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**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

 

----

** **

**FORM 10-Q**

 

**(Mark One)**

 
| **x**      | **QUARTERLY  REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE  ACT OF 1934**                                                                                                                                                                                                                                                                                                                 |
|------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ** ** | ** **                                                                                                                                                                                                                                                                                                                                                                                                              |
| ** ** | **For the  quarterly period ended June 30, 2008**                                                                                                                                                                                                                                                                                                                                                                  |
| ** ** | ** **                                                                                                                                                                                                                                                                                                                                                                                                              |
| **OR**     |
| ** ** |
| **o**      | **TRANSITION  REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE  ACT OF 1934**                                                                                                                                                                                                                                                                                                                |
| ** ** | ** **                                                                                                                                                                                                                                                                                                                                                                                                              |
| ** ** | **For the  transition period from                                  to**                                |

 

**Commission File Number: 00-26599**

 

**COLLEGE TONIGHT, INC.**

(Exact name of registrant as specified in itscharter)

 

| **Delaware**                                                    | ** ** | **26-2983120**                          |
|-----------------------------------------------------------------|------------|-----------------------------------------|
| (State or other jurisdiction of incorporation or  organization) |       | (I.R.S. Employer Identification Number) |
|                                                            |       |                                    |
| **6380 Wilshire Boulevard, Suite 120, Los Angeles, CA**    | ** ** | **90048**                               |
| (Address of principal executive offices)                        |       | (Zip Code)                              |

 

(Registrant’s telephone number, including area code)**323-966-5800**

 

Indicate by check markwhether the registrant (1) has filed all reports required to be filed by Section 13or 15(d) of the Securities Exchange Act of 1934 during the preceding 12months (or for such shorter period that the registrant was required to filesuch reports), and (2) has been subject to such filing requirements forthe past 90 days.

Yes**x**           No **o**

 

Indicate by check markwhether the registrant is a large accelerated filer, an accelerated filer, anon-accelerated filer, or a smaller reporting company. See the definitions of “largeaccelerated filer,” “accelerated filer” and “smaller 77reporting company” in Rule 12b-2of the Exchange Act.

|   | Large accelerated filer o                                              | Accelerated filer o         |
|--------|------------------------------------------------------------------------|-----------------------------|
|   | Non-accelerated filer o (Do not check if a smaller reporting  company) | Smaller reporting company x |

 

Indicate by check markwhether the registrant is a shell company (as defined in Rule 12b-2 of theExchange Act).

Yes**o**           No **x**

 

The number of shares ofregistrant’s common stock, $0.01 par value, outstanding at August 11,2008: 34,406,767.

 

 

 

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**COLLEGE TONIGHT, INC.**

**INDEX**

 
| ** **                                                                       | ** **                                                                                                                                                      | **Page No.** |
|----------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------|
| PART I. FINANCIAL INFORMATION                                               |                                                                                                                                                            |
|                                                                             |                                                                                                                                                            |              |
| Item 1.                                                                     | Financial Statements                                                                                                                                            |              |
|                                                                             |                                                                                                                                                            |              |
|                                                                             | Condensed Consolidated  Statements of Operations for the Three Months Ended June 30, 2008 and  2007 (unaudited)                                            | 3                 |
|                                                                             |                                                                                                                                                            |              |
|                                                                             | Condensed Consolidated  Statements of Operations for the Six Months Ended June 30, 2008 and 2007  (unaudited)                                              | 4                 |
|                                                                             |                                                                                                                                                            |              |
|                                                                             | Condensed Consolidated  Balance Sheets at June 30, 2008 (unaudited) and December 31, 2007                                                             | 5                 |
|                                                                             |                                                                                                                                                            |              |
|                                                                             | Condensed Consolidated Statements  of Cash Flows for the Six Months Ended June  30, 2008 and 2007 (unaudited)                                              | 6                 |
|                                                                             |                                                                                                                                                            |              |
|                                                                             | Condensed Consolidated Statements  of Preferred Stock and Shareholders’ Equity / Members Deficit from  July 3, 2006 to June 30, 2008 (unaudited) | 7                 |
|                                                                             |                                                                                                                                                            |              |
|                                                                             | Notes to  Condensed Consolidated Financial Statements (unaudited)                                                                                               | 8                 |
|                                                                             |                                                                                                                                                            |              |
| Item 2.                                                                     | Management’s  Discussion and Analysis of Financial Condition and Plan of Operations                                                                        | 16                |
|                                                                             |                                                                                                                                                            |              |
| Item 4.                                                                     | Controls and Procedures                                                                                                                                         | 19                |
|                                                                             |                                                                                                                                                            |              |
| PART II. OTHER  INFORMATION                                                 |                                                                                                                                                            |
|                                                                             |                                                                                                                                                            |              |
| Item 1.                                                                     | Legal Proceedings                                                                                                                                               | 19                |
|                                                                             |                                                                                                                                                            |              |
| Item 1A.                                                                    | Risk Factors                                                                                                                                                    | 19                |
|                                                                             |                                                                                                                                                            |              |
| Item 2.                                                                     | Unregistered  Sales of Equity Securities and Use of Proceeds                                                                                                    | 19                |
|                                                                             |                                                                                                                                                            |              |
| Item 3.                                                                     | Defaults  Upon Senior Securities                                                                                                                                | 20                |
|                                                                             |                                                                                                                                                            |              |
| Item 4.                                                                     | Submission  of Matters to a Vote of Security Holders                                                                                                            | 20                |
|                                                                             |                                                                                                                                                            |              |
| Item 5.                                                                     | Other Information                                                                                                                                               | 20                |
|                                                                             |                                                                                                                                                            |              |
| Item 6.                                                                     | Exhibits                                                                                                                                                        | 20                |
|                                                                             |                                                                                                                                                            |              |
| SIGNATURE                                                                        | 21                                                                                                                                                              |
|                                                                             |                                                                                                                                                            |
|  Principal  Executive Officer Certification Pursuant to Rule 13a-14(a) |                                                                                                                                                            |
|  Principal  Financial Officer Certification Pursuant to Rule 13a-14(a) |                                                                                                                                                            |
|  Principal  Executive Officer Certification Pursuant to Section 1350   |                                                                                                                                                            |
|  Principal  Financial Officer Certification, Pursuant to Section 1350  |                                                                                                                                                            |

 

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**COLLEGETONIGHT, INC.**

**FINANCIALSTATEMENTS**

 

**PART I – FINANCIAL INFORMATION**

 

**ITEM 1 – FINANCIALSTATEMENTS**

 

The unaudited interimfinancial statements included herein have been prepared by College Tonight, Inc.(the “Company”).  In the opinion ofmanagement, the interim financial statements reflect all adjustments of anormal recurring nature necessary for a fair statement of the results forinterim periods. It is suggested that these financial statements and notes tothe financial statements be read in conjunction with the financial statementsincluded in the Company’s Annual Report on Form 10-KSB/A for 2007.

 

COLLEGE TONIGHT, INC.

(A DEVELOPMENT STAGE COMPANY)

CONDENSEDCONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

 
| ** **                           | ** ** | **Three Months Ended June 30,** | ** ** |
|--------------------------------------|------------|-----------------------------------------------------|------------|
| ** **                           | ** ** | **2008**                                            | ** ** | **2007** | ** ** |
| **Revenues**                         |       | $                                                   | 1,150      |   | $ | 2,417 |   |
|                                 |       |                                                |       |   |   |
| **Operating Expenses:**              |       |                                                |       |   |   |
| Development costs                    |       | 59,822                                              |       | 9,249 |   |
| Depreciation and amortization        |       | 2,250                                               |       | — |   |
| Marketing                            |       | 66,377                                              |       | 5,371 |   |
| Selling, general and administrative  |       | 241,210                                             |       | 23,406 |   |
| Total operating expenses             |       | 369,659                                             |       | 38,026 |   |
|                                 |       |                                                |       |   |   |
| **Net Operating Loss**               |       | (368,509                                            | )          | (35,609 | ) |
|                                 |       |                                                |       |   |   |
| Interest income                      |       | 665                                                 |       | — |   |
| Interest expense                     |       | —                                              |       | (845 | ) |
|                                 |       |                                                |       |   |   |
| **Net Loss**                         |       | $                                                   | (367,844   | ) | $ | (36,454 | ) |
|                                 |       |                                                |       |   |   |
| Loss per share (basic and diluted)   |       | $                                                   | (0.01      | ) | $ | (0.01 | ) |
|                                 |       |                                                |       |   |   |
| Weighted average shares outstanding: |       |                                                |       |   |   |
| Basic and diluted                    |       | 28,859,168                                          |       | 6,494,775 |   |

 

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COLLEGE TONIGHT, INC.

