion. On June 4, 2004 the Company spun-off each of the above listed companies into separate public companies. On December 1, 2003, the Board of Directors of eCom approved the spin-off of eCom's ten (10) operating subsidiary companies, pursuant to SEC Staff Legal Bulletin No. 4. On December 18, 2003, USA SportsNet, Inc. entered into a definitive Asset Acquisition Agreement with American Capital Holdings, Inc., ("ACHI") The Date of Record for the first spin-off, USA SportsNet, Inc. (later renamed American Capital Holdings, Inc., Cusip No. 02503V 10 9/SEC CIK No. 0001288010)was January 5, 2004. The Date of Record for the second spin-off, MyZipSoft, Inc. (Standard & Poor's Cusip No. 628703 10 0/SEC CIK No. 0001290785) was February 23, 2004, and the shares of MyZipSoft were distributed to its shareholders on June 2, 2005. On March 2, 2004, the Board of Directors of eCom approved the spin off of the remaining eight (8) spin off companies in which the Board of Directors voted to issue to their shareholders one (1) share of the company for every one (1) share of eCom owned with a record date to be announced, pursuant to the advice of SEC Staff Legal Bulletin No. 4. Due to the dilemma caused as a direct result of Mr. Panaia's refusal to address the monies advanced to eCom by American Capital, on November 22, 2004, Barney A. Richmond resigned as an Officer and Director of eCom. On November 29, 2004 an involuntary petition was filed against eCom eCom.com, Inc. in the United States Southern District Bankruptcy Court (In Re: Case No. 04-34535 BKC-SHF)under Title 11, Chapter 11 of the United States Bankruptcy Code by petitioning creditors, American Capital Holdings, Inc., Richard Turner, Barney A. Richmond, and ACHI, Inc. The Bankruptcy proceedings were initiated in an effort to implement a viable plan for reimbursement of costs incurred by American Capital Holdings, Inc., the petitioning creditors, and all other creditors/vendors who have not been paid. Most importantly, the proceedings will enable Mr. Richmond to initiate reorganization plans in an effort to restore the shareholder value lost by approximately 6,000 shareholders. The aforementioned creditors are owed in excess of $1 million dollars. A copy of the June 2, 2005 Chapter 11, Title 11 Amended Involuntary Petition of eCom is posted on eCom's website, www.ecomecom.net. A detailed history is available on eCom eCom.com's 10K-SB filing at May 31, 2006. F-8 ECOM ECOM.COM, INC. NOTES TO FINANCIAL STATEMENTS NOTE A - NATURE OF OPERATIONS - (CONTINUED) On August 18, 2006 the 'Joint Plan of Reorganization of Debtor and American Capital Holdings, Inc.' was filed with the United States Southern District Bankruptcy Court. On August 25, 2006 the accompanying 'Disclosure Statement for Joint Plan of Reorganization of Debtor and American Capital Holdings, Inc.' was filed with the U.S. Bankruptcy Court. On December 28, 2006 the 'First Amended Joint Plan of Reorganization of Debtor and American Capital Holdings, Inc.' and 'First Amended Disclosure Statement for First Amended Joint Plan of Reorganization of Debtor and American Capital Holdings, Inc.' were filed with the Unites States Bankruptcy Court, Southern District of Florida, West Palm Beach Division, see exhibits 99.1 and 99.2. The plan, which is subject to Bankruptcy Court approval, calls for the issuance of Thirty One Million Five Hundred Ninety Three Thousand Sixty Four (39,752,709) Common Shares to the Creditors listed in Exhibit "A" of the Plan. It is the intent of American Capital Holdings, Inc., if the Plan of Reorganization is confirmed by the Bankruptcy Court, to distribute Twenty Three Million Two Hundred Eight Thousand Three Hundred Eight One (23,280,381) common shares as a dividend to American Capital Holdings, Inc's shareholders. The proposed date of record for this proposed stock dividend, which is subject to Bankruptcy Court approval, will be five (5) business days subsequent to the Plan of Reorganization's final hearing by the Bankruptcy Court. Prior to the distribution of the eCom shares, American Capital Holdings is going to verify that it is not deemed an underwriter by the SEC. If American Capital Holdings is deemed to be an underwriter of securities, additional registrations may be required which could delay the stock distribution. A transcript of the March 12, 2007 confirmation hearing is attached as Exhibit 99.1. The Order Confirming the First Amended Joint Plan of Reorganization of Debtor and American Capital Holdings, Inc. as Modified was signed by Judge Friedman on March 23, 2007 and is attached as Exhibit 99.2. This order may also be viewed at the eCom website www.ecomecom.net under the bankruptcy link. A post confirmation status conference is scheduled for Wednesday May 9, 2007 at 1:30 pm at 1515 North Flagler Drive, Room 801, West Palm Beach, Florida. The Company does not have any off-balance sheet arrangements. Employees. The Company has no employees. NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation, Use of Estimates The Company maintains its accounts on the accrual basis of accounting. The preparation of financial statements in conformity with U.S. generally accepted contingent assets and liabilities at the date of the financial statements and F-9 ECOM ECOM.COM, INC. NOTES TO FINANCIAL STATEMENTS NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Reclassification Certain reclassifications have been made to the prior years financial statements in order for them to be in conformity with the current years presentations. Revenue Recognition Revenue from the sale of compression products is also recognized at the time the products are shipped or downloaded. Cash Cash consists of deposits in banks and other financial institutions having original maturities of less than ninety days. Allowance for Doubtful Accounts It is the policy of management to review the outstanding