8-K/A 1 ka120505.txt AMENDED CURRENT REPORT ON FORM 8-K/A-1 DATED DECEMBER 5,2005 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K/A (AMENDMENT No. 1) CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act December 5, 2005 ---------------- Date of Report (Date of Earliest Event Reported) PCS EDVENTURES!.COM, INC. ------------------------- (Exact Name of Registrant as Specified in its Charter) IDAHO 000-49990 82-0475383 ----- --------- ---------- (State or other (Commission File No.) (IRS Employer I.D. No.) Jurisdiction) 345 Bobwhite Court, Suite 200 Boise, Idaho 83706 ------------------ (Address of Principal Executive Offices) (208) 343-3110 -------------- Registrant's Telephone Number N/A --- (Former Name or Former Address if changed Since Last Report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following provisions (see general instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) This is an amendment to the Form 8-K filed December 9, 2005 to include financial statements. Item 9.01. Financial Statements and Exhibits. a) Financial statements of businesses acquired. 510229 N.B. Ltd. DBA Labmentors unaudited financial statements for September 30, 2005. 510229 N.B. LTD. DBA LABMENTORS Financial Statements September 30, 2005 C O N T E N T S Balance Sheet 3 Statement of Operations 4 Statement of Stockholders' Equity (Deficit) 5 Statement of Cash Flows 6 Notes to the Financial Statements 7 511092 N.B. LTD. DBA LABMENTORS Balance Sheet September 30, 2005 (Unaudited) ASSETS CURRENT ASSETS Accounts receivable $ 10,061 Other receivable (Note 4) 3,935 Restricted cash (Note 3) 4,600 ---------- Total Current Assets 18,596 FIXED ASSETS (NET) 4,301 EDUCATIONAL SOFTWARE (NET) 156,099 INTELLECTUAL PROPERTY (NET) 20,925 ---------- TOTAL ASSETS $ 199,921 ========== LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) CURRENT LIABILITIES Bank overdraft $ 640 Accounts payable 33,969 Accrued interest 8,473 Accrued liabilities 12,793 Deposits payable 4,267 Unearned revenue 2,955 Other current liabilities 4,075 Notes payable and current portion of long-term liabilities (Note 5) 122,466 ---------- Total Current Liabilities 189,638 ---------- LONG-TERM LIABILITIES Long-term liabilities (Note 5) 130,522 ---------- Total Liabilities 320,160 ---------- COMMITMENTS AND CONTINGENCIES (Note 6) STOCKHOLDERS' EQUITY (DEFICIT) Common stock, no par value, authorized unlimited shares; 17,511,200 shares issued and outstanding 295,275 Accumulated other comprehensive loss (25,073) Accumulated deficit (390,441) ---------- Total Stockholders' Equity (Deficit) (120,239) ---------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ 199,921 ========== The accompanying notes are an integral part of these financial statements. 3 511092 N.B. LTD. DBA LABMENTORS Statement of Operations and Other Comprehensive Loss For the Period Ended September 30, 2005 (Unaudited) REVENUES $ 55,246 COST OF GOODS 22,327 ---------- GROSS PROFIT 32,919 EXPENSES Salaries and wages 50,675 Depreciation and Amortization expense 21,284 General and administrative 45,533 ---------- Total Operating Expenses 117,492 ---------- OPERATING LOSS (84,573) ---------- OTHER INCOME AND EXPENSES Interest expense (21,229) ---------- Total Other Income and Expenses (21,229) ---------- NET LOSS (105,802) OTHER COMPREHENSIVE LOSS Foreign currency translation adjustment (5,360) ---------- TOTAL COMPREHENSIVE LOSS $ (111,162) ========== BASIC LOSS PER SHARE $ (0.01) ========== WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING 17,511,250 ========== The accompanying notes are an integral part of these financial statements. 