(A DEVELOPMENT STAGE COMPANY)

CONDENSEDCONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

 
| ** **                           | ** ** | **Six Months Ended June 30,** | ** ** | **For the Period  July 3, 2006  (Inception) to** | ** ** |
|--------------------------------------|------------|---------------------------------------------------|------------|---------------------------------------------------------------------------|------------|
| ** **                           | ** ** | **2008**                                          | ** ** | **2007**                                                                  | ** ** | **June 30, 2008** | ** ** |
| **Revenues**                         |       | $                                                 | 1,653      |                                                                      | $          | 4,834 |   | $ | 8,604 |   |
|                                 |       |                                              |       |                                                                      |       |   |   |
| **Operating Expenses:**              |       |                                              |       |                                                                      |       |   |   |
| Development costs                    |       | 129,497                                           |       | 12,667                                                                    |       | 253,338 |   |
| Depreciation and amortization        |       | 3,529                                             |       | —                                                                    |       | 5,688 |   |
| Marketing                            |       | 126,675                                           |       | 10,789                                                                    |       | 332,407 |   |
| Selling, general and administrative  |       | 534,851                                           |       | 28,802                                                                    |       | 1,082,594 |   |
| Total operating expenses             |       | 794,552                                           |       | 52,258                                                                    |       | 1,674,027 |   |
|                                 |       |                                              |       |                                                                      |       |   |   |
| **Net Operating Loss**               |       | (792,899                                          | )          | (47,424                                                                   | )          | (1,665,423 | ) |
|                                 |       |                                              |       |                                                                      |       |   |   |
| Interest income                      |       | 5,295                                             |       | —                                                                    |       | 9,867 |   |
| Interest expense                     |       | —                                            |       | (845                                                                      | )          | (1,507 | ) |
|                                 |       |                                              |       |                                                                      |       |   |   |
| **Net Loss**                         |       | $                                                 | (787,604   | )                                                                         | $          | (48,269 | ) | $ | (1,657,063 | ) |
|                                 |       |                                              |       |                                                                      |       |   |   |
| Loss per share (basic and diluted)   |       | $                                                 | (0.04      | )                                                                         | $          | (0.01 | ) |   |   |
|                                 |       |                                              |       |                                                                      |       |   |   |
| Weighted average shares outstanding: |       |                                              |       |                                                                      |       |   |   |
| Basic and diluted                    |       | 21,545,648                                        |       | 6,191,545                                                                 |       |   |   |

 

The accompanying notes are an integral partof these financial statements.

 

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COLLEGE TONIGHT, INC.

(A DEVELOPMENT STAGE COMPANY)

CONDENSEDCONSOLIDATED BALANCE SHEETS

 
| ** **                                                                                                                                                                                                | ** ** | **June 30, 2008** | ** ** | **December 31,  2007** | ** ** |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------|-----------------------------|------------|-----------------------------|------------|
| ** **                                                                                                                                                                                                | ** ** | **(Unaudited)**             | ** ** | ** **                  | ** ** |
| **Assets**                                                                                                                                                                                                |       |                        |       |                        |       |
| **Current Assets:**                                                                                                                                                                                       |       |                        |       |                        |       |
| Cash                                                                                                                                                                                                      |       | $                           | 453,624    |                        | $          | 722,402 |   |
| Restricted cash                                                                                                                                                                                           |       | —                      |       | 5,843                       |       |
| Prepaid expenses                                                                                                                                                                                          |       | 365,625                     |       | —                      |       |
| Other current assets                                                                                                                                                                                      |       | 4,353                       |       | 7,074                       |       |
| **Total Current Assets**                                                                                                                                                                                  |       | 823,602                     |       | 735,319                     |       |
|                                                                                                                                                                                                      |       |                        |       |                        |       |
| Property, plant and equipment, net                                                                                                                                                                        |       | 18,054                      |       | 19,526                      |       |
| Intangible assets                                                                                                                                                                                         |       | 15,870                      |       | 4,487                       |       |
| Other assets                                                                                                                                                                                              |       | 28,040                      |       | 14,588                      |       |
| **Total Assets**                                                                                                                                                                                          |       | $                           | 885,566    |                        | $          | 773,920 |   |
|                                                                                                                                                                                                      |       |                        |       |                        |       |
| **Liabilities and Shareholders’ Equity**                                                                                                                                                             |       |                        |       |                        |       |
| **Current Liabilities:**                                                                                                                                                                                  |       |                        |       |                        |       |
| Accounts payable                                                                                                                                                                                          |       | $                           | 38,582     |                        | $          | 10,971 |   |
| Accrued expenses                                                                                                                                                                                          |       | 53,308                      |       | 130,086                     |       |
| **Total Current Liabilities**                                                                                                                                                                             |       | 91,890                      |       | 141,057                     |       |
|                                                                                                                                                                                                      |       |                        |       |                        |       |
| Convertible preferred stock $.001 par  value; 5,000,000 shares authorized; 2,412,800 shares issued and outstanding  at December 31, 2007 (converted to common stock in March 2008, see  Note 6) |       | —                      |       | 602,613                     |       |
| Commitments and contingencies                                                                                                                                                                             |       |                        |       |                        |       |
|                                                                                                                                                                                                      |       |                        |       |                        |       |
| **Shareholders’ Equity:**                                                                                                                                                                            |       |                        |       |                        |       |
| Common stock; $.001 par value; 100,000,000  shares authorized 34,406,767 and 33,919,786 shares issued and outstanding,  respectively                                                                      |       | 34,407                      |       | 33,920                      |       |
| Additional paid in capital                                                                                                                                                                                |       | 2,416,332                   |       | 865,789                     |       |
| Deficit accumulated during the development  stage                                                                                                                                                         |       | (1,657,063                  | )          | (869,459                    | )          |
| **Total Shareholders’ Equity**                                                                                                                                                                       |       | 793,676                     |       | 30,250                      |       |
|                                                                                                                                                                                                      |       |                        |       |                        |       |
| **Total Liabilities and Shareholders’ Equity**                                                                                                                                                       |       | $                           | 885,566    |                        | $          | 773,920 |   |

 

The accompanying notes are an integral partof these financial statements.

 

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COLLEGE TONIGHT, INC.