accounts receivable at year end, as well as the bad debt write-offs experienced in the past, and establish an allowance for doubtful accounts for uncollectible amounts. Depreciation Property and equipment is recorded at cost and is depreciated over the estimated useful lives of the related assets. Depreciation is computed using the straight-line method. Amortization Intangible assets are amortized over the assets estimated useful life using the straight-line method. Inventories Inventories are stated at the lower of cost or market using the first in first out method. NOTE C - PREPAID EXPENSES Prepaid expenses consist principally of amounts paid for subscriptions and domain name registrations. The Company paid its attorney a retainer of $65,000 in 2005 for representation as bankruptcy counsel. The balance of $595 at May 31, 2007 is for domain name registrations and money held by eCom's attorney for settlement to one equity holder who filed a claim against the company. F-10 ECOM ECOM.COM, INC. NOTES TO FINANCIAL STATEMENTS NOTE D - PROPERTY AND EQUIPMENT The following is a summary of property and equipment recorded in the financial statements at cost less depreciation as of May 31, 2007 and May 31, 2006: May 31, 2007 May 31, 2006 -------------- -------------- Computer hardware $ 85,074 $ 85,074 Computer software 13,633 13,633 Furniture, fixtures and equipment 4,330 4,330 --------- --------- Total cost 103,037 103,037 Accumulated depreciation 103,037 102,928 --------- --------- Net Property and Equipment $ - $ 109 ========= ========= Depreciation expense included in the cost of sales for the years ended are: $ 110 $ 220 ========= ========= The useful lives assigned to property and equipment to compute depreciation are: Computer Hardware 5 years Computer Software 5 years Furniture, fixtures and equipment 7 years Tools, dies and fixtures 5 years NOTE E - OTHER ASSETS There are no remaining other assets, other assets consisted primarily of security deposits on the lease of office facilities and utility deposits. NOTE F - LOANS FROM RELATED PARTIES, CURRENT PORTION The non-interest bearing short term loans due on demand from related parties post petition, not subject to compromise, and prepetition, subject to compromise, at May 31, 2007 and May 31, 2006 are as follows: 2007 2006 ------------ ------------ Post petition $ 124,739 $ 140,693 Prepetition 534,909 ---------- ---------- Total Loans from Related Parties $ 124,739 $ 675,602 ========== ========== The prepetition liabilities and related party debt at May 31, 2006 was reduced either by the issuance of the Companies common stock, paid or settled in accordance with the Chapter 11 reorganization plan approved by the Bankruptcy Court on March 23, 2007. F-11 ECOM ECOM.COM, INC. NOTES TO FINANCIAL STATEMENTS NOTE G - RECLASSIFICATION OF FINANCIAL STATEMENT PRESENTATION Certain reclassifications have been made to the prior years financial statements in order for them to be in conformity with the current years presentation. NOTE H - COST OF SALES Included in the cost of sales are the following: May 31, 2007 May 31, 2006 -------------- -------------- Depreciation 110 220 -------------- -------------- Total $ 110 $ 220 ============== ============== Shipping income $ 0 $ 0 ============== ============== NOTE I - COMMITMENTS AND CONTINGENCIES The Company maintains office facilities leased by American Capital Holdings, Inc. American Capital Holdings has not charged any rent to eCom eCom.com during the Years ending May 31, 2007 and 2006. On November 29, 2004, an involuntary petition was filed against eCom eCom.com, Inc. in the United States Southern District Bankruptcy Court (In Re: Case No. 04-34535 BKC-SHF)under Title 11, Chapter 11 of the United States Bankruptcy Code by petitioning creditors, American Capital Holdings, Inc., Richard Turner, Barney A. Richmond, and ACHI, Inc. The Bankruptcy proceedings were initiated in an effort to restore the shareholder value lost by approximately 6,000+ shareholders as well as implement a viable plan for reimbursement of costs incurred by American Capital Holdings, Inc., the petitioning creditors, and all other creditors/vendors who have not been paid. The aforementioned creditors were owed in excess of $1 million dollars. A copy of the June 2, 2005 Chapter 11, Title 11 Amended Involuntary Petition of eCom is posted on the eCom website, www.ecomecom.net. NOTE J - RELATED PARTY TRANSACTIONS The Company has received cash advances from David J. Panaia, Chairman and CEO of the Company, until he passed away on March 20, 2005, in varying amounts and at various times subsequent to the inception of the Company. These shareholder loans were non-collateralized and due on demand. On May 10, 2001, 1,286,359 shares of restricted stock were issued to Mr. Panaia, CEO in return for cancellation of $437,362 of the debt owed to him. F-12 ECOM ECOM.COM, INC. NOTES TO FINANCIAL STATEMENTS NOTE J - RELATED PARTY TRANSACTIONS - (CONTINUED) The amount of stockholder loans that were reduced was based on the quoted market price ($.68) on the date the common shares were issued and adjusted by a discount of 50% due to the restrictions placed on the stock. The entire amount of stockholder loans due Mr. Panaia was discharged by the bankruptcy court and distributed to the Estate of David J. Panaia on April 23, 2005 in return for the issuance of 7,500,000 shares of common stock. The balance owed to Mr. Panaia and his estate at May 31, 2007 and May 31, 2006 is $0 and $395,640 respectively. The Company has received cash advances from Richard Turner, CFO of the Company, in varying amounts and at various times subsequent to September 1, 2001. These related party loans were non-collateralized and due on demand. The interest portion of these notes has stopped accruing interest after the company was adjudicated bankrupt. The balance owed Mr. Turner