Partial Sale of a Business

12 Months Ended

Nov. 30, 2014

Notes to Financial Statements

Partial Sale of a Business

15. Partial Sale of a Business

Valuesetters, Inc. (the “Purchaser”) bought the fixed overhead, including equipment and back office operations, the majority of the customers and a copy of the source code (the “Partial Sale”) of Company’s wholly-owned subsidiary, TelcoSoftware.com Corp. (the “Subsidiary”), on September 30, 2014. The Subsidiary then became a wholesale customer of the Purchaser so that the Company could continue marketing its cloud-based VoIP product without incurring the fixed overhead costs assumed by the Purchaser. The Subsidiary received 40 million shares of common stock, or 8% of the outstanding shares of the Purchaser, which are valued at $1,040,000 at November 30, 2014. As a result of the Partial Sale, the Company’s revenues for the first quarter of fiscal 2015 are significantly diminished from the prior year. A presentation of the Company’s unaudited proforma income statement, had the Partial Sale not occurred, for the year ended November 30, 2014 is as follows:

	Year Ended
	11/30/2014
Revenue	$	519,808
Loss from operations		(855,730	)
Net loss		(463,952	)
Loss per share		0.00

The fair value of the marketable securities received by the Subsidiary as consideration for the sale at was $272,000 as of April 15, 2015. The Company does not consider the decrease in value from its November 30, 2014 level to be a permanent decline.