UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
[X] Quarterly Report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended October 31, 1999
[ ] Transition Report pursuant to 13 or 15(d) of the Securities
Exchange Act of 1934
For the transition period to
Commission File Number 0-26729
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WORLDBID CORPORATION
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(Exact name of small Business Issuer as specified in its charter)
Nevada 88-0427619
- ------ ----------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organisation)
Suite 1100, 1175 Douglas Street
Victoria, British Columbia, Canada V8W 2E1
- ---------------------------------- -------
(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code: 250-475-2248
---------------
None
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(Former name, former address and former fiscal year,
if changed since last report)
Check whether the issuer (1) filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the issuer
was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days [ ] Yes [X] No
State the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date:
6,000,000 Shares of $.001 par value Class A Common Stock outstanding
as of November 30, 1999.
PART 1 - FINANCIAL INFORMATION
Item 1. Financial Statements
The accompanying unaudited financial statements have been prepared in
accordance with the instructions to Form 10-QSB and Item 310 (b) of
Regulation S-B, and, therefore, do not include all information and
footnotes necessary for a complete presentation of financial
position, results of operations, cash flows, and stockholders' equity
in conformity with generally accepted accounting principles. In the
opinion of management, all adjustments considered necessary for a
fair presentation of the results of operations and financial position
have been included and all such adjustments are of a normal recurring
nature. Operating results for the six months ended October 31, 1999
are not necessarily indicative of the results that can be expected
for the year ending April 30, 2000.
2
WORLDBID CORPORATION
FINANCIAL STATEMENTS
OCTOBER 31, 1999
3
INDEX TO FINANCIAL STATEMENTS
-----------------------------
Page
----
PART I - FINANCIAL INFORMATION
- ------------------------------
Item 1 - Financial Statements. . . . . . . . . . . . . . . . . . 3
INDEX TO FINANCIAL STATEMENTS
- -----------------------------
Accountants' Review Report. . . . . . . . . . . . . . . . . . . .5
Financial Statements:
Balance Sheet . . . . . . . . . . . . . . . . . . . . . . . . .6
Statement of Operations and Accumulated Deficit . . . . . . . 7
Statement of Changes in Stockholders' Equity. . . . . . . . . .8
Statement of Cash Flows . . . . . . . . . . . . . . . . . . . 9
Notes to Financial Statements . . . . . . . . . . . . . . 10-15
Supplemental Statement:
Statement of Operating Expenses . . . . . . . . . . . . . . 17
4
ACCOUNTANTS' REVIEW REPORT
--------------------------
To the Board of Directors
Worldbid Corporation
Las Vegas, Nevada
We have reviewed the accompanying balance sheet of Worldbid
Corporation, a development stage company, as of October 31, 1999
and the related statements of operations and accumulated deficit,
changes in stockholders' equity, and statement of cash flows for
the six months then ended, in accordance with standards
established by the American Institute of Certified Public
Accountants. All information included in these financial
statements is the representation of the management of Worldbid
Corporation.
A review consists principally of inquiries of Company personnel
and analytical procedures applied to financial data. It is
substantially less in scope than an examination in accordance
with generally accepted auditing standards, the objective of
which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such
an opinion.
Based on our review, we are not aware of any material
modifications that should be made to the accompanying financial
statements in order for them to be in conformity with generally
accepted accounting principles.
Our review was made for the purpose of expressing limited
assurance that there are no material modifications that should be
made to the financial statements in order for them to be in
conformity with generally accepted accounting principles. The
supplemental statement of operating expenses is presented for the
purposes of additional analysis and is not a required part of the
basic financial statements. Such information has been subjected
to the inquiry and analytical procedures applied in the review of
the basic financial statements, and we are not aware of any
material modifications that should be made thereto.
