UNITED STATES SECURITIES AND

                               EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-KSB

              ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                    For the Fiscal Year ended: July 31, 2001

                           Commission File No. 0-30323

                      COLLEGE BOUND STUDENT ALLIANCE, INC.
        (Exact Name of Small Business Issuer as Specified in its Charter)

           NEVADA                                       84-1416023
(State or Other Jurisdiction of          (I.R.S. Employer Identification Number)
Incorporation or Organization)

       333 SOUTH ALLISON PARKWAY, SUITE 100, LAKEWOOD, COLORADO 80226-3115
          (Address of principal executive offices including zip code)

         Issuer's Telephone Number, Including Area Code: (303) 804-0155

        Securities Registered Pursuant to Section 12(b) of the Act: None.

           Securities Registered Pursuant to Section 12(g) of the Act:

                         COMMON STOCK, $0.001 PAR VALUE
                                (Title of Class)

Check whether the Issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
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 disclosure of delinquent filers pursuant to Item 405 of Regulation S-B
is not 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. [X]

State Issuer's revenues for its most recent fiscal year: $7,351,032

As of October 31, 2001, 24,537,629 shares of common stock were outstanding. The
aggregate market value of voting stock of the Registrant held by non-affiliates
was approximately $632,704.

Documents incorporated by reference:  NONE.

Transitional Small Business Disclosure Format (check one): Yes X  No

<PAGE>


TABLE OF CONTENTS

Part I

Item 1.  Description of Business .......................................     3-9

Item 2.  Property ......................................................       9

Item 3.  Legal Proceedings .............................................    9-10

Item 4.  Submission of Matters to a Vote of Security Holders ...........      10

Part II

Item 5.  Market for Common Equity and Related Stockholder Matters ......   11-15

Item 6.  Management's Discussion and Analysis of Financial
             Condition and Results of Operations .......................   16-21

Item 7.  Financial Statements ..........................................      21

Item 8.  Changes in and Disagreements with Accountants
             on Accounting and Financial Disclosure ....................   21-22

Part III

Item 9.  Directors and Executive Officers, Promoters and
             Control Persons; Compliance With Section 16(a) of the
             Exchange Act ..............................................   23-25

Item 10. Executive Compensation ........................................   26-28

Item 11. Security Ownership of Certain Beneficial Owners and Management    29-30

Item 12. Certain Relationships and Related Transactions ................   30-31

Item 13. Exhibits, Financial Statement Schedules and Reports on Form 8-K   32-33



                                       2
<PAGE>


Item 1. Description of Business

                                   THE COMPANY

OVERVIEW

     We were organized under the laws of the State of Colorado on July 15, 1993
under the name Winter Park Ventures, Inc. On April 22, 1997, we changed our name
to SportsStar Marketing, Inc. On July 13, 1999, we changed our name to College
Bound Student Alliance, Inc. after the acquisition of College Bound Student
Athletes, Inc. Effective August 1, 2000, we changed our domicile to Nevada. Our
offices are located at 333 South Allison Parkway, Suite 100, Lakewood, Colorado
80226-3115, and our telephone number is (303) 804-0155.

     National College Recruiting Association, Inc. ("NCRA"), a wholly owned
subsidiary of Chartwell International, Inc. granted us an exclusive license for
our use, rights, and interests in and to all of the assets, including brand and
trade names and databases, constituting the business of NCRA, along with the
rights to sell new and service existing franchises of NCRA and to publish the
Blue Chip Illustrated magazine. NCRA owns the rights to a program which promotes
high school athletes, in the pursuit of scholarships, to colleges. The program's
principal method of promotion is through profiles prepared and distributed to
various colleges. A profile is a one-page summary about a student, containing
information such as the student's name, address, date of birth, name of high
school, academic achievements, standardized test scores, desired major, and
photograph of the student, and, in the case of student-athletes, athletic
awards, achievements, and statistics.

     NCRA also licenses to us the publishing rights to a magazine, BLUE CHIP
ILLUSTRATED, which highlights the leading high school athletes in the country.
College coaches and fans are typical subscribers to BLUE CHIP ILLUSTRATED. The
Company suspended publication of the magazine in 1999.

     We use contractors and employees nationwide to represent high school
students and student-athletes seeking financial, informational, recruiting, and
admissions assistance to attend college. We offer assistance to our clients in
career planning, college major selection, college selection, college entrance
testing, searches for merit awards and financial aid and other higher education
aids and learning programs. We market our services through weekend workshops
held throughout the United States and a direct sales force. Our principal
production facilities are located in Dallas/Fort Worth metroplex, we have
another office in Orange County, California and we are headquartered in
Lakewood, Colorado. Our wholly owned subsidiaries include: College Bound
Student-Athletes, Inc. ("CBS-Athletes"), College Foundation Planners, Inc.
("CFPI"), and The College Partnership, Inc. ("TCP").

     During the year ended July 31, 2000 (fiscal 2000) we acquired CFPI and TCP.
The terms of these acquisitions are more fully described elsewhere herein.
During the year ended July 31,2001 (fiscal 2001) a substantial portion of our
focus was to integrate, improve upon and market the products of these businesses
into the Company. Currently a substantial portion of our revenue is generated
based upon modification of the original products develop by these acquired
entities. We acquired EMS athletes in April, 1999.

                                       3
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PRODUCTS AND SERVICES OFFERED

     We believe that every person and especially college bound students should
have the opportunity to realize their full potential and live a full life, which
begins with education preparation and career planning. We offer a placement
service to college-bound students, their parents, and college staff, which
focuses on matching a student's talents and abilities, via a student profile,
with colleges that the student is qualified to attend. Our business model
centers around becoming one of the few full-service providers of educational and
career planning services. Our academic services are combined with sports and
fine arts special interest areas, and vocational services which provide a single
solution for our customers. We strive to develop a trusted advisor relationship
with students that complement those with parents, schools, teachers, and
counselors.

     Students pay a fee to become one of our clients. From time to time we
receive funds from corporate sponsors wishing to underwrite this fee for student
clients. Over the last 3 years we have received 125 such corporate sponsorships
from national, regional and local organizations. However, during the twelve
months ended July 31, 2001 we only received $35,000 from corporate sponsors.

     Our original core business has been our College Bound Student
Scouting/Profiling program. The program assists high school athletic, fine arts,
or academic achievers with the college recruiting process, including completion
of a verified profile that is then distributed to our proprietary database of
college coaches, athletic directors, and department heads to assist the student
in obtaining sports, academic, or fine arts scholarships. We presently charge
$995 for our ongoing national program, $795 for our regional program of eight
states, $695 for our one-time national program, and $350 for each additional
area profile.

     We offer our products and services directly to students and their parents
via networking with high school coaches, direct mail, phone solicitations, and
our Internet website and seminar programs. We also offer our services through
corporate sponsorship programs.

     After signing the contract, our representative forwards the student's
information to us for processing. The student's file is then opened and a
preliminary profile is prepared. After the preliminary profile has been
reviewed, a master version is prepared. We then determine to which colleges the
profile will be sent based on the particular package purchased by the student,
on certain statistical requirements of the student, and also on nonquantitative
factors made on a case-by-case basis pertaining to the student's strengths and
weaknesses. The profile is mailed to the selected colleges and the colleges'
interest is tracked. The profile is updated periodically and resubmitted if
necessary.

                                       4
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     We do not have any dependence on any one or small group of direct customers
or suppliers. Since we primarily offer services rather than products, our
principal suppliers are office supply companies and those commercial printing
companies that supply our brochures. The loss of any one supplier would not
affect our operations adversely.

     With the acquisition of CFPI, we offer additional products and services to
college bound students set forth below:

1.   SAT and ACT Preparation Course that helps identify weak areas in each of
     the specific areas of math, verbal and writing skills, covered on these
     standardized tests. Our program offers computerized tutorials, educational
     tools, and personal assistance from one of our "coaches."

2.   College Major and Career Search assists the student using computerized
     analysis and research and personal advice to determine which college major
     and career a student is best suited for, hence shortening the student's
     time spent in college.

3.   Dream College Search and Selection assists students in learning how to plan
     early in high school to meet the specific entrance requirements of their
     dream college.

4.   Financial Aid Planning and search for merit money which is a complete
     course in understanding college financial aid programs, how much college
     costs, and what to do to reduce the out of pocket cost to the family. The
     program includes a computerized search of colleges that offer Academic
     Scholarships with criteria that match the student's personal
     qualifications.

5.   College Admissions Applications assists the student in emphasizing his/her
     academic and personal strengths and achievements that match the college
     admissions profile. The program walks the student through the entire
     application process and the importance of each of the documents and proper
     presentation and content.

6.   Financial Aid Service program assists students and/or parents in completing
     federal and private college financial aid applications, while recognizing
     special circumstances and conditions that may improve the assistance
     available for particular students. The program also assists with reviews of
     award letters, appeals applications and loan applications.

7.   Becoming a Master Student program maximizes the value students receive from
     their education by teaching them how to learn in the most effective way
     possible.

8.   College Survival Seminar program helps calm a student's fears about the
     freshman experience and helps them gain insight from recent college
     graduates about living away from home and includes a workbook and other
     information.

     Prior to the CFPI acquisition, a small number of these services were
subcontracted out on a limited basis or referred to other professionals.

                                       5
<PAGE>


     The services that we now offer due to the acquisition of TCP will assist
students in all high school grade levels in pursuing their future educational
goals. We market our services through weekend workshops held around the nation.
The focus of the workshops is to provide insight into early planning for college
selection, meeting college admission criteria and the financial aid process. We
serve as a "co-source" to families along with the assistance of school guidance
counselors.

     We analyze clients in five different areas. These include academic ability,
aptitude, interests, college preferences, and family income and assets. With the
data, we can create an action plan for each client. Each action plan is unique
and specific to each student. Our customer service personnel are available
sixteen hours a day, Monday through Friday, fifty-two weeks a year at a
toll-free number to advise students and families through all aspects of the
college admissions and financial aid process.

     We are hoping to expand our product/service offerings via future
acquisitions and the internal development of new products for alternative
education or training. Our focus is to greatly broaden our efforts in four
distinct markets: the academics, fine arts and athletics assistance markets
currently being served by us, and to expand into the vocational studies
assistance market.

     We typically charge fees ranging from $695 to $1,495 for each of the
services discussed above. Several discount packages that bundle some services
are also offered that range from $1,495 to $3,995. All prices are subject to
change without notice. We presently accept various credit cards and installment
payments. We offer a no interest three payment plan option for some of CFPI's
larger college partnership service packages that bundle together several of our
programs/services. We offer refunds occasionally when a customer feels that he
or she has not been provided valuable services in the college
recruiting/financial aid process.

MARKETING AND SALES

     We market our services largely through seminars, corporate sponsors and
through an organization of full and part-time regional directors and sales
representatives who live in the local area and who are familiar with the high
schools, students, teachers, and coaches in that area. One-on-one sales are
generally conducted at the student's home with the student's parents and the
student, targeting those students and athletes who meet minimum standards of
academic, fine arts, and athletic performance. Workshops are used to present
information about our services to large groups and to enroll students as new
clients.

     We also engage in activities in the local communities where our offices are
located to promote our services. As an example, in February 2000, we provided
our college placement service as a contestant prize in a scholarship pageant
held in Denver, Colorado.

     In July 2000, we expanded our website (www.cbsa.com) by providing more
disclosure about our business plan and the ability to receive potential customer
leads and orders for some of our products and services. Additional e-commerce
capabilities are planned for future updates to the website.

                                       6
<PAGE>


FRANCHISEES

     We previously offered for sale and sold franchises for NCRA businesses,
which are the establishing, operating, and promoting of athletic student
profiling for college-bound athletes.

     Currently, there are less than 6 franchises active in our program and we
have discontinued selling new franchises. We are in the process of phasing out
our existing franchises.

TRADEMARKS

     In June 1999, we filed service mark applications with the U.S. Patent and
Trademark Office to register the following marks: Career Bound Student Alliance,
CBSA, College Bound Student Athletes and College Bound Student Alliance. These
applications are pending.

     We acquired the design service mark registration for "CBSA" and "College
Bound Student-Athletes", registered on January 24, 1995 with the U.S. Patent and
Trademark Office, from CBS-Athletes.

     NCRA has design service marks for "NCRA-National College Recruiting
Association" and "Blue Chip Illustrated", which was registered March 9, 1999
with the U.S. Patent and Trademark Office and which are licensed to us.

     As a result of our acquisition of TCP we now own (or are in the application
process of owning) the following intellectual property rights;

     Service Marks:

          COLLEGE FINANCIAL AID SERVICES OF AMERICA CFASA
          Welcome to the Real World of College Financial Aid
          PLAN-IT College (applied for)

     Trademarks:

          FINANCIAL AID ALERT
          Don't stumble through college...PLAN-IT (applied for)
          The PLAN-IT College Program (applied for)
          College Action Plan (applied for)

     Copyrights:

          Invitation Letter
          Client Application and Fee for Services Agreement
          Authorization Agreement for Pre-Authorized Bank Draft
          Student Financial Information

     Process Patent:

          We are also in the process of applying for a patent of our proprietary
processes, algorithms and procedures used in our business, which is a
sophisticated matrix for identifying the best college for the money for each
student client. We currently have the right to this under a lease agreement with
an option to purchase in 2004.

                                       7
<PAGE>


COMPETITION

     Management believes that we and our competitors are serving less than 2% of
the potential market of all potential college bound high school students that
would receive as comprehensive an array of services as offered by the Company on
a nation-wide basis. There are two primary types of student services: (i)
Internet companies where, for a fee, the student places his/her own information
on an Internet site, and (ii) companies with operations similar to ours.

     Management knows of approximately two dozen companies, which appear to
offer services similar to ours. Management believes that we can continue to grow
in spite of this competition, but, we will need to expand our marketing and
sales efforts to do so. Some of these companies are better capitalized than we
are.

     While we believe we are one of the leaders in the industry, there can be no
assurance that we will be able to maintain our position in the industry.
Barriers to entry into Internet-based businesses are low and the development by
others of new, improved or modified programs and/or services could make our
products and/or services obsolete. Therefore, even if we develop new and
innovative services or products that prove to be commercially feasible, there is
no assurance that a new development by a competitor will not supersede any such
services or products. We must, therefore, continuously improve our services and
develop new products in order to be competitive. In this regard, we may not have
sufficient resources to undertake the research and development necessary to
remain competitive in the industry.

GOVERNMENT APPROVALS AND REGULATION

     We are involved in investigations and one litigation with federal and state
regulatory bodies (See Legal Proceedings Section). Among these cases, we were
involved in an investigation by the Federal Trade Commission with respect to the
past practices of TCP, prior to our acquiring it, relating to consumer trade
practices involving advertising, promotions and sales, and this matter was
settled without a significant adverse effect to the Company; and are involved in
litigation with the Attorney General of Minnesota regarding similar claims
against TCP.

     Few regulations control our business and operations, other than regulations
applicable to businesses generally. It is possible, however, that future laws
and regulations may be adopted with respect to college financial aid covering
such issues as privacy, pricing, quality of services, and libel, among others.
Any such new legislation or regulation could have an adverse impact on our
business.

                                       8
<PAGE>


     We are subject to state and federal laws regarding our past sales of
franchises to a small number of our area regional directors and sales
representatives (less than 5% of our area regional directors and sales
representatives are franchisees). The last franchise was sold in January 1999.
We, however, have discontinued offering franchises.

     The National Collegiate Athletic Association (NCAA) has certain rules and
regulations pertaining to college student-athletes, which affect our operations.
In particular, we may not act as an "agent" for the student or "negotiate" a
scholarship on a student's behalf. Management believes that our operations, as
an athletic profiling resume service, are in compliance with NCAA rules.

EMPLOYEES

     As of July 31, 2001, we had a total of 67 employees (57 full-time and 10
part-time) in our Colorado, Texas, and California offices. In addition, we have
approximately 200 independent regional directors and sales representatives
located throughout the country paid on a commission basis.

     Our future success depends in significant part upon the service of our key
senior management personnel and our continuing ability to attract and retain
highly qualified technical and managerial personnel. The time that the officers
and directors devote to our business affairs and the skill with which they
discharge their responsibilities will substantially impact our success. To the
extent the services of these individuals would be unavailable to us for any
reason, we would be required to identify, hire, train and retain other highly
qualified technical and managerial personnel to manage and operate our affairs.
Our business could be adversely affected to the extent such key individuals
could not be replaced.


Item 2. Description of Property

     We have a lease agreement with a non-affiliated third party to lease
approximately 6,140 square feet of office space at 333 South Allison Parkway,
Suite 100, Lakewood, Colorado. The lease term commenced August 1, 2000 and
expires July 31, 2005. Monthly rent is $9,460.