of $140,233 was discharged by the bankruptcy court for the issuance of 5,393,579 shares of common stock at the agreed upon price of $.026 per share. The balance owed to Mr. Turner as of May 31, 2007 is $3,793. As part of the debtor-in-possession financing, eCom received $100,000 in financing from American Capital Holdings on June 8, 2005 and an additional $15,186 on July 25, 2005. The balance owed American Capital was discharged by the bankruptcy court for the issuance of 23,795,237 shares of common stock. NOTE K - BUSINESS SEGMENTS As of May 31, 2007 the company no longer had consolidated business segments. The Paintball segment has been distributed to USA Performance Products, Inc., the software segment has been distributed to eSecureSoft Company on June 4, 2004. NOTE L - RECOVERABILITY OF ASSETS AND GOING CONCERN These financial statements are presented on the basis that the Company is a going concern. Going concern contemplates the realization of assets and the satisfaction of liabilities in the normal course of business over a reasonable length of time. The accompanying financial statements show that current liabilities exceed current assets by approximately $139,000 at May 31, 2007 and by approximately $809,000 at May 31, 2006 and that the Company has incurred net operating losses since inception. It is current managements intention to receive a final order from the Bankruptcy Court and have the Company came out of Bankruptcy using the provisions of fresh start accounting and then acquire an operating company in order to provide value for the current stockholders. NOTE M - INCOME TAXES Deferred income taxes are provided for temporary differences between the financial reporting and income tax basis of the Company's assets and liabilities. Temporary differences, net operating loss carry forwards and valuation allowances comprising the net deferred taxes on the balance sheets is as follows: F-13 ECOM ECOM.COM, INC. NOTES TO FINANCIAL STATEMENTS NOTE M - INCOME TAXES - (CONTINUED) May 31, 2007 -------------- Loss carry forward for tax purposes $ 7,000,000 ============== Deferred tax asset (34%) 2,380,000 Valuation allowance (2,380,000) -------------- Net deferred tax asset - ============== Through May 31, 2007, the Company had a federal income tax net operating loss carry forward of approximately $7,000,000 which will expire through the year 2023. No provision for federal and state income taxes has been recorded because the Company has incurred net operating losses since inception. The Company's net operating loss carry-forward as of May 31, 2007 was approximately $7,000,000. These carry-forwards, which will be available to offset future taxable income, will expire between the years 2009 and 2026. The Company does not believe that the realization of the related net deferred tax asset meets the criteria required by generally accepted accounting principles and, accordingly, the deferred income tax asset arising from such loss carry forward has been fully reserved. NOTE N - EFFECTS OF INFLATION To date, inflation has not had a material impact on the Company's financial results. NOTE O - RECENT ACCOUNTING PRONOUNCEMENTS The FASB issued SFAS No. 150, Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity, and is effective for financial instruments entered into after May 31, 2003. This Statement establishes standards for how an issuer classifies and measures in its statement of financial position certain financial instruments with characteristics of both liabilities and equity. It requires that an issuer classify a financial instrument that is within its scope as a liability because that financial instrument embodies an obligation of the issuer. Statement of Financial Accounting Standards No. 151, Inventory Costs, is an amendment of ARB No. 43, Chapter 4 and is effective for inventory costs incurred during fiscal years beginning after June 15, 2005. This statement amends ARB 43, Chapter 4, to clarify that abnormal amounts of idle facility expense, freight, handling costs, and wasted materials (spoilage) should be recognized as current-period charges. In addition, this Statement requires that allocation of fixed production overheads to the costs of conversion be based on the normal capacity of the production facilities. F-14 ECOM ECOM.COM, INC. NOTES TO FINANCIAL STATEMENTS NOTE O - RECENT ACCOUNTING PRONOUNCEMENTS - (CONTINUED) Statement of Financial Accounting Standards No. 152, Accounting for Real Estate Time-Sharing Transactions, is an amendment of FASB Statements No. 66 and 67. Statement of Financial Accounting Standards No. 153, Exchanges of Nonmonetary Assets, was issued in December 2004. The guidance in APB No. 29, Accounting for Nonmonetary Transactions, is based on the principle that exchanges of nonmonetary assets should be measured based on the fair value of the assets exchanged. The guidance in that Opinion, however, included certain exceptions to that principle. This Statement amends Opinion 29 to eliminate the exception for nonmonetary exchanges of similar productive assets and replaces it with a general exception for exchanges of nonmonetary assets that do not have commercial substance. A nonmonetary exchange has commercial substance if the future cash flows of the entity are expected to change significantly as a result of the exchange. Statement of Financial Accounting Standards No. 154, Accounting Changes and Error Corrections, was issued in May 2005. This Statement requires retrospective application to prior periods' financial statements of changes in accounting principle, unless it is impracticable to determine either the period- specific effects or the cumulative effect of the change. When it is impracticable to determine the period-specific effects of an accounting change on one or more individual prior periods presented, this Statement requires that the new accounting