Sarna & Company
Westlake Village, California
December 10, 1999
5
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
BALANCE SHEET
OCTOBER 31, 1999
ASSETS
Current Assets
Cash $ 41,127
Accounts Receivable 18,830
-------
Total Current Assets $ 59,957
Property and Equipment
Computer Software 62,077
Computer Equipment 43,378
Office Equipment 1,820
-------
Total Property and Equipment 107,275
Less Accumulated Depreciation <5,257>
-------
Net Property and Equipment 102,018
Other Assets - Domain Names 2,647
-------
TOTAL ASSETS $ 164,622
==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts Payable and Accrued Expenses $ 5,408
-------
Total Current Liabilities $ 5,408
Stockholders' Equity
Common Stock, $0.001 par value
100,000,000 shares authorized,
6,000,000 shares issued 6,000
Additional Paid in Capital 486,500
Accumulated deficit <333,286>
--------
Total Stockholders' Equity 159,214
-------
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY $ 164,622
==========
See Notes to Financial Statements
6
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATIONS AND ACCUMULATED DEFICIT
FOR THE SIX MONTHS ENDED OCTOBER 31, 1999
Revenues $ 18,830
Operating Expenses <282,786>
--------
Loss Before Other Income <263,956>
Other Income - Interest 2,242
--------
Loss Before Provision for <261,714>
Income Taxes
Provision for Income Taxes <0>
----------
Net Loss <261,714>
Accumulated Deficit, April 30, 1999 <71,572>
-----------
Accumulated Deficit, October 31, 1999 $ <333,286>
===========
Net Loss per Share $ <0.06>
===========
Weighted Average Shares Outstanding 6,000,000
===========
See Notes to Financial Statements
7
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FOR THE SIX MONTHS ENDED OCTOBER 31, 1999
Common Stock Additional Accumulated Total
Dollar Paid in Deficit Stockholders'
Shares Amount Capital Equity
--------- ------- --------- ----------- ------------
Balances
April 30, 1999 6,000,000 $ 6,000 $ 486,500 $ <71,572> $ 420,928
Net Loss
Period Ended
October 31, 1999 ------ ------ ------ <261,714> <261,714>
-----------------------------------------------------
Balances
October 31, 1999 6,000,000 $ 6,000 $ 486,500 $ <333,286> $ 159,214
=====================================================
See Notes to Financial Statements
8
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED OCTOBER 31, 1999
Cash Flows from Operating Activities:
Net Loss $ <261,714>
Adjustments to Reconcile Net Income to
Net Cash Provided by Operating Activities
Amortization 3,100
Depreciation 2,310
<Increase> Decrease in:
Accounts Receivable <18,830>
Increase <Decrease> in:
Accounts Payable and Accrued Expenses <204>
-------
Net Cash Used by Operating Activities <275,338>
Cash Flows from Investing Activities:
Computer Equipment/Software Purchases $ <45,154>
Office Equipment Purchases <1,820>
Domain Name Registrations <2,800>
----------
Net Cash Used by Investing Activities <49,774>
--------
Net Decrease in Cash <325,112>
Cash, April 30, 1999 366,239
-------
Cash, October 31, 1999 $ 41,127
========
Supplemental Disclosure of
Cash Flow Information: None
See Notes to Financial Statements
9
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
- ---------------------------------------------------
General
- -------
Worldbid Corporation (the "Company" or "WBC") was originally
incorporated on August 10, 1998 in the state of Nevada as
"Tethercam Systems, Inc.". On January 15, 1999 the Company
changed its name to Worldbid Corporation.
The Company is engaged in the acquisition and development of
proprietary commercial web sites. WBC plans to earn revenues
from advertising generated on these sites and through e-mail that
targets potential suppliers. The Company's initial business is
transacted through its current Internet web site located at
"www.worldbid.com". This site is still in the development stage.
Basis of Presentation
- ---------------------
The Company reports revenue and expenses using the accrual method
of accounting for financial and tax reporting purposes.
Use of Estimates
- ----------------
Management uses estimates and assumptions in preparing these
financial statements in accordance with generally accepted
accounting principles. Those estimates and assumptions affect
the reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities, and the reported revenues and
expenses.