     CFPI leases approximately 2,010 square feet of office space from a
non-affiliated third party at 14081 South Yorba, Suite 106 and 112, Tustin,
California 92780. The lease requires monthly rent of $2,714 and expires July 31,
2004.

     TCP leases approximately 13,357 square feet of office space from a
non-affiliated third party at Bank America Tower, 8801 West Freeway, Grand
Prairie, Texas 75051. The lease requires monthly rent of $17,231.


Item 3. Legal Proceedings

     In fiscal 2000, the Attorney General of Minnesota filed suit against TCP
alleging deceptive trade practices, consumer fraud and false advertising prior
to its acquisition by the Company. The plaintiffs in the case are seeking
injunctive and other relief. The Company through its legal counsel is involved
in ongoing settlement discussions with the State of Minnesota. Based on these
discussions management believes this matter will be resolved without significant
financial consequences. However, as this may result in a jury trial, no estimate
of the loss, if any, can be made.

                                       9
<PAGE>


     In fiscal 2001, the prior owners of a business acquired by the Company in
fiscal 1999 filed an action against the Company demanding payments on promissory
notes issued in the acquisition.

     The Company contends the purchase price was overvalued as of the purchase
date, that the remaining performance thresholds have not been met and,
therefore, the corresponding performance payments are not due, and that a return
of previous payments may be required. The Company also terminated certain
consulting and employment agreements to these prior owners. The Company
subsequently filed suit against these parties. One of the prior owners has filed
a counter suit against the Company alleging breach of executive employment
agreement and seeks money damages in the amount of $540,000 plus attorney fees
and other costs. The Company believes that it has meritorious defenses as to the
entire amount sought. Accordingly, no amounts have been accrued on this action,
however, the promissory notes on the acquisition remain outstanding. The Company
intends to vigorously contest this action and seek recovery of the promissory
notes issued.

     The Company is also involved in claims, legal actions, regulatory inquiries
and interpretations arising in the ordinary course of business and is the
subject of investigations in the State of Illinois. In the opinion of
management, the ultimate disposition of these matter will not have a material
adverse effect on the Company's financial position or results of operations.


Item 4. Submission of Matters to a Vote of Security Holders

     None





                                       10
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Item 5. Market for Common Equity and Related Stockholder Matters

     Our common stock is currently traded on the OTC Bulletin Board under the
symbol "GRAD". The following table sets forth the range of high and low bid
quotations for each fiscal quarter within the last two fiscal years. These
quotations reflect inter-dealer prices without retail mark-up, mark-down, or
commissions and may not necessarily represent actual transactions.

     FISCAL QUARTER ENDED                   HIGH BID             LOW BID

          October 31, 1999                   $0.52                $0.18
          January 31, 2000                   $0.71                $0.15
          April 30, 2000                     $1.60                $0.20
          July 31, 2000                      $0.31                $0.28
          October 31, 2000                   $0.42                $0.19
          January 31, 2001                   $0.20                $0.09
          April 30, 2001                     $0.36                $0.12
          July 31, 2001                      $0.20                $0.06

     As of October 31, 2001, there were 170 record holders of our common stock.
Based on reports from Corporate Stock Transfer, we believe that there are
approximately 1,600 beneficial stockholders. Since our inception, no cash
dividends have been declared on the common stock.

     The Securities and Exchange Commission (SEC) has adopted rules that
regulate broker-dealer practices in connection with transactions in "penny
stocks". Generally, penny stocks are equity securities with a price of less than
$5.00 (other than securities registered on certain national exchanges or quoted
on the NASDAQ system). If our shares are traded for less than $5 per share, as
they currently are, the shares will be subject to the SEC's penny stock rules
unless;

     (1) our net tangible assets exceed $5,000,000 during our first three years
of continuous operations or $2,000,000 after the first three years of continuous
operations; or

     (2) we have average revenue of at least $6,000,000 for the last three
years.

     The penny stock rules require a broker-dealer, prior to a transaction in a
penny stock not otherwise exempt from the rules, to deliver to a customer a
standardized risk disclosure document prescribed by the SEC that provides
information about penny stocks and the nature and level of risks in the penny
stock market. The broker-dealer also must provide the customer with current bid
and offer quotations for the penny stock, the compensation of the broker-dealer
and its salesperson in the transaction, and monthly account statements showing
the market value of each penny stock held in the customer's account. In
addition, the penny stock rules require that prior to a transaction in a penny
stock not otherwise exempt from those rules, the broker-dealer must make a
special written determination that the penny stock is a suitable investment for
the purchaser and receive the purchaser's written agreement to the transaction.
These requirements may have the effect of reducing the level of trading activity
in the secondary market for a stock that becomes subject to the penny stock
rules. As long as our common stock is subject to the penny stock rules, the
holders of the common stock may find it difficult to sell our common stock.

                                       11
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Recent Sales of Unregistered Securities

     During the past three years, we have sold shares of common stock which were
not registered under the Securities Act of 1933, as amended, as follows:

     From December 1998 to May 1999, we issued 236,001 shares of common stock to
directors (William Willard, Janice Jones, and William Kroske) and an advisor,
who now serves as our Chief Financial Officer, (John Grace) for services valued
at $28,718.

     From December 1998 to March 1999, we issued 173,656 shares of common stock
to employees for compensation in the amount of $21,272.

     From December 1998 to March 1999, we issued 471,795 shares of common stock
to certain parties for services valued at $56,387 and to secure the payment of
certain amounts owed by us. The shares issued as security for payment (450,100)
are held in escrow.

     In February 1999, we issued 42,000 shares of common stock to 4 persons for
cash in the amount of $16,619, net offering costs, pursuant to the exemption
from registration contained in Rule 504.

     In April 1999, we issued 500,000 shares of common stock to Wayne and Kevin
Gemas as part of the purchase price for CBS-Athletes, and 22,500 shares of
common stock to 6 employees and consultants of CBS-Athletes. The shares were
valued at $179,579. In addition, options to purchase 500,000 shares of common
stock at $0.50 per share, and additional options to purchase 500,000 shares of
common stock contingent upon attaining certain performance thresholds were
issued to Wayne and Kevin Gemas. The issued options at $0.50 were valued at
$61,531. An additional 25,000 shares, valued at $7,462, were issued to one of
the CBS-Athletes consultants in August 1999.

     In May 1999, 351,996 shares of common stock were issued and held in escrow
to secure the payment of a note in the amount of $176,000. These shares were not
valued since they are held in escrow. These shares were canceled in January 2000
and 352,000 shares were reissued in the names of Kevin and Wayne Gemas. The
shares are still held in escrow.

     In August 1999, we issued 42,990 shares of common stock to officers,
directors, and an advisor (Art Harrison, Janice Jones, William Willard, and John
Grace) for compensation of $21,387.

     In August 1999, we issued 1,347 shares of common stock to Marcus McCarty
for compensation of $536.

     In August 1999, we issued 30,000 shares of common stock to Michael Johnson
for compensation of $11,880.

                                       12
<PAGE>


     In August 1999, we issued 55,000 shares of common stock to The Taxin
Network for services valued at $16,417.

     In August 1999, we issued 22,500 shares of common stock to the John and Sue
Brodie Trust as additional purchase price for CBS-Athletes.

     In October 1999, we issued 125,000 shares of common stock to Patrick Darrel
Hackman for investor relation services valued at $27,134.

     In November 1999, we issued 360,000 shares of common stock to Johnson &
Associates for investor/public relations services valued at $71,633.

     In January 2000, we issued 140,000 shares of common stock to Charlie Jarvis
for website creation services valued at $50,649.

     In February 2000, we issued 145,033 shares of common stock to officers,
directors and advisors of the Company (Arthur Harrison, Janice Jones, William
Willard, and John Grace) for compensation of $35,814.

     In February 2000, we issued 3,278 shares of common stock to Daniel J. Miske
in lieu of legal fees of $1,068.

     In February 2000, we offered and sold 2,000,000 shares of common stock at
$.50 per share for a total of $1,000,000 pursuant to Rule 504 of Regulation D to
8 persons in the State of Nevada and one accredited investor in the State of
Colorado. The offering was registered by qualification in the State of Nevada.
No underwriters were used in connection with the offering. The purchasers in
descending order of our February 2000 504 offering were as follows:

       Investor Name                   Shares Purchased       Proceeds
       -------------                   ----------------       --------

1. Oriental New Investments                1,000,000         $  500,000
2. Michael Chueh                             300,000         $  150,000
3. Diane Marie Wiley                         233,000         $  116,500
4. Rocio Trujillo                            224,000         $  112,000
5. Wall Street Partners                      200,000         $  100,000
6. Angela Gornec                              20,000         $   10,000
7. Arthur Gearhart                            10,000         $    5,000
8. Terry McGowan                               8,000         $    4,000
9. Marion Porter                               5,000         $    2,500
                                          ----------         ----------

         TOTAL                             2,000,000         $1,000,000
                                          ==========         ==========


                                       13
<PAGE>


     In February 2000, we issued 8,000 shares of common stock to Serena Riedel,
an employee, for compensation of $5,861.

     In May 2000, we issued 500,000 shares of common stock to Constance J.
Cooper as part of the purchase price for CFPI. The shares were valued at
$161,174. In addition, options to purchase 500,000 shares of common stock at the
higher of $0.50 per share or market value on September 5, 2000, contingent upon
CFPI attaining certain performance thresholds were issued to Constance J.
Cooper.

     In May 2000, we issued 2,000 shares of common stock each to Anthony Shouse,
our former controller, and John Grace, in consideration for their agreement to
defer part of their compensation. The shares were valued at $1,148. Also in May
2000, we issued 51,990 shares of common stock to officers, directors, and
advisors (Arthur Harrison, Janice Jones, William Willard, and John Grace) for
compensation of $20,149.

     In May 2000, we issued 10,000 shares and 150,000 shares of common stock to
Lovelock79.com and Maple, Poplar & Ash Ltd., respectively, as payment for
services. The shares were valued at $3,256 and $48,841, respectively.

     In May 2000, we granted to Swartz Private Equity, LLC warrants to purchase
445,000 shares of common stock during a five-year period at an exercise price of
the lower of $.50 per share or the lowest reset price. The terms of the warrants
provide that the purchase price will be reset every six months.

     In July 2000, we issued 23,182 shares of common stock to John Grace for
compensation of $6,885.

     In July 2000, we issued 17,000 shares of common stock to Jack Renkens for
his services valued at $5,049.

     In July 2000, we issued 10,000 shares of common stock to Lawrence Berggoetz
in lieu of payment for services valued at $2,970.

     In July 2000, we issued 2,000,000 shares of common stock to the sole
stockholder, Mr. Scott G. Traynor, of College Resource Management, Inc. in
connection with our acquisition of the Company. The shares were valued at
$504,000.

     In August 2000, we issued 25,000 shares of common stock to Arthur Harrison
for compensation of $7,033.

     In August 2000, we issued 100,000 shares of common stock upon the exercise
of a stock option to purchase these shares for an exercise price of $27,500.

     In October 2000, we issued 9,600 shares of common stock to Jerome Lapin for
compensation of $2,400.

     In November 2000, we issued 71,336 shares of common stock to John Grace for
compensation of $8,917.

                                       14
<PAGE>


     In November 2000, we issued 30,000 shares of common stock for the
repurchase of franchise rights valued at $11,718.

     In December 2000, we issued 23,167 shares of common stock to John Grace for
his agreement to defer part of his compensation. The shares were valued at
$3,475.

     In December 2000, we issued 36,000 shares of common stock for the
repurchase of franchise rights valued at $4,750.

     In January 2001, we issued 1,457,714 shares of common stock to officers and
employees ( Jerome Lapin, Janice Jones and John Grace) for their forgiveness of
their deferred compensation balances totaling $182,214.

     In March 2001, we issued 2,000 shares of common stock to Company's
directors for compensation of $344.

     In May 2001, we issued 40,000 shares of common stock to Constance J. Cooper
as part of the purchase price for CFPI. The shares were valued at $6,400 and
this amount was recognized as compensation expense.

     No underwriters were used in connection with any of the stock transactions
described above. Except for those transactions for which we relied upon the
exemption from registration contained in Rule 504, we have relied upon Section
4(2) of the Securities Act of 1933 for exemption from registration. All of the
purchasers were deemed to be sophisticated with respect to an investment in
securities of the Company by virtue of their financial condition and/or
relationship to members of management. We affixed appropriate legends to the
stock certificates issued in the transactions.




                                       15
<PAGE>


Item 6. Management's Discussion and Analysis or Plan of Operation

     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
     OPERATIONS

     We acquired three companies over the sixteen month period ended July 31,
2000 two of which were in the last two months of fiscal 2000. Therefore fiscal
2001 was a year of integration of these businesses and great transition.
Considerable effort and resources were expended during fiscal 2001 on
consolidating operations, realigning product lines and the sales organizations,
developing marketing strategies, improving and expanding products and services,
expanding the sales force, identifying and implementing efficiencies and
expanding infrastructure. As a result of these activities we incurred
significant losses through the 9 months ended April 30, 2001, which have put a
heavy strain on our financial resources and worsened our financial position. We
however, reached breakeven profitability in the fourth quarter ended July 31,
2001 and believe the worse is behind us.

     Our fiscal year end is July 31. Except for the historical information
contained herein, the following discussion contains forward-looking statements
that involve risks and uncertainties. Our actual results could differ materially
from those discussed here. Factors that could cause or contribute to such
differences include, but are not limited to, those discussed in this section and
elsewhere herein.

RESULTS OF OPERATIONS: YEAR ENDING JULY 31, 2001 VERSUS JULY 31, 2000

GENERAL

     The revenue recognized during fiscal 2001 was significantly impacted by 3
factors: (1) revenue from two companies acquired near the end of fiscal 2000
being included in fiscal 2001 for the first time, (2) revenues from contracts
signed in August through December, 2000 being deferred over a twelve month
period whereas revenues from similar open contracts as of July 31, 2000 were
recorded as an asset at the time of acquisition and therefore we did not
recognize revenue from the existing contracts during our fiscal year 2001, and
(3) revenues from new TCP products introduced in January, 2001 were not
recognized until the product was shipped, which delayed revenue recognition for
an average of another 3 to 5 months. As a result of these factors the revenue
reported in the financial statements in fiscal 2001 is significantly less than
the underlying business activity. A substantial portion of the costs relating to
the generation of such revenues are recognized as an operating cost when they
were incurred and therefore have had the effect of increasing operating costs
before the related revenues are recognized. We believe the revenues and
operating results of fiscal 2001 are not comparable to the prior year and most
likely will not be comparable to future periods as a result of the above factors
affecting our revenues.

                                       16
<PAGE>


The table below summarizes the actual business activity for the past four fiscal
quarters as compared to the revenues recognized in the financial statements for
the same periods. TCP was acquired by us as of July 31, 2000. As previously
indicated we substantially changed and improved upon TCP's product January 1,
2001. TCP's contracts account for approximately 85% of our total revenue. Below
is a summary of TCP's contracts signed during each quarter of fiscal 2001, the
value of TCP contracts signed each quarter together with other company revenues,
and the revenues per financial statements, net of reserves.

<TABLE>
<CAPTION>

                                           Three Months        Three Months       Three Months       Three Months
                                               Ended               Ended             Ended              Ended
                                           July 31, 2001      April 30, 2001    January 31, 2001   October 31, 2000
                                           -------------      --------------    ----------------   ----------------
<S>                                        <C>                <C>               <C>                <C>
Number of TCP contracts signed, net of
cancellations                                     2,821              3,692              2,115              2,646
                                             ==========         ==========         ==========         ==========

Estimated value of TCP contracts signed,
less estimated reserves                      $2,640,099         $3,296,612         $1,763,898         $1,895,289
                                             ==========         ==========         ==========         ==========

Open TCP customer contract receivables,
net of reserves                              $3,894,349         $3,228,561         $1,901,809         $1,926,000
                                             ==========         ==========         ==========         ==========

Cash collected from TCP customers in
period                                       $2,232,142         $2,397,361         $1,746,289         $1,942,261
                                             ==========         ==========         ==========         ==========

Number of open TCP customer contracts
for which revenue has not been fully
recognized                                        7,821              7,205              6,041              6,360
                                             ==========         ==========         ==========         ==========

Estimated value of TCP contracts signed,
plus revenues from all other company
student services                             $2,841,248         $3,604,248         $2,162,918         $2,327,675
                                             ==========         ==========         ==========         ==========

Revenues per financial statements,
net of estimated reserves                    $3,473,211         $1,779,135         $1,258,899         $  782,496
                                             ==========         ==========         ==========         ==========
</TABLE>

     The number of weekend workshops varies from quarter to quarter depending on
holidays; there were 9, 12, 10 and 12 workshop weekends in the fiscal quarters
ended July 31, 2001; April 30, 2001; January 31, 2001 and October 31, 2000,
respectively. Seasonality is impacted by the number of workshop weekends and
also by lower turnouts during the November and December holiday season. Numbers
of contracts sold during the three and twelve months ended July 2001 are higher
than that experienced by TCP prior to the acquisition in its prior year due to a
higher unit selling price and higher unit sales volume occurring with the
introduction of a new and upgraded products beginning January 1, 2001.