4 511092 N.B. LTD. DBA LABMENTORS Statement of Stockholders' Equity (Deficit) Other Common Shares Accumulated Comprehensive Shares Amount Deficit Loss Balance, May 31, 2004 10,807,000 $ 64,377 $(125,338) $ (19,553) Stock issued for conversion of debt - related party at $0.04 per share 1,500,000 59,715 - - Stock issued for services rendered at $0.04 per share 100,000 3,981 - - Stock issued for cash at $0.02 per share 5,004,200 79,620 - - Stock issued for cash at $0.88 per share 100,000 87,582 - - Movement in other comprehensive income (loss) - foreign currency translation adjustments - - - (160) Net loss for the year ended May 31, 2005 - - (159,301) - ---------- --------- ---------- ----------- Balance, May 31, 2005 17,511,200 $ 295,275 $ (284,639) $ (19,713) Movement in other comprehensive income (loss) - foreign currency translation adjustments (Unaudited) - - - (5,360) Net loss for the period ended September 30, 2005 (Unaudited) - - (105,802) - ---------- --------- ---------- ----------- Balance, September 30, 2005 (Unaudited) 17,511,200 $ 295,275 $ (390,441) $ (25,073) ========== ========= ========== =========== The accompanying notes are an integral part of these financial statements. 5 511029 N.B. LTD. DBA LABMENTORS Statement of Cash Flows For the Period Ended September 30, 2005 (Unaudited) CASH FLOW FROM OPERATING ACTIVITIES Net loss $ (105,802) Adjustments to reconcile net loss to net cash used by operating activities: Depreciation and amortization expense 21,284 Amortization of debt discount 16,841 Changes in operating assets and liabilities: Increase in accounts receivable 5,770 Decrease in restricted cash 9,334 Decrease in other current assets 1,086 Decrease in prepaid expenses 1,433 (Decrease) in accounts payable (11,968) Increase in accrued liabilities 8,805 Increase in deferred revenue 2,955 Increase in accrued interest 4,509 ---------- Net Cash Used by Operating Activities (45,753) ---------- CASH FLOW FROM INVESTING ACTIVITIES - CASH FLOWS FROM FINANCING ACTIVITIES Decrease in bank overdraft (7,946) Cash proceeds from notes payable 53,699 ---------- Net Cash Provided by Financing Activities 45,753 NET INCREASE IN CASH - CASH AT BEGINNING OF YEAR - ---------- CASH AT END OF YEAR $ - ========== The accompanying notes are an integral part of these financial statements. 6 511092 N.B. LTD. DBA LABMENTORS Notes to the Financial Statements September 30, 2005 (Unaudited) NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS The financial statements presented are those of 511092 N.B. LTD. DBA LabMentors, a Canadian Corporation ("the Company"). On February 2, 2000, LabMentors was incorporated under the laws of the Province of New Brunswick, Canada as 511092 N.B. LTD. to engage in web-based educational products. LabMentors currently sells products to Course Technology and DeVry in the United States. These programs offer a unique atmosphere highly conducive to individual styles of learning and a system that utilizes computer technology to increase areas of inquiry and application. In addition, the labs allow certifications for several platforms and software applications at the collegiate level. The Company intends to continue to develop products for this market, as well as expand its reach into secondary education in the U.S. and internationally. Our products and technologies are targeted to the public and private school classrooms. Our products and technologies are delivered to the classroom through software and Internet access. Our technologies allow students to explore the basic foundations of computers from programming to database technologies to server integration. There are currently three major shareholders of the Company stock, including Joseph Khoury (President), Bogdan Itoafa (Co-Founder), and Workers Investment Fund. NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES a. Accounting Method The Company's financial statements are prepared using the accrual method of accounting. The Company has elected May 31 as its year-end. b. Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. c. Basic Loss per Share The computation of basic loss per share of common stock is based on the weighted average number of shares outstanding during the period of the financial statements. As of September 30, 2005, the Company had no stock equivalents outstanding. 7 511092 N.B. LTD. DBA LABMENTORS Notes to the Financial Statements September 30, 2005 NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) d. Concentration of Credit Risks and Significant Customers The Company maintains cash in bank deposit accounts, which, at times, may exceed federally insured limits. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant credit risk on cash and cash equivalents. Financial instruments which potentially subject the Company to concentration of credit risk consist primarily of trade receivables. In the normal course of business, the Company provides credit terms to its customers. Accordingly, the Company performs ongoing credit evaluations of its customers and maintains allowances for possible losses which when realized have been within the range of management's expectations. The Company does not require collateral from its customers. During the period ended September 30, 2005, the Company had sales to one major customer that accounted for 100 percent of revenues. e. Foreign Currency Translation The functional currency of the Company is the Canadian dollar ($CDN). The Company's financial statements have been translated into US dollars. All assets and liabilities are translated at the exchange rate on the balance sheet date and all revenues and expenditures are translated at the average rate for the year. Translation adjustments are reflected as a separate component of stockholders' equity, accumulated other comprehensive income (loss) and the net change for the year reflected separately in the statements of operations and other comprehensive income (loss). In accordance with SFAS No. 95, "Statement of Cash Flows," the cash flows of the Company are translated using the weighted average exchange rates during the respective period. As a result, amounts in the statement of cash flows related to changes in assets and liabilities will not necessarily agree with the changes in the corresponding balances on the balance sheet which was translated at the exchange rate at the end of the period. f. Revenue Recognition The Company recognizes revenues relating to access to and usage of its program and exercise software on the Company's website over the term of the subscription or hourly units purchased. 8 511092 N.B. LTD. DBA LABMENTORS Notes to the Financial Statements September 30, 2005 NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) g. Newly Issued Accounting Pronouncements During the period ended September 30, 2005, the Company adopted the following accounting pronouncements: The FASB issued SFAS No. 123R (revised 2004) "Share-Based Payment" in December 2004. SFAS No. 123R requires employee stock-based compensation to be measured based on the fair value as of the grant-date of the awards and the cost is to be recognized over the period during which an employee is required to provide services in exchange for the award. This pronouncement eliminates the alternative use of Accounting Principles Board (APB) No. 25, wherein the intrinsic value method of accounting for awards. SFAS No. 123R is effective for the Company's fiscal year beginning June 1, 2005. The company will adopt the provisions of SFAS No. 123R on a prospective basis once the acquisition is complete. The financial statement impact is not an issue in that all stock currently outstanding with the Company will be converted to PCS stock upon close, after which time all calculations will be in accordance with their policies and procedures, which incorporate this new SFAS. The FASB issued SFAS No. 154, Accounting Changes and Error Correction - a replacement of APB No. 20 and SFAS No. 3, Reporting Accounting Changes in Interim Financial Statements, in May 2005. SFAS 154 changes the requirements for the accounting for and reporting of a change in accounting principle. It also applies to changes required by an accounting pronouncement in the unusual instance that the pronouncement does not include specific transition provisions. The implementation of the provisions of these pronouncements are not expected to have a significant effect on the Company's consolidated financial statement presentation. h. Educational Software The Company's inventory consists of internally developed education computer programs and exercises to be accessed on the internet. In accordance with FAS 86, the costs associated with research and initial feasibility of the programs and exercises are expensed as incurred. Once economic feasibility has been determined, the costs to develop the programs and exercises are capitalized until they are ready for sale and access and are reported at the lower of unamortized cost or net realizable value. Capitalized program and exercise inventory are amortized on a straight-line basis over the estimate useful life of the program or exercise, generally 42 to 48 months. 