(A DEVELOPMENT STAGE COMPANY)

CONDENSEDCONSOLIDATED STATEMENTS OF CASH FLOW

(UNAUDITED)

 
| ** **                                                                                  | ** ** | **Six Months Ended June 30,** | ** ** | **For the Period  July 3, 2006  (Inception) to** | ** ** |
|---------------------------------------------------------------------------------------------|------------|---------------------------------------------------|------------|---------------------------------------------------------------------------|------------|
| ** **                                                                                  | ** ** | **2008**                                          | ** ** | **2007**                                                                  | ** ** | **June 30, 2008** | ** ** |
| **Cash Flows from Operating Activities:**                                                   |       |                                              |       |                                                                      |       |   |   |
| Net loss                                                                                    |       | $                                                 | (787,604   | )                                                                         | $          | (48,269 | ) | $ | (1,657,063 | ) |
| Adjustments to reconcile net loss to net  cash used in operating activities:                |       |                                              |       |                                                                      |       |   |   |
| Depreciation and amortization                                                               |       | 2,523                                             |       | —                                                                    |       | 4,681 |   |
| Non-cash compensation charge                                                                |       | 58,824                                            |       | —                                                                    |       | 59,824 |   |
| Change in assets and liabilities:                                                           |       |                                              |       |                                                                      |       |   |   |
| Prepaid expenses                                                                            |       | (90,625                                           | )          | (860                                                                      | )          | (96,468 | ) |
| Accounts payable and accrued expenses                                                       |       | (38,201                                           | )          | 1,776                                                                     |       | 102,856 |   |
| Net cash used in operating activities                                                       |       | (855,083                                          | )          | (47,353                                                                   | )          | (1,586,170 | ) |
|                                                                                        |       |                                              |       |                                                                      |       |   |   |
| **Cash Flows from Investing Activities:**                                                   |       |                                              |       |                                                                      |       |   |   |
| Change in restricted cash                                                                   |       | 5,843                                             |       | —                                                                    |       | 5,843 |   |
| Other assets                                                                                |       | (13,451                                           | )          | —                                                                    |       | (33,337 | ) |
| Purchases of property and equipment                                                         |       | (1,087                                            | )          | (5,574                                                                    | )          | (22,771 | ) |
| Net cash used in investing activities                                                       |       | (8,695                                            | )          | (5,574                                                                    | )          | (50,265 | ) |
|                                                                                        |       |                                              |       |                                                                      |       |   |   |
| **Cash Flows from Financing Activities:**                                                   |       |                                              |       |                                                                      |       |   |   |
| Proceeds from issuance of common stock, net  of issuance and other direct costs of $144,441 |       | —                                            |       | —                                                                    |       | 895,059 |   |
| Proceeds from sale of common stock pursuant  to subscription agreements                     |       | 595,000                                           |       | 450,050                                                                   |       | 1,195,000 |   |
| (Payments) proceeds from related party  loans                                               |       | —                                            |       | (26,673                                                                   | )          | — |   |
| Net cash provided by financing activities                                                   |       | 595,000                                           |       | 423,377                                                                   |       | 2,090,059 |   |
|                                                                                        |       |                                              |       |                                                                      |       |   |   |
| Net change in cash                                                                          |       | (268,778                                          | )          | 370,450                                                                   |       | 453,624 |   |
| Cash at beginning of the period                                                             |       | 722,402                                           |       | 355                                                                       |       | — |   |
| Cash at end of the period                                                                   |       | $                                                 | 453,624    |                                                                      | $          | 370,805 |   | $ | 453,624 |   |
|                                                                                        |       |                                              |       |                                                                      |       |   |   |
| Supplemental disclosure of noncash  investing and financing activities:                     |       |                                              |       |                                                                      |       |   |   |
| Conversion of convertible Series A  preferred shares to common shares                  |       | $                                                 | 602,613    |                                                                      |       |   | $ | 602,613 |   |
|                                                                                        |       |                                              |       |                                                                      |       |   |   |
| Issuance of common stock                                                                    |       | $                                                 | 353,417    |                                                                      |       |   | $ | 353,417 |   |
|                                                                                        |       |                                              |       |                                                                      |       |   |   |
| Issuance of convertible Series A  preferred shares in the merger transaction           |       |                                              |       |                                                                      |       | $ | 602,613 |   |
|                                                                                        |       |                                              |       |                                                                      |       |   |   |
| Issuance of common stock upon conversion of  notes payable and related accrued interest     |       |                                              |       |                                                                      |       | $ | 190,641 |   |
|                                                                                        |       |                                              |       |                                                                      |       |   |   |
| Conversion of LLC to corporation                                                            |       |                                              |       |                                                                      |       | $ | 68,676 |   |
|                                                                                        |       |                                              |       |                                                                      |       |   |   |
| Common stock acquired upon merger with  SIMEX                                               |       |                                              |       |                                                                      |       | $ | 160,086 |   |

 

The accompanying notes are an integral partof these financial statements.

 

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COLLEGE TONIGHT, INC.

 (A DEVELOPMENT STAGE COMPANY)

CONDENSEDCONSOLIDATED STATEMENTS OF PREFERRED STOCK AND SHAREHOLDERS’ EQUITY / MEMBERSDEFICIT

 
| ** **                                                                                                                     | ** ** | **Preferred Stock** | ** ** | **Members  Deficit  Accumulated  during the  Development** | ** ** | **Common Stock** | ** ** | **Additional  Paid in** | ** ** | **Deficit  Accumulated  during the  Development** | ** ** | **Total  Shareholders’** | ** ** |
|--------------------------------------------------------------------------------------------------------------------------------|------------|--------------------------|------------|-----------------------------------------------------------------|------------|-----------------------|------------|------------------------------|------------|--------------------------------------------------------|------------|-------------------------------|------------|
| ** **                                                                                                                     | ** ** | **Shares**               | ** ** | **Amount**                                                      | ** ** | **Stage**             | ** ** | **Shares**                   | ** ** | **Amount**                                             | ** ** | **Capital**                   | ** ** | **Stage** | ** ** | **Equity** | ** ** |
|                                                                                                                           |       |                     |       |                                                            |       |                  |       |                         |       |                                                   |       |                          |       |   |   |   |   |
| Balance at  July 3, 2006 (inception)                                                                                      |       | —                   |       | $                                                               | —     |                  | $          | —                       |       | —                                                 |       | $                             | —     |   | $ | — |   | $ | — |   | $ | — |   |
| Net loss for the  period from July 3, 2006 to December 31, 2006                                                      |       | —                   |       | —                                                          |       | (44,384               | )          | —                       |       | —                                                 |       | —                        |       | — |   | (44,384 | ) |
| Balance at  December 31, 2006                                                                                             |       | —                   |       | $                                                               | —     |                  | $          | (44,384                      | )          | —                                                 |       | $                             | —     |   | $ | — |   | $ | — |   | $ | (44,384 | ) |
|                                                                                                                           |       |                     |       |                                                            |       |                  |       |                         |       |                                                   |       |                          |       |   |   |   |   |
| Net loss for the  period from January 1, 2007 through June 7, 2007, date of  conversion from an LLC to a corporation |       | —                   |       | —                                                          |       | (24,292               | )          | —                       |       | —                                                 |       | —                        |       | — |   | (24,292 | ) |
| Effect of  conversion from LLC to corporation                                                                                  |       | —                   |       | —                                                          |       | 68,676                |       | 1,612,500                    |       | 1,613                                                  |       | (25,905                       | )          | (44,384 | ) | — |   |
| Issuance of  common stock from subscription agreements                                                                         |       | —                   |       | —                                                          |       | —                |       | 340,300                      |       | 340                                                    |       | 599,660                       |       | — |   | 600,000 |   |
| Shares of College  Tonight issued to director and placement agents                                                             |       | —                   |       | —                                                          |       | —                |       | 460,000                      |       | 460                                                    |       | 540                           |       | — |   | 1,000 |   |
| Conversion of  common stock to preferred stock upon merger with Simex                                                          |       | 2,412,800                |       | 602,613                                                         |       | —                |       | (2,412,800                   | )          | (2,413                                                 | )          | (600,200                      | )          | — |   | (602,613 | ) |
| Issuance of  common stock, net of issuance costs                                                                               |       | —                   |       | —                                                          |       | —                |       | 10,395,000                   |       | 10,395                                                 |       | 884,664                       |       | — |   | 895,059 |   |
| Common stock  acquired upon merger with Simex                                                                                  |       | —                   |       | —                                                          |       | —                |       | 19,711,969                   |       | 19,712                                                 |       | (179,798                      | )          | — |   | (160,086 | ) |
| Issuance of  common shares for conversion of notes payable                                                                     |       | —                   |       | —                                                          |       | —                |       | 3,812,817                    |       | 3,813                                                  |       | 186,828                       |       | — |   | 190,641 |   |
| Net loss for the  period from June 7, 2007 to December 31, 2007                                                      |       | —                   |       | —                                                          |       | —                |       | —                       |       | —                                                 |       | —                        |       | (825,075 | ) | (825,075 | ) |
| Balance at  December 31, 2007                                                                                             |       | 2,412,800                |       | $                                                               | 602,613    |                  | $          | —                       |       | 33,919,786                                             |       | $                             | 33,920     |   | $ | 865,789 |   | $ | (869,459 | ) | $ | 30,250 |   |
|                                                                                                                           |       |                     |       |                                                            |       |                  |       |                         |       |                                                   |       |                          |       |   |   |   |   |
| Conversion of  preferred stock to common stock at a rate of forty shares of common stock for  each share of preferred stock    |       | (2,412,800               | )          | (602,613                                                        | )          | —                |       | 96,512,000                   |       | 96,512                                                 |       | 506,101                       |       | — |   | 602,613 |   |
| Reverse stock split  at a conversion rate of four for one                                                                      |       | —                   |       | —                                                          |       | —                |       | (97,823,840                  | )          | (97,824                                                | )          | 97,824                        |       | — |   | — |   |
| Issuance of  common stock, net of issuance costs                                                                               |       | —                   |       | —                                                          |       | —                |       | 311,331                      |       | 311                                                    |       | 353,106                       |       | — |   | 353,417 |   |
| Issuance of  common stock from subscription agreements                                                                         |       | —                   |       | —                                                          |       | —                |       | 1,487,500                    |       | 1,488                                                  |       | 593,513                       |       | — |   | 595,000 |   |
| Net loss                                                                                                                       |       | —                   |       | —                                                          |       | —                |       | —                       |       | —                                                 |       | —                        |       | (787,604 | ) | (787,604 | ) |
| Balance at  June 30, 2008 (Unaudited)                                                                                     |       | —                   |       | $                                                               | —     |                  | $          | —                       |       | 34,406,778                                             |       | $                             | 34,407     |   | $ | 2,416,332 |   | $ | (1,657,063 | ) | $ | 793,676 |   |