principle be applied to the balances of assets and liabilities as of the beginning of the earliest period for which retrospective application is practicable and that a corresponding adjustment be made to the opening balance of retained earnings (or other appropriate components of equity or net assets in the statement of financial position) for that period rather than being reported in an income statement. When it is impracticable to determine the cumulative effect of applying a change in accounting principle to all prior periods, this Statement requires that the new accounting principle be applied as if it were adopted prospectively from the earliest date practicable. This Statement requires that retrospective application of a change in accounting principle be limited to the direct effects of the change. Indirect effects of a change in accounting principle, such as a change in nondiscretionary profit- sharing payments resulting from an accounting change, should be recognized in the period of the accounting change. This Statement also requires that a change in depreciation, amortization, or depletion method for long-lived, nonfinancial assets be accounted for as a change in accounting estimate by a change in accounting principle. This Statement carries forward without change the guidance contained in Opinion 20 for reporting the correction of an error in previously issued financial statements and a change in accounting estimate. This Statement also carries forward the guidance in Opinion 20 requiring justification of a change in accounting principle on the basis of preferability. Statement of Financial Accounting Standards No. 155, Accounting for Certain Hybrid Financial Instruments, was issued in February 2006. This Statement permits fair value remeasurement for any hybrid financial instrument that contains an embedded derivative that otherwise would require bifurcation; F-15 ECOM ECOM.COM, INC. NOTES TO FINANCIAL STATEMENTS NOTE O - RECENT ACCOUNTING PRONOUNCEMENTS - (CONTINUED) clarifies which interest-only strips and principle-only strips are not subject to the requirements of Statement 133; establishes a requirement to evaluate interests in securitized financial assets to identify interests that are freestanding derivatives or that are hybrid financial instruments that contain an embedded derivative requiring bifurcation; clarifies that concentrations of credit risk in the form of subordination are not embedded derivatives, and amends Statement 140 to eliminate the prohibition on a qualifying special- purpose entity from holding a derivative financial instrument that pertains to a beneficial interest other than another derivative financial instrument. Statement of Financial Accounting Standards No. 156, Accounting for Servicing of Financial Assets, was issued in March 2006. This Statement requires an entity to recognize a servicing asset, a contract to service financial assets under which the estimated future revenues from contractually specified servicing fees, late charges, and other ancillary revenues are expected to more than adequately compensate the servicer for performing the servicing, or servicing liability, a contract to service financial assets under which the estimated future revenues from contractually specified servicing fees, late charges, and other ancillary revenues are not expected to adequately compensate the servicer for performing the servicing, each time it undertakes an obligation to service a financial asset by entering into a servicing contract. SFAS No's. 150, 151, 152, 153, 154, 155 and 156 were adopted by the company and did not have a material effect on the Company's financial position or results of operations. Special Note Regarding Forward-Looking Statements Certain statements in this report and elsewhere (such as in other filings by the Company with the Securities and Exchange Commission ("SEC"), press releases, presentations by the Company or its management and oral statements) may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," and "should," and variations of these words and similar expressions, are intended to identify these forward-looking statements. The Company's actual results could differ materially from those anticipated in these forward-looking statements. Factors that might cause or contribute to such differences include, among others, competitive pressures, the success of management in identifying acquisition candidates or in raising additional capital. The Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements, which may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. F-16 ECOM ECOM.COM, INC. ITEM 8. DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURES None. ITEM 8A. CONTROLS AND PROCEDURES. EVALUATION OF THE COMPANY'S DISCLOSURE CONTROLS AND INTERNAL CONTROLS: Within the 90 days prior to the date of this Report on Form 10-KSB, the Company evaluated the effectiveness of the design and operation of its 'disclosure controls and procedures'("Disclosure Controls"). This 'evaluation' ("Controls Evaluation") was done under the supervision and with the participation of management, including the Chief Executive Officer/Chairman ("CEO")and Chief Financial Officer ("CFO"). As a result of this review, the Company adopted guidelines concerning disclosure controls and the establishment of a disclosure control committee made up of senior management. LIMITATIONS ON THE EFFECTIVENESS OF CONTROLS: The Company's management, including the CEO/CHAIRMAN and CFO, does not expect that its Disclosure Controls or its 'internal controls and procedures for financial reporting' ("Internal Controls") will prevent all error and all fraud. Control system, no matter how well conceived and managed, can provide only reasonable assurance that the objectives of the control system are met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, control may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost- effective control system, misstatements due to error or fraud may occur and not be detected. CONCLUSIONS: Based upon the Controls Evaluation, the CEO/CHAIRMAN and CFO have concluded that, subject to the limitations noted above, the Disclosure Controls are effective to timely alert management to material information relating to the Company during the period when its periodic reports are being prepared. 