     While the profitability achieved in the fourth fiscal quarter ended July
31, 2001 is not necessarily indicative of future quarters, we believe we will
achieve profitability in calendar 2002, and can continue our growth rate and
manage our costs. The estimated value of the contracts entered into in the six
months ended October 31, 2001 exceeded the same period last year by over 30%,
despite some setback caused by the September 11 tragedy and related anthrax
scares.

                                       17
<PAGE>


     As a result of the seasonality of our sales and possibly the adverse
effects of the September 11, 2001 tragedy, we do expect to report a loss for the
first fiscal quarter of 2002. However, this loss is expected to be significantly
less than reported for the same quarter of fiscal 2001. Our ability to continue
our growth is dependent on obtaining new funding and the absence of further
major terrorist activities in the U.S. which would probably significantly reduce
attendance at our workshops. Attendance rates in recent weeks have been
returning to normal.

REVENUE

     For the year ending July 31, 2001, total revenue increased $5,495,006 or
296% to $7,351,032 as compared to $1,856,026 for 2000. Revenue is expected to
continue increasing in fiscal 2002, as we expand our direct sales force, direct
marketing campaigns to improve workshop attendance, expand the corporate
sponsorship program and implement the CFPI enhanced services model nationwide.

     Student services revenue increased for the fiscal year 2001 to $7,163,383
from $1,285,779 in 2000, primarily as a result of the acquisition of TCP
(formerly College Resource Management, Inc.) and a full year's activity from the
acquisition of CBS-Athletes in 2001 and CFPI's. Student services revenues are
expected to grow as we improve our direct marketing campaigns to increase
workshop attendance and expand our number of sales representatives.

     Corporate sponsor revenue decreased $500,320 or 93% for the year ended July
31, 2001 to $35,345 from $535,665 for 2000. While we will continue to search for
similar sponsorships in the future, there is no assurance that we will receive
additional sponsorships.

     We have recently experienced substantial revenue growth; however, there can
be no assurance that we will continue to grow at historical rates or at all. Our
ability to generate increased revenue and achieve profitability will depend upon
our ability to increase sales through development and/or acquisition of new
products, expanding the number of sales representatives, and further developing
our direct marketing campaigns to increase attendance at our workshops. Our
ability to expand and develop these channels depends on a number of factors
beyond our control, including general business and economic conditions.
Expansion and development of existing and additional marketing and distribution
channels will also depend, in part, upon our ability to secure additional
financing, technology, expertise and staff.

     Other revenue increased $117,722 or 340% for the year ended July 31, 2001
to $152,304 from $34,582 for 2000. This primarily represents interest earned on
the sale and payments associated with the TCP products.

                                       18
<PAGE>


COST OF SERVICES

     The cost of services for 2001 increased $623,644 or 58% to $1,705,112 from
$1,081,468 for 2000. The increase in cost of services is primarily attributable
to the acquisition of TCP with its related cost of sales. As a percentage of
student services revenue, cost of services was 23% for the current year, as
compared to 58% for the prior year. Cost of service decreased as a percentage of
revenue because of the low direct cost of TCP's product. Cost of services is
comprised primarily of production costs for our product deliverables.

OPERATING EXPENSES

     Selling, general and administrative expenses increased 401% or $7,038,367
to $8,795,286 for 2001, as compared to $1,756,919 for 2000. The increase results
from the high sales and marketing costs associated with selling the TCP products
which include direct marketing campaigns, commissions and conducting workshops
in over 300 locations during 2001.

     Our results have also been affected by the costs associated with the
integration of operational and administrative functions and building
infrastructure for future expansion.

DEPRECIATION AND AMORTIZATION

     Depreciation and amortization increased 118% or $286,147 to $528,496 for
2001, as compared to $242,349 for 2000. The additional depreciation and
amortization was primarily due to the acquisition of TCP, CFPI and CBS-Athletes
since their acquisitions resulted in intangible assets totaling $2,321,233.
These assets are generally being amortized over a 10-year period.

OPERATING LOSS.

     Our operating loss for 2001 was $3,677,862 compared to an operating loss of
$1,224,710 in 2000. The increase in operating loss is primarily attributable to
the increased selling, general and administrative costs associated with the, TCP
CAP product, costs of merging operations and building infrastructure, high legal
and accounting fees, higher investor and public relations expenses, and higher
amortization expenses.

NON OPERATING INCOME (EXPENSE).

     Interest expense for 2000 increased 227% or $239,989 to $345,718 as
compared to $105,729 for 2000. The increase in interest expense relates
primarily to the financing of the acquisitions. Our interest expense is directly
related to our level of borrowings and related interest rates.

NET LOSS AND NET LOSS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS

     Net loss for fiscal 2001 was $4,010,901, as compared to $1,319,820 for
2000. The basic and diluted net loss per share attributable to common
stockholders for 2001 was $0.16, as compared to net loss per share of $0.07 for
2000.

FINANCIAL CONDITION FOR YEAR ENDED JULY 31, 2000 AS COMPARED TO JULY 31, 1999

     Working capital decreased by $2,818,049 to a negative $3,376,236 balance as
of July 31, 2001 from a negative $558,187 balance as of July 31, 2000. This
decrease in working capital is primarily attributed to the $1,910,721 increase
in deferred revenue to a July 31, 2001 balance of $2,334,301, plus increases in
accounts payable and the debt financing of unrecorded contract receivables.

                                       19
<PAGE>


LIQUIDITY AND CAPITAL RESOURCES

     Our primary sources of liquidity and capital resources historically have
been borrowings and sales of our equity securities. Cash used for payment of
operating costs has offset these sources of cash flows.

     During fiscal 2001 we incurred significant operating losses and a
deterioration in working capital as we revamped and improved product lines and
our marketing organization, consolidated the operations of our acquired
companies and invested in expansion of our operations and infrastructure. We
believe these activities consumed considerable focus and resulted in significant
losses during the first three quarters of fiscal 2001. A portion of these costs
and operating deficits were funded by a financing of our on and off balance
sheet customer contract receivables, the deferral of compensation by certain
executives, the deferral of payments to certain vendors and related parties, and
stock issued for services. We recognize that these activities can not occur as a
long-term strategy. We need to generate positive cash flows from operations,
raise debt and equity financing and further corporate sponsor contributions.
During the final quarter of fiscal 2001 financial results indicate we were
marginally profitable during this quarter and new customer contracts sold
increased 35% over the first fiscal quarter of 2001.

     We do not expect our near-term growth in cash flow from increased sales
will be sufficient to meet our obligations and will need to rely on a
significant portion of outside funding to continue our operations and fund our
growth. We do believe, however, our current financing sources can provide us
adequate funding to sustain operations through fiscal 2002. We also believe we
can attach alternative sources of capital on more favorable terms. We have
recently engaged two investment banking firms to assist us in obtaining both
debt and equity financing and certain investor prospects have informally
indicated an interest in making a significant investment. While there is no
guarantee we will be successful in attracting such investment, we believe
reorganization costs are behind us, we have substantially decreased our losses
from operations, sales are improving and the fundamentals of our business are
strong, which all present an attractive investment vehicle with growth
potential. At October 31, 2001 we had financed approximately $1,500,000 of
receivables as senior debt, had pledged collateral of approximately $1,600,000
against the senior debt and had $1,600,000 of unencumbered receivables and
contracts. For financing purposes, we have been able to use as collateral open
contracts for which we have not yet delivered our product (therefore they are
not recorded as receivables for financial statement purposes) but these
contracts have met certain criteria for financing by our lender. We believe the
unencumbered contract receivables are available for further senior debt and the
collaterized receivables are available for subordinated debt. Our investment
banker estimates that approximately $3 to $5 million can be raised as
subordinated debt over and above a minimum of $1 million additional senior debt
securities. Management and our investment banker expect the terms and conditions
of additional financing on senior debt are expected to be better than the
existing line; however, terms may not be as beneficial to us on the subordinated
debt or equity securities as might otherwise be expected in normal circumstances
because of our past losses. Additionally, certain funds raised are required to
be paid to accelerate payments on debt obligations.

                                       20
<PAGE>


     In summary, management believes that our cash requirements through next
year will be satisfied by the following sources; (1) cash expected to be
generated from operations, (2) obtaining further senior debt financing (3)
obtaining subordinate debt financing, (4) corporate sponsor contributions and
(5) possible equity financing. No assurance can be given, however, that we will
be successful in obtaining additional capital to satisfy existing obligations
and fund future operations and at what terms such capital will be available.

     As reflected in our statement of cash flows during fiscal 2001 we used
$290,904 cash in operations as compared to $616,887 in fiscal 2000. Uses of cash
in operations in fiscal 2001 consisted of our net loss $4,010,901 offset by non
cash expenses of $919,045. The revenue recognition factors as described in the
Results of Operations section on page 16 explain why our loss is so much greater
then our use of cash in operations.

     In fiscal 2001 cash provided by financing activities consisted primarily of
$1,034,084 financed by the placement of both on and off balance sheet customer
contract receivables. In fiscal 2000, cash provided by financing activities
consisted primarily of $974,984 realized upon the sale of the Company's common
stock.

     Cash used in investing activities in fiscal 2001 was $34,080 to purchase
property and equipment. Cash used in investing activities in fiscal 2000 was
$3,669 to purchase property and equipment $24,119 paid to purchase CFPI and
$100,000 to purchase licenses, net of $74,683 of cash acquired from TCP.

YEAR 2002 COMPLIANCE

     We have had no significant disruptions due to Year 2001 issues and we do
not expect any disruptions in the future. We have expended no financial or
technical resources to remediate any Year 2002 problems.


Item 7. Financial Statements

     Consolidated Financial Statements are included herein beginning on page
F-1.


Item 8. Changes in and Disagreements with Accountants and Financial Disclosure

     KPMG LLP ("KPMG") was previously the principal accountants of the Company.
On September 28, 2001, we sent a letter to KPMG notifying it that its
appointment as principal accountants was terminated. This action was subject to
approval by our Board of Directors. Our Board of Directors approved the change
in independent accountants on October 2, 2001. On October 3, 2001, we appointed
Hein + Associates LLP to replace KPMG as our independent public accountants to
audit our consolidated financial statements for the year ended July 31, 2001.
KPMG was not dismissed by us due to any disagreements with KPMG on any matter of
accounting principles or practices, financial statement disclosure, or auditing
scope or procedure.

                                       21
<PAGE>


     The independent auditor's reports of KPMG on our consolidated financial
statements for the years ended July 31, 200 and 1999 did not contain any adverse
opinion or a disclaimer of opinion, nor were they qualified or modified as to
uncertainty, audit scope or accounting principles.

     In connection with the audits of the two most recent fiscal years ended
July 31, 2000 and the subsequent interim periods through the date of KPMG's
dismissal, there were no disagreements with KPMG on any matter of accounting
principles or practices, financial statement disclosure, or auditing scope or
procedure, which, if not resolved to the satisfaction of KPMG, would have caused
it to make reference to the subject matter thereof in connection with its
independent auditor's report, except as follows:

          During the quarters ended October 31, 2000 and January 31, 2001, our
     senior management responsible for the financial statements (including the
     Chief Financial Officer, Chairman of the Board and President and an
     additional member of the Board of Directors) had discussions with KPMG
     regarding the appropriate revenue recognition policy for the
     multiple-element contract arrangements entered into from August 1 to
     December 31, 2000 by a recently acquired subsidiary.

          KPMG characterizes the above noted discussions as a disagreement as
     the term is defined in Item 304 (a) (1) (iv) of Regulation S-K, and we do
     not.

     We authorized KPMG to respond fully to the inquiries of Hein + Associates
concerning all of the matters discussed herein.

     A letter from KPMG LLP addressed to the Securities and Exchange Commission
dated November 8, 2001 stating whether it agrees with the above statements is
furnished in the 8-K/A-2 filed November 8, 2001.

     We have not, during our two most recent fiscal years and any subsequent
interim periods prior to engaging the new accountant, consulted with the newly
engaged accountant regarding:

     (i)  The application of accounting principles to a specified transaction,
          either completed or proposed; or the type of audit opinion that might
          be rendered on the registrant's financial statements, and neither a
          written report was provided to the registrant nor oral advice was
          provided that the new accountant concluded was an important factor
          considered by the registrant in reaching a decision as to the
          accounting, auditing or financial reporting issue; or

     (ii) Any matter that was either the subject of a disagreement or a
          reportable event.


                                       22
<PAGE>


Item 9. Directors and Executive Officers, Promoters and Control Persons,
        Compliance with Section 16(a) of the Exchange Act

     The officers and directors of the Company are as follows:

           NAME            AGE                    POSITION
           ----            ---                    --------

     Jerome M. Lapin       71      Chief Executive Officer, Chairman Of the
                                   Board and Director

     Douglas Rother        50      President

     Janice A. Jones       53      Executive Vice President - Corporate
                                   Development, Corporate Secretary and Director

     John J. Grace         57      Chief Financial Officer

     John Chapman          43      VP Finance and Administration

     Rick N. Newton        48      Director

     Peter Lambert         49      Director

     Leonard Chaikind      70      Director


     There is no family relationship between any Director or Executive Officer
of the Company except that Janice A. Jones and John J. Grace are married to each
other

     Effective September 20, 2001 the Company established an Audit Committee and
a Compensation Committee. The Audit Committee currently consists of Mr. Chaikind
and Peter Lambert. The Compensation Committee currently consists of Rick N.
Newton and Peter Lambert.

     Set forth below are the names of all Directors and Executive Officers of
the Company, all positions and offices with the Company held by each such
person, the period during which he has served as such, and the principal
occupations and employment of such persons during at least the last five years:

     JEROME M. LAPIN has been Chief Executive Officer and a Director since
August 1999, and Chairman of the Board since December 1, 2000. From January 1994
to July 1999, Mr. Lapin was President, CEO and Chairman of the Board of
Directors of American Coin Merchandising Corporation, a publicly traded company,
(symbol ACMI), based in Boulder, Colorado. Mr. Lapin was a co-founder of
International House of Pancakes in 1958. In 1966, he retired to Australia where
he pursued private business interests including World Hosts Pty, Ltd., which
owned Caprice Restaurant and established Orange Julius in Australia. In 1978 Mr.
Lapin returned to the United States and became President and CEO of Topsy's
International, Inc., Kansas City, Missouri, which acquired the Tastee Freez
chain of 800 units. He was also President of Sanwa Foods, Inc., a soup
manufacturer in Los Angeles that was subsequently acquired by Campbell Soups.

                                       23
<PAGE>


     DOUG ROTHER President, formerly served as President of Columbine JDS
Systems, Inc., from 1995 through 2000, a software and hardware provider to the
electronic/media industry the largest company of its type in the world. Clients
included MTV, Turner Broadcasting, Tribune, New York Times, and many others.
During his five year tenure, revenues grew from $20 million to $150 million and
over 700 employees worldwide reported to him. Prior to that position, he was
President of Jefferson Pilot-Data Systems, one of four divisions of
Jefferson-Pilot Insurance (NYSE:JP). Mr. Rother holds a B.A. in Political
Science and an MBA in Marketing from the University of Memphis.

     JOHN CHAPMAN has successfully turned around and grown two technology
companies in the last eight years. Since 1997, Mr. Chapman served as Chief
Financial Officer for Page Digital, Inc. where revenues grew from $5 million to
$13 million. From 1995 to 1997, he was corporate controller for Production Data
Systems, Inc. (PDS) where revenues grew from $20 million to $50 million during
his two year tenure. During Mr. Chapman's tenure, PDS grew from 250 to over 600
employees. Mr. Chapman served as an audit manager with Price Waterhouse Coopers
from 1983 to September 1991. He holds a BS Business degree from San Diego State
University.

