U.S. 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
SEPTEMBER 30, 2000
OR
[ ] 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: 33-43621
INTERNET BUSINESS'S INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
Nevada 33-0845463
(State or jurisdiction of incorporation I.R.S. Employer
or organization) Identification No.)
4634 South Maryland Parkway, Suite 101, Las Vegas, Nevada 89119
(Address of principal executive offices) (Zip Code)
Registrant's telephone number: (702) 968-0008
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the Registrant was required to
file such reports), and (2) been subject to such filing
requirements for the past 90 days. Yes No X .
As of September 30, 2000, the Registrant had 221,115,113
shares of common stock issued and outstanding.
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION PAGE
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED BALANCE SHEETS
AS OF SEPTEMBER 30, 2000 AND JUNE 30, 2000 3
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED
SEPTEMBER 30, 2000 AND SEPTEMBER 30, 1999 4
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE three MONTHS ENDED
SEPTEMBER 30, 2000 AND SEPTEMBER 30, 1999 5
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 11
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK 13
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS 14
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS 14
ITEM 3. DEFAULTS UPON SENIOR SECURITIES 14
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS 14
ITEM 5. OTHER INFORMATION 14
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 14
SIGNATURE 14
PART I.
ITEM 1. FINANCAL STATEMENTS.
INTERNET BUSINESS'S INTERNATIONAL, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
September 30 June 30
2000 2000
Assets
Cash $ 107,162 $1,661,963
Accounts receivable, net 77,256 128,389
Mortgage notes held for sale 2,312,064 2,907,741
Prepaid expenses and other 101,181 127,905
Total current assets 2,597,663 4,825,998
Property and equipment, net 756,805 575,061
Intangible assets, net 2,707,573 2,884,174
Investments in unconsolidated companies 913,207 0
Note receivable 520,700 654,009
7,495,948 8,939,242
Liabilities and Stockholders' Equity
Accounts payable 383,123 317,998
Accrued liabilities 67,070 48,900
Revolving line of credit 2,216,156 2,958,563
Current portion of long-term debt 125,000 29,165
Deferred revenues 229,029 247,090
Total current liabilities 3,020,378 3,601,716
Long-term debt 223,520 203,931
Minority interest in subsidiaries (25,526) (5,868)
Stockholders' equity:
Preferred stock, par value $100.00 per
share; 1,000,000 shares authorized;
23,900 issued and outstanding at
September 30, 2000 and June 30, 2000 2,390,000 2,390,000
Common stock, par value $0.01 per share;
249,000,000 shares authorized;
221,115,113 shares issued and
outstanding at September 30, 2000
and June 30, 2000 2,211,151 2,211,151
Additional paid-in capital 3,669,490 3,669,490
Accumulated deficit (3,993,065) (3,131,178)
Total stockholders' equity 4,277,576 5,139,463
Total liabilities and stockholders'
Equity 7,495,948 8,939,242
The accompanying notes are an integral part of these financial
statements
INTERNET BUSINESS'S INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended
September 30 September 30
2000 1999
Revenues 6,899,937 294,646
Cost and expenses:
Cost of revenues 6,064,866 205,848
Interest expense 2,726 0
Selling, general and administration 1,837,044 86,719
Depreciation and amortization 242,159 0
Total costs and expenses 8,146,795 292,567
(Loss) income from operations (1,246,858) 2,079
Other income (expense):
Gain on sale of equity investments 308,412 0
Interest income 61,142 0
Other expense (4,241) 0
Total other income, net 365,313 0
Income (loss) before minority interest (881,545) 2,079
Minority interest in loss of subsidiaries (19,658) 0
Net (loss) income (861,887) 2,079
Net loss (income) per common share Nil Nil
Weighted average number of common shares
Outstanding 189,571,337 177,444,535
The accompanying notes are an integral part of these financial statements
INTERNET BUSINESS'S INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three Months Ended
September 30 September 30
2000 1999
Cash Flows From Operating Activities:
Net (loss) income (861,887) 2,079
Adjustments to reconcile net (loss)
income to net cash (used in) provided
by operating activities:
Depreciation and amortization 242,159 163,587
Gain on sale of equity investments (308,412) 0
Minority interest (19,658) 0
Changes in operating assets and
liabilities:
Accounts receivable 51,133 (183,352)
Inventories 0 (73,771)
Mortgage loans receivable 595,677 0
Prepaid expenses and other 26,724 287,245
Accounts payable 65,125 207,757
Accrued liabilities 18,170 201,253
Deferred revenues (18,061) 0
Net cash (used in) provided by operating