Development Stage Company
- -------------------------
WBC meets the guidelines of SFAS No. 7 and as such is classified
as a development stage company.
Pro Forma Compensation Expense
- ------------------------------
WBC accounts for costs of stock-based compensation in accordance
with APB No. 25, "Accounting for Stock Based Compensation"
instead of the fair value based method in SFAS No. 123. No stock
options have been issued by WBC. Accordingly, no pro forma
compensation expense is reported in these financial statements.
10
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
- ---------------------------------------------------------------
Accounts Receivable
- -------------------
No allowance for uncollectable accounts has been provided.
Management has evaluated the accounts and believes they are all
collectable.
Depreciation, Amortization and Capitalization
- ---------------------------------------------
The Company records depreciation and amortization when
appropriate using both straight-line and declining balance
methods over the estimated useful life of the assets (five to
seven years). Expenditures for maintenance and repairs are
charged to expense as incurred. Additions, major renewals and \
replacements that increase the property's useful life are capitalized.
Property sold or retired, together with the related accumulated
depreciation, is removed from the appropriate accounts and the
resultant gain or loss is included in net income.
Impairment of Long-Lived Assets
- -------------------------------
The Company evaluates the recoverability of long-lived assets in
accordance with Statement of Financial Accounting Standards No.
121, "Accounting for the Impairment of Long-Lived Assets and for
Long-Lived Assets to be disposed of". SFAS No. 121 requires
recognition of impairment of long-lived assets in the event the
net book value of such assets exceeds the future non-discounted
cash flows attributable to such assets.
Income Taxes
- ------------
The Company accounts for its income taxes in accordance with
Statement of Financial Accounting Standards No. 109, "Accounting
for Income Taxes". Under Statement 109, a liability method is
used whereby deferred tax assets and liabilities are determined
based on temporary differences between basis used for financial
reporting and income tax reporting purposes. Income taxes are
provided based on tax rates in effect at the time such temporary
differences are expected to reverse. A valuation allowance is
provided for certain deferred tax assets if it is more likely
than not, that the Company will not realize the tax assets
through future operations.
11
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
- ---------------------------------------------------------------
Fair Value of Financial Instruments
- -----------------------------------
Financial accounting Standards Statement No. 107, "Disclosures
About Fair Value of Financial Instruments", requires the Company
to disclose, when reasonably attainable, the fair market values
of its assets and liabilities which are deemed to be financial
instruments. The Company's financial instruments consist
primarily of cash and certain investments.
Per Share Information
- ---------------------
The Company computes per share information by dividing the net
loss for the period presented by the weighted average number of
shares outstanding during such period.
Year 2000 Compliance
- --------------------
The Year 2000 issue is the result of computer programs having
been written using two digits (rather than four) to define years.
Computers or other equipment with date-sensitive software may
recognize "00" as 1900 rather than 2000. This could result in
system failures or miscalculations. If the Company or
significant customers, suppliers or other third parties fail to
correct Year 2000 issues, the Company's ability to operate could
be affected.
The following disclosure is pursuant to the Year 2000 Readiness
and Disclosure Act.
Worldbid's Year 2000 program is designed to minimize the
possibility of Year 2000 interruptions. Any such interruption
may have a material adverse impact on the Company's future
operating results. In 1999, the Company established procedures
to identify and assess systems and processes vulnerable to Year
2000 problems. The Company also developed procedures to monitor
levels of compliance within its stated goals of compliance.
In each area of vulnerability, various testing and readiness
methodologies are being used to identify and correct suspect
systems, processes or supplier interfaces. The Company projects
to meet its Year 2000 compliance goals prior to the end of 1999.
12
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED
- ---------------------------------------------------------------
Recently Issued Accounting Pronouncements
- -----------------------------------------
Effective at inception, the Company has adopted the provisions of
SOP No. 98-1, "Software for Internal Use", issued by the American
Institute of Certified Public Accountants.
