U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2005
OR
[ ] TRANSITION REPORT UNDER SECTION 13 OF 15(D) OF THE EXCHANGE ACT OF 1934
From the transition period from ___________ to ____________.
Commission File Number 333-42640
ENDO NETWORKS, INC.
(Exact name of small business issuer as specified in its charter)
Nevada 75-2882833
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
2624 DUNWIN DRIVE, UNIT #3, MISSISSAUGA, ONTARIO, CANADA L5L 3T5
(Address of principal executive offices)
(905) 820-8800
(Issuer's telephone number)
N/A
(Former name, former address and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant (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:
As of August 10, 2005, there were 12,665,366 shares of common stock of the
issuer outstanding.
TABLE OF CONTENTS
PART I - FINANCIAL STATEMENTS
Item 1 Financial Statements 13
Item 2 Management's Discussion and Analysis Or
Plan of Operations 13
Item 3 Controls and Procedures 14
PART II OTHER INFORMATION
Item 1 Legal Proceedings 13
Item 2 Changes in Securities 14
Item 3 Default upon Senior Securities 14
Item 4 Submission of Matters to a Vote of Security Holders 14
Item 5 Other Information 14
Item 6 Exhibits and Reports on Form 8-K 14
PART I - FINANCIAL INFORMATION
ITEM I. FINANCIAL STATEMENTS
ENDO NETWORKS, INC.
BALANCE SHEET
June 30, 2005
(Unaudited)
ASSETS
Cash 13,762
Accounts receivable, net 282,707
Prepaid expenses 63,585
---------
Total current assets 360,054
Property, Plant & Equipment, net of accumulated depreciation of $772,823 489,676
---------
TOTAL ASSETS $ 849,730
=========
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable 196,298
Accrued expenses - related party 213,461
Accrued expenses - other 312,970
Capitalized leases 173,636
---------
Total current liabilities 896,365
Capitalized leases - non current 45,395
---------
TOTAL LIABILITIES $ 941,760
---------
STOCKHOLDERS' DEFICIT:
Common stock, $.001 par value, 50,000,000 shares authorized, 12,665,366
shares issued and outstanding 12,665
Additional paid in capital 299,105
Accumulated deficit (540,951)
Other comprehensive income 137,151
---------
Total Stockholders' Deficit (92,030)
---------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT $ 849,730
=========
ENDO NETWORKS, INC.
STATEMENT OF OPERATIONS
Three and Nine Months Ended June 30, 2005 and 2004
(Unaudited)
Three Months Ended Nine Months Ended
June 30, June 30,
2005 2004 2005 2004
------------ ------------ ------------ ------------
Revenue $ 377,068 $ 296,535 $ 814,295 $ 498,590
Cost of sales 165,724 92,784 260,831 265,736
------------ ------------ ------------ ------------
Gross profit 211,344 203,751 553,464 232,854
Operating expenses:
Depreciation 52,150 27,358 157,052 44,094
Other general and administrative 119,520 121,729 482,807 314,623
------------ ------------ ------------ ------------
171,670 149,087 639,859 358,717
------------ ------------ ------------ ------------
Net income (loss) $ 39,674 $ 54,664 $ (86,395) $ (125,864)
============ ============ ============ ============
Net income (loss) per share:
Basic and diluted $ 0.00 $ 0.00 $ (0.01) $ (0.01)
============ ============ ============ ============
Weighted average shares outstanding:
Basic 12,665,366 12,635,366 12,665,366 12,635,366
------------ ------------ ------------ ------------
Diluted 13,299,366 13,259,366 12,665,366 12,635,366
------------
ENDO NETWORKS, INC.
STATEMENT OF CASH FLOWS
Nine Months Ended June 30, 2005 and 2004
(Unaudited)
2005 2004
--------- ---------
Cash flows from operating activities:
Net loss $ (86,395) $(125,864)
Adjustments to reconcile net loss to cash
used in operating activities:
Depreciation 157,052 123,075
Stock options issued 47,688
Stock issued for services 11,904
Changes in assets and liabilities:
Accounts receivable (137,306) (50,605)
Prepaid expenses 8,556 (4,040)
Accounts payable and accrued expenses 155,113 131,990
--------- ---------
Net cash provided by operating activities 97,020 142,228
--------- ---------
Cash flows from investing activities:
Capital expenditures (194,161) (80,782)
--------- ---------
Net cash used in investing activities (194,161) (80,782)
Cash flows from financing activities:
(Payments on) Proceeds from lease financing 6,255 (82,817)
--------- ---------
Net cash provided by (used in) financing activities 6,255 (82,817)
Effect of foreign exchange rate change on cash 93,036 5,721
Net increase in cash 2,150 (15,650)
Cash, beginning of period 11,612 15,650
--------- ---------
Cash, end of period $ 13,762 $ --
========= =========
Supplemental information:
Income taxes paid $ -- $ --
Interest paid $ 22,278 $ 4,982
--------- ---------
ENDO NETWORKS, INC.