Activities (209,030) 604,798
Cash Flows From Investing Activities:
Purchases of property and equipment (247,302) (196,664)
Purchase of intangible assets 0 (564,562)
Proceeds from sale of investment in
Company 420,562 0
Investments in companies' stock (1,025,357) 0
Net cash used in investing activities (852,097) (761,226)
Cash Flows From Financing Activities:
Net repayments under revolving line of
Credits (742,407) 0
Net repayment of long-term debt 115,424 77,546
Collection of notes receivable -
Stockholder 133,309 0
Issuance of common stock 0 364
Net cash (used in) provided by financing
Activities (493,674) 77,910
Net decrease in cash (1,554,801) (78,518)
Cash, beginning of period 1,661,963 82,577
Cash, end of period 107,162 4,059
The accompanying notes are an integral part of these financial statements
INTERNET BUSINESS'S INTERNATIONAL, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Basis of Presentation
The preparation of financial statements in conformity with
accounting principles generally accepted in the United States
requires management to make estimates and assumptions that affect
the amounts reported in the financial statements. Actual results
could differ materially from those estimates. The unaudited
consolidated financial statements of the Company include the
accounts of all of its wholly or majority owned subsidiaries. All
intercompany accounts or transactions have been eliminated.
The unaudited consolidated financial statements at September 30,
2000 and for the three months ended September 30, 2000 and 1999
are unaudited, but include all normal recurring adjustments and
accruals which are necessary to fairly state the Company's
consolidated financial position, results of operations and cash
flows for the periods presented. Operating results for the three
months ended September 30, 2000 and 1999 are not necessarily
indicative of results that may be expected for any future
periods. The consolidated balance sheet at June 30, 2000 has
been derived from the audited consolidated financial statements
at that date but does not include all of the information and
footnotes required by accounting principles generally accepted in
the United States for complete financial statements.
The information included in this report should be read in
conjunction with the Company's audited consolidated financial
statements and notes thereto included in the Company's Annual
Report on Form 10-K for the fiscal year ended June 30, 2000.
2. Acquisitions
PMCC Financial Corp.
On July 28, 2000, the Company entered into an agreement with PMCC
Financial Corp. ("PMCC"), a full-service mortgage banking
company, whereby the Company would purchase 2,460,000 shares of
PMCC common stock from PMCC's former chairman of the board, which
represents 66.36% of the 3,707,000 total PMCC shares outstanding.
The aggregate purchase price of $3,198,000 is to be paid in cash
to the seller by the Company as follows: $700,000 at date of
closing; $306,857 for each of the seven installment payments to
be paid on the 30th, 60th, 90th, 120th, 150th, 180th and 210th days
following the close; $175,000 on each of the 240th and 270th day
after the date of the closing. Shares of PMCC will be released to
the Company based on payments made by the Company, as outlined in
the agreement. Shares of PMCC, a listed AMEX company, are
currently not trading. In the event that three months after
closing, if PMCC's shares are not actively trading on the AMEX or
NASDQ exchanges and the Company has not merged PMCC with the
Company or any of the Company's subsidiaries, the purchase price
shall be reduced by the amount of the final two $175,000
payments. As of September 30, 2000, the Company has paid
approximately $1,043,000, representing the payment due at closing
and the 1st installment, and has received 269,230 shares of PMCC,
representing approximately 7% of the total outstanding stock of
PMCC.
Also on July 28, 2000, in a separate transaction, the Company
entered into a stock sales agreement with an unrelated individual
whereby the Company would sell up to 370,000 of PMCC shares that
the Company either owns or will eventually own, for total
consideration of $1,387,500. Shares of PMCC stock sold by the
Company will be released to the buyer in proportion to payments
received. As of September 30, 2000, the Company received
payments of $420,563 and the Company released 112,150 shares of
PMCC stock that it owned. If PMCC shares are not actively
trading within six months of the agreement, the Company will
issue to the Buyer the equivalent number of shares of stock of
the Company. Management has represented that PMCC will become
actively trading within the six-month period, and the Company has
recognized a gain on the sale of the PMCC stock of $308,413
during the three months ended September 30, 2000.