 

The accompanying notes are an integral partof these financial statements.

 

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**COLLEGE TONIGHT, INC.**

**NOTES TO THE CONDENSEDCONSOLIDATED FINANCIAL STATEMENTS**

**(UNAUDITED)**

 

Note 1 – Nature of Business and Basis of Presentation

 

TheCompany conceptualized and designed a website that provides college studentsand alumni with a social networking medium via the Internet. The websiteinforms people of nightlife options in their community and school as well aspromotes social interaction within the student body and alumni.

 

Sinceits inception, the Company has devoted substantially all of its efforts toresearch and development of its technology, business and financial planning,recruiting management and technical staff, acquiring assets and raising capital.Accordingly, the Company is considered to be in its development stage asdefined in Statement of Financial Accounting Standards No. 7.

 

Theinterim financial statements included herein have been prepared by the Company,without audit pursuant to the rules and regulations of the Securities andExchange Commission (“SEC”).  Certain information and footnote disclosuresnormally included in annual financial statements prepared in accordance withaccounting principles generally accepted in the United States of America havebeen condensed or omitted.  The interim financial statements reflect, inthe opinion of management, all adjustments necessary (consisting only of normalrecurring adjustments) to present a fair statement of results for the interimperiods presented.  The operating results for any interim period are notnecessarily indicative of the results that may be expected for the year ending December 31,2008. The accompanying financial statements should be read in conjunctionwith the consolidated financial statements and notes included in the Company’sAnnual Report on Form 10-KSB, as amended, for the year ended December 31,2007.

 

Note 2 - History and Liquidity

 

*Background*

 

OnNovember 29, 2007, Simex Technologies, Inc., the predecessor to CollegeTonight, Inc. (“Simex”) completed an acquisition of College Tonight, Inc.(the “Reverse Merger”). Simex had been an inactive public shell for the twoyears preceding the Reverse Merger. As part of the acquisition, Simex issued tothe stockholders of College Tonight, Inc., 2,412,800 shares of Series APreferred Stock in exchange for all of the issued and outstanding capital stockof College Tonight.  Since Simex did nothave sufficient authorized common shares at the date of the transaction toeffect the conversion of the Series A Preferred shares to common, thevalue of the preferred stock was classified as a liability at December 31,2007 until the March 5, 2008 share authorization approval noted below.As a result of the ReverseMerger transaction, College Tonight became Simex’s wholly-owned subsidiary andthe former stockholders of College Tonight became Simex’s controllingstockholders.

 

Undergenerally accepted accounting principles in the United States of America, theReverse Merger was considered to be a capital transaction in substance, ratherthan a business combination. That is, the acquisition was equivalent to theissuance of stock by College Tonight, Inc. for the net monetary assets ofSimex, accompanied by a recapitalization, and was accounted for as a change incapital structure. Accordingly, the accounting for the acquisition wasidentical to that resulting from a reverse acquisition, except that no goodwillwas recorded.  Under reverse takeover accounting, the comparativehistorical financial statements of the “legal acquirer” (Simex) are those ofthe “accounting acquirer” (College Tonight).  Earnings (loss) per shareare calculated to reflect the company’s change in capital structure for 

 

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allperiods presented.  Costs associated with the merger were expensed asincurred by College Tonight, Inc. The net monetary assets acquired fromthe Simex business was $5,843.

 

CollegeTonight was originally formed as a California limited liability company,College Tonight LLC, on July 3, 2006, and all member units were exchangedfor stock in College Tonight Inc. on June 7, 2007 when the Companyconverted into a Delaware corporation.

 

OnDecember 14, 2007, the Board of Directors of Simex approved and adopted bywritten consent resolutions to amend the Certificate of Incorporation of Simex.Pursuant to this Written Consent, the Company’s Certificate of Incorporationwas amended to (i) increase the Company’s total authorized stock from50,000,000 to 100,000,000 shares of Common Stock (ii) effect a 1-for-4Reverse Split of the Company’s issued and outstanding Common Stock, and (iii) changethe Company’s name to “College Tonight, Inc.” to more accurately reflectour business operations. On March 5, 2008 the share increase reversesplit, and name change became effective. The Company applied for a change inits trading symbol, and now trades under the ticker symbol “CGEG” on the NASDBulletin Board.

 

Uponthe closing of the Reverse Merger, Simex’s directors, Kjell I. Jagelid andWarren L. Traver, resigned from all offices of Simex that they held effectiveimmediately and also submitted letters of resignation from their positions asSimex directors.  Their resignations as directors became effective afterdissemination on February 11, 2008 of a definitive information statementpursuant to Sections14(c) ands (f) of the Securities Exchange Actrelating to the aforementioned amendments made to the Company’s Certificate ofIncorporation.  Zachary Suchin and Jason Schutzbank were appointed to ourBoard of Directors, with Mr. Suchin being appointed Chairman. In addition,Messrs. Suchin and Schutzbank were appointed officers of Simex (anddirectors and officers of College Tonight, Inc. when the name changebecame effective).

 

*Liquidity*

 

TheCompany is a development stage company which has generated negative cash flowsfrom operations, and a deficit accumulated during the development stage of$1,657,063 at June 30, 2008.  Those factors, as well as the uncertainconditions that the Company faces regarding its future raising of capital andultimately successfully commercializing its business plan raise substantialdoubt about the Company’s ability to continue as a going concern. Management ofthe Company has a plan to increase capital through issuance of additionalstock, however there can be no assurance that this plan can be successfullyimplemented.

 

TheCompany’s financial statements have been presented on the basis that it is agoing concern, which contemplates the realization of assets and thesatisfaction of liabilities in the normal course of business. The financialstatements of the Company do not include any adjustments that might benecessary if the Company is unable to continue as a going concern.

 

Note 3 - Summary of Significant Accounting Policies

 

*Use ofEstimates*

 

Thepreparation of financial statements in conformity with accounting principlesgenerally accepted in the United States of America requires management to makeestimates and assumptions that affect the reported amounts of assets andliabilities and disclosure of contingent assets and liabilities at the date ofthe financial statements and the reported amounts of revenues and expensesduring the reported period. Actual results could differ from those estimates.