9 511092 N.B. LTD. DBA LABMENTORS Notes to the Financial Statements September 30, 2005 NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) i. Intellectual Property The Company's intellectual property consists of capitalized costs associated with the development of the internet software and delivery platform developed by the Company to enable access to the various educational programs and exercises developed by the Company. In accordance with FAS 86 as discussed previously regarding inventory, the initial costs associated with researching the delivery platform and methods were expensed until economic feasibility and acceptance were determined. Thereafter, costs incurred to develop the internet online delivery platform and related environments were capitalized until ready for use and able to deliver and access the Company's educational programs and exercises. Costs incurred thereafter to maintain the delivery and access platform are expensed as incurred. These capitalized costs are being amortized on a straight-line basis over the estimated useful life of the Company's delivery and access platform which has been determined to be 60 months. j. Property and Equipment Property and equipment are recorded at cost and being depreciated for financial accounting purposes on the straight-line method over their respective estimated useful lives ranging from five to seven years. Upon retirement or other disposition of these assets, the cost and related accumulated depreciation are removed from the accounts and the resulting gains or losses are reflected in the results of operations. Expenditures for maintenance and repairs are charged to operations. Renewals and betterments are capitalized. Depreciation of leased equipment under capital leases is included in depreciation. NOTE 3 - RESTRICTED CASH Pursuant to an employment arrangement, the Company has placed funds in an escrow account with an attorney. Those funds are restricted as to their use and have been classified as such in the Company's financial statements. A portion of the funds are released each pay period to pay the salary of the employee who is utilizing LabMentors until December 2005 as an employee based immigration sponsor. The balance of restricted cash of September 30, 2005 was $3,935. NOTE 4 - OTHER RECEIVABLES This amount includes receivables from employees due to travel and other expense advances. Each will be properly categorized once documentation and/or receipts are provided to the accounting department. No material changes should be noted. 10 511092 N.B. LTD. DBA LABMENTORS Notes to the Financial Statements September 30, 2005 NOTE 5 - NOTES PAYABLE & LONG TERM DEBT As of September 30, 2005, the following notes payable and long-term debt were outstanding: ACOA Loan $ 45,402 Loan #1 BH 5,587 Notes Payable WIF 98,971 Notes Payable Frank Maresca 103,028 ----------- Total 252,988 Less current portion (122,466) ----------- Long Term Debt $ 130,522 =========== Also note that all debt, with the exception of the ACOA Loan will be converted at close of the acquisition, which occurred as a subsequent event referenced in Note 8. NOTE 6 - COMMITMENTS AND CONTINGENCIES Currently the Company has a month-to-month lease agreement for its office location. This lease is between the Company and a related party. This related party is wholly owned by the Company's President and CEO. NOTE 7 - GOING CONCERN The Company's financial statements are prepared using generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company does not have significant cash or other material assets, nor does it have an established source of revenues sufficient to cover its operating costs. Additionally, the Company has accumulated significant losses, has negative working capital, and a deficit in stockholders' equity. All of these items raise substantial doubt about its ability to continue as a going concern. Management's plans with respect to alleviating the adverse financial conditions that caused its auditors to express substantial doubt about the