International Business Co., Inc.
On August 19, 2000, the Company entered into an agreement to
acquire all of the outstanding shares of International Business
Co. ("IBC"), a software developer that streamlines B2B e-
commerce, in exchange for 2,000,000 shares of restricted Company
shares to be held in escrow, with 1,000,000 restricted company
shares released to the seller on August 11, 2001 and the
remaining 1,000,000 shares released on April 11, 2002. Between
the period from September 1, 2000 through March 1, 2001, the
Company can unilaterally cancel the contract if dissatisfied with
the seller's performance. As of September 30, 2000, the Company
has not completed its acquisition of IBC and has advanced monies
to IBC totaling $18,500.
3. Net Loss Per Share
Basic net loss per shares has been computed by dividing net loss
by the weighted average number of shares outstanding during the
period. Diluted net loss per share is computed by adjusting the
weighted average number of shares outstanding during the period
for all potentially dilutive shares outstanding during the
period. Net loss and weighted average shares outstanding used for
computing diluted loss per share were the same as that used for
computing basic loss per share for the three months ended
September 30, 2000 and September 30, 1999.
4. Segment Information
Management has determined that there are four reportable segments
based on the customers served by each segment: Full service
internet service provider ("ISP"), mortgage banking business, and
business-to-business ("B2B") provider and business-to-consumer
("B2C") provider. Such determination was based on the level at
which executive management reviews the results of operations in
order to make decisions regarding performance assessment and
resource allocation.
Full service internet service provider serves customers requiring
internet access in the western United States through dial-up,
digital subscriber lines ("DSL"), and wireless; web hosting and
web design. Mortgage banking business includes online mortgage
loan origination, processing, servicing and resales. Business-to-
business provider primarily provides reverse auction services to
foreign companies wishing to purchase materials and supplies in
the United States. Business-to-consumer provider primarily
consists of cellular phone service origination fees and sales.
Certain general expenses related to advertising and marketing,
information systems, finance and administrative groups are not
allocated to the operating segments and are included in "other"
in the reconciliation of operating income reported below.
Information on reportable segments is as follows:
Three Months Ended
September 30 September 30
2000 1999
Full-service ISP
Net sales 792,572
Operating income 160,474
Mortgage loan originations held for resale
Net sales 5,927,079
Operating loss (515,734)
Business-to-business provider
Net sales 0
Operating loss (99,789)
Business-to-consumer provider
Net sales 180,286
Operating loss (164,226)
Other
Unallocated expenses (627,583)
Total
Net sales 6,899,937
Operating loss (1,246,858)
Prior to September 30, 1999, the Company only had one reportable
segment, full-service ISP provider services.
5. Subsequent Events
On October 5, 2000, the Company entered into a Stock Purchase
Agreement to acquire all of the outstanding stock of
SonicAuction.com, a business-to-business auction marketplace that
provides a forum for business merchants to purchase equipment and
merchandise. The agreement calls for the Company to issue to the
Seller 500,000 shares of Company stock (with certain restrictions
as set forth in the agreement), in exchange for all of the
outstanding and treasury shares of common stock of
SonicAuction.com.
On October 20, 2000, the Company entered into a Stock Purchase
Agreement ("Agreement") with Auction-Sales.Com, Inc. and its
majority shareholder, Zahid Rafiq (collectively, "Seller"), for
the purchase by the Company of 96.62% of the outstanding and
treasury shares of common stock ("Shares") of Auction-Sales.Com,
Inc., a leading edge e-commerce dynamic pricing application
service provider and has developed a proprietary state of the art
hybrid auction platform that addresses the combined needs of the
B2C, B2B and C2C markets. In exchange for the Shares, the
Company will pay, under the terms of the agreement, the
following:
(a) 11,000,000 shares of Company's restricted common stock to
Seller for all of Seller's Shares, as follows: (i) 5,500,000
restricted shares will be issued to the Seller's current
shareholders, as defined (ii) 2,500,000 restricted shares will be
paid to certain creditors of the Seller. Seller represents that
all of these creditors are unsecured. Seller shall procure signed
consents from each creditor confirming the agreement to accept
restricted shares in proportion to their claims within 60 days of
closing of the transaction. Failure to procure signed consents
will justify rescission of this Agreement at the option of the
Company, such that each party shall restore to the other the
consideration which each placed into the Agreement. (iii)
3,000,000 restricted shares of the purchase price will be paid to
outside consultants for work performed for facilitating the
transaction.
