1080757--3/31/2009--VIRTUAL_EDUCATION_SOFTWARE

related topics

{regulation, government, change}

{product, market, service}

{system, service, information}

{stock, price, share}

{control, financial, internal}

{competitive, industry, competition}

{property, intellectual, protect}

{personnel, key, retain}

We have limited financial resources. The success of our business model is dependent on growth in market acceptance of online products delivered over the Internet as well as continued growth of CD-based course product. If this acceptance does not grow or is otherwise diminished, our revenues will continue to decline and we may never become profitable. The success of our product investment strategy and our ability to remain competitive against companies with access to larger amounts of capital is dependent on our ability to maintain our cost-effective development resources. If we are unable to do so, we would experience significant product delays and increases in product development costs which would adversely affect our strategy, competitive position, revenues and profitability. Our future success is dependent on Internet technology developments and our ability to adapt to these and other technological changes and to meet evolving industry standards. Misuse or misappropriation of our proprietary rights or inadvertent infringement by us on the rights of others could adversely affect our results of operations. If our security measures are breached and unauthorized access is obtained to our web-based products, they may be perceived as not being secure, customers may curtail or stop using these products and we may incur significant legal and financial exposure and liabilities. Claims relating to content available or accessible from, our web sites may subject us to liabilities and additional expense . Interruptions or delays in service from our third-party Web hosting facilities could impair the delivery of our service and harm our business. Our officers have no experience in managing a public company, which increases the risk that we will be unable to establish and maintain all required disclosure controls and procedures and internal controls over financial reporting and meet the public reporting and the financial requirements for our business. Risks Relating to Our Industry Our ability to obtain distance learning material is directly dependent on our ability to retain qualified faculty for courses. Our ability to continue to market distance learning courses at colleges and universities is directly dependent on our ability to maintain relationships with an educational institution. Our course offerings at colleges and universities are directly impacted by policies established by educational institutions that we have no control over. Our ability to continue to market distance learning courses at colleges and universities is directly dependent on our ability to keep our courses Accredited by State Education Departments. Our ability to continue to market distance learning courses could become obsolete if technological advances allow colleges and universities do develop their own distance learning courses. We have significant competition from better financed companies, with superior technology and resources. Risks Relating to Our Stock Our stock will be considered a penny stock . We have no dividend policy. If we fail to maintain an effective system of internal control over financial reporting and disclosure controls and procedures, we may be unable to accurately report our financial results and comply with the reporting requirements under the Exchange Act.

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1080757--3/31/2009--VIRTUAL_EDUCATION_SOFTWARE_INC