Other recently issued accounting pronouncements will have no
significant impact on the Company and its reporting methods.
Capitalized Software
- --------------------
The Company has capitalized computer software costs incurred
during the application development stage in accordance with SOP
No. 98-1 issued by the American Institute of Certified Public
Accountants. These capitalized costs consist primarily of direct
materials, services and payroll related costs associated with the
coding, installation to hardware and testing of the Company's
software. Costs incurred subsequent to the Company's application
development stage to enhance, manage, monitor and operate the
Company's website will be expensed as incurred.
NOTE 2 - ACQUISITION OF WORLDBID.COM
- ------------------------------------
On February 2, 1999 the Company acquired the web site
"worldbid.com" together with all software, tangible and
intellectual assets and rights associated with that site from
Databoat International Limited (Databoat). This web site which
consists of software and registered rights, was accounted for as
an asset acquisition as are other software purchases and
development costs. The Company has issued to Databoat a total of
3,000,000 restricted shares of common stock (Databoat Shares-Fair
Market Value $30,000) pursuant to an acquisition agreement. The
Company has also entered into a consulting agreement with
Databoat's principal stockholder, Mr. Scott Wurtele and on-line
Design, a company controlled by him.
13
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 2 - ACQUISITION OF WORLDBID.COM - CONTINUED
The Company and Databoat have agreed that the Databoat Shares
will be held in escrow for a period of four years on the terms
and conditions of an escrow agreement between the Company,
Databoat and Cane & Company, the attorneys for the company (the
"Escrow Agreement"). The Databoat shares will be released to
Databoat in accordance with the Escrow Agreement, commencing on
the date which is one year from the date of closing on the
following schedule.
Anniversary of Closing Date Number of Shares
- --------------------------- ----------------
One Year 300,000 shares
Two Year 700,000 shares
Three Year 1,000,000 shares
Four Year 1,000,000 shares
NOTE 3 - PROVISION FOR INCOME TAXES
- -----------------------------------
The provision for income taxes for the period ended October 31,
1999 represents the minimum state income tax expense of the
Company, which is not considered significant.
NOTE 4 - COMMITMENTS AND CONTINGENCIES
- --------------------------------------
Operating Leases
- ----------------
The Company currently rents administrative office space from Ms.
Wendy Wurtele, the spouse of a company director Mr. Scott
Wurtele. Current rent under this monthly renewal contract is
$650 per month.
Management Consulting Agreement
- -------------------------------
The Company has entered into a consulting agreement, with On-Line
Design, a British Columbia company owned 100% by Mr. Wurtele.
The Company will pay $5,000 per month expiring February 16, 2000
and then $7,500 per month expiring February 16, 2001. In
exchange for these payments, On-Line Design will provide
management and continued development of the Company's business.
Litigation
- ----------
The Company is not presently involved in any litigation.
14
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 5 - RELATED PARTY TRANSACTIONS
- -----------------------------------
The Company has entered into a consulting agreement (see
management consulting agreement), with on-line Design, a company
controlled by Mr. Scott Wurtele. Databoat, a major stockholder
of WBC, is also controlled by Mr. Scott Wurtele (see Acquisition
of Worldbid.Com).
The company rents its office space from Ms. Wendy Wurtele, the
spouse of a director, Mr. Scott Wurtele.