     JANICE A. JONES, Ph.D., is co-founder, and has been a director since 1997
and our corporate secretary since 1998. She was appointed Vice President -
Corporate Development in March 2000. In addition, she founded and has been a
director of Chartwell since its inception in 1984 and its Chief Executive
Officer since 1990, as well as President and a director of NCRA. In 1979 she
formed The Chartwell Group, Inc., an investment banking and financial relations
firm serving emerging growth companies. Dr. Jones was engaged in investor
relations for several companies from 1973 to 1982 including Cameron & Associates
from 1976 to 1980. Dr. Jones holds Ph.D., 1980, and Masters, 1976, degrees in
Social Sciences from Yeshiva University, and a B.A., 1973, from Hunter College.
She received the Hunter College Hall of Fame Award in 1986. Dr. Jones devotes
her full-time to our business and that of Chartwell.

     JOHN J. GRACE is co-founder of our Company and became our Chief Financial
Officer in September 2000. Mr. Grace has worked with us in an advisory capacity
since inception on a variety of matters including acquisitions, development of
products and services, managerial appointments and finance. Prior to 1993, Mr.
Grace was a trustee at the Center for the New West, a think tank, and was a
senior fellow there in 1995-1996 and the Executive Director in 1996 before
joining Chartwell and our Company in senior advisor roles. Prior to this, Mr.
Grace was a Managing Partner at Coopers & Lybraud (or now Price Waterhouse
Coopers) where he spent 28 years in various senior positions.

     PETER LAMBERT has been a Director since May 2000. Since May 1999, Mr.
Lambert has been the Executive Vice President and Chief Financial Officer of
Century Media, Inc., a television advertising agency based in Santa Monica,
California. From 1973 to 1997, Mr. Lambert was a commercial banker, primarily
with Lloyds Bank (1973 to 1978), The Bank of California (1978 to 1986), and
Imperial Bank (1992 to 1997), handling a wide variety of businesses including
real estate developers, commercial property owners, service companies, sports
teams, high net-worth individuals, talent agencies, production companies,
restaurateurs, and collectors of corporate jets and thoroughbreds. Since 1997,
Mr. Lambert has been the Chief Financial Officer, and one of the principal
owners, of Century Entertainment, LLC, which provides consulting services to
entrepreneurs in the film services business that is highly concentrated in Los
Angeles. Mr. Lambert has an MBA from Loyola Marymount University in Los Angeles,
and a Bachelor's Degree in Business Administration from the University of
Southern California. Mr. Lambert also graduated from Stanford's Graduate School
of Credit and Financial Management and the University of Oklahoma's National
Commercial Lending School.

                                       24
<PAGE>


     RICK N. NEWTON has been a Director since April 1999, and served as Chairman
of the Board from April 1999 to December 2000. From November 1996 to March 1999,
he was Director of Corporate Finance Services at American Express Co., Denver,
Colorado. From April 1990 to October 1996, he was CEO of Systems Science
Institute. Mr. Newton has more than 28 years of multi-industry experience3
ranging from start-up to Fortune 500 companies, and he played a significant role
(as an outside advisor) in our acquisition of CBS-Athletes. He graduated from
the University of Colorado with a Degree in Engineering. Mr. Newton devotes
approximately 5% of his time to our business.

     LEONARD CHAIKIND is the Chairman & CEO of Institutional Investors
Consulting Company (IICC), Houston, Texas. Mr. Chaikind has served in this
capacity since he founded IICC on July 15, 1991. IICC is a holding company, an
investment bank and an investment advisory group. Its primary focus is to help
its clients in the area of private (non traditional) investments. Prior to
founding IICC, Mr. Chaikind worked for Royal Dutch Shell and the Shell Oil
Company for 33 years (1958 to 1991) in a wide variety of assignments. From late
1985 to August 1991, Mr. Chaikind served as the Administrator of the $12 billion
dollars Shell Savings and Retirement Programs with responsibility for both the
investment and administration of 4 major funds. He was one of the key founders
of the Committee on Investment of Employee Benefit Assets (CIEBA), the largest
Corporate Pension Fund Group in the World, and served as Vice Chairman of this
group from its beginning until his retirement from Shell. He also served as an
active member of both the NYSE Institutional Investors Advisory Committee and
the Commodity Futures Trading Commission Advisory Board (the CFTC is to the
futures and derivatives industry what the SEC is to securities industry).

     Dr. Jones may be deemed to be our "promoter" within the meaning of the
Rules and Regulations under federal securities laws.

COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT OF 1934

     Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
our executive officers, directors and persons who beneficially own more than ten
percent (10%) of a registered class of our equity securities, to file initial
reports of securities ownership of the Company and reports of changes in
ownership of equity securities of the Company with the Securities and Exchange
Commission ("SEC"). Such persons also are required by SEC regulation to furnish
us with copies of all Section 16(a) forms they file.

     To our knowledge, during the fiscal year ended July 31, 2001, our officers
and directors complied with all applicable Section 16(a) filing requirements.
These statements are based solely on a review of the copies of such reports
furnished to us by our officers and directors and their written representations
that such reports accurately reflect all reportable transactions.

                                       25
<PAGE>


Item 10. Executive Compensation

     The following table sets forth information for all persons who have served
as the chief executive officer during the last completed fiscal year:

<TABLE>
<CAPTION>
                                               Summary Compensation Table
                                               --------------------------


                              Annual Compensation                                 Long Term Compensation
                              -------------------                                 ----------------------
                                     Salary                                     Awards              Payouts
                                     ------                                     ------              -------
                                                                                      Securities
                                                         Other        Restricted      Underlying                  All other
   Name and                                              Annual         Stock         Option/SARS     LTIP       compensation
   Position        Year      Current     Deferred(1)  Compensation      Awards         (Number)      Payouts         ($)
   --------        ----      -------     --------     ------------      -------        --------      -------         ---
  <S>              <C>       <C>          <C>              <C>              <C>           <C>          <C>         <C>
  Jerome M.
    Lapin          2001      $65,999      $97,512          $-0-             $-0-          $-0-         $-0-        $2,000(2)
    Chief
  Executive        2000        $-0-       $70,000          $-0-             $-0-        550,000        $-0-           $-0-
 Officer and
 Chairman of
the Board and
   Director

John J. Grace
    Chief          2001      $44,525      $63,100-         $-0-             $-0-           -0-         $-0-        $2,000(2)
  Financial
   Officer

----------
</TABLE>

(1)  Deferred compensation is due November 1, 2002.
(2)  Mr. Lapin received $2,000 for compensation to serve as a Director and Mr.
     Grace received $2,000 for compensation as a member of the Board of
     Advisors.
(3)  There were no bonuses paid to Mr. Lapin or Mr. Grace.


COMPENSATION OF DIRECTORS

     Beginning in May 2000, we have paid each of the Company's Directors $500
per quarter and agreed to issue the, at their choice, either options to purchase
3,000 shares of common stock exercisable at $0.50 per share or 1,500 shares of
common stock, for each quarter they serve.

                                       26
<PAGE>


EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE IN CONTROL
ARRANGEMENTS

     In April 1999, we entered into an employment agreement with Rick Newton.
Pursuant to the terms of the agreement, Mr. Newton received 55,000 restricted
shares of common stock upon acceptance of his employment and an option to
purchase up to 1,000,000 shares of common stock at $0.50 per share. The option
is exercisable for a five-year period and vests at the rate of 200,000 shares
per year. On August 10, 1999, the Board of Directors rescinded the five-year
option to purchase up to 1,000,000 shares, but granted Mr. Newton the option to
purchase up to 60,000 shares at $0.50 per share, this amount vested on the
commencement of his employment. This option expires April 16, 2004. On May 31,
2000, Mr. Newton was granted a five-year option to purchase up to 250,000 shares
at $0.50 per share. This option is vested as to 140,000 shares and will vest as
to the remaining 110,000 shares on April 19, 2001 if he has performed as
Chairman through November 6, 2000.

     On August 9, 1999, we entered into an Employment and Stock Option Agreement
with Jerome M. Lapin, the Chief Executive Officer. Mr. Lapin's employment
agreement renews automatically for successive one-year terms unless his
employment is terminated. He is paid an annual salary of $60,000 and was granted
five-year options to purchase 500,000 shares of common stock at $0.272 per
share, half of which vested on August 9, 1999 and the remainder of which will
vest August 9, 2000. Mr. Lapin has agreed that during his employment with us and
for a period of three years from the termination of his employment that he will
not directly or indirectly, own, manage, operate, control, be employed by,
perform services for, consult with, solicit business for, participate in, or be
connected with the ownership, management, operation, or control of (i) any
business which is materially similar to or competitive with our business in the
United States or (ii) any of our then existing vendors, affiliates, or customers
in the United States. Mr. Lapin's salary was increased effective March 1, 2000
to $80,000 per year. He was also granted an additional option to acquire 50,000
shares exercisable at $0.50 per share, vesting March 1, 2001. Mr. Lapin has
deferred payment of his salary. At July 31, 2000, $67,053 in salary had been
accrued and deferred. Effective September 1, 2000, Mr. Lapin's salary was
increased to $170,000, a portion of which is deferred up to November 2, 2002. In
January 2001, Mr. Lapin opted to convert $85,500 of his deferred salary into
684,000 shares of the Company's common stock. At July 31, 2001, salary deferred
and accrued totaled $49,583.31.

     On August 16, 2000, we entered into a letter agreement with John J. Grace,
the spouse of Janice Jones and an officer, director, and principal shareholder,
with regard to his compensation for services rendered July 1, 1999 through
December 31, 1999. Mr. Grace billed us for actual time worked at the rate of
$100 as follows: $25 per hour payable upon receipt of billings, $50 per hour
payable upon receipt of financing of $500,000 or more, and $25 per hour in
stock. For the fiscal years ending July 31, 1999 and July 31, 2000, Mr. Grace
earned $-0- and $107,750, respectively, and received $22,000 in March 2000. Mr.
Grace has agreed to defer receipt of compensation until we receive additional
financing. Mr. Grace agreed to become our CFO commencing September 1, 2000. His
salary structure is substantially the same. Effective September 1, 2000, one
half of Mr. Grace's salary is to be paid with the other half being deferred up
to November 1, 2002. In January 2001, Mr. Grace opted to convert $82,292 of his
deferred salary into 658,333 shares of the Company's common stock. At January 1,
2001, his annual salary was established at $136,800 per annum of which 1/2 is
deferred and 1/2 payable semi-monthly, and which salary is to be reduced to
$120,000 per annum upon hiring a V.P. of Finance and Administration. At July 31,
2001, salary deferred and accrued totaled $35,350.

                                       27
<PAGE>


     Beginning March 2000, Dr. Jones was paid an annual salary of $50,000.
Effective January 1, 2001, Dr. Jones' salary increased to $60,000. In January
2001, Dr. Jones opted to convert $10,000 of deferred salary into 80,000 shares
of the Company's common stock. At July 1, 2001, Dr. Jones' salary was increased
to $96,000, of which a portion is deferred. At July 31, 2001, salary deferred
and accrued totaled $2,000.

     On May 5, 2000 in connection with the acquisition of College Foundation
Planners, Inc (CFPI), we entered into an Employment Agreement with Constance
Cooper. Under the terms of the Agreement, Ms. Cooper is to be employed by us for
an initial term of three years, with annual extensions thereafter by mutual
consent of the parties, at an annual salary of $54,000, beginning on March 1,
2001. Ms. Cooper is entitled to a bonus equal to 50% of CFPI's annual pre-tax
cash flow (Net Income) from $50,000 to $150,000 and a bonus equal to 25% of
pre-tax Cash Flow (Net Income) over $150,000 to $300,000. No payments have been
made or earned under this plan and a new mutually agreed to plan will be
established for fiscal 2002. In addition, Ms. Cooper receives a car allowance of
$380 per month. She was also granted four-year option to purchase 500,000 shares
of common stock at $0.50 per share or the then current market value up to $1.00,
that vest at a rate of 166,666 shares per year over the next three years,
providing certain milestones are met. In August this option was exchanged for
50,000 shares of the Company's restricted common stock.



                                       28
<PAGE>


Item 11. Security Ownership of Certain Beneficial Owners and Management

     The following table provides certain information as to the officers and
directors individually and as a group, and the holders of more than 5% of the
common stock, as of October 31, 2001:

Name and Address of Owner              Number of Shares Owned   Percent of Class
-------------------------              ----------------------   ----------------

Chartwell International, Inc                 6,987,641              28.48% (1)
333 South Allison Parkway, Ste 100
Lakewood, CO 80226

Janice A. Jones                             11,190,442 (2)          45.61% (2)
333 South Allison Parkway, Ste 100
Lakewood, CO 80226
Vice President-Corporate Development,
Secretary and Director

John J. Grace                                4,902,801 (3)          18.98% (3)
333 South Allison Parkway, Ste 100
Lakewood, CO 80226
Chief Financial Officer

Scott G. Traynor                             2,000,000               8.15%
5690 Buckleigh Point
Suwanee, GA 30024

Kevin W. Gemas                               1,352,000 (4)           5.51% (4)
1001 W. Glen Oaks Lane
Suite 108
Mequon, WI 53092

Jerome M. Lapin                              1,352,000 (5)           5.51% (5)
333 South Allison Parkway, Ste 100
Lakewood, CO 80226
CEO and Director

Rick N. Newton                                 365,500 (6)           1.49% (6)
333 South Allison Parkway, Ste 100
Lakewood, CO 80226
Chairman of the Board

Peter Lambert                                   25,500 (7)           0.10%
3130 Wilshire Boulevard, 4th Floor
Santa Monica, CA 90400
Director

Harris Ravine                                   25,000 (8)           0.10%
333 South Allison Parkway, Ste 100
Lakewood, CO 80226
Director

Leonard Chaikind                                25,000 (9)           0.10%
2600 S. Gessner, Ste 501
Houston, TX 77063

Officers and Directors as a group           11,883,542              48.43%
(7 persons)
-----------------

(1)  Dr. Janice A. Jones is the beneficial owner of 46% of the common stock of
     Chartwell International, Inc. ("Chartwell"). Dr. Jones is an officer and
     director of Chartwell and may be deemed to have beneficial ownership of the
     shares owned by record by Chartwell.

(2)  Includes 6,987,641 shares held by Chartwell International, Inc., 188,500
     shares held directly, 1,144,301 shares owned of record by John J. Grace
     (the spouse of Janice A. Jones), 1,500,000 shares owned of record by Family
     Jewels II Limited Partnership (an entity owned and controlled by Dr.
     Jones), the right to convert debt into 1,000,000 shares held by The
     Chartwell Group, Inc. (a company owned and controlled by Dr. Jones) and
     shares issuable upon option held by Janice A. Jones to purchase 1,800,000
     share from Chartwell. Dr. Jones disclaims beneficial ownership of the
     shares beneficially held by her husband John J. Grace. Also includes 70,000
     share held jointly with her husband, John J. Grace.

                                       29
<PAGE>


(3)  Includes 1,144,301 shares owned of record by John J. Grace, 188,500 shares
     held of record by Janice A. Jones, his wife, shares issuable upon an option
     held by Mr. Grace to purchase 200,000 shares from Chartwell, shares
     issuable upon an option held by Janice A. Jones to purchase 1,800,000 share
     from Chartwell, 1,500,000 shares owned of record by Family Jewels II
     Limited Partnership (an entity owned and controlled by Janice A. Jones).
     Mr. Grace disclaims beneficial ownership of shares beneficially owned by
     his wife. Also includes 70,000 shares held jointly with his wife, Janice A.
     Jones

(4)  These shares are owned of record by Kevin W. Gemas and Wayne O. Gemas as
     joint tenants. Includes shares issuable upon exercise of an option to
     purchase 500,000 shares. See Part I - Item 1. Description of Business.
     Includes 352,000 shares held in escrow to secure payment of certain notes.

(5)  Includes 794,100 shares held directly and 450,000 shares issuable under
     currently exercisable options.

(6)  Includes 55,500 shares held directly and 310,000 shares issuable under an
     option.

(7)  Includes 500 shares held directly and 25,000 shares issuable under an
     option.

(8)  Mr. Ravine has resigned in September, 2001 and became a member of the Board
     of Advisors.

(9)  Includes 25,000 shares issuable under an option.

(10) This table is based on $24,537,629 shares of common Stock outstanding on
     October 31, 2001.


Item 12. Certain Relationships and Related Transactions

     In June 1997, we entered into an agreement with National College Recruiting
Association, Inc. ("NCRA"), a wholly-owned subsidiary of Chartwell
International, Inc. Chartwell International was at the time and still is one of
our principal shareholders. NCRA granted us an exclusive license for the use,
rights, and interests in and to all of the assets constituting the business of
NCRA, along with the rights to sell new and service existing franchises of NCRA
and to publish the Blue Chip Illustrated magazine. This agreement was amended on
August 1, 2000. Under the amended agreement we guarantee a monthly royalty
payment of $12,500 on annual Company revenues up to $10,000,000 and 1.0% for
revenue that exceed ten ($10) million dollars per annum. In addition, NCRA has
agreed to defer on half of its royalty fee during the first year until November
1, 2002, or earlier, if sufficient funds are available. As of July 31, 2001
$61,500 of the royalty fees was deferred and accrued.