26 ECOM ECOM.COM, INC. PART III ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; (1) Officers serve at the pleasure of the Company's Board of Directors. (2) Each of these Directors was elected to serve until the next Annual Meeting of Shareholders. The Company has no plans to hold its next annual meeting. The Board of Directors sets corporate policies that are implemented by the Company's management. In the event that the Board of Directors determines that a member faces a conflict of interest, for any reason, it is expected that the subject director will abstain from voting on the matter that raised the issue. Barney A. Richmond, 55, has been President and a Director of the Company since March 2004. He is also President and a Director of American Capital Holdings and the other nine (9) eCom spin-off companies. From 1985 to the present, Mr. Richmond has been an independent advisor and investor in assisting companies, as well as individuals, regarding public offerings, mergers, reverse mergers and a variety of corporate financing issues. Mr. Richmond has also been an investor in numerous reorganizations and business turnarounds, including many substantial bankruptcy reorganizations. Mr. Richmond has been a member of the Boards of Directors of The Richmond Company, Inc., Benny Richmond, Inc., 877 Management Corporation, King Technologies, Inc., King Radio Corporation, United States Financial Group, Inc., JSV Acquisition Corporation, Chase Capital, Inc, Berkshire International, Inc. and Dunhall Pharmaceuticals, Inc. Richard C. Turner, 47, who started with the Company in June of 2001 as Chief Financial Officer, Treasurer and Director, worked with Glenn G. Schanel, CPA, from September 1990 until his appointment with eCom. Mr. Turner specialized in assisting clients with accounting, tax and office technology issues. A 1981 graduate of Rutgers University, Mr. Turner attended graduate school at New York University until 1989. From May 1989 until September 1990 Mr. Turner served as Vice President of Finance at First American Bank, Lake Worth, Florida, where he was responsible for the bank's financial reporting, budgeting and cost accounting. Mr. Turner has served as Treasurer and as a member of the board of directors of both the Palm Beach Business Associates and the North Palm Beach / Palm Beach Gardens Jaycees. He concentrates full time on his duties as Chief Financial Officer of eCom, American Capital Holdings and the other nine (9) spin-off companies. The bylaws provide for indemnification of officers, directors or eCom agents against legal expenses, judgments, fines, settlements and other amounts reasonably incurred by such persons after having been made or threatened to be made a party to legal action. Payment of such amounts may also be made in advance if expenses are likely to be incurred by officers, directors or agents in defense of any such action. The extent, amount and eligibility for the indemnification provided will be determined by the Board of Directors. These indemnifications will be made by a majority vote of a quorum of directors, including any director who is a party to such action, suit, or proceeding or by the shareholders by a majority vote of a quorum of shareholders including any shareholder who is a party to such action, suit or proceeding. The Company is further authorized by the bylaws to purchase insurance for indemnification of any person as provided by the bylaws and to the extent provided by Florida law. The Company at this time has no insurance coverage for officers and directors and has not expended any funds to obtain such 27 ECOM ECOM.COM, INC. ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; (CONTINUED) insurance policies to insure or indemnify directors or officers against any liabilities that may occur. Management reserves the right to obtain such insurance. Florida Statutes Section 607.0850 authorizes indemnification of officers, directors, employees and agents in instances constituting: (1) certain violations of criminal law which the person did not know were illegal, or (2) actions taken in good faith by persons which were intended to be in the best interests of the corporation. Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the "Act") may be permitted to directors, officers and controlling persons of eCom pursuant to the foregoing provisions or otherwise, the Company have been advised that in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by eCom of expenses incurred or paid by a director, officer or controlling person of eCom in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Company will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by eCom is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. 