15
SUPPLEMENTAL STATEMENT
16
WORLDBID CORPORATION
(A DEVELOPMENT STAGE COMPANY)
STATEMENT OF OPERATING EXPENSES
FOR THE SIX MONTHS ENDED OCTOBER 31, 1999
Operating Expenses
Accounting $ 5,030
Amortization 3,100
Automobile 401
Bank Charges 236
Computer Maintenance 357
Consulting 17,720
Depreciation 2,310
Directors Fees 1,500
Dues and Subscriptions 329
Internet Provider Fees 1,519
Legal Fees 20,359
Market Research and Development 38,667
Marketing 27,233
Office Administration 14,992
Office Supplies 1,201
Postage and Delivery 1,438
Posting Bids 10,199
Professional Development 5,953
Programming Efforts Expensed 65,892
Rent 2,040
Sales Commissions 275
Sales Expenses 4,994
Telephone 6,939
Travel and Entertainment 9,579
Web Site Management 40,523
----------
Total Operating Expenses $ 282,786
==========
See Notes to Financial Statements
17
Item 2. Management's Discussion and Analysis or Plan of Operations
GENERAL
WorldBid Corporation (the "Company") is an electronic commerce
company which owns and operates an on-line business-to-business
world trade web site. The Company's web site is located on the
Internet at "www.worldbid.com" (the "Web Site"). The Web Site
facilitates business transactions on the Internet by providing an
organized and systematic tool for businesses to post notices of
goods for sale and requests for tender of goods. The Company
uses e-mail notifications in order to enable businesses to
connect. The Company has focused on the international trade
market in order to provide an economical means of enabling
businesses from around the world to meet and transact business.
The Web Site solicits businesses who have products for sale or
who are interested in procuring products for purchase. The Web
Site enables businesses to submit postings on the web site in a
systematic and organised manner. Businesses are connected using
a system of automatic e-mail notifications whereby postings are
transmitted to other businesses within specific categories of
interest. Businesses are then able to contact other businesses
directly and negotiate transactions between themselves without
the involvement of the Company.
The Company acquired the "Worldbid.com" internet business in
February 1999. Since that date the Company has completely
restructured the Web site in the following manner:
a) Re-design of the graphics and presentation of the Web site.
b) Expansion of the functionality of the Web site to include
additional features, including posting of goods offered for
sale and expanded e-mail notification capabilities.
c) Expansion and upgrading of the company's computer hardware
and programming in order to expand the functionality and
capacity of the Web site.
d) Addition and search capabilities in order that users can
search for products by description or product codes.
e) Expansion in the number of categories within the Web site
from 20 to 420.
The Web site is now fully operational. The Company has reached a
database of over 7,000 business parties who have completed
postings on the web site. The number of business parties is
presently growing at a rate of approximately 70 per day. The
Company completed 1 million e-mail trade notifications during the
month of July. The number of e-mail trade notifications
increased to 3.8 million for the month of October.
The Company has commenced actively marketing the advertising
potential of the Web site now that the development of the Web
site is complete. The Company realized its first advertising
revenue in August.
18
The Company has entered into strategic alliances with companies
in Turkey, Italy, Germany, China and India for them to operate
under the Worldbid banner with their own Web master. An example
of one such Web site is "worldbidgermany.com". The Company will
receive 50% of all revenue earned by these joint ventures.
The Company's board of directors was increased from two directors
to three directors in September with the appointment of Mr. Scott
Wurtele to the board of directors on September 10, 1999. Mr.
Wurtele is the controlling shareholder of Databoat International
Limited, the owner of 50% of the Company's outstanding common
stock. The Company now has nine full-time equivalent contract
personnel whose duties and responsibilities include programming,
advertisement management software, automation of posting, sales
and marketing, electronic marketing, website design and
administration.
The Company acquired WorldBid Networks Ltd. as a wholly owned
subsidiary effective December 13, 1999. WorldBid Networks Ltd.
has entered into a lease for approximately 3,600 square feet of
office space in Victoria, British Columbia. The Company's web
site operations and web site development activities will be
carried out at this premises. The lease is for a term expiring
July 31, 2003.
RESULTS OF OPERATIONS
Sales
- -----
The Company realized revenues of $18,830 for the six months ended
October 31, 1999. The revenues consisted of revenues from
advertising on the e-mail trade notifications. Revenues from
advertising commenced in August. The Company anticipates that
revenue from advertising will increase if the number of e-mail
trade notifications sent by the Company continues to increase.