     Through July 31, 200, we leased office space on a month-to-month basis from
Chartwell International, Inc. Rental expense was $80,319 for the year ended July
31, 2000.

     On February 26, 1998, we entered into a Management Services Agreement with
Chartwell International, Inc. Chartwell agreed to raise capital for us as
required; provide accounting and financial services; provide accounting and
financial services; provide acquisition services; communicate with major
investors, business partners and legal counsel; assist in the utilization of
trade credits; assist in the preparation of business plans; and assist with
external promotional announcements. We agreed to pay Chartwell $7,500 per month
beginning February 1, 1998 until our revenue exceeds $4,000,000 per year. At
that time, Chartwell's fee would increase to 2-1/2% of total revenue. We also
agreed to reimburse Chartwell for it's out of pocket expenses incurred by
Chartwell on our behalf. Management fee expense was $52,500 for the years ended
July 31, 2000. This agreement was terminated February 29, 2000.

                                       30
<PAGE>


     On March 29, 1999, in connection with the acquisition of CBS-Athletes, we
entered into an Employment Agreement with Kevin Gemas. Under the terms of the
Agreement, Mr. Gemas was to be employed by us for an initial term of five years,
with annual extensions thereafter by mutual consent of the parties, at an annual
salary of $90,000, subject to annual review. In addition, Mr. Gemas receives a
standard benefit package (health insurance, vacation pay, sick pay, etc.) and an
automobile allowance of $1,100 per month. Mr. Gemas' employment agreement was
terminated effective February 28, 2001.

     We have a note payable for the value of $43,721 to Chartwell for borrowed
trade credits as of July 31, 2001.

     We have a total of $75,000 in notes payable to Wayne Gemas for advances and
loans he made to CBS-Athletes prior to our acquisition of that Company.

     On June 15, 1999, we also borrowed $5,000 from Chartwell International. The
related promissory note was due December 15, 1999 with simple interest at the
rate of 10% per annum. This note was paid in February 2000.

     On June 15, 1999, we borrowed $5,000 from Arthur E. Harrison, who was then
our Chief Financial Officer. The related promissory note was due December 15,
1999 with simple interest at the rate of 10% per annum. Rick N. Newton and
Janice A. Jones, officers and directors, personally guaranteed the payment of
the note. This note was paid in February 2000.

     On July 28, 1999, we borrowed $50,000 from Spring Sun Holdings, Ltd., a
non-affiliated third party. The related promissory note was guaranteed by
Chartwell International, Inc. and secured by 135,135 shares of our common stock
owned by Chartwell. The note accrued interest at the rate of 10% per annum and
was due January 28, 2000. We tendered payment of this note at maturity.

     On January 28, 2000 and February 1, 2000, we borrowed $52,500 and $17,500,
respectively, from Chartwell International, Inc., one of our principal
shareholders and a company of which Janice Jones is an officer, director and
principal shareholder. Janice Jones is also an officer and director for us, and
one of our principal shareholders. The notes are unsecured and accrue interest
at the rate of 10% per annum. These loans are still outstanding and Chartwell
has agreed to extend the maturity date of these loans to November 1, 2002.

     On December 20, 2000, Jerome Lapin, John Grace and Janice Jones made six
month working capital loans totaling $120,000 ($40,000 each) to the Company
collateralized by the Company's open customer contracts. The interest rate on
these notes is 14% per annum, compounded monthly and payable quarterly. In June
2001, the lenders extended the term for an additional six months and
subordinated their collateral interests to those of Monterey Financial.

     We believe that the terms of transactions with affiliates are the same as
terms we would be able to negotiate with unaffiliated third parties.

                                       31
<PAGE>


Item 13. Exhibits and Reports on Form 8-K.

     (a)  Exhibits.

Exhibit
Number    Description and Location
------    ------------------------

  2.1     Stock Purchase Agreement with Wayne O. Gemas as incorporated
          by reference to Exhibit 2.1 from the Company's registration
          on Form 10-SB.

  2.2     Amendments to Stock Purchase Agreement with Wayne O. Gemas
          as incorporated by reference to Exhibit 2.2 from the
          Company's registration on Form 10-SB/A No. 2.

  2.3     Agreement to Acquire College Foundation Planners, Inc. by
          College Bound Student Alliance, Inc. as incorporated by
          reference to Exhibit 2.3 from the Company's registration on
          Form 10-SB/A No.2.

  3.1     Amended and Restated Articles of Incorporation as
          incorporated by reference to Exhibit 3.1 from the Company's
          registration on Form 10-SB.

  3.2     Bylaws as incorporated by reference to Exhibit 3.2 from the
          Company's registration on Form 10-SB.

  10.1    Agreement with National College Recruiting Association as
          incorporated by reference to Exhibit 10.1 from the Company's
          registration on Form 10-SB.

  10.2    Management Services Agreement with Chartwell International,
          Inc. as incorporated by reference to Exhibit 10.2 from the
          Company's registration on Form 10-SB.

  10.3    Office Lease with Chartwell International, Inc. as
          incorporated by reference to Exhibit 10.3 from the Company's
          registration on Form 10-SB.

  10.4    Office Lease with The Intrepid Company as incorporated by
          reference to Exhibit 10.4 from the Company's registration on
          Form 10-SB.

  10.5    Consulting Agreement with Wayne O. Gemas as incorporated by
          reference to Exhibit 10.5 from the Company's registration on
          Form 10-SB.

  10.6    Executive Employment Agreement with Kevin Gemas as
          incorporated by reference to Exhibit 10.6 from the Company's
          registration on Form 10-SB.

  10.7    Employment Agreement with Arthur D. Harrison as incorporated
          by reference to Exhibit 10.7 from the Company's registration
          on Form 10-SB.

  10.8    Employment Agreement with Rick N. Newton as incorporated by
          reference to Exhibit 10.8 from the Company's registration on
          Form 10-SB.

  10.9    Promissory Note to Arthur D. Harrison dated June 15, 1999 as
          incorporated by reference to Exhibit 10.9 from the Company's
          registration on Form 10-SB.

                                       32
<PAGE>


  10.10   Employment and Stock Option Agreement with Jerome M. Lapin
          dated August 9, 1999 as incorporated by reference to Exhibit
          10.10 from the Company's registration on Form 10-SB.

  10.11   Promissory Note to Chartwell International, Inc. dated
          January 28, 2000, as amended as incorporated by reference to
          Exhibit 10.11 from the Company's registration on Form 10-SB.

  10.12   Promissory Note to Chartwell International, Inc. dated
          February 1, 2000 as amended as incorporated by reference to
          Exhibit 10.12 from the Company's registration on Form 10-SB.

  10.13   Amendment to Agreement with National College Recruiting
          Association as incorporated by reference to Exhibit 10.13
          from the Company's registration on Form 10-SB/A No.2.

  10.14   Investment Agreement with Swartz Private Equity, LLC as
          incorporated by reference to Exhibit 10.14 from the
          Company's registration on Form 10-SB/A No.2.

  10.15   Promissory Notes and Security Agreement to Constance J.
          Cooper as incorporated by reference to Exhibit 10.15 from
          the Company's registration on Form 10-SB/A No.2.

  10.16   Employment Agreement with Constance J. Cooper as
          incorporated by reference to Exhibit 10.16 from the
          Company's registration on Form 10-SB/A No.2.

  10.17   Office lease with SanTom Holdings, L.L.C. as incorporated by
          reference to Exhibit 10.17 from the Company's registration
          on Form 10-SB/A No. 2.

  10.18   Custom Software Development and License Agreement dated
          March 1, 1998 between College Resource Management, Inc., and
          International Business Consulting, Inc. Previously filed.

  10.19   Executive Employment Agreement dated July 31, 2000 by and
          between CRM and Richard L. Sechrist II. Previously filed.

  10.20   Executive Employment Agreement dated July 31, 2000 by and
          between CRM and David L. Russell. Previously filed.

  10.21   Executive Employment Agreement dated July 31, 2000 by and
          between CRM and Marilu Hall. Previously filed.

  10.22   Executive Employment Agreement dated July 31, 2000 by and
          between CRM and Richard V. Wilson. Previously filed.

  10.23   Executive Employment Agreement dated July 31, 2000 by and
          between CRM and Timothy William White. Previously filed.

  10.24   Cook Covington Operating Lease Agreement. Previously filed.

  21      Subsidiaries of the Registrant as incorporated by reference
          to Exhibit 21 from the Company's registration on Form
          10-SB/A No. 2.

  27      Financial Data Schedule. Previously filed.


     (b)  Reports on Form 8-K.

          Form 8-K; August 7, 2000; Items 2 & 7
          Form 8-K/A; October 13, 2000; Items 2 & 7.


                                       33
<PAGE>


                           Forward-Looking Statements

     Statements made in this Form 10-KSB that are not historical or current
facts are "forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933 (the "Act") and Section 21E of the Securities Exchange
Act of 1934. These statements often can be identified by the use of terms such
as "may," "will," "expect," "believe," "anticipate," "estimate," or "continue"
or the negative thereof. We intend that such forward-looking statements be
subject to the safe harbors for such statements. We wish to caution readers not
to place undue reliance on any such forward-looking statements, which speak only
as of the date made. Any forward-looking statements represent management's best
judgment as to what may occur in the future. However, forward-looking statements
are subject to risks, uncertainties and important factors beyond our control
that could cause actual results and events to differ materially from historical
results of operations and events and those presently anticipated or projected.
These factors include adverse economic conditions, entry of new and stronger
competitors, inadequate capital, continued operating losses, inability to raise
additional debt and/or equity, unexpected costs, failure to gain product/service
approval in the United States or foreign countries and failure to capitalize
upon access to new markets, as well as outcomes of various state and federal
government regulatory actions. Additional risks and uncertainties that may
affect forward-looking statements about our business and prospects include the
possibility that a competitor will develop a more comprehensive or less
expensive service, delays in market awareness of our services and products, or
possible delays in our marketing strategies, each of which could have an
immediate and material adverse effect by placing us behind our competitors. For
a fuller description of certain of these important factors that could cause
actual results to differ materially from those currently anticipated or
projected, please see "Management's Discussion and Analysis of Financial
Condition and Results of Operations." We disclaim any obligation subsequently to
revise any forward-looking statements to reflect events or circumstances after
the date of such statement or to reflect the occurrence of anticipated or
unanticipated events.



                                       34
<PAGE>


                                   SIGNATURES

In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form SB-2 and authorized this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Lakewood, State of Colorado on November 13, 2001.

COLLEGE BOUND STUDENT ALLIANCE, INC.

Date:  November 13, 2001                   By: /s/ Jerome M. Lapin
                                           ----------------------------
                                           Jerome M. Lapin
                                           Chief Executive Officer

     In accordance with the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the dates stated.

Date:  November 13, 2001                   By: /s/ Jerome M. Lapin
                                           ----------------------------
                                           Jerome M. Lapin
                                           Chief Executive Officer and
                                           Chairman of the Board

Date:  November 13, 2001                   By: /s/ John J. Grace
                                           ----------------------------
                                           John J. Grace
                                           Chief Financial Officer and
                                           Principal Accounting Officer

Date:  November 13, 2001                   By: /s/ Janice Jones
                                           ----------------------------
                                           Janice Jones
                                           Executive Vice President-Corporate
                                           Development, Secretary and Director

Date:  November 13, 2001                   By: /s/ Rick Newton
                                           ----------------------------
                                           Rick Newton
                                           Director

Date:  November 13, 2001                   By:
                                           ----------------------------
                                           Peter Lambert
                                           Director

Date:  November 13, 2001                   By:
                                           ----------------------------
                                           Leonard Chaikind
                                           Director


                                       35
<PAGE>
<TABLE>
<CAPTION>

                       COLLEGE BOUND STUDENT ALLIANCE, INC AND SUBSIDIARIES

                                    CONSOLIDATED BALANCE SHEETS

                                      JULY 31, 2001 AND 2000

                                              ASSETS
                                                                          2001           2000
                                                                      -----------    -----------
<S>                                                                   <C>                <C>
CURRENT ASSETS
Cash                                                                  $   453,337    $   231,271
Amounts due from customer contracts acquired,
    net of allowance for doubtful accounts of $435,204                       --        1,796,784
Accounts receivable, net of allowance for doubtful accounts
    of $182,141 and $100,000 in 2001 and 2000, respectively             1,278,878         18,398
Notes receivable from financing                                           154,901           --
Inventory                                                                 152,244           --
Deferred customer contract expenses                                       849,711           --
Other current assets                                                       80,043         10,340
                                                                      -----------    -----------

        Total Current Assets                                            2,969,114      2,056,793

Property and equipment, net                                               389,134        494,791
Licensing rights, net of accumulated amortization of $210,367
      $210,367 and $147,089 in 2001 and 2000, respectively                109,856        175,072
Intangible and other assets, net of accumulated amortization
      of $514,574 and $193,367 in 2001 and 2000, respectively           2,321,233      2,703,187
Other assets                                                               24,019           --
                                                                      -----------    -----------

        Total Assets                                                  $ 5,813,356    $ 5,429,843
                                                                      ===========    ===========

                           LIABILITIES AND STOCKHOLERS' EQUITY (DEFICIT)

CURRENT LIABILITIES
  Notes payable on financing                                          $   887,317    $      --
  Current maturities on long-term obligations                             261,835        236,593
  Current maturities of long-term obligations related parties             726,685        847,725
  Accounts payable                                                      1,287,240        555,552
  Accrued liabilities                                                     847,912        541,130
  Deferred revenue                                                      2,334,361        423,640
                                                                      -----------    -----------

        Total Current Liabilities                                       6,345,350      2,604,640

LONG-TERM LIABILITIES
  Deferred rent                                                           366,656           --
  Long-term obligations, less current mauturities                       1,616,158      1,782,218
  Long-term obligations to related parties, less current maturities       621,637        427,794
                                                                      -----------    -----------
                                                                        2,604,451      2,210,012
                                                                      -----------    -----------
        Total Liabilities                                               8,949,801      4,814,652

COMMITMENTS AND CONTINGENCIES (Notes 2,5,8,14,15,16)

STOCKHOLDERS' EQUITY (DEFICIT):
 Preferred stock, $.001 par value, 10,000,000 shares authorized
  none issued or outstanding
 Common stock, $.001 par value, 40,000,000 shares authorized;
  27,207,229 issued and 25,207,229 shares issued and
  outstanding at July 31, 2001, and 25,483,068 shares
  issued and 23,483,068 shares issued and outstanding
  at July 31, 2000                                                         25,207         23,482
 Additional paid-in capital                                             3,756,851      3,521,489
 Deferred compensation                                                       --          (22,178)
 Accumulated deficit                                                   (6,918,503)    (2,907,602)
                                                                      -----------    -----------

        Total stockholders' equity (deficit)                           (3,136,445)       615,191
                                                                      -----------    -----------

        Total liabilities and stockholders' equity (deficit)          $ 5,813,356    $ 5,429,843
                                                                      ===========    ===========


                   See accompanying notes to consolidated financial statements.

                                                F-1
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS

                       YEARS ENDED JULY 31, 2001 AND 2000

                                                        2001            2000
                                                    ------------    ------------

Revenue:
  Student services                                  $  7,163,383    $  1,285,779
  Corporate sponsor contributions                         35,345         535,665
  Financing revenue                                      150,358            --
  Other                                                    1,946          34,582
                                                    ------------    ------------
                                                       7,351,032       1,856,026
Cost of services                                      (1,705,112)     (1,081,468)
                                                    ------------    ------------
     Gross profit                                      5,645,920         774,558

Selling, general and administrative expenses           8,795,286       1,756,919
Depreciation and amortization                            528,496         242,349
                                                    ------------    ------------
                                                       9,323,782       1,999,268
                                                    ------------    ------------
     Loss from operations                             (3,677,862)     (1,224,710)

Interest expense                                        (345,718)       (105,729)
Other income, net                                         12,679          10,619
                                                    ------------    ------------
     Net loss                                         (4,010,901)     (1,319,820)

Fair value of warrant issued                                --          (124,278)
                                                    ------------    ------------

     Net loss attributable to common stockholders   $ (4,010,901)   $ (1,444,098)
                                                    ============    ============

Net loss per share attributable to common
stockholders - based and diluted                    $      (0.16)   $      (0.07)
                                                    ============    ============

Weighted average number of common shares
outstanding basic and diluted                         24,484,676      19,562,120
                                                    ============    ============


          See accompanying notes to consolidated financial statements.