Notes to the Financial Statements
June 30, 2005
NOTE 1: MANAGEMENT REPRESENTATION AND PRESENTATION
Operating results for the nine months ended June 30, 2005 are not necessarily
indicative of the results that may be expected for the year ending September 30,
2005. It is suggested that the financial statements be read in conjunction with
the audited financial statements and notes for the fiscal year ended September
30, 2004 included in the Endo Networks' Current Report on Form 10-KSB filed on
February 18, 2005.
The balance sheet of ENDO Networks as of June 30, 2005, the related statements
of operations for the three and nine months ended June 30, 2005 and 2004 and the
statements of cash flows for the three and nine months ended June 30, 2005 and
2004 included in the financial statements have been prepared by Endo Networks
without audit. In the opinion of management, the accompanying financial
statements include all adjustments (consisting of normal, recurring adjustments)
necessary to summarize fairly the Endo Networks' financial position and results
of operations. The results of operations for the three and nine months ended
June 30, 2005 are not necessarily indicative of the results of operations for
the full year or any other interim period. Notes to the financial statements
which would substantially duplicate the disclosure contained in the audited
financial statements for the most recent fiscal year ended September 30, 2004 to
be reported in Form 10-KSB, have been omitted.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NATURE OF OUR BUSINESS
ENDO Networks, Inc. (ENDO) is a company that uses technology and proven
marketing tactics to engage consumers and compel specific behaviors in high
traffic public locations such as events, retail and restaurant locations across
North America, and online. ENDO also develops application software and client
controlled media.
RISKS AND UNCERTAINTIES
All of the following risks may impair our business operations. If any of the
following risks actually occur, our business, financial condition or results of
operations could be materially adversely affected. In such case, the trading
price of our common stock could decline, and you may lose all or part of your
investment. Additional risks include: We may not be able to adequately protect
and maintain our intellectual property. Our dependence on certain local third
parties may impact our ability to control certain aspects of our operations. We
may have difficulty competing with larger and better-financed companies in our
sector. New legislative or regulatory requirements may adversely affect our
business and operations. We are dependant on certain key existing and future
personnel. We may be subject to product liability claims in the future. There
may not be sufficient liquidity in the market for our securities in order for
investors to sell their securities.
ACCOUNTING FOR STOCK-BASED COMPENSATION
Endo Networks accounts for stock-based compensation issued to employees and
advisors of Endo Networks using the intrinsic value based method as prescribed
by APB Opinion No. 25 "Accounting for Stock Issued to Employees" ("APB 25").
Under the intrinsic value based method, compensation is the excess, if any, of
the fair value of the stock at the grant date or other measurement date over the
amount an employee must pay to acquire the stock. Compensation, if any, is
recognized over the applicable service period, which is usually the vesting
period.
In December 2004, the FASB issued SFAS No. 123 (revised 2004), :Share-Based
Payment". Statement 123(R) will provide investors and other users of financial
statements with more complete and neutral financial information by requiring
that the compensation cost relating to share-based payment transactions be
recognized in financial statements. That cost will be measured based on the fair
value of the equity or liability instruments issued. Statement 123(R) covers a
wide range of share-based compensation arrangements including share options,
restricted share plans, performance-based awards, share appreciation rights, and
employee share purchase plans. Statement 123(R) replaces FASB Statement No. 123,
Accounting for Stock-Based Compensation, and supercedes APB Opinion No. 25,
Accounting for Stock Issued to Employees. Statement 123, as originally issued in
1995, established as preferable a fair-value based method of accounting for
share-based payment transactions with employees. However, that Statement
permitted entities the option of continuing to apply the guidance in Opinion No.
25, as long as the footnotes to financial statements disclosed what net income
would have been had the preferable fair-value-based method been used. Public
companies filing as small business issuers will be required to apply the
Statement 123(R) as of the first interim or annual reporting period that begins
after December 31, 2005.
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
ENDO Networks does not expect the adoption of recently issued accounting
pronouncements to have a significant impact on ENDO's results of operations,
financial position or cash flow.
STOCK OPTION PLANS
There were no stock options issued during the three months ended June 30, 2005.