Costs Of Goods Sold/Operating Expenses/Research And Development Expenses
- ------------------------------------------------------------------------
The Company's operating expenses were $282,789 for the six month
period ending October 31, 1999, compared to operating expenses of
$55,512 for the period ending April 30, 1999. Management expects
that operating expenses and research and development costs will
increase substantially as the Company attempts to expand its
business operations in accordance with its business plans. The
Company anticipates increased operating expenses due to the
following: (i) the Company plans a substantial marketing program
over the next six months in order to increase awareness of the
Company and its Web site; (ii) expenses associated with
anticipate increased Web site usage; (iii) expenses associated
with additional programs to be written to handle the anticipated
increased outgoing e-mail traffic; (iv) the Company's leased
premises in Victoria, British Columbia; and (v) additional
expenses associated with completing the Company's plan of
operations, as discussed below.
Net Loss
- --------
The Company recorded a net loss of $261,714 for the six months
ended October 31, 1999, compared to a net loss of $71,571 for the
period ending April 30, 1999. This loss reflects the fact
19
that the Company did not achieve material revenues during the six
months ending October 31, 1999. The Company anticipates that
losses will increase as the Company increases its operating
expenses to carry out its plan of operations.
PLAN OF OPERATIONS
The Company's plan of operations for the next twelve months
involves attempting to increase revenue from the Company's Web
site operations using the following key business development and
marketing strategies:
1. Developing advertising sales for the Web site;
2. Evaluating the additional revenue opportunities for the Web
site;
3. Initiating advertising and promotional campaigns for the Web
site;
4. Continuing the enhancement of the Web site to offer a unique
Internet world trade site;
5. Expanding the functionality and features of the Web site;
6. Monitor usage of the Web site and develop user profiles;
7. Add additional web sites for countries outside of the United
States and Canada.
The Company also plans to evaluate the following sources of
potential revenue which may be earned from its Web site
operations:
1. Subscription charges whereby the Company would charge fees
for posting requests for tenders and offers for sale. A
subscription fee model is presently being tested on the
Worldbidindia.com web site. The Company may charge fees to
businesses once the volume of usage on the Web site has
increased to a level where businesses are prepared to pay a
fee for the service.
2. Contractual arrangements with other companies whereby the
Company would earn a commission or fee based on referrals to
Web sites operated by other companies.
3. Future revenue streams derived on the basis of a percentage
of the value of the business transacted on the Company web
site and worldwide auctions.
The implementation of any new potential revenue source would
require additional software development and implementation.
The Company's plan of operations is set forth in detail in the
Company's Form 10-SB registration statement which has been filed
with the Securities and Exchange Commission.
Liquidity
The Company had cash on hand of $41,127 and working capital of
$54,549 on October 31, 1999. The Company's monthly operating
expenses are approximately $55,000 per month. The Company's
revenues are approximately $6,000 per month. Accordingly, the
Company will require additional financings in order to continue
business operations.
20
The Company's discussion of its financial condition and operating
results and plan of operations includes forward-looking
statements. Actual operating and financial results of the
Company and the Company's actual plan of operations may differ
materially from the stated plan of operations. Factors which may
cause the actual results of the Company or its actual plan of
operations to vary include, without limitation, decisions of the
board of directors not to pursue the stated plan of operations
based on re-assessment by the board of directors of the plan
which is in the best interests of the Company, changes in the
Internet business or general economic conditions.
YEAR 2000 RISK
Background
Computer systems, software packages, and microprocessor dependent
equipment may cease to function or generate erroneous data when
the Year 2000 arrives. The problem affects those systems or
products that are programmed to accept a two-digit code in date
code fields. To correctly identify the Year 2000, a four-digit
date code field will be required to be what is commonly termed
"Year 2000 compliant."
Readiness
The Company has completed an assessment of all internal systems
and operations to determine Year 2000 compliance. The Company's
assessment has included an assessment of computer hardware
systems and web site operations systems. The Company has
determined that its internal computer hardware systems and web
site operations systems and operations are Year 2000 compliant.