                                       F-2
<PAGE>


                                   COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                           CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)

                                            YEARS ENDED JULY 31, 2001 AND 2000



                                          COMMON STOCK            ADDITIONAL                                       TOTAL
                                   --------------------------      PAID-IN        DEFERRED      ACCUMULATED     STOCKHOLDERS'
                                     SHARES         AMOUNT         CAPITAL      COMPENSATION      DEFICIT     EQUITY (DEFICIT)
                                   -----------    -----------    -----------    ------------    -----------   ---------------
Balance at August 1, 1999           17,784,748    $    17,785    $ 1,531,936    $      --      $(1,587,782)   $   (38,061)

Common stock issued for              2,000,000          2,000        972,984           --             --          974,984
     cash, net of offering costs
Common stock issued to                  64,000             64         22,832           --             --           22,896
     directors for services
Common stock issued to                  38,347             38         18,198           --             --           18,236
     employees in lieu of cash
     compensation
Common stock issed for               1,071,473          1,071        282,410           --             --          283,481
     services
Common stock issued for              2,524,496          2,524        658,004           --             --          660,528
     acquisitions
Cancellation of common                (351,996)          (352)           352           --             --             --
     stock held in escrow
Reissuance of common                   352,000            352           (352)          --             --             --
     stock held in escrow
Fair value of warrants issued             --             --          124,278           --             --          124,278
     for common stock put
     agreement
Warrants issued in exchange               --             --         (124,278)          --             --         (124,278)
     for common stock put
     agreement
Issuance of common stock                  --             --           35,125        (35,125)          --             --
     option awards
Amortization of common                    --             --             --           12,947           --           12,947
     stock and common stock
     option awards
Net loss                                  --             --             --             --       (1,319,820)    (1,319,820)
                                   -----------    -----------    -----------    -----------    -----------    -----------

Balance at July 31, 2000            23,483,068         23,482      3,521,489        (22,178)    (2,907,602)       615,191

Common stock issued to                 100,447            101         10,804           --             --           10,905
     directors and employees
     for services
Common stock issued for              1,457,714          1,458        180,756           --             --          182,214
     deferred compensation
Common stock issued for                100,000            100         27,400           --             --           27,500
     exercise of options
Amortization of common                    --             --             --           22,178           --           22,178
     stock and common stock
     option awards
Common stock issued for                 66,000             66         16,402           --             --           16,468
     purchase of franchisees
Net loss                                  --             --             --             --       (4,010,901)    (4,010,901)
                                   -----------    -----------    -----------    -----------    -----------    -----------

Balance at July 31, 2001            25,207,229    $    25,207    $ 3,756,851    $      --      $(6,918,503)   $(3,136,445)
                                   ===========    ===========    ===========    ===========    ===========    ===========


                               See accompanying notes to consolidated financial statements.

                                                            F-3
<PAGE>


                          COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                                  CONSOLIDATED STATEMENTS OF CASH FLOWS

                                   YEARS ENDED JULY 31, 2001 AND 2000

                                                                                    2001           2000
                                                                                -----------    -----------

Cash flows from operating activities:
  Net loss                                                                      $(4,010,901)   $(1,319,820)
  Adjustments to reconcile net loss to net cash used in operating activities:
    Provision for doubtful accounts                                                 182,141        100,000
    Depreciation and amortization                                                   528,496        242,349
    Issuance of common stock for director and employee compensation                 112,979         41,132
    Deferred compensation to related parties                                        148,106           --
    Issuance of common stock for services to third parties                             --          283,481
    Gain on sale of assets                                                           (7,531)          --
    Amortization of deferred compensation                                            22,178         12,947
    Other                                                                            79,155           --
  Changes in operating assets and liabilities:
    Due from customer contracts                                                   1,796,784           --
    Accounts receivable                                                          (1,442,621)       (97,346)
    Other current assets                                                            (93,722)        11,085
    Inventory                                                                      (152,244)          --
    Deferred customer contract expense                                             (849,711)          --
    Accounts payable                                                                731,688         (6,902)
    Accrued liabilities                                                             336,922         82,442
    Deferred revenue                                                              1,910,721         33,745
    Deferred license fees, net                                                      416,656           --
                                                                                -----------    -----------

        Net cash used in operating activities                                      (290,904)      (616,887)
                                                                                -----------    -----------

                                               (continued)

                                                   F-4
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                       YEARS ENDED JULY 31, 2001 AND 2000


                                                                                    2001           2000
                                                                                -----------    -----------
Cash flows from investing activities:
  Purchase of property and equipment                                                (34,080)        (3,669)
  Cash acquired in purchase of College Resource Management, Inc.                       --           74,683
  Cash paid for purchase of College Foundation Planners, Inc.                          --          (24,119)
  Cash acquired in purchase of College Bound Student-Athletes, Inc.                    --             --
  Purchase of licenses                                                                 --         (100,000)
  Other assets                                                                         --             --
                                                                                -----------    -----------

Net cash used in investing activities                                               (34,080)       (53,105)
                                                                                -----------    -----------
Cash flows from financing activities:
  Proceeds from financing of contracts                                            1,034,084           --
  Payments on financed contracts                                                   (146,768)          --
  Amounts due from financed contract                                               (154,901)          --
  Payments on long term obligations                                                (312,106)       (11,469)
  Proceeds from long term obligations                                               156,000             25
  Payments on long term obligations - related parties                              (176,759)      (270,733)
  Proceed from long term obligations - related parties                              120,000        126,073
  Common stock issued for cash                                                       27,500        974,984
                                                                                -----------    -----------

Net cash provided by financing activities                                           547,050        818,880
                                                                                -----------    -----------

Net increase (decrease) in cash                                                     222,066        148,888

Cash at the beginning of the period                                                 231,271         82,383
                                                                                -----------    -----------

Cash at the end of the period                                                   $   453,337    $   231,271
                                                                                ===========    ===========


Supplemental disclosure of cash flow information-

Cash paid during the year for interest                                          $   226,847    $    24,941
                                                                                ===========    ===========

Supplemental disclosures of non-cash investing and financing activities:
The Company purchased all of the outstanding stock of College Resource
Management, Inc. and College Foundation Planners, Inc. in 2000

Assets acquired and liabilities assumed were as follows:
Net cash acquired                                                               $      --      $    50,564
Fair value of assets acquired                                                          --        3,801,903
Debt assumed                                                                           --         (410,696)
Other liabilities assumed                                                              --         (696,341)
                                                                                -----------    -----------

Purchase price of acquisitions                                                  $      --      $ 2,745,430
                                                                                ===========    ===========
Common stock issued for accrued compensation                                    $    80,140    $      --
                                                                                ===========    ===========

Payment on long term obligations - related party by exchange of asset           $    18,544    $      --
                                                                                ===========    ===========
Acquisition of assets for notes                                                 $    15,288    $      --
                                                                                ===========    ===========


                      See accompanying notes to consolidated financial statements.

                                                   F-5
</TABLE>
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 2000


1.   ORGANIZATION, OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:

     History And Business Activity - College Bound Student Alliance, Inc. and
     subsidiaries (the "Company") provides products and services to qualified
     students and assists parents and students who have the opportunity to
     qualify for financial aid opportunities. This is the Company's only
     business segment. The Company offers assistance to its clients in career
     planning, college major selection, college selection, college entrance
     testing, searches for merit awards and financial aid and other higher
     education aids and learning programs. The Company markets its products
     through weekend workshops held throughout the United States and through a
     direct sales force. The Company's principal production facilities are
     located in the Dallas/Fort Worth metroplex, and it has our office in Orange
     County, California and is headquartered in Lakewood, Colorado.

     The consolidated financial statements include the financial statements of
     the Company and its wholly owned subsidiaries: College Bound
     Student-Athletes, Inc., College Foundation Planners, Inc. and College
     Resource Management, Inc. All intercompany balances and transactions have
     been eliminated in consolidation.

     Revenue Recognition - The Company recognizes revenue as the services are
     performed and the products are delivered. Deferred revenue is recorded for
     cash received in advance for services the Company is obligated to perform.
     Corporate sponsor contributions, which are not restricted as to use by the
     sponsor, are recognized as revenue when received in accordance with
     Statement of Financial Accounting Standards No. 116, ACCOUNTING FOR
     CONTRIBUTIONS RECEIVED AND CONTRIBUTIONS MADE.

     The amounts due from customer contracts acquired reflect the future cash
     flows of College Resource Management, Inc.'s (CRM) contracts acquired in
     July, 2000, less amounts which are not expected to be collected. Deferred
     revenue of $353,687 as of July 31, 2000 relating to the CRM contracts is
     reflected at its estimated fair value which was estimated to be the present
     value of costs that are expected to be incurred to deliver the future
     services on such contracts plus an allowance for normal profit on those
     services.

     Revenue is recognized consistent with Staff Accounting Bulletin No. 101
     (SAB 101). For customer agreements where there are multiple deliverables
     and fair value of the deliverables is not determinable, revenue is
     recognized over the service period on the straight-line basis. Prior to
     January 1, 2001, the Company entered into the multiple deliverables
     contracts, which included a service component that was contractually
     available over the one-year contract period. Revenue, therefore was
     recognized over the one year period for these contracts. Effective January
     1, 2001, the Company introduced a new customer product to enhance its
     services. This product does not contain multiple deliverables. These
     products currently accounts for a substantial portion of the Company's
     revenue. The new customer agreements obligate the Company to deliver a
     product called The College Action Plan (TM) ("CAP"). Revenue is recognized
     and the receivable is recorded when the CAP is delivered.

                                      F-6
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 2000


     Management estimates that approximately 90 percent of the direct costs of
     performing its obligations under the multiple deliverable agreements is
     incurred in the first 60 days after contract initiation. Direct and
     incremental costs in acquiring contracts are deferred and recognized over
     the contract period for multiple deliverables contracts and upon delivery
     of the CAP for the new contracts. Management estimates that approximately
     70 percent of the total direct and indirect costs of performing its
     obligations are expensed in the first 60 days after contract initiation.
     Accordingly, expenses recognized historically have been disproportionately
     high as compared to reported revenue.

     Finance income on installment contracts is recognized in income over the
     contract period.

     Property And Equipment - Property and equipment are recorded at cost.
     Property and equipment under capital leases are stated at the present value
     of minimum lease payments. Depreciation on property and equipment is
     calculated on a straight-line basis over the estimated useful lives of the
     assets. Property and equipment under capital leases are amortized on a
     straight-line basis over the shorter of the lease term or estimated useful
     life of the asset.

     Impairment Of Long-Lived Assets And Long-Lived Assets To Be Disposed Of -
     The Company accounts for long-lived assets in accordance with the
     provisions of SFAS No. 121, ACCOUNTING FOR THE IMPAIRMENT OF LONG-LIVED
     ASSETS AND FOR LONG-LIVED ASSETS TO BE DISPOSED OF. This Statement requires
     that long-lived assets and certain identifiable intangibles be reviewed for
     impairment whenever events or changes in circumstances indicate that the
     carrying amount of an asset may not be recoverable. Recoverability of
     assets to be held and used is measured by a comparison of the carrying
     amount of an asset to future net cash flows expected to be generated by the
     asset. If such assets are considered to be impaired, the impairment to be
     recognized is measured by the amount by which the carrying amount of the
     assets exceeds the fair value of the assets. Assets to be disposed of are
     reported at the lower of the carrying amount or fair value less costs to
     sell.

     Licensing Rights - Licensing rights are recorded at cost and are amortized
     on a straight-line basis over a five year period, which is shorter than
     their term.

     Intangible And Other Assets - Intangible and other assets consist primarily
     of intangible assets, recruiting systems technology and a covenant not to
     compete acquired in business combinations. Intangible assets and recruiting
     systems technology which represent the excess of purchase price over fair
     value of net assets acquired are amortized on a straight-line basis over 10
     years and the covenant not to compete is being amortized on a straight-line
     basis over the covenant period of three years. The Company assesses the
     recoverability of intangible assets by determining whether the amortization
     of the intangible asset balance over its remaining life can be recovered
     through undiscounted future operating cash flows of the acquired operation.
     The amount of impairment, if any, is measured based on projected discounted
     future operating cash flows using a discount rate reflecting the Company's
     average cost of funds. The assessment of the recoverability of intangible
     assets will be impacted if estimated future operating cash flows are not
     achieved.

                                      F-7
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 2000


     Intangible assets at July 31, 2001 consist of:

                                                 Accumulated
                                     Amount      Amortization       Net
                                  -----------    ------------   -----------

          Covenant                $   156,013    $   (72,806)   $    83,207
          Excess purchase price     2,679,794       (441,768)     2,238,026
                                  -----------    -----------    -----------

                                  $ 2,835,807    $  (514,574)   $ 2,321,233
                                  ===========    ===========    ===========

     Income Taxes - Income taxes are accounted for under the asset and liability
     method. Deferred tax assets and liabilities are recognized for the future
     tax consequences attributable to differences between the financial
     statement carrying amounts of existing assets and liabilities and their
     respective tax bases and operating loss and tax credit carryforwards.
     Deferred tax assets and liabilities are measured using enacted tax rates
     expected to apply to taxable income in the years in which those temporary
     differences are expected to be recovered or settled. The effect on deferred
     tax assets and liabilities of a change in tax rates is recognized in
     operations in the period that includes the enactment date.

     Net Loss Per Share - The Company computes earnings (loss) per share in
     accordance with the requirements of Statement of Financial Accounting
     Standards No. 128 (SFAS No. 128), EARNINGS PER SHARE. SFAS No. 128 requires
     the disclosure of basic earnings per share and diluted earnings per share.
     Basic earnings per share is computed by dividing income available to common
     stockholders by the weighted average number of common shares outstanding.
     Diluted earnings per share is computed by dividing income available to
     common stockholders by the weighted average number of common shares
     outstanding increased for potentially dilutive common shares outstanding
     during the period. The dilutive effect of stock options, warrants and their
     equivalents is calculated using the treasury stock method.

     Net loss attributable to common stockholders - basic and diluted is
     computed based on the weighted average number of shares of common stock
     outstanding during the year. Basic loss attributable to common stockholders
     and loss attributable to common stockholders - assuming dilution, are the
     same for the years ended July 31, 2001 and 2000, because of the
     antidilutive effect of stock options and awards when there is a net loss.
     As of July 31, 2001, the Company has issued options to purchase 4,776,234
     shares of its common stock, warrants to purchase 490,000 shares of its
     common stock, and 2,000,000 shares of common stock held in escrow as
     collateral for note payable to stockholder which is considered issued but
     not outstanding common stock, which could potentially dilute basic earnings
     per share in the future.

     Net loss attributable to common stockholders in fiscal 2000 reflects the
     fair value of the warrants issued in exchange for the common stock put
     agreement.

     Stock Options - The Company accounts for stock options issued to employees
     in accordance with the provisions of Accounting Principles Board (APB)
     Opinion No. 25, ACCOUNTING FOR STOCK ISSUED TO EMPLOYEES, and related
     interpretations. As such, compensation expense is recorded on the date of
     grant only if the current market price of the underlying stock exceeds the
     exercise price. The Company has adopted Statement of Financial Accounting
     Standards No. 123 (SFAS No. 123), ACCOUNTING FOR STOCK-BASED COMPENSATION,
     which permits entities to recognize as expense over the vesting period the
     fair value of all stock-based awards on the date of grant. Alternatively,
     SFAS No. 123 also allows entities to continue to apply the provisions of
     APB Opinion No. 25 and provide pro forma net income (loss) disclosures for
     employee stock option grants as if the fair-value-based method defined in
     SFAS No. 123 had been applied. The Company has elected to continue to apply
     the provisions of APB Opinion No. 25 and provide the pro forma disclosures
     required by SFAS No. 123 for stock options issued to employees. All equity
     instruments issued to non-employees are accounted for using the provisions
     of SFAS No. 123.

                                      F-8
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 2000


     Use Of Estimates - The preparation of financial statements in conformity
     with accounting principles generally accepted in the United States of
     America 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 revenue and expenses during the reporting period.
     Actual results could differ significantly from those estimates. Significant
     estimates include the estimated future life of intangibles, and the
     allowance for doubtful accounts. If substantial losses continue and, as a
     result of lack of experience with the CAP, it is reasonably possible that
     such estimates could materially change within the next year.

     Reclassifications - Certain financial statement reclassifications have been
     made of 2000 amounts to conform to the 2001 presentation. Such
     reclassification had no effect on net loss.