At June 30, 2005, there were 634,000 stock options outstanding which are
exercisable at $0.50 per share and expire on December 31, 2006. The 634,000
stock options were fully vested on September 30, 2004. There is no pro-forma
effect on net income (loss) or net income (loss) per share for the nine months
ended June 30, 2005 and 2004.
REVENUE RECOGNITION
ENDO recognizes revenue when persuasive evidence of an arrangement exists,
delivery has occurred, the sales price is fixed or determinable and
collectability is probable. ENDO recognizes revenue from the sale of advertising
related products and services like interactive advertising, studio promotion,
and event management as the services are performed. ENDO maintains allowances
for doubtful accounts on all its accounts receivable for estimated losses
resulting from the inability of its customers and others to make required
payments. If the financial condition of ENDO's customers and others were to
deteriorate, resulting in an impairment of their ability to make payments,
additional allowances may be required.
NOTE 3 - LEASE FINANCING OBLIGATIONS
As of June 30, 2005, the Company is in technical default on its lease
obligations since it has missed payments totaling approximately $94,000. On June
10, 2005, the leasing company verbally agreed to add the sum of the missed
payments to the outstanding lease amount and proportionately increase the
remaining payments on the lease, without penalty. The Company has been making
twice the required payments for the last three months.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The following discussion should be read in conjunction with the financial
statements and notes thereto included elsewhere in this Form 10-QSB and in our
Form 10-KSB. This report contains forward-looking statements including, without
limitation, statements regarding trends, cyclicality, seasonality, volatility
and growth in the markets we sell into, our strategic direction, new product
introductions, our liquidity position, our ability to generate cash from
continuing operations, our expected order and revenue growth, the potential
impact of our adopting new accounting pronouncements, our financial results, the
impact and timing of our enterprise resource planning and customer relationship
management systems implementation, our obligations under our retirement and
post-retirement benefit plans, timing of, costs related to, and savings from our
restructuring programs, the existence or length of an economic recovery and our
ability to take advantage of a recovery that involve risks and uncertainties.
Our actual results could differ materially from the results contemplated by
these forward-looking statements due to various factors, including those
discussed below in "Factors That May Affect Future Results" and elsewhere in
this Form 10-QSB.
OVERVIEW
Endo Networks Inc. helps businesses acquire new customers and build sales and
loyalty with existing customers.
We use interactive technology such as
touchscreen kiosks, handheld computers, and websites, combined with promotional
marketing tactics to filter large numbers of consumers, to find qualified
prospects, and even precondition them for the sales.
Our services can be deployed within a business' own retail environment, to
increase sales with their own customer base by increasing frequency of visit
and/or average spend with individual customers , or they can be deployed within
a partner location such as an office tower or a consumer show, to find and
acquire qualified new customers. Our solutions are:
- Permission based
- Integratable with legacy systems
- Scaleable
- Measurable
- Conducive to brand partnerships
Our areas of expertise include: Web, Kiosk, Handheld, Wireless, Loyalty,
Promotional Marketing, Direct Marketing, Integration with Point of Sale, Survey,
Incentive, Sampling, and Field and Event Marketing.
Our client base includes specialty retail, general retail, food service,
automotive, alcohol, energy, consumer packaged goods, entertainment, amateur
sports, and telecommunications companies.
Our corporate head office is located at 2624 Dunwin Drive, Unit 3, Mississauga,
Ontario, Canada, 20 minutes from Toronto and 60 minutes from Buffalo.
LIQUIDITY AND CAPITAL RESOURCES
Total assets increased during the quarter ended June 30, 2005 from $665,687 at
March 31, 2005 to $849,730 at June 30, 2005. The increase is primarily
attributable to the increase in accounts receivable and the purchase of
additional equipment.
We do expect to incur material capital expenditures during the next 12 months
for equipment relating to new client deployments. There is no assurance we will
be able to generate sufficient revenues or obtain sufficient funds when needed,
or whether such funds, if available, will be obtained on terms satisfactory to
us. We do not have any long term or contingent obligations that must be
satisfied.
CRITICAL ACCOUNTING POLICIES
Our Unaudited Financial Statements have been prepared in accordance with
accounting principles generally accepted in the United States of America. The
preparation of these financial statements requires us to make estimates and
judgments that affect the reported amounts of assets, liabilities, revenues and
expenses, and related disclosure of contingent assets and liabilities. We base
our estimates on historical experience and on various other assumptions that are
believed to be reasonable under the circumstances, the results of which form the
basis of making judgments about the carrying values of assets and liabilities
that are not readily apparent from other sources. Actual results may differ from
these estimates under different assumptions or conditions.