 

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*RevenueRecognition*

 

Revenuefor sponsorships and placement of advertising are recognized when the events towhich they pertain occur. Revenue for sale of products is recognized upondelivery and customer acceptance.

 

*Depreciationand amortization*

 

Propertyand equipment are stated at cost.  Depreciation is computed on thestraight-line method over the estimated useful lives of the assets. Estimated useful lives of five years are used for furniture, fixtures, andequipment, and three years for computer hardware and software.

 

*Advertising*

 

TheCompany expenses all advertising costs as incurred and such costs amounted to$126,675 and $10,789 for the six months ended June 30, 2008 and 2007,respectively.

 

*LossPer Share*

 

Basicloss per share is calculated by dividing the net loss by theweighted-average number of common shares outstanding during the period. Dilutedloss per share is calculated by dividing the net loss by theweighted-average number of common shares and dilutive potential common sharesoutstanding during the period. Our diluted loss per share is the same as thebasic loss per share for 2008 and 2007. At June 30, 2008 2,000,000 of thecommon shares each issued to Zachary R. Suchin and Jason A. Schutzbank aresubject to cancellation in the event certain Company-related performancetargets are not met. These shares have been excluded from the earnings (loss)per share calculation, as they are not considered outstanding for such purpose.

 

*Incometaxes*

 

Deferredtaxes are calculated using the liability method whereby deferred tax assets arerecognized for deductible temporary differences and operating loss and taxcredit carryforwards and deferred tax liabilities are recognized for taxabletemporary differences.  Temporary differences are the differences betweenthe reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinionof management, it is more likely than not that some portion or all of thedeferred tax assets will not be realized.  Deferred tax assets andliabilities are adjusted for the effects of changes in tax laws and rates onthe date of enactment.

 

InJune 2006, the Financial Accounting Standards Board (“FASB”) issued FASBInterpretation No. 48, Accounting for Uncertainty in Income Taxes, anInterpretation of SFAS 109, Accounting for Income Taxes (“FIN 48”). This interpretation clarifies the accounting for uncertainty in income taxesrecognized in an entity’s financial statements in accordance with SFAS 109 byprescribing the minimum recognition threshold and measurement attributable to atax position taken or expected to be taken on a tax return is required to bemet before being recognized in the financial statements.  The adoption ofFIN 48 had no material impact on the Company’s financial statements for theyear ended December 31, 2007 and the six months ended June 30, 2008.The Company can not reasonably estimate uncertainties in tax positions for theyears ended 2003 through 2006 because Simex has not filed tax returns and,thus, has not yet determined its tax positions. Presumably, due to theexistence of probable, as yet not determined loss carryovers, any suchpositions, if challenged, would presumably simply reduce the amount of the losscarryovers, and resultant deferred income tax assets. For tax positions takenby Simex for filed open years, including 2002 and possibly years previous to2002, the Company can not reasonably estimate uncertainties in tax positionsbecause of insufficient information.  It is also possible that the Company

 

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couldbe liable for unassessed penalties for Simex’s failure to timely file taxreturns.  The amount of such penalties can not be currently determined butit is not believed they would have a material impact on the Company’s financialstatements.

 

*Capitalizedwebsite development costs*

 

TheCompany capitalized eligible costs associated with software developed orobtained for internal use in accordance with the American Institute ofCertified Public Accountants, or AICPA, Statement of Opinion No. 98-1, “Accountingfor the Costs of Computer Software Developed or Obtained for Internal Use” andEmerging Issues Task Force, or EITF, Issue No. 00-02, “Accounting forWebsite Development Costs”. Costs incurred in the development phase arecapitalized and will be amortized in cost of revenues over the product’sestimated useful life once placed into service. Costs related to the planningand post implementation phases of the website and related applicationsdevelopment efforts are recorded as operating expenses. There were no suchcosts for the six months ending June 30, 2008 and 2007, respectively.

 

*New accountingpronouncements*

 

InSeptember 2006, the FASB issued SFAS No. 157, Fair Value Measurements(“SFAS No. 157”).  SFAS 157 defines fair value, establishes aframework for measuring fair value in accounting principles generally acceptedin the United States of America and expands disclosures about fair valuemeasurements.  SFAS 157 applies only to fair-value measurements that arealready required or permitted by other accounting standards and is expected toincrease the consistency of those measurements.  SFAS 157 emphasizes thatfair value is a market-based measurement that should be determined based on theassumptions that market participants would use in pricing an asset orliability. The Company will be required to disclose the extent to which fair valueis used to measure assets and liabilities, the inputs used to develop themeasurements, and the effect of certain of the measurements on earnings (orchanges in net assets) for the period. SFAS 157 is effective for fiscal yearsbeginning after December 15, 2007, and the Company’s adoption of SFAS 157as of January 1, 2008 did not have a material impact on its financialstatements.

 

InFebruary 2007, the FASB issued SFAS No. 159, “The Fair Value Optionfor Financial Assets and Liabilities, including an amendment of FASB Statement No. 115”(“SFAS No. 159”). This statement permits entities to choose to measuremany financial instruments and certain other items at fair value that are notcurrently required to be measured at fair value. SFAS No. 159 is effectivefor financial statements issued for fiscal years beginning after November 15,2007, and the Company’s adoption of SFAS No. 159 as of January 1,2008 did not have a material impact on its financial statements.

 

Note 4 – Acquisitions

 

OnApril 11, 2008, the Company acquired certain assets and assumed noliabilities of OnFIREbeerpong, Inc. (“Onfire”) for $12,500.  Onfire is based in San Diego, California andis an online e-commerce business that specializes in designing, manufacturingand selling beer pong tables through a website with the domain name ofOnfirebeerpong.com. The acquisition was funded through the issuance of 10,000shares of common stock, valued at $1.25 per share, which was the market priceof the Company’s common stock on the date of the transaction. Onfire haslimited assets and liabilities and limited sales activity.

 

Note5 – Property and Equipment

 

Propertyand equipment, net of accumulated depreciation are as follows:

 

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| ** **                     | ** ** | **Estimated**        | ** ** | **June 30,** | ** ** | **December 31,** | ** ** |
|--------------------------------|------------|----------------------|------------|-------------------|------------|-----------------------|------------|
| ** **                     | ** ** | **Useful Life** | ** ** | **2008**          | ** ** | **2007**              | ** ** |
| Furniture and fixtures         |       | 5                    |       | $                 | 15,819     |                  | $          | 15,819 |   |
| Computer equipment             |       | 3                    |       | 6,952             |       | 5,865                 |       |
|                           |       |                 |       | 22,771            |       | 21,684                |       |
| Less: accumulated depreciation |       |                 |       | (4,717            | )          | (2,158                | )          |
|                           |       |                 |       | $                 | 18,054     |                  | $          | 19,526 |   |

 

Depreciationand amortization expense for the six months ended June 30, 2008 and 2007was $3,529 and $0, respectively.

 

Note6 – Shareholder’s Equity

 

*CommonStock*

 

OnJune 7, 2007, upon the exchange of all member units for stock in CollegeTonight Inc., the Company had authorized capital of 10,000,000 shares of commonstock. The Company issued 806,250 shares each to Zachary R. Suchin and Jason A.Schutzbank, officers of the Company. In addition 100,000 shares were issued toa director (resulting in a compensation charge of $1,000, representing theapproximate fair value of such shares at the date of issuance) and 360,000shares were issued to stock placement agents. In July and September 2007the Company received $450,000 and $150,000, respectively, in exchange for thesale of 340,300 shares of common stock pursuant to stock subscription agreements.All share amounts have been adjusted to reflect the 1,000 for 1 split which occurredat the date of the Reverse Merger. As discussed above, all of these issuedshares to the shareholders of College Tonight Inc. (2,412,800 in the aggregate)were cancelled and 2,412,800 shares of Simex Series A preferred stock wereissued to the shareholders as part of the Reverse Merger transaction.