Company's ability to continue as a going concern are as follows: During the fiscal year ending May 2005, the Company opened discussions with PCS Edventures!.com, Inc. for possible acquisition activities. As stated in Note 8, this acquisition is set to close on or before November 30, 2005. Over the next fiscal year, the Company will continue to develop marketplace strategy for the U.S. market as well as the international market. See Note 8 for further information. The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plan described in the preceding paragraph and eventually attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. 11 511092 N.B. LTD. DBA LABMENTORS Notes to the Financial Statements September 30, 2005 NOTE 8 - SUBSEQUENT EVENTS In July 2005, the Company entered into a Letter of Intent Agreement which provides for the Company to be acquired by PCS Edventures!.com, Inc., an Idaho Corporation ("PCS"). On November 30, 2005, a Share Exchange Agreement was executed by all shareholders and PCS President to conclude the acquisition of LabMentors. LabMentors has since legally changed its name to PCS LabMentors, LTD. The Company is structured as a wholly owned subsidiary of PCS. All accounting is currently being transitioned to PCS, while sales and research and development continue to take place in Fredericton, New Brunswick Canada. No employees were terminated as a result of the acquisition. In addition, the Company changed locations. The Company now operates from a smaller location owned and managed by an unrelated party on a month-to-month basis. 12 b) Pro forma financial information. Pro forma financial statements UNAUDITED CONDENSED COMBINED PRO FORMA FINANCIAL STATEMENTS The following unaudited condensed combined pro forma financial statements ("the pro forma financial statements'') and explanatory notes have been prepared and give effect to the acquisition of 511092 N.B. LTD. ("LabMentors") (a Canadian Company) by PCS Edventures!.com, Inc. ("PCS"). PCS has a year end of March 31 while LabMentors has a May 31 year end. In accordance with Article 11 of Regulation S-X under the Securities Act, an unaudited condensed combined pro forma balance sheet (the "pro forma balance sheet'') as of September 30, 2005, and unaudited condensed combined pro forma statements of operations and other comprehensive loss for the periods ended September 30, 2005 and for the years ended March 31, 2005 (PCS) and May 31, 2005 (Lab Mentors) (the "pro forma statements of income''), have been prepared to reflect, for accounting purposes, the acquisition of LabMentors by PCS. The following pro forma financial statements have been prepared based upon the historical financial statements of LabMentors and PCS. The pro forma financial statements should be read in conjunction with the historical consolidated financial statements and related notes thereto of PCS and Susidiaries as of March 31, 2005; included in its Form 10-KSB and the May 31, 2005 audited financial statements and the unaudited September 30, 2005 financial statements filed separately with this Form 8-K. The September 30, 2005 pro forma balance sheet assumes that the acquisition of LabMentors by PCS was completed at the beginning of the periods presented, May 31, 2004. The September 30, 2005 pro forma balance sheet includes the historical unaudited consolidated balance sheet data of LabMentors and PCS as of September 30, 2005. LabMentors and PCS have had no intercompany activity that would require elimination in the pro forma financial statements, with the exception of equity adjustments for gain on settlement of LabMentors' debt and recording of the purchase through a stock exchange. The pro forma statements of operations for the periods ended September 30, 2005 and the year ended March 31, 2005 for PCS (May 31, 2005 for LabMentors, assumes that the acquisition of LabMentors by PCS occurred on June 1, 2004. The differences in the periods presented as a result of the differing year ends of the companies, does not materially distort the results of operations of the combined companies as if they were consolidated for all periods presented. The pro forma financial statements are provided for illustrative