We believe the following critical accounting policies, among others, affect our
more significant judgments and estimates used in the preparation of our
financial statements:
ALLOWANCE FOR DOUBTFUL ACCOUNTS
We maintain allowances for doubtful accounts for estimated losses resulting from
the inability of our customers to make required payments. The allowance for
doubtful accounts is based on specific identification of customer accounts and
our best estimate of the likelihood of potential loss, taking into account such
factors as the financial condition and payment history of major customers. We
evaluate the collectability of our receivables at least quarterly. If the
financial condition of our customers were to deteriorate, resulting in an
impairment of their ability to make payments, additional allowances may be
required. The differences could be material and could significantly impact cash
flows from operating activities.
VALUATION OF INTANGIBLES
From time to time, we acquire intangible assets that are beneficial to our
product development processes. We periodically evaluate the carrying value of
intangibles, including the related amortization periods. In evaluating acquired
intangible assets, we determine whether there has been impairment by comparing
the anticipated undiscounted cash flows from the operation and eventual
disposition of the product line with its carrying value. If the undiscounted
cash flows are less than the carrying value, the amount of the impairment, if
any, will be determined by comparing the carrying value of each intangible asset
with its fair value. Fair value is generally based on either a discounted cash
flows analysis or market analysis. Future operating income is based on various
assumptions, including regulatory approvals, patents being granted, and the type
and nature of competing products. If regulatory approvals or patents are not
obtained or are substantially delayed, or other competing technologies are
developed and obtain general market acceptance or market conditions otherwise
change, our intangibles may have a substantially reduced value, which could be
material.
DEFERRED TAXES
We record a valuation allowance to reduce the deferred tax assets to the amount
that is more likely than not to be realized. We have considered estimated future
taxable income and ongoing tax planning strategies in assessing the amount
needed for the valuation allowance. Based on these estimates, all of our
deferred tax assets have been reserved. If actual results differ favorably from
those estimates used, we may be able to realize all or part of our net deferred
tax assets. Such realization could positively impact our operating results and
cash flows from operating activities.
RESULTS OF OPERATIONS
COMPARISON OF RESULTS FOR THE THREE AND NINE MONTHS ENDED JUNE 30, 2005 TO THE
THREE AND NINE MONTHS ENDED JUNE 30, 2004
REVENUE. During the three months ended June 30, 2005, the company generated
revenues of $377,068 from sales compared to revenues from sales for the three
months ended June 30, 2004 of $296,535, which represents an increase of $80,533
over the same period of the prior year. Revenue for the nine months ended June
30, 2005 and 2004 was $814,295 and $498,590, respectively. The increases are due
to performing work on projects that are scalable with moderate incremental
costs.
COST OF SALES. Cost of goods sold increased from $92,784 or 31% of sales for the
three months ended June 30, 2004 to $165,724 or 44% of sales for the three
months ended June 30, 2005, an increase of $72,940 or 13%, due to having higher
costs for the projects we completed. For the nine months ended June 30, 2005 and
2004, costs of goods sold were $260,831 and $265,736, respectively, being 32%
and 53% of sales respectively.
GROSS PROFIT. Based on the foregoing, gross profit increased from $203,751 or
69% of sales for the three months ended June 30, 2004 to $211,344 or 56% for the
three months ended June 30, 2005. Gross profit increased from $232,854 for the
nine months ened June 30, 2004 to $553,464 for the nine months ended June 30,
2005. This was due to the reduction in the cost of goods sold. Margins on sales
increased for the nine months ended June 30, 2005 compared to the nine months
ended June 30, 2005 due to the type of service/product offering Endo sold in the
quarter.
GENERAL, ADMINISTRATIVE AND SELLING EXPENSES. General, Administrative and
Selling expenses were $119,520 for the three months ended June 30, 2005,
compared to $121,729 for the three months ended June 30, 2004, representing an
decrease of $2,209. As a percentage of sales, general and administrative
expenses were 32% of sales compared with 41% of sales in the same period the
prior year, a decrease of 9%. For the nine months ended June 30, 2005, general
and administrative costs increased to $482,807 from $314,623 in the nine months
ended June 30, 2004.
Amortization and depreciation expense are not included in our general and
administrative expenses. These expenses were $52,150 and $27,358 for the three
months ended June 30, 2005 and 2004 respectively, and $157,052 and $44,094 for
the nine months ended June 30, 2005 and 2004 respectively.
NET INCOME (LOSS) AND INCOME (LOSS) PER SHARE.