 

OnNovember 29, 2007, in connection with the reverse merger acquisition Simexclosed a private placement pursuant to which Simex issued and sold to certainaccredited investors 10,395,000 shares of common stock for $895,059, net ofissuance and other direct costs of $144,441. At the time of the merger, therewere 19,711,969 shares of common stock held by the Simex shareholders in thepublic shell.

 

OnNovember 29, 2007, in connection with the reverse merger acquisition,Simex issued 3,812,817 shares of common stock resulting from the conversion offive convertible notes with an original balance of $182,000 plus accruedinterest.  The notes were convertible into common stock at $0.05 pershare, representing the approximate quoted value of the underlying common stockat the date of the transaction.

 

OnMarch 5, 2008, Simex Technologies, Inc. amended its articles ofincorporation to change its name to College Tonight, Inc., increase itsauthorized capital from 50,000,000 to 100,000,000 common shares and initiate aone for four reverse split. All share amounts in the above consolidatedfinancial statements have been adjusted to reflect the one for four reversesplit.

 

Duringthe second quarter of June 2008 the Company received $595,000 in exchangefor the sale of 1,487,500 shares of common stock pursuant to various stocksubscription agreements.

 

TheCompany issued an additional 311,331 unregistered shares of its common stockfrom January 1, 2008 through and including June 30, 2008. Theseissuances were as follows:

 

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·                  250,000 shares issued in consideration of athird party providing marketing, promotional and endorsement services.  The Company recorded $275,000 as a prepaidmarketing asset as of June 30, 2008 (Note 8).

·                  10,000 shares provided in consideration ofthe purchase of substantially all of OnFire’s assets. The Company recorded$12,500 for the acquisition of OnFire’s assets (Note 4).

·                  18,250 shares provided to former employees asadditional compensation for services. The Company recorded $20,250 ascompensation expense in the six months ended June 30, 3008 related tothese share issuances.

·                  8,081 shares issued in consideration of athird party providing marketing and promotional services. The Company recorded$10,667 as marketing expense in the six months ended June 30, 2008 relatedto this share issuance.

·                  25,000 shares issued in consideration of athird party providing investor relation services. The Company recorded $35,000as professional fees expense in the six months ended June 30, 2008 relatedto this share issuance.

 

AtJune 30, 2008 2,000,000 of the common shares each issued to Zachary R.Suchin and Jason A. Schutzbank are subject to cancellation in the event certainperformance targets are not met in the future. These shares have been excludedfrom the earnings (loss) per share calculation, as they are not consideredoutstanding for such purpose. When the restriction is released, the fair valueof the shares will be measured and a compensatory charge recorded.

 

*PreferredStock*

 

TheCompany may issue up to 5,000,000 shares of preferred stock in one or moreclasses or series within a class as may be determined by the Board ofDirectors, who may establish the number of shares to be included in each classor series, may fix the designation, powers, preferences and rights of theshares of each such class or series and any qualifications, limitations orrestrictions thereof. Any preferred stock so issued by the Board of Directorsmay rank senior to the common stock with respect to the payment of dividends oramounts upon liquidation, dissolution or winding up of the Company. Moreover,under certain circumstances, the issuance of preferred stock or the existenceof the un-issued preferred stock might tend to discourage or render moredifficult a merger or other change in control.

 

*Series AConvertible Preferred Stock*

 

Inconnection with the reverse merger acquisition of College Tonight Inc. on November 29,2007, Simex issued 2,412,800 shares of Series A Preferred Stock for allthe outstanding shares of College Tonight, Inc. The Series APreferred Stock has the following features:

 

·                  Each share of Series A Preferred Stockis entitled to dividends in an amount equal to any cash dividend declared oneach share of Common Stock multipled by the 40:1 conversion factor.

·                  Each share of Series A Preferred Stockis entitled to receive its share of assets distributable upon the liquidation,dissolution or winding up of the affairs of Simex equal to the amountdistributable to each share of Common Stock multipled by the 40:1 conversionfactor.

·                  Each share of Series A Preferred Stockis convertible into forty shares of Common Stock, subject to adjustment undercertain circumstances, and will be mandatorily converted into Common Stock atany time that the Company has sufficient authorized but unissued shares ofCommon Stock to issue common stock on conversion of all outstanding shares ofpreferred stock. The 2,412,800 shares issued in connection with the reverseacquisition converted into Common Stock on the first trading day following theeffective date of the aforementioned amendments to the Company’s Certificate ofIncorporation.

 

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·                  Each share of Series A Preferred Stockis entitled to that number of votes equal to the number of shares of CommonStock into which it is convertible.

 

TheCompany has authorized the issuance of up to 5,000,000 shares of PreferredStock. At December 31, 2007, the Company had 2,412,800 shares of Series APreferred Stock issued and outstanding. On March 5, 2008, the 2,412,800shares of Series A Preferred Stock issued to the new controllingstockholders were converted into Common Stock in the Company at the rate offorty (40) shares of Common Stock for each share of Series A PreferredStock and were subject to a one for four reverse split.

 

Note7 – Income Taxes

 

TheCompany had no income tax liability for the six months ended June 30, 2008and 2007 as the Company generated a loss in all periods and the resultantdeferred tax assets have been fully reserved.

 

Deferredincome taxes reflect the net effects of temporary differences between thecarrying amounts of assets and liabilities for financial reporting purposes andthe amounts used for income tax purposes.  The Company has net operatinglosses of approximately $1,115,000 from the activities of College Tonight, Inc.since conversion to a C corporation. Simex had significant net operatinglosses prior to the merger, however, the amount has not yet been calculatedsince Simex has not filed tax returns in recent years, and also utilization ofthe net operating losses would be significantly restricted, if available atall.  The utilization of net operating losses would be limited undersection 382 of the Internal Revenue Code due to a change in ownership of morethan 50%. The significant components of the Company’s deferred tax assets(liabilities) are as follows:

 
| ** **                           | ** ** | **June 30,** | ** ** |
|--------------------------------------|------------|-------------------|------------|
| ** **                           | ** ** | **2008**          | ** ** |
| Deferred tax assets:                 |       |              |       |
| Net operating loss carryforward      |       | $                 | 587,134    |   |
| Start up costs                       |       | 63,092            |       |
| Total gross deferred tax assets      |       | 650,226           |       |
|                                 |       |              |       |
| Deferred tax liabilities:            |       |              |       |
| Depreciation                         |       | (506              | )          |
| Total gross deferred tax liabilities |       | (506              | )          |
| Valuation allowance                  |       | (649,720          | )          |
| Net deferred tax asset (liability)   |       | $                 | —     |   |

 

Thedifference between the tax provision at the statutory federal income tax rateand the tax provision attributable to income before taxes was as follows:

 

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| ** **                           | ** ** | **June 30,** | ** ** |
|--------------------------------------|------------|-------------------|------------|
| ** **                           | ** ** | **2008**          | ** ** |
| Statutory federal income tax rate    |       | 34.0              | %          |
| State taxes, net of federal benefits |       | 8.7               | %          |
| Valuation allowance                  |       | (42.7             | )%         |
| Income tax rate                      |       | 0.0               | %          |

 

SeeNote 3 for discussion of the adoption of Fin 48.

 

Note 8 – Commitments and Contingencies

 

*Claimsand assessments*

 

Inthe normal course of business, the Company is subject to certain claims andassessments.  Management believes that there are no claims or assessmentsoutstanding which would materially affect the financial position of theCompany.