(b) Earn out for the Seller: The Seller shall be paid up to an
additional $3,000,000 based upon earnings over the next 3 years
through additional restricted stock. The earn out will be based
on a 10% growth per year over the previous years revenue. The
$3,000,000 will be distributed equally over the subsequent 3 year
i.e. $1,000,000 per year, and can be cumulative. This earn out is
further defined as follows: (i) The initial base Year ends on 9-
30-00. The subsequent year base will be the previous revenue (ii)
The stock will be issued per quarter upon reaching the Goal per
quarter for that portion of the annualized growth of 10% over the
previous year.
(c) The Company may invest up to $2,000,000 in Auction-
Sales.Com, Inc., at a rate not to exceed $500,000 per quarter,
based on performance on Auction-Sales.Com as a function of gross
revenues and based on a budget, which is pre-approved by Company.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.
The following discussion should be read in conjunction with the
financial statements of the Registrant and notes thereto
contained elsewhere in this report.
Results of Operations.
Revenues for the three-month period ended September 30, 2000 of
$6,899,937 increased 2,340% when compared with revenues of
$294,646 in the prior year comparable period of the third
calendar quarter of 1999.
The gross profits margin of 12.1 % for the three months ended
September 30, 2000 is a decrease from the gross profit margin of
30.1 % for the same three-month period of the previous fiscal
year. Current year margins for the past three months reflect the
acquisitions made by the company and its related increase in
overhead.
Selling, general, and administrative expenses for the three
months ended September 30, 2000 increased to $1,837,044 which is
a significant increase when compared with the $ 86,719 for the
prior year comparable period. This increase is again due to the
acquisitions made during the last 12 months.
The resulting net loss for the three months ended September 30,
2000 was $861,887 which is a significant change when compared
with a profit of $2,079 for same period ending September 30,
1999. $242,159 of the loss represents "Depreciation and
Amortization".
Liquidity and Capital Resources.
Net cash provided by the operations of the Registrant was
$107,162 for the three months ended September 30, 2000 versus net
cash provided by operating activities of $4,059 in the comparable
prior year period.
Capital Expenditures.
Other than as set forth below, no material capital expenditures
were made during the quarter ended on September 30, 2000:
purchase infrastructure equipment totaling $247,302.
Acquisitions
(a) Stock in PMCC Financial Corp.
On July 28, 2000, the Registrant entered into an agreement with
PMCC Financial Corp. ("PMCC"), a full-service mortgage banking
company, whereby the Registrant would purchase 2,460,000 shares
of PMCC common stock from PMCC's former chairman of the board,
which represents 66.36% of the 3,707,000 total PMCC shares
outstanding (see Exhibit 10.11 to this Form 10-Q). The aggregate
purchase price of $3,198,000 is to be paid in cash to the seller
by the Registrant as follows: $700,000 at date of closing;
$306,857 for each of the seven installment payments to be paid on
the 30th, 60th, 90th, 120th, 150th, 180th and 210th days following the
close; $175,000 on each of the 240th and 270th day after the date
of the closing. Shares of PMCC will be released to the Registrant
based on payments made by the Registrant, as outlined in the
agreement. Shares of PMCC, a listed AMEX company, are currently
not trading. In the event that three months after closing, if
PMCC's shares are not actively trading on the AMEX or NASDQ
exchanges and the Registrant has not merged PMCC with the
Registrant or any of the Registrant's subsidiaries, the purchase
price shall be reduced by the amount of the final two $175,000
payments. As of September 30, 2000, the Registrant has paid
approximately $1,043,000, representing the payment due at closing
and the 1st installment, and has received 269,230 shares of PMCC,
representing approximately 7% of the total outstanding stock of
PMCC.