     Recent Pronouncements - In June 2001, the Financial Accounting Standards
     Board ("FASB") issued Statements of Financial Accounting Standards No. 141
     "Business Combinations" ("SFAS 141") and No. 142 "Goodwill and Other
     Intangible Assets" ("SFAS 142"). SFAS 141 requires all business
     combinations initiated after June 30, 2001 to be accounted for under the
     purchase method. For all business combinations for which the date of
     acquisition is after June 30, 2001, SFAS 141 also establishes specific
     criteria for the recognition of intangible assets separately from goodwill
     and requires unallocated negative goodwill to be written off immediately as
     an extraordinary gain, rather than deferred and amortized. SFAS 142 changes
     the accounting for goodwill and other intangible assets after an
     acquisition. The most significant changes made by SFAS 142 are: 1) goodwill
     and intangible assets with indefinite lives will no longer be amortized; 2)
     goodwill and intangible assets with indefinite lives must be tested for
     impairment at least annually; and 3) the amortization period for intangible
     assets with finite lives will no longer be limited to forty years. At this
     time, we cannot reasonably estimate the effect of The Company does not
     believe that the adoption of tiese statements on either will have a
     material effect on its our financial position, results of operations, or
     cash flows. The adoption of SFAS 141 is not expected to have a material
     effect on the Company's financial position or its results of operations.
     SFAS 142, when implemented, will result in lower amortization expense to
     the Company of approximately $325,000 per year.

                                      F-9
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 2000


     In June 2001, the FASB also approved for issuance SFAS 143 "Asset
     Retirement Obligations." SFAS 143 establishes accounting requirements for
     retirement obligations associated with tangible long-lived assets,
     including (1) the timing of the liability recognition, (2) initial
     measurement of the liability, (3) allocation of asset retirement cost to
     expense, (4) subsequent measurement of the liability and (5) financial
     statement disclosures. SFAS 143 requires that an asset retirement cost
     should be capitalized as part of the cost of the related long-lived asset
     and subsequently allocated to expense using a systematic and rational
     method. The Company will adopt the statement effective no later than
     January 1, 2003, as required. The transition adjustment resulting from the
     adoption of SFAS 143 will be reported as a cumulative effect of a change in
     accounting principle. The adoption of this statement is not expected to
     have a material effect on the Company's financial position, results of
     operations, or cash flows.

     In August 2001, the FASB also approved SFAS 144, "Accounting for the
     Impairment or Disposal of Long-Lived Assets." SFAS 144 replaces SFAS 121,
     "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
     Assets to Be Disposed Of." The new accounting model for long-lived assets
     to be disposed of by sale applies to all long-lived assets, including
     discontinued operations, and replaces the provisions of APB Opinion No. 30,
     "Reporting Results of Operations-Reporting the Effects of Disposal of a
     Segment of a Business," for the disposal of segments of a business. SFAS
     144 requires that those long-lived assets be measured at the lower of
     carrying amount or fair value less cost to sell, whether reported in
     continuing operations or in discontinued operations. Therefore,
     discontinued operations will no longer be measured at net realizable value
     or include amounts for operating losses that have not yet occurred. SFAS
     144 also broadens the reporting of discontinued operations to include all
     components of an entity with operations that can be distinguished from the
     rest of the entity and that will be eliminated from the ongoing operations
     of the entity in a disposal transaction. The provisions of SFAS 144 are
     effective for financial statements issued for fiscal years beginning after
     December 15, 2001 and, generally, are to be applied prospectively. At this
     time, the Company cannot estimate the effect of this statement on its
     financial position, results of operations, or cash flows.

2.   LIQUIDITY:

     During fiscal 2001 the Company incurred significant operating losses and a
     deterioration in working capital as it: revamped and improved product lines
     and its marketing organization; consolidated the operations of its acquired
     companies; and invested in expansion of its operations and infrastructure.
     Management believes these activities consumed considerable focus and
     resulted in significant losses during the first three quarters of fiscal
     2001. A portion of these costs were funded by a financing of the Company's
     on and off balance sheet customer contract receivables. During the final
     quarter of fiscal 2001 financial results indicate the Company was
     marginally profitable during this quarter and new customer contracts sold
     increased 35% over the first fiscal quarter of 2001.

     The Company does not expect its near-term growth in cash flow from
     increased sales will be sufficient to meet its obligations and will need to
     rely on a significant portion of funding to continue its operations and
     fund its growth. The Company has recently engaged two investment banking
     firms to assist it in obtaining both debt and equity financing and certain
     investor prospects have informally indicated an interest in making a
     significant investment. While there is no guarantee the Company will be
     successful in attracting such investment, management believes
     reorganization costs are behind it, the Company has substantially decreased
     its losses from operations, sales are improving and the fundamentals of its
     business are strong, which all present an attractive investment vehicle
     with growth potential. Management and its investment banker expect the
     terms and conditions of additional financing on senior debt are expected to
     be better than the existing credit facility; however, terms may not be as
     beneficial to the Company on the subordinated debt or equity securities as
     might otherwise be expected in normal circumstances because of past losses.

                                      F-10
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 2000


3.   CONTRACT RECEIVABLES:

     The Company enters into contracts with its customer prior to delivery of
     its product. The customer makes an initial deposit at time of the contract
     and usually makes additional payments prior to the delivery of the
     Company's product. Such payments are recognized as deferred revenue.

     The delivery of the Company's product is dependent on the customer
     delivering to the Company certain information. Generally this information
     is provided within 90 to 120 days of the customer initiating the contract.
     From this information the Company prepares and delivers a personalized CAP
     to the student. At that time revenue is recognized and the receivable is
     recorded. As of July 31, 2001, approximately $4,800,000 (net of an
     estimated allowance) of contracts have been signed, but the CAP has not yet
     been delivered to the student. Therefore, the related receivable has not
     been recorded nor any revenue recognized on these contracts.

     The Company is also recognizing revenue on a straight basis over the one
     year term of the contract for contracts written between August 1, 2000 and
     December 31, 2000. These services had multiple delivery elements as such
     the receivable is not recorded on the balance sheet. The unrecorded net
     contract amount related to these services at July 31, 2001 is approximately
     $600,000.

     The Company estimates an allowance on unfulfilled contracts with the
     expectation that a percentage of contracts will not be completed, as well
     as other collection risks. The Company experiences a substantially higher
     loss rate in the early life of a contract than after the CAP has been
     delivered and/or the contract matures and several monthly payments have
     been received.

4.   BUSINESS COMBINATIONS:

     Acquisition Of College Resource Management, Inc. - On July 31, 2000, the
     Company acquired all of the issued and outstanding common stock of College
     Resource Management, Inc. (CRM). CRM's name was changed to The College
     Partnership in fiscal 2001. The purchase price totaled $2,311,016 which is
     comprised of a $2 million promissory note payable to the seller over 10
     years, 2,000,000 restricted shares of the Company's common stock with a
     fair value of $504,000 and acquisition costs of $118,458. The promissory
     note payable to seller has a stated interest rate of 7.5% which has been
     discounted at 11.5% for purposes of calculating the purchase price. This
     rate reflects effective interest rates management believes were available
     to the Company for debt obligations with similar terms and features. The
     present value of amounts to be paid under the note totaled $1,688,558. The
     common stock of the Company valued at $504,000 at the date of acquisition
     reflects the fair value of the stock based on the closing price of the
     Company's stock on July 31, 2000, in the over-the-counter market, less a
     10% discount given the restricted nature of the shares issued.

                                      F-11
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 2000


     The acquisition has been accounted for by the purchase method and the
     excess of cost over the fair value of acquired net tangible assets of
     $1,145,588 was recognized as intangible assets and is being amortized on a
     straight-line basis over 10 years. The results of operations of CRM was
     included in the Company's consolidated financial statements starting August
     1, 2000.

     Acquisition Of College Foundation Planners, Inc. - On May 5, 2000, the
     Company acquired College Foundation Planners, Inc. (CFPI) for $434,414
     consisting of 500,000 restricted shares of the Company's common stock with
     a fair value of $148,500, $241,541 in promissory notes payable to seller
     and $44,373 in direct acquisition costs. Of the 500,000 shares of
     restricted common stock issued, 250,000 shares were delivered at closing
     and the remaining 250,000 shares had been placed in escrow with an
     independent agent and will be released upon CFPI achieving certain
     performance thresholds for the one year period ending May 5, 2001.

     The acquisition has been accounted for by the purchase method and the
     results of operations of CFPI have been included in the Company's
     consolidated financial statements from May 1, 2000. The purchase price was
     allocated to the fair value of identifiable assets and liabilities was of
     April 30, 2000. In connection with the purchase, the Company recorded an
     intangible asset for recruiting systems technology of $470,972 which is
     being amortized on a straight-line basis over ten years.

     Acquisition Of College Bound Student-Athletes, Inc. - On April 15, 1999,
     the Company acquired all of the issued and outstanding common stock of
     College Bound Student-Athletes, Inc. (CBS Athletes), for $945,901. During
     2000, the Company issued 22,500 shares of common stock valued at $8,028 as
     additional purchase price consideration. The purchase price is comprised of
     a $600,000 note payable to the seller, a $176,000 covenant not to compete,
     522,500 shares of the Company's common stock valued at $198,934, options to
     purchase 500,000 shares of the Company's common stock at $0.50 per share
     valued at $61,531 and $10,000 in direct acquisition costs. The note payable
     to seller and covenant not to compete were non-interest bearing, which the
     Company discounted at 8% for purposes of calculating the purchase price.
     The present value of amounts to be paid under the note and covenant not to
     compete totaled $675,436. Additional payments of up to $1.1 million and
     options to purchase 500,000 shares of the Company's common stock could be
     made upon CBS Athletes achieving certain performance thresholds. The
     Company believes the performance thresholds were not met, although the
     former owner disputes on of the thresholds and the matter is currently in
     arbitration along with other potential adjustments described in Note 15.
     Additional consideration, if any, would be recognized at the point that
     meeting the thresholds becomes probable.

                                      F-12
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 2000


     The acquisition has been accounted for by the purchase method and the
     results of operations of CBS Athletes have been included in the Company's
     consolidated financial statements from April 15, 1999. The purchase price
     was allocated to the fair value of identifiable assets and liabilities. In
     connection with the purchase, the Company recorded three intangible assets:
     a covenant not to compete valued at $147,485 which is being amortized over
     the covenant period of three years on a straight-line basis; software of
     $73,300 which is being amortized on a straight-line basis over five years;
     and recruiting systems technology of $1,057,108 which is being amortized on
     a straight-line basis over ten years.

5.   FINANCING OF RECEIVABLES:

     In July, 2001, the Company entered into an arrangement with a finance
     company to finance a portion of on balance sheet and "off-balance sheet"
     contracts receivables which are pledged as collateral. At July 31, 2001, a
     principal balance of $887,317 is due to be repaid from the proceeds of the
     related customer accounts held by the finance company totaling
     approximately $1,883,000 in contracts (including "off-balance sheet"
     contracts). The finance company also holds a $154,901 as additional
     collateral (reflected as a note receivable on the Company's balance sheet).

6.   PROPERTY AND EQUIPMENT:

     Property and equipment at July 31, 2001 and 2000, consisted of the
     following:

                                                                     Estimated
                                              2001          2000    Useful Lives
                                            ---------    ---------  ------------

      Furniture and equipment               $ 436,990      439,929    5-7 years
      Computer software                       152,108      108,954    5 years
      Vehicle                                    --         14,076    3 years
                                            ---------    ---------
                                              589,098      562,959
            Less accumulated depreciation
               and amortization              (199,964)     (68,168)
                                            ---------    ---------

            Property and equipment, net     $ 389,134      494,791
                                            =========    =========


     Depreciation and amortization for the years ended July 31, 2001 and 2000,
     was $144,011 and $42,832, respectively.

                                      F-14
<PAGE>
<TABLE>
<CAPTION>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 20003

7.   LONG-TERM OBLIGATION:


     Third party obligations:                                               July 31, 2001
                                                                            -------------
     <S>                                                                     <C>
     Note due on demand                                                      $     5,040

     Note payable with interest at 8%, principal and interest, due
       October 31, 2001                                                           16,000

     Note payable to stockholder for acquisition of CRM (d)                    1,601,315

     Unsecured notes payable to stockholder assumed in connection with the
       acquisition of CRM, with an effective interest rate of
       12.5%: due in monthly installments through January 2002 (f)               183,773

     Other obligations with interest rates ranging from 11% to 12%,
       collateralizd by related underlying assets                                 71,865
                                                                             -----------

     Total debt to third parties                                               1,877,993

     Less:  current maturities of long-term debt to third parties               (261,835)

                                                                             -----------
     Long-term debt, less current maturities                                 $ 1,616,158
                                                                             ===========



                                      F-14
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 2000


Related party obligations:                                                               July 31, 2001
                                                                                         -------------

     Note payable to stockholder, with interest at 10% payable monthly, due on
       March 15 2001 (a)                                                                  $    15,000

     Note payable to stockholder, non-interest bearing, due March 15, 2001 (a)                 60,000

     Notes payable to Chartwell International (Chartwell), a significant shareholder,
       with interest at 10% payable monthly, principal payable on the earlier of
       November 1, 2001 or receipt of long-term financing, as defined in the agreements        70,000

     Note payable to National Collegiate Recruiting Associates, Inc, a wholly owned
       subsidiary of Chartwell, with interest at 10%, $1,000 payable monthly, or
       payable on the earlier of March 15, 2001 or receipt of long-term financing,
       as defined in the agreement                                                              9,000

     Note payable to Chartwell with interest at 10% compounded quarterly, the
       principal and accrued interest is payable on the earlier of November 1, 2002
       or receipt of long-term financing, as defined in the agreement. Cumulative
       principal and interest payable in trade credits or in cash at the discretion
       of the Company                                                                          43,722

     Note payable to Chartwell non-interest bearing, payable November 1, 2002                  61,500

     Note payable to stockholder with interest at 14%, compounded
       monthly, interest payable quarterly, due November 1, 2002                               40,000

     Note payable to stockholders with interest at 14%, compounded
       monthly, interest payable quarterly, due November 1, 2002                               80,000

     Note payable to stockholder for acquisition of CBS Athletes (a)                          362,997

     Note payable to stockholder assumed in connection with
       acquisition of CBS Athletes (b)                                                        177,325

     Note payable to stockholder for agreement not to compete in
       connection with the acquisition of CBS Athletes  (c)                                   102,801

     Notes payable to stockholder for acquisition of CFPI (e)                                 236,544

     Unsecured note payable to stockholder assumed in connection
       with the acquisition of CFPI, non-interest bearing                                       4,500

     Deferred compensation due officers                                                        84,933

                                                                                          -----------
     Total debt to related parties                                                          1,348,322

     Less:  Current maturities of long-term debt to related parties                          (726,685)

                                                                                          -----------
     Long-term debt to related parties, less current maturities                           $   621,637
                                                                                          ===========
</TABLE>

                                      F-15
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 2000


     (a) $600,000 non-interest bearing note and $75,000 other note, unsecured,
     discounted by the Company at 8% to reflect the present value of amounts to
     be paid under the noted: $160,000 in principal was repaid in fiscal 2000
     and $38,544 in fiscal 2001 and the remainder of the unpaid balance is due
     upon receiving an additional $3,500,000 in financing or March 15, 2001. The
     balance of the payments due in 2001 were suspended pending outcome of an
     arbitration proceeding described in Note 15.

     (b) $208,888 unsecured note, with interest at 8%, final payment due
     November 15, 2004; 60 equal monthly installment of interest and principal
     of $4,446 beginning in December 1999. $19,137 in principal payments were
     made in fiscal 2001. Further payments due in 2001 were suspended pending
     outcome of an arbitration proceeding described in Note 15.

     (c) $176,000 non-interest bearing note, discounted by the Company at 8% to
     reflect the present value of amounts to be paid under the note: 36 equal
     monthly installments of $4,889 beginning December 15, 1999, secured by
     352,000 shares of the Company's stock held in escrow. $24,643 in principal
     payments were made in fiscal 2001. Further payments due in 2001 were
     suspended pending outcome of an arbitration proceeding described in Note
     15.

     (d) Notes payable with interest rates ranging from 7.1% to 12.9% principal
     and interest payments ranging from $228 to $1,401 per month, due May 5,
     2003. The present value of amounts to be paid under these notes approximate
     the carrying value of these notes. If the Company obtains additional
     long-term financing, principal payments on this debt could be accelerated
     based on the terms of the agreement. Principal payments on these notes
     during the fiscal year ended July 31, 2001 totaled $4,042.