28 ECOM ECOM.COM,INC. ITEM 10. EXECUTIVE COMPENSATION The following table provides information regarding the executive compensation of persons serving as eCom's executive officers during the fiscal years ended 2007, 2006 and 2005. Summary Compensation Table Long Term Compensation Annual Compensation Awards Payouts Securities Other Restr. Underlying All Annual Stock Options/ Other Name and Principal Compen- Awards SARs LTIP Compen- Position Year Salary Bonus sation # Shares # Shrs Payouts sation Barney A Richmond 2007 0 0 0 - 0 0 0 President 2006 0 0 0 - 0 0 0 2005 0 0 0 - 0 0 0 Richard C. Turner 2007 0 0 0 - 0 0 0 CFO and Treasurer 2006 0 0 0 - 0 0 0 2005 0 0 0 - 0 0 0 David J. Panaia 2005 0 0 0 - 0 0 0 ex-Chairman, CEO Peter Tamayo, Jr. 2005 0 0 0 - 0 0 0 CTO Robert C. Wilson 2005 0 0 0 - 0 0 0 ex-President Distributions from the bankruptcy proceeding included distributions the the officers of the Company as follows: On April 23, 2007, the Company issued 5,393,579 shares to Richard C. Turner as settlement of an unpaid bankruptcy claims of $140,233. These shares are held in escrow by the Company and will not be distributed until after the final bankruptcy hearing. On April 23, 2007, the Company issued 1,153,846 shares to Barney A. Richmond as settlement of an unpaid bankruptcy claim of $30,000. These shares are held in escrow by the Company and will not be distributed until after the final bankruptcy hearing. None of eCom's current executive officers has an employment agreement or stock option arrangement with eCom. It is intended that the directors be compensated at the rate of $4,000 per year, plus $100.00 per meeting attended and reasonable travel expenses if cash flow permits. 29 ECOM ECOM.COM,INC. ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT As of the date of this report, the Company has a total of 200,000,000 shares of Common Stock authorized at a par value of $.0001, and there are 89,707,821 shares of Common Stock outstanding. The following table sets forth information, as of such date, with respect to the beneficial ownership of Common Stock by (a) each person known by us to be the beneficial owner of more than 5% of the outstanding Common Stock, (b) the directors and officers Number of % of Shares Name and Address Shares Owned Outstanding ---------------- ------------ ----------- Estate of David J. Panaia (1) 15,687,459 17.5 Palm Beach Gardens, FL Richard C. Turner 10,112,979 11.3 Palm Beach Gardens, FL Barney A. Richmond 1,153,846 1.3 Jupiter, FL American Capital Holdings 23,795,237 26.5 Jupiter, FL All Officers and 11,266,825 12.6 Directors as a Group 2 persons (1) David J. Panaia, an officer and director of the Company, passed away on March 20, 2005, was the beneficial owner of 400,000 shares held in the name of the Panaia Family Trust and 41,500 shares held in the name of Barbara Panaia, wife of David Panaia. On April 23, 2007 7,500,000 shares were issued to the estate of David J. Panaia. ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS Certain transactions to which the Company is a party and certain matters affecting it have or will result in a material benefit to certain of the directors and executive officers, or may create conflicts of interest, as follows: On April 23, 2007, the Company issued 23,795,237 shares to American Capital Holdings, Inc. as settlement of an unpaid bankruptcy claim of $618,676. (1) On April 23, 2007, the Company issued 5,393,579 shares to Richard C. Turner as settlement of an unpaid bankruptcy claims of $140,233. (1) On April 23, 2007, the Company issued 1,153,846 shares to Barney A. Richmond as settlement of an unpaid bankruptcy claim of $30,000. (1) On April 23, 2007, the Company issued 708,943 shares to Sherry L. Cherrix as settlement of an unpaid bankruptcy claim of 18,433. (1) 30 ECOM ECOM.COM,INC. ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS - CONTINUED On April 23, 2007, the Company issued 7,500,000 shares to the Estate of David Panaia as settlement of an unpaid bankruptcy claim of $395,640. On April 23, 2007, the Company issued 358,680 shares to MeVis Technologies as settlement of an unpaid claim of $9,325.69. On April 23, 2007, the Company issued 842,424 to Quentin Partners as compensation for a bankruptcy claim on unpaid rent of 21,903.02. (1) As of the date of this report these shares are being held by the company until after the final bankruptcy hearing, currently scheduled for September 10, 2007. Except as described above, no director, officer or principal security holder of eCom has or has had a direct or indirect material interest in any transaction to which the Company is or was a party. The Company believes that the terms of each of the transactions described above were no less favorable to us than could have been obtained from third parties. However, it should be noted that all restricted stock issuances to affiliates are made at a 50% discount from the then market value of the Common Stock. In addition, in the future the Company will not enter into additional transactions with directors, officers or principal shareholders unless the terms thereof are no less favorable to us than could be obtained from third parties. ITEM 13. EXHIBITS, FINANCIAL STATEMENTS AND REPORTS ON FORM 8-K (a) Index to financial statements and financial statement schedules The audited balance sheets of the Company as of May 31, 2007 and 2006 and the related statements of operations, stockholders' equity and cash flows for the years ended May 31, 2007 and 2006 appear in sequentially numbered pages F-1 through F-19 - ITEM &. FINANCIAL STATEMENTS. The page numbers for the financial statement categories are as follows: Page Description F-2 Report of Independent Registered Public Accounting Firm - May 31, 2007 and 2006 F-3 Balance Sheets as of May 31, 2007 and 2006 F-4 Statements of Operations for the Years Ended May 31, 2007 and 2006 F-5 Statement of Shareholders' Deficit for the Years Ended May 31,2007 and 2006 F-6 Statements of Cash Flows for the Years Ended May 31, 2007 and 2006 F-8 Notes to Financial Statements (b) Reports on Form 8-K Form 8-K filed August 22, 2006 accession number 0001000459-06-000003 stating: On August 18, 2006 the 'Joint Plan of Reorganization of Debtor and American Capital Holdings, Inc.' was filed with the United States Southern District Bankruptcy Court. 