Also on July 28, 2000, in a separate transaction, the Registrant
entered into a stock sales agreement with an unrelated individual
whereby the Registrant would sell up to 370,000 of PMCC shares
that the Registrant either owns or will eventually own, for total
consideration of $1,387,500 (see Exhibit 10.12 to this Form 10-
Q). Shares of PMCC stock sold by the Registrant will be released
to the buyer in proportion to payments received. As of September
30, 2000, the Registrant received payments of $420,563 and the
Registrant released 112,150 shares of PMCC stock that it owned.
If PMCC shares are not actively trading within six months of the
agreement, the Registrant will issue to the Buyer the equivalent
number of shares of stock of the Registrant. Management has
represented that PMCC will become actively trading within the
six-month period, and the Registrant has recognized a gain on the
sale of the PMCC stock of $308,413 during the three months ended
September 30, 2000.
(b) IBC Corp.
On August 11, 2000, the Registrant entered into an agreement
to acquire all of the outstanding shares of International
Business Co. ("IBC"), a software developer that streamlines B2B
e-commerce, in exchange for 2,000,000 shares of restricted
Registrant shares to be held in escrow, with 1,000,000 restricted
company shares released to the seller on August 11, 2001 and the
remaining 1,000,000 shares released on April 11, 2002 (see
Exhibit 10.13 to this Form 10-Q). Between the period from
September 1, 2000 through March 1, 2001, the Registrant can
unilaterally cancel the contract if dissatisfied with the
seller's performance. As of September 30, 2000, the Registrant
has not completed its acquisition of IBC and has advanced monies
to IBC totaling $18,500.
Current Developments.
After the quarter ended September 30, 2000, the Registrant
entered into three additional material contracts, as follows:
(a) Sonic Auction.com.
100% of the web based auction site Sonic Auction.com was acquired
by the Registrant on October 5, 2000 in exchange for 500,000
shares of restricted common stock of the Registrant. Sonic
Auction is a B2B auction marketplace, providing a auction site
for business merchants to purchase equipment, and merchandise at
a discount. This site has a loyal customer base and had sales of
over $2,000,000 for the year ended December 31, 1999. The site
has over $400 million worth of auction-able product currently
listed for auction.
(b) Washington State Hotel and Motel Association.
The agreement with the Washington State Hotel and Motel
Association, dated October 4, 2000, provides the use of the GGPP
reverse Auction site as a platform for hotel association members
purchasing products needed for their different hotel properties.
This method of purchasing allows the suppliers of products the
chance to sell products to the buyers in competition with one
another, the net effect is that the buyers would select the
supplier with the lowest per unit cost. This reduces the cost of
supplies and thereby should increase their potential of profit.
This agreement covers the modification of the GGPP website for
use by the Association, and does not involve any payment by the
Registrant.
(c) Auction-Sales.Com.
On October 20, 2000, the Registrant entered into a Stock Purchase
Agreement with Auction-Sales.Com, Inc. and its majority
shareholder, Zahid Rafiq (collectively, "Seller"), for the
purchase by the Registrant of 96.62% of the outstanding and
treasury shares of common stock of Auction-Sales.Com, Inc., a
Delaware corporation. In exchange for the shares, the Registrant
will pay, under the terms of this agreement, the following:
(a) 11,000,000 shares of Registrant's restricted common
stock to Seller for all of Seller's Shares, as follows:
(i) 5,500,000 restricted shares will be issued to current
shareholders, identified on the list attached to the Agreement.
(ii) 2,500,000 restricted shares will be paid to certain
creditors of the Registrant identified in an attachment to the
Agreement. Seller represents that all of these creditors are
unsecured. Seller shall procure signed consents from each
creditor confirming the agreement to accept restricted shares in
proportion to their claims within 60 days of closing of the
transaction. Failure to procure signed consents will justify
rescission of this Agreement at the option of the Registrant,
such that each party shall restore to the other the consideration
which each placed into the Agreement.
(iii) 3,000,000 restricted shares of the purchase price
will be paid to outside consultants for work performed for
facilitating the transaction.
(b) Earn out for the "Seller": The Seller shall be paid up
to an additional $3,000,000 based upon earnings over the next 3
years through additional restricted stock. The earn out will be
based on a 10% growth per year over the previous years revenue.
The $3,000,000 will be distributed equally over the subsequent 3
year i.e. $1,000,000 per year, and can be cumulative. This earn
out is further defined as follows:
The initial base Year ends on September 30, 2000. The subsequent
year base will be the previous revenue .