 

*Employmentagreements*

 

TheCompany has employment agreements with Jason A. Schutzbank, Milton B. Suchinand Zachary R. Suchin. Milton B. Suchin is Chairman of the Board of Directorsand Chief Operating Officer of College Tonight.  Mr. Suchin is thefather of Zachary Suchin, the Company’s chief executive officer. The materialterms of these agreements are as follows:

 

·                  Annual compensation for Mr. Zachary R.Suchin of $100,000 per year, Mr. Milton B. Suchin of $100,000 per year,and Mr. Schutzbank of $70,000 per year;

·                  Subject to earlier termination, the term ofeach agreement will expire on June 30, 2010;

·                  Reimbursement of health insurance expenses upto $250 per month for Mr. Zachary R, Suchin and Mr. Schutzbank, andreimbursement of the actual costs of health insurance for Mr. Milton B.Suchin;

·                  In the event of a termination without cause,severance equal to the salary due under the employment contract for a periodequal to the greater of one year or the remaining term of the employmentcontract;

·                  In the event College Tonight does not employthe employee following the expiration of the term of the employment contract,either because of College Tonight’s decision not to renew the employmentcontract or the inability of College Tonight and the employee to negotiate amutually acceptable new employment contract, severance equal to one year’ssalary under the employment contract;

·                  A confidentiality covenant prohibiting theemployee from disclosing any information that is owned, used or maintained byCollege Tonight and which provides College Tonight with an advantage overcompetitors who do not know or use the information;

·                  A non-compete covenant preventing theemployee from rendering services or owning more than 5% of any other companywhose business is the operation of a social networking website for as long asthe employee is receiving severance under the employment contract.

 

*Endorsementagreement*

 

InApril 2008, the Company entered into a one year agreement with Blue-EyedGirl, Inc. (“Blue-Eyed Girl”) on behalf of Lauren Conrad.  Ms. Conrad,star of the MTV series, “The Hills” and an emerging

 

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talentin the world of fashion design, has agreed to provide endorsements of CollegeTonight’s website and related services.  The Company issued Blue-Eyed Girl250,000 shares of its common stock as partial consideration for Ms. Conrad’sagreement to make various promotional appearances and to authorize the Companyto use her endorsement for the purpose of promoting and publicizing the Company’swebsite and services.  Blue-Eyed Girl will be eligible to receiveadditional consideration, a portion of which will consist of additional sharesof common stock, if the Company’s website achieves certain amounts of newregistered users. The Company recorded the fair value of the shares issuedto Blue-Eyed Girl as prepaid marketing expenses, which is being amortized on astraight-line basis to expense over the one year term of the agreement.Additional consideration, if any, earned by Blue-Eyed Girl will be recognizedas an expense upon attainment of the contractual milestones.

 

**ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIALCONDITION AND PLAN OF OPERATIONS**

 

***Plan of Operations / Overview***

 

Ourbusiness is the operation and marketing of a website at www.CollegeTonight.com.The website displays events in and around college campuses, including specialdeals that may appeal to the cost-conscious college student.  The Companyis young, having been formed in 2006, and our anticipated plan of operation forthe next twelve months is to continue marketing and adding features to ourWebsite to enhance its attractiveness and utility to college students, toexpand our Website to additional metropolitan areas and college campuses, andto continue our efforts to create and capture revenue opportunities availablefrom the traffic we generate to our Website.  The Company believes thatcash on hand is sufficient for at least the next six months in light ofanticipated operating expenses.  Additional financing efforts are expectedwithin the next six months, though the Company is unable to provide informationas to the terms of any such financing or whether its efforts to obtainadditional funds will be successful.

 

Inlight of the Reverse Merger and the new direction of College Tonight, and theaccounting rules with respect to a reverse merger, we have notconsolidated revenues or other financial information for our predecessor,Simex, with College Tonight’s operations. Simex had been essentiallyinactive since 2006.  College Tonight is considered a development stagecompany.

 

***Results of Operations – Three Months Ended June 30, 2008 and 2007***

 

*Revenues*

 

CollegeTonight’s revenues from operations for the three months ended June 30,2008 and 2007 were $1,150 and $2,417, respectively.  During these periodsCollege Tonight focused on developing our business plan, promotional events,advertising and developing our website.  The decrease in revenue wasprimarily attributable to sponsorship of a promotional event by a singlecustomer in 2007 compared to advertising revenue in 2008 and product salesrevenue generated from the Company’s new revenue stream as result of theacquisition of OnFire in April 2008. Overall, we generated minimal revenuefrom the few events that were run during the initial roll-out of the serviceoffering during 2008 and 2007. Accordingly, our revenues during this period arenot reflective of the revenues we expect to generate in the future.

 

*DevelopmentCosts*

 

CollegeTonight incurred development costs of $59,822 and $9,249 for the three monthsended June 30, 2008 and 2007, respectively.  The $50,573 increase indevelopment costs was used to further develop our Website in preparation forthe national rollout of our online services on college campuses across the 

 

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country. None of these costs met the criteria for capitalization as they did notrepresent enhancements of the functionality of the Company’s website.

 

*MarketingExpenses*

 

CollegeTonight incurred marketing expenses of $66,377 and $5,371 for the three monthsended June 30, 2008 and 2007, respectively. The increase of $61,006 wasattributable to the advertisement and promotion costs necessary to launch ourbusiness as well as to create brand awareness for our services and Companyname.

 

*Selling,General and Administrative Expenses*

 

CollegeTonight incurred selling, general and administrative expenses of $241,210 and$23,406 for the three months ended June 30, 2008 and 2007,respectively.  The increase of $217,804 was incurred in building thecorporate infrastructure necessary to launch our new business. Approximately $104,905 of the 2008 expenses was attributable to thecompensation of College Tonight officers and employees, and $50,445 wasincurred for professional fees associated with legal and accounting costs ofbeing a public company. The remaining selling, general and administrativeexpenses of $85,860 was primarily attributable to rent, insurance and travelrelated costs associated with the running of the business.

 

*InterestIncome and Expense*

 

Netinterest income, (expense) was $665 and $(845) for the three months ended June 30,2008 and 2007, respectively, resulting from earnings on cash invested ininterest bearing bank accounts, and interest incurred on related party loans.

 

*NetLoss*

 

Duringthe three months ended June 30, 2008 and 2007, we incurred a net loss of$367,844 and $36,454, respectively.  The net losses experienced by theCompany reflect the Company’s expenses to research and develop its technology,create business and financial plans, promote its service offerings and recruitmanagement and other staff.

 

***Results of Operations – Six Months Ended June 30, 2008 and 2007***

 

*Revenues*

 

CollegeTonight’s revenues from operations for the six months ended June 30, 2008and 2007 were $1,653 and $4,834, respectively.  During these periodsCollege Tonight focused on developing our business plan, promotional events,advertising and developing our website.  The decrease in revenue wasprimarily attributable to sponsorship of a promotional event by a singlecustomer in 2007 compared to advertising revenue in 2008 and product salesrevenue generated from the Company’s new revenue stream as a result of theacquisition of OnFire in April 2008. Overall, we generated minimal revenuefrom the few events that were run during the initial roll-out of the serviceoffering during 2008 and 2007. Accordingly, our revenues during these periodsare not reflective of the revenues we expect to generate in the future.

 

*DevelopmentCosts*

 

CollegeTonight incurred development costs of $129,497 and $12,667 for the six monthsended June 30, 2008 and 2007, respectively.  The $116,830 increase indevelopment costs was used to further develop 

 

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ourWebsite in preparation for the national rollout of our online services oncollege campuses across the country.  None of these costs met the criteriafor capitalization as they did not represent enhancements of the functionalityof the Company’s website.

 

*MarketingExpenses*

 

CollegeTonight incurred marketing expenses of $126,675 and $10,789 for the six monthsended June 30, 2008 and 2007, respectively. The increase of $115,886 wasattributable to the advertisement and promotion costs necessary to launch ourbusiness as well as to create brand awareness for our services and Companyname.

 

*Selling,General and Administrative Expenses*

 

CollegeTonight incurred selling, general and administrative expenses of $534,851 and$28,802 for the six months ended June 30, 2008 and 2007,respectively.  The increase of $506,049 was incurred in building thecorporate infrastructure necessary to launch our new business. Approximately $208,681 of the 2008 expense was attributable to the compensationof College Tonight officers and employees, and $167,370 was incurred for professionalfees associated with legal and accounting costs of being a public company. Theremaining selling, general and administrative expenses of $158,800 wasprimarily attributable to rent, insurance and travel related costs associatedwith the running of the business.