31 ECOM ECOM.COM,INC. ITEM 13. EXHIBITS, FINANCIAL STATEMENTS AND REPORTS ON FORM 8-K (CONTINUED) Form 8-K filed August 25, 2006 accession number 0001000459-06-000004 stating: On August 25, 2006 the 'Disclosure Statement for Joint Plan of Reorganization of Debtor and American Capital Holdings, Inc.' was filed with the U.S. Bankruptcy Court. Form 8-K filed November 30, 2006 accession number 0001000459-06-000009 stating: A former subsidiary of eCom eCom.com, Inc. formerly known as Pro Card Corporation, now renamed Green Energy Group, Inc. issued a Form 8K with the Securities and Exchange Commission on November 30, 2006. Green Energy's 8K announced that on November 22, 2006, Green Gnergy Group, Inc. has entered into a Purchase Agreement with Tri- States Petroleum Products, LLC. Form 8-K filed March 28, 2007 accession number 0001000459-07-000004 stating: On March 12, 2007, an Order confirming eCom eCom.com's "eCom") Disclosure Statement and Reorganization Plan in the United States Florida Southern District Bankruptcy Court in re: Case No. 04-35435 was entered by the Honorable Judge Steven H. Friedman. The March 12, 2007 Court Transcript was filed with the Clerk of Florida Southern District Bankruptcy Court on March 27, 2007. A copy of this transcript can be reviewed at ecomecom.net under the title of "Bankruptcy News Information". Form 8-K filed March 30, 2007 accession number 0001000459-07-000006 stating: On March 23, 2007 an Order Confirming First Amended Joint Plan of Reorganization of Debtor and American Capital Holdings, Inc. was issued by the Honorable Judge Steven H. Friedman of the United States Florida Southern District Bankruptcy Court re: Case No. 04-35435. A copy of this March 23, 2007 order can be viewed at www.ecomecom.net under the "Bankruptcy News Information" link. (c) Exhibits: 3.1 Articles of Incorporation (1) 3.2 By-laws (1) 10.1 Agreement for acquisition of assets of Performance Paintball Products Inc. (1) 10.2 Agreement of acquisition of rights to All American Bowl (2) 10.3 Personal services agreement with All American Bowl Executive Director (2) 10.4 Promissory Note to Stratex Corporation dated August 12, 1997 (3) 10.5 Marketing and Management Agreement between Axis Enterprises, Ltd. and Registrant dated January 10, 1998 (3) 32 ECOM ECOM.COM,INC. ITEM 13. EXHIBITS, FINANCIAL STATEMENTS AND REPORTS ON FORM 8-K (CONTINUED) 10.6 Agreement for acquisition of assets of Amateur Athletes of America, Inc. (3) 10.7 Lease Agreement between Ryco Properties, Inc. and Registrant dated May 4, 1998 (3) 10.8 Investment Agreement between Swartz Private Capital LLC and the Registrant dated May 13, 1999 (4) 10.9 Registration Rights Agreement between Swartz Private Capital LLC and the Registrant dated May 13, 1999 (4) 10.10 Side Agreement (4) 10.11 Amended and Restated Investment Agreement between Swartz Private Capital LLC and the Registrant dated July 1999 (5) 10.12 Memorandum dated September 13, 1999 from Swartz Private Capital LLC extending date to file registration statement (5) 10.13 First Stock Incentive Plan (5) 10.14 Occupancy Agreement between Chimney Rock Services, LLC and Registrant dated September 15, 1999 (6) 10.15 License Agreement between iTool.com and Registrant dated December 20, 1999 (6) 10.16 Stock Exchange Agreement between the shareholders of Star Dot Marketing, Inc. and Registrant dated January 21, 2000 (7) 10.17 Service Agreement between eWebPEO.com, Inc. and Registrant dated March 25, 2000 (6) 10.18 Consulting and Compensation Agreement between eWebPEO.com, Inc. and Registrant dated April 16, 2000 (6) 10.19 Agreement of Sale between US Amateur Sports Company and Eugenio Postorivo Jr., Individually, dated May 11, 2001 (8) 10.20 Stock Purchase Agreement between the Company and Brian Delaporta, Individually, dated May 31, 2001 (9) 10.21 Addendum to Advance Balance Acknowledgement dated May 31, 2001 (9) 10.22 Strategic Marketing and Sales Agreement between BIFS Technologies Corporation and the Registrant dated March 19, 2001 (10) 10.23 Operating Agreement for ZyndeCom, Inc. dated August 20, 2001 (10) 10.24 Board of Directors approves the spin-off of the remaining Subsidiaries (11) 10.25 Barney A Richmond appointed President of eCom eCom.com Inc. (12) 10.26 On March 29, 2004, David Panaia prepared and issued a Press Release(13) Announcing the appointment of Barney A. Richmond as President of eCom. 10.27 List of Shareholders as of May 31, 2005 who received spinoff shares and corresponding Certified Mail numbers of Share Certificates mailed May 31, 2005. (13) 10.28 Court Orders from Involuntary Bankruptcy Petition of eComeCom.com, Inc. (13:exhibit 99.3) 11 Statement of Computation of Earnings per Share 31.1 Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 31.2 Certification of Chief Financial Officer 32 Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 33 ECOM ECOM.COM,INC. ITEM 13. EXHIBITS, FINANCIAL STATEMENTS AND REPORTS ON FORM 8-K (CONTINUED) 99.1 Form 8-K filed June 2, 2005 (13) 99.2 Form 8-K filed July 8, 2005 (13) 99.3 Form 8-K filed July 13, 2005 (13) 99.4 Joint Plan of Reorganization of Debtor and American Capital Holdings 99.5 Disclosure Statement for Joint Plan of Reorganization of Debtor and American Capital Holdings, Inc. (1) Incorporated by reference to the Company's original Registration Statement on Form 10 SB-1, Registration 33-96638-A, filed on September 6, 1995. (2) Incorporated by reference to Form 10-KSB for the year ended May 31, 1997. (3) Incorporated by reference to Form 10-KSB for the year ended May 31, 1998. (4) Incorporated by reference to Form 8-K filed with the Commission on May 26, 1999. (5) Incorporated by reference to Form 10-KSB for the year ended May 31, 1999. (6) Incorporated by reference to Form 10-KSB for the year ended May 31, 2000. (7) Incorporated by reference to Form 8-K filed with the Commission on January 21, 2000. (8) Incorporated by reference to Form 8-K filed with the Commission on May 31, 2001. (9) Incorporated by reference to Form 8-K filed with the Commission on June 7, 2001. (10)Incorporated by reference to Form 10-KSB for