(ii) The stock will be issued per quarter upon reaching the Goal
per quarter for that portion of the annualized growth of 10% over
the previous year.
(c) The Registrant may invest up to $2,000,000 in Auction-
Sales.Com, Inc., at a rate not to exceed $500,000 per quarter,
based on performance on Auction-Sales.Com as a function of gross
revenues and based on a budget, which is pre-approved by the
Registrant.
Auction-Sales.Com is an e-commerce pricing application service
provider. Auction-Sales.Com has developed a proprietary state of
the art hybrid auction platform that address the combined needs
of the B2C, B2B and C2C markets. This is accomplished by
providing a single integrated marketplace and portal technology
that empowers all parties, including manufacturers, distributors,
resellers and consumers. The Auction-Sales.Com platform provides
supply chain integration and economies of scale in connection
with dynamic pricing application targeting businesses and /or
consumers.
Forward Looking Statements.
The foregoing Management's Discussion and Analysis of Financial
Condition and Results of Operations contains "forward looking
statements" within the meaning of Rule 175 of the Securities Act
of 1933, as amended, and Rule 3b-6 of the Securities Act of 1934,
as amended, including statements regarding, among other items,
the Registrant's business strategies, continued growth in the
Registrant's markets, projections, and anticipated trends in the
Registrant's business and the industry in which it operates. The
words "believe," "expect," "anticipate," "intends," "forecast,"
"project," and similar expressions identify forward-looking
statements. These forward-looking statements are based largely
on the Registrant's expectations and are subject to a number of
risks and uncertainties, certain of which are beyond the
Registrant's control. The Registrant cautions that these
statements are further qualified by important factors that could
cause actual results to differ materially from those in the
forward looking statements, including, among others, the
following: reduced or lack of increase in demand for the
Registrant's products, competitive pricing pressures, changes in
the market price of ingredients used in the Registrant's products
and the level of expenses incurred in the Registrant's
operations. In light of these risks and uncertainties, there can
be no assurance that the forward-looking information contained
herein will in fact transpire or prove to be accurate. The
Registrant disclaims any intent or obligation to update "forward
looking statements."
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable.
PART II.
ITEM 1. LEGAL PROCEEDINGS.
The Registrant is not a party to any material pending legal
proceedings and, to the best of its knowledge, no such action by
or against the Registrant has been threatened.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
Not Applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
On September 27, 2000, the annual meeting of shareholders of
the Registrant was held. At this meeting, the following matters
were voted on and approved:
(a) The election of following three (3) nominees as Directors of
the Registrant until the next annual meeting of shareholders and
until their respective successors shall be elected and qualified:
Louis Cherry, Albert R. Reda, and Wade Whitely;
(b) To approve the appointment of Henry Schiffer, C.P.A., a
P.C., as the Registrant's independent auditors for the new fiscal
year commencing on July 1, 2000;
Of the 221,115,113 shares eligible to vote at this meeting,
a total of 113,754,182 shares voted in favor of the proposal and
for each of the nominated directors. There were no negative
votes and no abstentions on any of the voting. The proposal
regarding the approval of a share exchange between the Registrant
and PMCC Mortgage Corp., whereby the Registrant would become a
wholly owned subsidiary of this firm (as set forth in the
Schedule 14A Proxy Statement filed with the SEC on September 15,
2000), was not voted on due to incomplete negotiations between
the parties with respect to this transaction.
ITEM 5. OTHER INFORMATION.
The Registrant is aware that it failed to report the acquisition
of an amount of common stock of PMCC Financial Corporation which
exceeds 5% of the outstanding of that company in compliance with
Rule 13(d) under the Securities Exchange Act of 1934. A Schedule
13D for this acquisition is now in the process of being prepared
for filing.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
Exhibits.
Exhibits included or incorporated by reference herein: See
Exhibit Index.
Reports on Form 8-K.
No reports on Form 8-K were filed during the first quarter of the
fiscal year covered by this Form 10-Q. The disclosures herein
regarding the acquisition and disposition of common stock of PMCC
Financial Corporation is being made in lieu of the filing of a
Form 8-K which was inadvertently not filed for these
transactions.
SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Internet Business's International, Inc.