 

*InterestIncome and Expense*

 

Netinterest income, (expense) was $5,295 and $(845) for the six months ended June 30,2008 and 2007, respectively, resulting from earnings on cash invested ininterest bearing bank accounts and interest incurred on related party loans.

 

*NetLoss*

 

Duringthe six months ended June 30, 2008 and 2007, we incurred a net loss of$787,604 and $48,269, respectively.  The net losses experienced by theCompany reflect the Company’s expenses to research and develop its technology,create business and financial plans, promote its service offerings and recruitmanagement and other staff.

 

***Liquidity and Capital Resources***

 

AtJune 30, 2008, we had $453,624 in cash, current liabilities of $91,890 andworking capital of $731,712. While we had positive working capital at June 30,2008, we currently have minimal revenues and it’s likely that we will spend allof our cash on product development and marketing expenses before we achieve abreakeven level of operations.  The Company believes that cash on hand issufficient for at least the next six months in light of anticipated operatingexpenses.  Additional financing efforts are expected within the next sixmonths, though the Company is unable to provide information as to the terms of anysuch financing or whether its efforts to obtain additional funds will besuccessful.  If so, we will likely needto raise additional capital in order to continue to operate and grow thebusiness in accordance with our business plan. We may sell additional common orpreferred shares in the Company and are actively exploring other alternativesto the issuance of additional equity capital. There is no assurance that wewill be able to obtain additional capital or that the terms necessary toattract additional investors will be beneficial to existing shareholders.

 

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AtDecember 31, 2007, we had $728,245 in cash and restricted cash, currentliabilities of $141,057, and working capital of $594,262.

 

***Going Concern***

 

CollegeTonight’s financial statements have been presented on the basis that it is agoing concern, which contemplates the realization of assets and the satisfactionof liabilities in the normal course of business. As shown in the accompanyingfinancial statements, College Tonight incurred net operating losses for thethree months ended June 30, 2008 and during the period from July 3,2006 (Inception) to June 30, 2008. These factors create substantial doubtabout our ability to continue as going concern. Our ability to continue as agoing concern is dependent, for the foreseeable future, on our continuedsuccess in raising capital.  The financial statements do not include anyadjustments that might be necessary if College Tonight is unable to continue asa going concern.

 

***Off-Balance Sheet Arrangements***

 

CollegeTonight does not have any off-balance sheet arrangements that are reasonablylikely to have a current or future effect on our financial condition, changesin financial condition, revenues or expenses, results of operations, liquidity,capital expenditures or capital resources that are material to investors.

 

**ITEM 4. CONTROLS AND PROCEDURES**

 

The Company’s ChiefExecutive Officer and Vice President of Finance and Business Development haveevaluated the effectiveness of the Company’s disclosure controls and procedures(as defined in Exchange Act Rule 13a–15(e)) as of June 30, 2008.Based on such evaluation, the Company’s Chief Executive Officer and VicePresident of Finance and Business Development, have concluded that, as of June 30,2008, the Company’s disclosure controls and procedures were effective.

 

In connection with theevaluation by management, including the Company’s Chairman & ChiefExecutive Officer and Vice President of Finance and Business Development, nochanges in the Company’s internal control over financial reporting (as definedin Exchange Act Rule 13a-15(f)) during the quarter ended June 30, 2008were identified that have materially affected or are reasonably likely tomaterially affect the Company’s internal control over financial reporting.

 

**PART II - OTHER INFORMATION**

 

**ITEM 1.  LEGAL PROCEEDINGS**

 

None.

 

**ITEM 1A.  RISK FACTORS**

 

Not provided in accordancewith Commission rule concerning smaller reporting companies.

 

**ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USES OFPROCEEDS**

 

TheCompany made the following unregistered sales of its common stock from April 1,2008 through and including June 30, 2008: (i) 250,000 shares issued in consideration for a third partyproviding marketing, promotional and endorsement services, (ii) 10,000shares provided in consideration for the purchase of substantially all ofOnFIREbeerpong, Inc.’s assets, (iii) 6,250 shares provided to aformer employee as additional compensation for services, (iv) 25,000shares for providing investor relation services and 

 

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(v),1,487,500 shares sold for $0.40 per share to accredited investors pursuant to aprivate placement memorandum. All of the sales by the Company of itsunregistered securities were made in reliance upon Section 4(2) ofthe Securities Act of 1933 as these offerings were without public solicitationor advertising.

 

**ITEM 3.**** DEFAULTS UPON SENIORSECURITIES**

 

None.

 

**ITEM 4.**** SUBMISSION OF MATTERS TO AVOTE OF SECURITY HOLDERS**

 

None.

 

**ITEM 5.**** OTHER INFORMATION**

 

None.

 

**ITEM 6. EXHIBITS**

 

Exhibit Index

 
| **Exhibit** | ** ** | ** **                                                                                                                                                                                                                                                                                                                          |
|-------------|------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| **Number**  | ** ** | **Description**                                                                                                                                                                                                                                                                                                                     |
|        |       |                                                                                                                                                                                                                                                                                                                                |
| 3.1         |       | Articles  of Incorporation of College Tonight, Inc., as amended. Incorporated by  reference to Form 10-QSB for Simex Technologies, Inc., filed  July 2, 1999 and by reference to Exhibit 3.1 of Form 8-K for  Simex Technologies, Inc., dated March 5, 2008 and filed  March 11, 2008. |
|        |       |                                                                                                                                                                                                                                                                                                                                |
| 3.2*        |       | Amended  and Restated Bylaws of College Tonight, Inc.                                                                                                                                                                                                                                                                          |
|        |       |                                                                                                                                                                                                                                                                                                                                |
| 16          |       | February 16,  2008 letter from Connolly, Grady and Cha, P.C. concerning its dismissal as the  Company’s independent registered public accountant. Incorporated by reference  to Form 8-K of Simex Technologies, Inc., dated February 12,  2008 and filed February 19, 2008.                           |
|        |       |                                                                                                                                                                                                                                                                                                                                |
| 22.2        |       | Definitive  Information Statement pursuant to Sections 14(C) and (F) of the  Securities Exchange Act of 1934 on Form DEF 14C for Simex  Technologies, Inc., dated February 6, 2008 and filed  February 14, 2008.                                                                                      |
|        |       |                                                                                                                                                                                                                                                                                                                                |
| 31.1*       |       | Certification  by the Principal Executive Officer pursuant to Section 302 of the  Sarbanes-Oxley Act of 2002                                                                                                                                                                                                                   |
|        |       |                                                                                                                                                                                                                                                                                                                                |
| 31.2*       |       | Certification  by the Principal Financial Officer pursuant to Section 302 of the  Sarbanes-Oxley Act of 2002.                                                                                                                                                                                                                  |
|        |       |                                                                                                                                                                                                                                                                                                                                |
| 32.1*       |       | Certification  by the Principal Executive Officer pursuant to 18 U.S.C. Section 1350  Adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                  |
|        |       |                                                                                                                                                                                                                                                                                                                                |
| 32.2*       |       | Certification  by the Principal Financial Officer pursuant to 18 U.S.C. Section 1350  Adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.                                                                                                                                                                  |

 

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* Filed herewith.

 

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**SIGNATURES**

 

Pursuant to the requirementsof the Securities Exchange Act of 1934, the registrant has duly caused thisreport to be signed on its behalf by the undersigned thereunto duly authorized.

 

**COLLEGE TONIGHT, INC.**

(FORMERLY KNOWN AS SIMEXTECHNOLOGIES, INC.)

 

Dated: August 13, 2008

 

 
|   | By:                                                    | /s/  Zachary R. Suchin |
|--------|-------------------------------------------------------------|------------------------|
|   | Zachary R. Suchin, President, CEO and                       |
|   | Principal  Executive Officer                                |
|   |                                                        |                   |
|   |                                                        |                   |
|   | By:                                                    | /s/  Aaron Samel       |
|   | Aaron Samel, Vice President of Finance                      |
|   | and  Business Development, and Principal  Financial Officer |

 

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