As such, the Company does not anticipate any material adverse
operational issues to arise from the Year 2000 problem affecting
internal systems and operations.
The Company has completed upgrading of all third party licensed
software to ensure Year 2000 compliance. The Company has relied
upon the written representations of each of the third parties
from whom the Company licenses third party software that the
upgraded software is Year 2000 compliant. While the Company has
relied upon representations by third parties, the Company cannot
give any assurance that all third party licensed software will be
Year 2000 compliant.
The Company has investigated the Year 2000 compliance of all
computer hardware purchased by the Company since commencement of
operations. The Company has relied upon representations by
hardware manufactures that all computer hardware purchased is
Year 2000 compliant. While the Company has relied upon
representations by manufacturers, the Company cannot give any
assurance that all computer hardware will be Year 2000 compliant.
The Company has made inquires of its Internet service provider,
NetNation Communications, Inc. ("NetNation"), as to the Year 2000
compliance of the Internet service provider's systems and
operations. NetNation has given oral representations to the
Company that its systems and operations are Year 2000 compliant.
The Company has requested written confirmation of NetNation Year
2000 compliance representations as part of its Year 2000
compliance plan. However, there is no assurance that the Company
will not be affected by Year 2000 problems
21
arising from problems with the Internet service provider's systems and
operations or experienced by the Internet service provider as a result
of third party problems.
Risks
The Company may realize exposure and risk if the systems for
which it is dependent upon to conduct day-to-day operations are
not year 2000 compliant. The Company's worst case scenario would
be the inability of the Web Site to function due to the inability
of the computer hardware systems and web site operations systems
to function properly and disruptions to telecommunications
services experienced by Internet service providers and their
users throughout the world. Under this worst case scenario, the
Company would not be able to continue operations and the Web
Site would be inoperable until such time as the Company had
replaced or upgraded computer hardware or software components.
If the Year 2000 problem affects the Company's Internet service
provider, the Web Site would remain in operable until the
Internet service provider re-commenced operations or until a
replacement Internet service provider had been found. In a worst
case scenario, the Year 2000 problem will result in increased
expense to the Company and decreased revenues being earned from
the Web Site or the delay the realization of revenues from the
Web Site.
Estimated Year 2000 Costs
The Company estimates that its total internal cost for ensuring
Year 2000 compliance for all internal systems to date to be less
than $10,000. The Company anticipates incurring internal costs
of less than $10,000 in completing its Year 2000 compliance plan.
The Company has not incurred any external cost in ensuring Year
2000 compliance in view of the fact that the Company has only
recently commenced operations and has purchased computer hardware
and software on the basis of representations by manufacturers as
to Year 2000 compliance.
Contingency Planning
The Company has developed a contingency plan to address
situations that may result if the Company is affected by Year
2000 problems. The contingency plan includes multiple back-ups
of all computer databases. The Company will continue to back-up
all computer bases every second day, both before and after
January 1, 2000. The Company maintains and will continue to
maintain five separate back-ups of its databases at all times.
The Company will continue to ensure that any computer hardware or
software purchased prior to January 1, 2000 is Year 2000
compliant.
The Company is unable to make a contingency plan that will cover
the situation that may arise if any significant number of the
computers constituting the Internet fail to process dates
properly for the year 2000 and there is a system-wide slowdown or
breakdown. The Company's business is dependent on the continued
successful operation of the Internet. Any interruption or
significant degradation of Internet operations due to Year 2000
problems would significantly harm the Company's business.
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Defaults upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K.
(a) None
(b) Reports on Form 8-K--None
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SIGNATURES
In accordance with the requirements of the Securities and
Exchange Act of 1934, the Registrant has duly caused this
report to be signed on its behalf by the undersigned,
thereunto duly authorized.
WORLDBID CORPORATION
Date: December 17, 1999
-----------------
\s\ Howard Thomson
By: ________________________
HOWARD THOMSON
Director, Secretary & Treasurer
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