Dated: November 15, 2000 By: /s/ Albert R. Reda
Albert R. Reda, Chief Executive Officer
EXHIBIT INDEX
Exhibit Description
No.
2 Agreement and Plan of Merger (incorporated by reference to
Exhibit 2 to the Form 8-K/A filed on November 22, 1999)
3.1 Articles of Incorporation (incorporated by reference to
Exhibit 3.1 to the Form 10-Q filed on December 1, 1999).
3.2 Certificate of Amendment of Articles of Incorporation
(incorporated by reference to Exhibit 3.2 to the Form 10-Q filed
on December 1, 1999).
3.3 Certificate of Amendment of Articles of Incorporation
(incorporated by reference to Exhibit 3.3 of the Form 10-Q filed
on May 22, 2000).
3.4 Certificate of Amendment of Articles of Incorporation
(incorporated by reference to Exhibit 3.4 of the Form 10-Q filed
on May 22, 2000).
3.5 Bylaws (incorporated by reference to Exhibit 3.3 to the Form
10-Q filed on December 1, 1999).
4.1 Retainer Stock Plan for Non-Employee Directors and
Consultants, dated October 1, 1999 (incorporated by reference to
Exhibit 4.1 to Form S-8 filed on October 8, 1999)
4.2 Consulting Agreement between the Registrant and Mark Crist,
dated October 5, 1999 (incorporated by reference to Exhibit 4.2
to Form S-8 filed on October 8, 1999)
10.1 Purchase Agreement (LA Internet) between the Registrant and
Iron Horse Holdings, Incorporated, dated June 10, 1999
(incorporated by reference to Exhibit 10.2 to the Form 10-Q filed
on December 1, 1999).
10.2 Purchase Agreement between the Registrant and the
Stockholders of MBM Capital Group Inc., dated July 1, 1999
(incorporated by reference to Exhibit 10.3 to the Form 10-Q filed
on December 1, 1999).
10.3 Acquisition Agreement (Net 2 Loan) between the Registrant
and Lifestyle Mortgage Partners, dated September 15, 1999
(incorporated by reference to Exhibit 10.4 to the Form 10-Q filed
on February 22, 2000).
10.4 Purchase Agreement (license) between the Registrant and
Stockholders of California Land & Home Sale, Inc., dated October
1, 1999 (incorporated by reference to Exhibit 10.5 to the Form
10-Q filed on February 22, 2000).
10.5 Acquisition Agreement (Optical Brigade) between the
Registrant and Wade Whitley, dated November 1, 1999 (incorporated
by reference to Exhibit 10.6 to the Form 10-Q filed on February
22, 2000).
10.6 Agreement for Acquisition between the Registrant and Direct
Communications, Inc., dated February 25, 2000 (incorporated by
reference to Exhibit 10.6 of the Form 10-Q filed on May 22, 2000).
10.7 Agreement between the Registrant and Internet 2xtreme, dated
March 6, 2000 (incorporated by reference to Exhibit 10.7 of the
Form 10-Q filed on May 22, 2000).
10.8 Agreement between the Registrant, Roanoke Technology Corp.,
and Global GPP Corp., dated March 21, 2000 (incorporated by
reference to Exhibit 10.8 of the Form 10-Q filed on May 22, 2000).
10.9 Agreement between GPP Hungary Kft and Haitec Magyarorazagi
Kft, dated March 30, 2000 (incorporated by reference to Exhibit
10.9 of the Form 10-Q filed on May 22, 2000).
10.10 Stock Purchase Agreement between the Registrant and
Atlas Capital Corporation, dated April 1, 2000 (incorporated by
reference to Exhibit 10.10 to the Form 10-K filed on September
27, 2000).
10.11 Stock Purchase Agreement between the Registrant and
Ronald Friedman, Robert Friedman, and The Ronald Friedman 1997
Grantor Retained Annuity Trust, dated July 28, 2000 (see below).
10.12 Stock Sales Agreement between the Registrant and a
buyer, dated July 28, 2000 (see below).
10.13 Stock Purchase Agreement between the Registrant,
International Business Company, Dennis B. Ginther, Clifford J.
Roebuck, Jadwiga L. Ginther, and Bogumila E. Basu , dated August
19, 2000 (see below).
21 Subsidiaries of the Registrant (see below).
27 Financial Data Schedule (see below).