the year ended May 31, 2001. (11)Incorporated by reference to Form 8-K filed with the Commission on March 2, 2004. (12)Incorporated by reference to Form 8-K filed with the Commission on March 31, 2004. (13)Incorporated by reference to Form 10-KSB for the year ended May 31, 2005. Exhibit 11 STATEMENT OF COMPUTATION OF EARNINGS PER SHARE AS OF MAY 31, 2006 Calculation of Numerator: Calculation of Denominator: Net loss (122,951) Weighted average common shares Adjustment 0 issued and outstanding 54,202,662 -------- Potentially dilutive securities 0 Net Loss (122,951) ---------- ========= Weighted average shares outstanding 54,202,662 ========== 34 ECOM ECOM.COM,INC. ADDITIONAL INFORMATION Corporate Headquarters 1016 Clemmons Street, Suite 302 Jupiter, Florida 33477 Telephone Number: (561) 745-6789; Internet Address - http://www.ecomecom.net E-mail Address - investor@ecomecom.net Independent Registered Public Accounting Firm Wieseneck, Andres & Company, P.A. Certified Public Accountants 772 U.S. Highway 1, Suite 200 North Palm Beach, Florida 33408 ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES. Audit Fees. The aggregate fees billed to the Company for professional services rendered for the audit of the Company's annual financial statements, review of the Company's quarterly financial statements, and other services normally provided in connection with statutory and regulatory filings or engagements was $5,088 for the fiscal year ended May 31, 2007, and $19,338 for the fiscal year ended May 31, 2006. Other Fees. Other fees billed to the Company by accountants for consultation services, research and client assistance totaled $0 for the fiscal year ended May 31, 2007, and $0 for the fiscal year ended May 31, 2006. SIGNATURE In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned thereunto duly authorized. August 28, 2007 By: /s/ Barney A. Richmond Barney A. Richmond, Chief Executive Officer August 28, 2007 By: /s/ Richard C. Turner Richard C. Turner, Chief Financial Officer 35 Exhibit 31.1 CERTIFICATION REQUIRED UNDER SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 I, Barney A. Richmond, certify that: (1) I have reviewed this Annual Report on Form 10-KSB of eCom eCom.com, Inc. (2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; (3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods presented in this report; (4) The small business issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d- 15(f)) for the small business issuer and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) Evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (d) Disclosed in this report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and (5) The small business issuer's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the small business issuer's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer's ability to record, process, summarize and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting. Date: August 28, 2007 /s/ Barney A. Richmond - ------------------------ Barney A. Richmond Chief Executive Officer 36 Exhibit 31.2 CERTIFICATION REQUIRED UNDER SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002 I, Richard C. Turner, certify that: (1) I have reviewed this Annual Report on Form 10-KSB of eCom eCom.com, Inc. (2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; (3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods presented in this report; (4) The small business issuer's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d- 15(f)) for the small business issuer and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) Evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and (d) Disclosed in this report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's most recent fiscal quarter (the small business issuer's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer's internal control over financial reporting; and (5) The small business issuer's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer's auditors and the audit committee of the small business issuer's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer's ability to record, process, summarize and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting. Date: August 28, 2007 /s/ Richard C. Turner - --------------------------- Richard C. Turner Chief Financial Officer 37 ECOM ECOM.COM,INC. Exhibit 32 CERTIFICATIONS OF CEO AND CFO PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT CERTIFICATION PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 (18 U.S.C. SECTION 1350) In connection with the Annual Report of eCom eCom.com Inc., a Florida corporation (the "Company"), on Form 10-KSB for the year ending May 31, 2007, as filed with the Securities and Exchange Commission (the "Report"), Barney A. Richmond, Chief Executive Officer of the Company and Richard C. Turner, Chief Financial Officer of the Company, respectively, do each hereby certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350), that to his knowledge: (1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company. /s/ Barney A. Richmond Barney A. Richmond Chief Executive Officer August 28, 2007 /s/ Richard C. Turner Richard C. Turner Chief Financial Officer August 28, 2007 [A signed original of this written statement required by Section 906 has been provided to eCom eCom.com Inc. and will be retained by eCom eCom.com, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.] Exhibits to Form 10-KSB will be provided to shareholders of the Registrant upon written request addressed to eCom eCom.com, 1016 Clemmons St, Suite 302, Jupiter, FL 33477-3305. Any exhibits furnished are subject to a reasonable photocopying charge. The Securities and Exchange Commission has not approved or disapproved of this Form 10-KSB and Annual Report to Shareholders nor has it passed upon its accuracy or adequacy. 38 -----END PRIVACY-ENHANCED MESSAGE-----