As a result of the above, in the three months ended June 30, 2005, net income
was $39,674 or $0.00 per share, compared to income of $54,664 or $(0.00) per
share for the three months ended June 30, 2004. For the nine months ended June
30, 2005, there was a loss of $86,395 compared to a net loss of $125,864 for the
same period the prior year.
FORWARD LOOKING STATEMENTS. This Form 10-QSB contains forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements made by Endo Networks involve known and unknown
risks, uncertainties and other factors which may cause the actual results,
performance or achievements of the Company to be materially different from any
future results, performance or achievements expressed or implied by such
forward-looking statements. Factors that could cause actual results to differ
materially from the forward looking statements include, but are not limited to,
risks associated with lack of significant operating history, demand for the Endo
Networks' products, international business operations, dependence on licensees,
governmental regulations, technological changes, intense competition and
dependence on management. Given these uncertainties, readers are cautioned not
to place undue reliance on such forward-looking statements. The Company's
management disclaims any obligation to forward-looking statements contained
herein to reflect any change in the Endo Networks' expectation with regard
thereto or any change in events, conditions, circumstances or assumptions
underlying such statements.
ITEM 3. CONTROLS AND PROCEDURES
An evaluation was carried out under the supervision and with the participation
of the Endo Networks' management, including our Chief Executive Officer and
Chief Financial Officer, regarding the effectiveness of our disclosure controls
and procedures (as defined in Rule 13a-15 under the Securities Exchange Act of
1934) as of June 30, 2005. As a result of their evaluation, our Chief Executive
Officer and Chief Financial Officer have concluded that the Endo Networks'
disclosure controls and procedures are effective to ensure that information
required to be disclosed by Endo Networks in reports that it files or submits
under the Securities Exchange Act of 1934 is recorded, processed, summarized and
reported within the time periods specified in the Securities and Exchange
Commission rules and forms. There were no changes in Endo Networks' internal
control over financial reporting that occurred during the quarter ended December
31, 2004, that has materially affected and is reasonably likely to materially
affect, the Endo Networks' internal control over financial reporting.
PART III
ITEM 1. LEGAL PROCEEDINGS
None
ITEM 2. EMPLOYMENT AGREEMENTS
None
ITEM 3. RECENT SALES OF UNREGISTERED SECURITIES
None
ITEM 4. EXHIBITS AND REPORTS ON FORM 8-K
(a) The following exhibits are filed as part of this report.
Exhibit No. Document
31.1 Certification of Chief Executive Officer required by Rule
13a-14a/15d-14(a) under the Exchange Act.
31.2 Certification of Chief Financial Officer required by Rule
13a-14a/15d-14(a) under the Exchange Act.
32.1 Certification of Chief Executive Officer pursuant to Section 8 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.
32.2 Certification of Chief Financial Officer pursuant to Section 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.
(b) Reports of Form 8-K
None
SIGNATURES.
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
/s/ Peter B. Day
-----------------------
Peter B. Day
Chief Executive Officer
August 12, 2005
Exhibit 31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
I, Peter B. Day, certify that:
1. I have reviewed this annual report on Form 10-QSB of ENDO NETWORKS, INC.
2. Based on my knowledge, this annual 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 annual
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual 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-14 and 15d-14 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. 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
c. 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 12, 2005
/s/ Peter B. Day
-----------------------
Peter B. Day
Chief Executive Officer
Exhibit 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
I, Peter B. Day, certify that:
1. I have reviewed this annual report on Form 10-QSB of Endo Networks, Inc.
2. Based on my knowledge, this annual 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 annual
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual 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-14 and 15d-14 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. 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
c. 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 12, 2005
/s/ Peter B. Day
-----------------------
Peter B. Day,
Chief Financial Officer
Exhibit 32.1
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of Endo Networks, Inc. (the "Company") on
Form 10-QSB for the period ending June 30, 2005, as filed with the Securities
and Exchange Commission on the date hereof (the "Report'), I, Peter B. Day,
Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
that:
(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 results of operations of the Company at
the dates and for the periods indicated.
/s/ Peter B. Day
---------------------------
Peter B. Day,
Chief Executive Officer
August 12, 2005
Exhibit 32.2
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Report of Endo Networks, Inc. (the "Company") on Form
10-QSB for the period ending June 30, 2005, as filed with the Securities and
Exchange Commission on the date hereof (the "Report'), I, Peter B. Day, Chief
Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350,
as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(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 results of operations of the
Company at the dates and for the periods indicated.
/s/ Peter B. Day
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Peter B. Day,
Chief Financial Officer
August 12, 2005