purposes only, and are not necessarily indicative of the operating results or financial position that would have occurred if the mergers had been consummated at the beginning of the periods or on the dates indicated, nor are they necessarily indicative of any future operating results or financial position. The pro forma financial statements do not include any adjustments related to any restructuring charges or one-time charges which may result from the mergers or the final result of valuations of inventories, property, plant and equipment, intangible assets, debt, and other obligations. PCS EDVENTURES!.COM, INC. AND SUBSIDAIRIES UNAUDITED CONDENSED COMBINED PRO FORMA BALANCE SHEET Pro Forma PCS LabMentors Combined --------- ---------- Combined PCS as of as of Historical & LabMentors September 30, PCS & Pro Forma September 30, 2005 LabMentors Adjustments 2005 --------------------- ---------- ----------- ------------ ASSETS Current Assets: Cash $ 130,047 $ - $ 130,047 $ - $ 130,047 Accounts receivable 583,936 10,061 593,997 - 593,997 Restricted cash - 4,600 4,600 - 4,600 Other current assets 12,307 3,935 16,242 - 16,242 ---------- ---------- ---------- -------- ---------- Total Current Assets 726,290 18,596 744,886 - 744,886 Fixed Assets, Net: 13,834 4,301 18,135 - 18,135 Inventory 87,416 156,099 243,515 - 243,515 Goodwill - - - 62,030 2 62,030 Other Assets 6,225 20,925 27,150 - 27,150 ---------- ---------- ---------- -------- ---------- TOTAL ASSETS $ 833,765 $ 199,921 $1,033,686 $ 62,030 $1,095,716 ========== ========== ========== ======== ========== LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) Current Liabilities: Bank overdraft $ - $ 640 $ 640 $ - $ 640 Accounts payable 422,455 33,969 456,424 - 456,424 Accrued compensation 56,293 5,727 62,020 - 62,020 Payroll liabilities 48,769 5,358 54,127 - 54,127 Accrued interest 60,344 8,473 68,817 - 68,817 Accrued expenses 69,735 1,708 71,443 - 71,443 Unearned revenue 347,310 2,955 350,265 - 350,265 Deposits payable - 4,267 4,267 - 4,267 Other current liabilities - 4,075 4,075 - 4,075 Notes payable- related parties 116,690 - 116,690 - 116,690 Notes payable 114,952 122,466 237,418 (122,466)1 114,952 ---------- ---------- ---------- -------- ---------- Total Current Liabilities 1,236,548 189,638 1,426,186 (122,466) 1,303,720 ---------- ---------- ---------- -------- ---------- Long Term Liabilities Notes payable - 130,522 130,522 (85,120)1 45,402 ---------- ---------- ---------- -------- ---------- Total Non- Current Liabilities - 130,522 130,522 (85,120) 45,402 ---------- ---------- ---------- -------- ---------- Total Liabilities 1,236,548 320,160 1,556,708 (207,586) 1,349,122 ---------- ---------- ---------- -------- ---------- Stockholders' Equity: Preferred stock 56,372 - 56,372 - 56,372 Common stock 24,199,911 295,275 24,495,186 (207,586)1 24,619,911 420,000 2 (502,861)2 Accumulated deficit (24,659,066) (390,441)(25,049,507)125,338 2(24,924,169) Accumulated Other Comprehensive Loss - (25,073) (25,073) 19,553 2 (5,520) ---------- ---------- ---------- -------- ---------- Total Stockholders' Equity (402,783) (120,239) (523,022)269,616 (253,406) ---------- ---------- ---------- -------- ---------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $ 833,765 $ 199,921 $1,033,686 $ 62,030 $1,095,716 ========== ========== ========== ======== ========== (1) To reflect conversion of LabMentors debt to equity in conjunction with PCS acquisition. (2) To reflect PCS Edventures acquisition of LabMentors as if done May 31, 2004. PCS EDVENTURES!.COM, INC. AND SUBSIDAIRIES UNAUDITED CONDENSED COMBINED PRO FORMA STATEMENT OF OPERATIONS AND OTHER COMPREHENSIVE LOSS Pro Forma PCS LabMentors Combined ------- ---------- PCS for the & LabMentors Months Ended Combined for the period September 30, PCS & Pro Forma ended Sept. 30, 2005 LabMentors Adjustments 2005 --------------------- ---------- ----------- ------------- REVENUES Lab Revenue 1,652,374 $ 55,246 $ 1,707,620 $ 0 $ 1,707,620 License Revenue 91,482 0 91,482 0 91,482 Subscription Revenue 2,553 0 2,553 0 2,553 ---------- --------- ----------- -------- ------------ Total Revenues 1,746,409 55,246 1,801,655 0 1,801,655 ---------- --------- ----------- -------- ------------ COST OF SALES 859,291 22,327 881,618 0 881,618 ---------- --------- ----------- -------- ------------ GROSS PROFIT 887,118 32,919 920,037 0 920,037 ---------- --------- ----------- -------- ------------ OPERATING EXPENSES Salaries and wages 257,091 50,675 307,766 0 307,766 Depreciation expense 2,381 21,284 23,665 0 23,665 General and administrative 513,916 45,533 559,449 0 559,449 Stock for services expense 90,115 0 90,115 0 90,115 ---------- --------- ----------- -------- ------------ Total Operating Expenses 863,503 117,492 980,995 0 980,995 ---------- --------- ----------- -------- ------------ OPERATING INCOME(LOSS) 23,615 (84,573) (60,958) 0 (60,958) ---------- --------- ----------- -------- ------------ OTHER INCOME AND EXPENSES Interest expense (34,867) (21,229) (56,096) 0 (56,096) Interest income 23 0 23 0 23 Other income 17,131 0 17,131 0 17,131 Other expense (2,400) 0 (2,400) 0 (2,400) Gain on settlement of debt 0 0 0 0 0 ---------- --------- ----------- -------- ------------ Total Other Income and Expenses (20,113) (21,229) (41,342) 0 (41,342) ---------- --------- ----------- -------- ------------ NET INCOME (LOSS) 3,502 (105,802) (102,300) 0 (102,300) OTHER COMPREHENSIVE LOSS Foreign currency translation adjustment 0 (5,360) (5,360) 0 (5,360) ---------- --------- ----------- -------- ------------ TOTAL COMPREHENSIVE LOSS $ 3,502 $(111,162) $ (107,660)$ 0 $ (107,660) ========== ========= =========== ======== ============ Basic income per share $ (0.00) ============ Weighted average shares outstanding 27,087,405 ============ PCS EDVENTURES!.COM, INC. AND SUBSIDAIRIES UNAUDITED CONDENSED COMBINED PRO FORMA STATEMENT OF OPERATIONS AND OTHER COMPREHENSIVE LOSS Pro Forma Combined PCS LabMentors PCS for the for the & LabMentors Year Ended Year Ended Combined for the year March 31, May 31, PCS & Pro Forma ended March 31, 2005 2005 LabMentors Adjustments 2005 REVENUES Lab Revenue 1,294,709 $ 124,848 $ 1,419,557 $ 0 $ 1,419,557 License Revenue 158,917 0 158,917 0 158,917 Subscription Revenue 15,045 0 15,045 0 15,045 ---------- --------- ----------- -------- ------------ Total Revenues 1,468,671 124,848 1,593,519 0 1,593,519 ---------- --------- ----------- -------- ------------ COST OF SALES 679,324 0 679,324 0 679,324 GROSS PROFIT 789,347 124,848 914,195 0 914,195 ---------- --------- ----------- -------- ------------ OPERATING EXPENSES Salaries and wages 452,756 79,406 532,162 0 532,162 Depreciation expense 2,052 30,202 32,254 0 32,254 General and administrative 751,338 167,698 919,036 0 919,036 Stock for services expense 525,004 0 525,004 0 525,004 ---------- --------- ----------- -------- ------------ Total Operating Expenses 1,731,150 277,306 2,008,456 0 2,008,456 ---------- --------- ----------- -------- ------------ OPERATING LOSS (941,803) (152,458) (1,094,261) 0 (1,094,261) ---------- --------- ----------- -------- ------------ OTHER INCOME AND EXPENSES Interest expense (58,877) (6,864) (65,741) 0 (65,741) Interest income 993 0 993 0 993 Other income 17,065 0 17,065 0 17,065 Gain on settlement of debt 43,990 21 44,011 44,011 ---------- --------- ----------- -------- ------------ Total Other Income and Expenses 3,171 (6,843) (3,672) 0 (3,672) ---------- --------- ----------- -------- ------------ NET LOSS (938,632) (159,301) (1,097,933) 0 (1,097,933) OTHER COMPREHENSIVE LOSS foreign currency translation adjustment 0 (160) (160) 0 (160) ---------- --------- ----------- -------- ------------ TOTAL COMPREHENSIVE LOSS $ (938,632)$(159,461) $(1,098,093)$ 0 $ (1,098,093) ========== ========= =========== ======== ============ Basic income per share $ (0.04) ============ Weighted average shares outstanding 26,253,256 ============ c) Exhibits. The following exhibits are attached pursuant to Item 601 of Regulation S-B (17 CFR 228.601) and Instructions B.2 of this form. None. * Summaries of any exhibit are modified in their entirety by this reference to each exhibit. SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned hereunto duly authorized. PCS EDVENTURES!.COM, INC. Date: 02/15/2006 /s/Anthony A. Maher ---------- ---------------------------- Anthony A. Maher, CEO, President and Chairman of the Board of Directors