     (e) $2,000,000 note payable with a stated interest rate of 7.5% which the
     Company discounted at 11.5% for purposes of calculating the purchase price.
     The 11.5% rate reflects effective interest rates management believes are
     available to the Company for debt obligations with similar terms and
     features. The present value of amounts to be paid under the note totaled
     $1,688,558 at July 31, 2000. The note is payable in 120 equal monthly
     installments of principal and interest of $23,740, and matures July 31,
     2010. If the Company obtains additional long-term financing as defined in
     the agreement, 50% of the net proceeds of such financing must be used to
     prepay the principal of this note. This note is collatered by 2,000,000
     shares of the Company's common stock currently held in escrow by a third
     party. Principal payments on these notes during the fiscal year ended July
     31, 2001 totaled $87,243.

     (f) Stated interest rates ranged from 5.75% to 6.0% which were discounted
     at 12.5% at the purchase date to reflect fair value of amounts to be paid
     under the notes.

                                      F-16
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 2000


     The aggregate maturities of long-term debt to related parties for each year
     subsequent to July 31, 2001, assuming the Company does not obtain
     additional financing which causes acceleration of the payment of debt,
     follow:

          July 31:            Third Parties    Related Parties        TOTAL
          --------            -------------    ---------------     ----------

          2002                  $  261,834       $  726,684*       $  988,519
          2003                     231,190          333,154           564,344
          2004                     142,056           51,337           193,393
          2005                     150,485           19,468           169,953
          2006                     167,884            3,433           171,317
          Thereafter               924,544          214,245         1,138,789
                                ----------       ----------        ----------

          TOTAL                 $1,877,993       $1,348,321        $3,226,315
                                ==========       ==========        ==========


          *    includes suspended payments which were due in 2001, but are
               currently subject to arbitration proceeding described in Note 15.


8.   RELATED PARTY TRANSACTIONS:

     The Company entered into a consulting agreement with the former owner of
     CBS Athletes for $1,500 per month for five years beginning as of the date
     when the first $100,000 payment is made on the note payable to stockholder
     for acquisition of CBS Athletes. In March 2000, $160,000 was paid against
     the purchase price, which triggered payments to start under the consulting
     agreement. The first $1,500 payment was made April 2000 and are to be made
     monthly for the next five years, except beginning in 2001 the payments were
     suspended pending outcome of an arbitration proceeding described in Note
     15.

     The Company leased office space on a month-to-month basis through July 31,
     2000 from Chartwell International, Inc. (Chartwell), a significant investor
     in the Company. Rental expense under this agreement was $80,319 for the
     year ended July 31, 2000. CBSA entered into its own five (5) year rental
     agreement beginning August, 2001 for which its rent expense was $134,378
     for the year ended July 31, 2001.

     Beginning February 1, 1998, the Company entered into a three-year agreement
     with Chartwell whereby Chartwell's management performed certain management
     functions for the Company in exchange for $7,500 per month. Management fee
     expense was $52,500 for the year ended July 31, 2000. The management
     agreement was cancelled February 29, 2000.

     The Company has acquired licensing rights through an agreement with
     National College Recruiting Association, Inc. (NCRA), which is a wholly
     owned subsidiary of Chartwell. The license provides the Company with
     exclusive use, rights and interest in all of the assets, including brand
     and trade names and databases, constituting the business of NCRA, along
     with the rights to sell new and service existing franchises of NCRA and to
     publish the Blue Chip Illustrated magazine. Blue Chip Illustrated
     highlights the leading high school athletes in the country. College coaches
     and fans are typical subscribers to Blue Chip Illustrated. NCRA owns the
     rights to a program which promotes high school athletes, in the pursuit of
     scholarships, to colleges. The term of the licensing rights agreement is
     five years, which is renewable for an unspecified number of five-year
     terms. The fee for the NCRA license includes a payment of $310,000 to NCRA,
     plus 2.5% of gross revenue from licensed operations. The Company paid
     $75,000 in 2000, negotiated a note payable of $25,000 in 2000 and paid
     $210,000 in 1999, which amounts are included in licensing rights, net of
     accumulated amortization. Total royalty expense was $150,000 and $33,500 in
     2001 and 2000, respectively.

                                      F-17
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 2000


     The terms of an agreement with the seller of CRM provide for reductions in
     debt to the seller for the settlement of certain regulatory matters which
     arose prior to the acquisition. Amounts paid to resolve regulatory matters
     amounted to $80,518, which reduced the current payable to stockholder as of
     July 31, 2001.

9.   CORPORATE SPONSOR CONTRIBUTIONS:

     During 2000, the Company received an unrestricted contribution from an
     unrelated corporations totaling $536,000, of which $500,000 was from one
     corporation.

10.  INCOME TAXES:

     Current and deferred income tax was zero for the years ended July 31, 2001
     and 2000, as the Company recorded a full valuation allowance on deferred
     tax assets.

     In the allocation of the purchase price of CRM, net deferred income tax
     liabilities of $405,710 were created which have been offset by the use of
     the Company's existing net operating loss carry forwards. As a result no
     deferred taxes have been recorded and the Company's valuation allowance
     increased by $24,527 in fiscal 2001.

     The Company is in the process of preparing its current and prior years tax
     returns. Therefore, amounts presented below could be revised based on the
     finalization of such income tax information.


                                      F-18
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 2000


     Income tax benefit differed from the amounts computed by applying the U.S.
     Federal income tax rate of 34% to pretax loss as a result of the following:

                                                         2001           2000
                                                         ----           ----

     Computed "expected" tax benefit                 $ 1,364,000    $   448,739
     Increase (reduction) in income taxes
      resulting from:
       Deferred tax liabilities assumed in CRM              --         (405,710)
       acquisition
       Permanent differences                              (5,000)       (56,565)
       State income taxes, net of federal income         140,000         43,554
          tax benefit
       Increase in valuation allowance                (1,499,000)       (24,527)
       Other                                                --           (5,491)
                                                     -----------    -----------
                                                     $      --      $      --
                                                     ===========    ===========







                                      F-19
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 2000


     The tax effects of temporary differences that give rise to significant
     portions of deferred tax assets and liabilities at July 31, 2001 and 2000,
     are presented below:

                                                         2001          2000
                                                         ----          ----
     Deferred tax assets:
       Allowance for doubtful account receivable     $    67,000    $    36,883
       Deffered compensation                              30,000         48,915
       Accrued vacation                                    7,000          5,968
       Deferred revenue                                     --           17,356
       Cash to accrual adjustment for CRM                   --          170,853
       Fair value of CRM deferred revenue acquired          --          131,925
       Net operating loss carry forwards               1,989,000        861,040
                                                     -----------    -----------
         Total deferred tax assets                     2,093,000      1,272,940

     Deferred tax liabilities:
       Amounts due from CRM customer contracts              --         (670,200)
         acquired
       Property and equipment acquired from CRM          (30,000)       (35,821)
       Prepaid expenses acquired from CRM                   --           (2,467)
                                                     -----------    -----------

         Total deferred tax liabilities                  (30,000)      (708,488)
                                                     -----------    -----------

         Total net deferred tax assets               $ 2,063,000    $   564,452
                                                     ===========    ===========

                                                     $(2,063,000)   $  (564,452)
                                                     -----------    -----------
     Less valuation allowance
     Net deferred taxes                              $      --      $      --
                                                     ===========    ===========


     The increase in the valuation allowance was approximately $1,499,000 and
     $25,000 for the years ended July 31, 2001 and 2000, respectively. In
     assessing the realizability of deferred tax assets, management considers
     whether it is more likely than not that some portion or all of the deferred
     tax assets will not be realized. The ultimate realization of deferred tax
     assets is dependent upon the generation of future taxable income during the
     periods in which those temporary differences become deductible. Management
     considers the scheduled reversal of deferred tax liabilities, projected
     future taxable income and tax planning strategies in making this
     assessment. In order to fully realize the deferred tax assets, the Company
     will need to generate future taxable income of approximately $6,300,000
     prior to the expiration of the net operating loss carryforwards as follows:
     $600,000 in 2013, $800,000 in 2019,$900,000 in 2020 and $4,000,000 in 2021.

                                      F-20
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 2000


11.  STOCKHOLDERS' EQUITY (DEFICIT):

     The Company has 10,000,000 shares of authorized preferred stock, par value
     $.001, issuable from time to time in different series with rights and
     privileges to be determined by the Board of Directors. No specific series
     of preferred stock have yet been established. Common stock issued but not
     outstanding of 2,000,000 shares represents the shares issued in the
     Company's name that are held in escrow by a third party.

     In February 2000, the Company sold 2,000,000 shares of common stock at $.50
     per share for $974,984, net of offering costs of $25,016 to various
     investors.

     The Company issued options to an employee to purchase 50,000 shares of
     common stock at an exercise price of $.50 when the fair value of the common
     stock was $1.00 per share. Pursuant to APB 25, the Company recorded a
     charge to compensation expense during the year ended July 31, 2000, of
     $10,416. The remaining unamortized portion of this deferred compensation of
     $14,584 is reported as a reduction of equity at July 31, 2001 and recorded
     in expenses in fiscal 2001.

     In conjunction with the CFPI acquisition, the Company issue 40,000
     restricted shares valued at $10,125 of the Company's common stock, to
     selected employees of CFPI on May 5, 2001. The compensation expense for the
     period May 1, 2000 to July 31, 2000 of $2,531 is included in selling,
     general and administrative expenses and the remaining unamortized portion
     of deferred compensation totaling $7,594 is reported as a reduction of
     equity at July 31, 2000 and recorded in expenses in fiscal 2001.

     In January 2001, $120,463 of deferred compensation as of July 31, 2000 and
     $61,751 of deferred compensation incurred from August to November 2001 were
     exchanged for 1,457,714 shares of common stock.

12.  STOCK OPTIONS AND WARRANTS:

     The Company applies APB Opinion No. 25 in accounting for its stock options
     issued to employees and directors for services in the normal course,
     whereby $12,947 of compensation expense has been recognized in the
     accompanying financial statements for the year ended July 31, 2000.

     Had the Company determined compensation cost based on the fair value at the
     grant date for its stock options under SFAS No. 123, the Company's net loss
     would have increased to the pro forma amounts indicated below:

                                                        2001        2000
                                                        ----        ----

          Net loss as reported                     $             (1,319,820)
          Net loss                                               (1,566,336)
          Net loss per share - basic and diluted                       (.08)


     The above pro forma disclosures are not necessarily representative of the
     effect on the reported net loss for future periods because options vest
     over several years and additional awards are generally made each year. The
     per share weighted average fair value of stock options granted during 2001
     and 2000 was $___ and $.23, respectively, on the date of grant using the
     Black-Scholes option pricing model with the following assumptions for 2000:
     no expected dividend yield, risk free interest rates ranging from ___% to
     ____%, volatility ranging from ___% to ___% and expected option lives
     ranging from __ to ____years; and the following assumptions for 2000: no
     expected dividend yield, risk free interest rate ranging from ____% to
     ____%, volatility ranging from 117% to 174%, and expected option lives
     ranging from __ to ___ years.

                                      F-21
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 2000


     Stock option activity was as follows:

                                                      Number of     Range of
                                                       Shares    Exercise Prices
                                                     ----------  ---------------

      Balance at July 31, 1999                        1,181,233    .50 - 1.00
            Granted                                   2,682,501    .27 - 1.00
            Canceled                                    (25,000)          .50
                                                     ----------
      Balance at July 31, 2000                        3,838,734    .27 - 1.00
                                                     ==========
            Granted
            Canceled
                                                     ----------
            Balance at July 31, 2001

      Number of options exercisable at July 31, 2001
                                                     ==========

     Canceled options are a result of employee terminations or forfeitures.

                                          Weighted Average
                                             Remaining
     At Exercise Price        Number      Contractual Life    Number Exercisable
           2001            Outstanding        (Years)              July 31,
           ----            -----------        -------              --------

        $  0.27               500,000
           0.50             2,078,734
           1.00             1,260,000
                            ---------                             ---------

                            =========                             =========

     In fiscal 2000, the Company entered into an underwriting arrangement with
     an investment banking institution (see Note 16). In connection with this
     agreement, the Company issued warrants to purchase 490,000 shares of its
     common stock at, initially, a purchase price of $.50 per share. The
     purchase price may be adjusted on each six month anniversary of the date of
     issuance to the lower of the then exercise price or the lowest closing
     price for the five trading days ending on such six month anniversary. The
     Company has recorded the fair value of the warrants as an offering cost
     which is included in stockholders' equity (deficit) based on the following
     assumptions: no expected dividend yield, risk free interest rate of 6.75%,
     volatility of 117%, and expected lives ranging from 4 to 5 years.

                                      F-23
<PAGE>2


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 2000


13.  FAIR VALUE OF FINANCIAL INSTRUMENTS:

     The fair value of a financial instrument is the amount at which the
     instrument could be exchanged in a current transaction between willing
     parties. The carrying amount of cash, amounts due from customer contracts
     acquired, accounts receivable, notes payable, accounts payable, accrued
     liabilities and notes payable and due to related parties approximate fair
     value because of the short maturity or duration of these instruments. The
     carrying amount of long-term debt approximates fair value as the interest
     rates are considered market rates. For long-term debt which is not interest
     bearing, the discount used for financial reporting purposes is the
     incremental borrowing rate and, accordingly, discounted value approximates
     fair value.

14.  LEASES:

     The Company has noncancelable operating leases for its offices certain
     equipment and software that expire over the next five years.

     Future minimum lease payments under noncancelable operating leases (with
     initial or remaining lease terms in excess of one year) as of July 31,
     2001, are:

                                                        Operating Leases
                                                        ----------------

          Year ending July 31:
                2002                                       $   772,000
                2003                                           963,000
                2004                                           968,000
                2005                                           436,000
                                                           -----------

                     Total minimum lease payments          $ 3,139,000
                                                           -----------

     Total rent expense associated with operating leases was $919,000 and
     $102,000 for the years ended July 31, 2001 and 2000, respectively.

                                      F-23
<PAGE>


              COLLEGE BOUND STUDENT ALLIANCE, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                             JULY 31, 2001 AND 2000


15.  LEGAL PROCEEDINGS:

     In fiscal 2000, the Attorney General of Minnesota filed suit against TCP
     alleging deceptive trade practices, consumer fraud and false advertising,
     which allegedly occurred prior to the acquisition of TPC by the Company.
     The plaintiffs in the case are seeking injunctive and other relief. The
     Company through its legal counsel is involved in ongoing settlement
     discussions with the State of Minnesota. Based on these discussions
     management believes this matter will be resolved without significant
     financial consequences. However, as this may result in a jury trial, an
     estimate of the loss, if any, cannot be made.

     In fiscal 2001, the prior owners of a business acquired by the Company in
     fiscal 1999 filed an action against the Company demanding payments on
     promissory notes issued in the acquisition. The Company contends the
     purchase price was overvalued as of the purchase date, that the remaining
     performance thresholds have not been met and, therefore, the corresponding
     performance payments are not due, and that a return of previous payments
     may be required. The Company also terminated certain consulting and
     employment agreements to these prior owners and filed suit against these
     parties. One of the prior owners subsequently filed a counter suit against
     the Company alleging breach of executive employment agreement and seeks
     monetary damages in the amount of $540,000, plus attorney fees and other
     costs. The Company believes that it has meritorious defenses as to the
     entire amount sought. Accordingly, no amounts have been accrued on this
     action, however, the promissory notes on the acquisition remain
     outstanding. The Company intends to vigorously contest this action and seek
     recovery of the promissory notes issued.

     The Company is involved in claims and legal actions arising in the ordinary
     course of business. In the opinion of management, the ultimate disposition
     of these matters will not have a material adverse effect on the Company's
     financial position or results of operations.

16.  SUBSEQUENT EVENTS (unaudited):

     After July 31, 2001 the following significant events occurred.

     The Company agreed to terms with former vendors which resulted in the
     return of 800,000 shares of stock.

     The Company also agreed to exchange 70,000 shares of restricted common
     stock for options to purchase 765,000 shares of its common stock.

     The September 11, 2001 tragedy had a limited adverse impact on the
     Company's operations and financial events as a result of delayed mailings
     for 2 weekends resulting in fewer reservations for the workshops and 20%
     fewer people with reservations actually showing up for the workshops.
     Recent trends indicate activities are returning to normal.

     In fiscal 2000, the Company entered into a financing arrangement with an
     investment banking institution (see Note 11). Under this arrangement, the
     Company issued 490,000 warrants. Subsequent to July 31, 2001 the Company
     advised the investment banking institution it was canceling its agreement
     for non-performance; including the issuance of the warrants. The investment
     banking institution has not yet acknowledged this cancellation. In such
     event as the investment banking institution should attempt to exercise the
     warrants, the Company will vigorously contest such action as the financing
     transaction contemplated by the investment banking arrangement did not
     occur as it was never approved by the Securities and Exchange Commission.

     The Company issued common shares to its directors.


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