SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the registrant: [x]
Filed by a party other than the registrant: [_]
Check the appropriate box:
[ ] Preliminary proxy statement
[_] Confidential, for use of the Commission only (as permitted by Rule
14a-6(e)(2))
[x] Definitive proxy statement
[_] Definitive additional materials
[_] Soliciting material pursuant to Rule 14a-12
MarketCentral.net Corp.
---------------------------------
(Name of Registrant as specified in Its Charter)
(Name of Person filing Proxy Statement, if other than the Registrant)
Payment of filing fee (check the appropriate box):
[x] No fee required
[_] Fee computed on table below per Exchange Act Rules 14a-6(i) (1) and 0-11
(1) Title of each class of securities to which transaction applies:
NONE
(2) Aggregate number of securities to which transaction applies: NONE
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11: N/A
(4) Proposed maximum aggregate value of transaction: N/A
(5) Total fee paid: N/A
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a) (2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number or the
form or schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, schedule or registration statement no.:
(3) Filing party:
(4) Date filed:
1
<PAGE>
[COMPANY LOGO]
MARKETCENTRAL.NET, CORP.
Presidents Letter To Shareholders- June 20, 2000
Dear Shareholders:
It has been quite an eventful year for MarketCentral.net, and I am pleased to
report significant progress. Most importantly your company was approved as a
full reporting company by the SEC on July 1, 1999. What this means is that we
maintained our listing on the Over-The-Counter Bulletin Board, and that we now
file quarterly and annual reports with the SEC. Investors can always view these
periodic reports and other filings with the SEC by accessing the EDGAR database
on the SEC web site (http://www.sec.gov).
Your company completed two consulting agreements with major Wall Street figures,
Mr. G. Richard Eakle and Mrs. Joan Lappin of Gramercy Capital Corporation. Under
these agreements Mr. Eakle and Mrs. Lappin will provide proprietary content to
the MarketCentral.net web site. Of utmost importance, these renowned luminaries
will be assisting us in raising our secondary financing in the coming year.
In that regard we have hired Focus Partners of NYC to develop a new and exciting
strategic business plan. The plan is outlined in the annual report and reflects
our understanding of the changes and challenges we face in developing a
profitable working revenue model. The key to our new direction will be the
creation of strategic alliances with financial services companies in banking,
mortgages, auto loans, insurance, stock brokerage and other related services.
That should dramatically increase revenues according to our income model for
transactions and will add to our advertising and Super Mall revenues.
The technological revolution we are experiencing is just starting. Decades of
growth lie ahead of us and the challenge is great. We are committed to meeting
that challenge and delivering a successful and profitable company to our
shareholders.
The coming year will see great changes for your company. We are looking forward
to a long and prosperous relationship with all of you.
/s/
Roy Spectorman, President
MarketCentral.net Corp.
MARKET CENTRAL.NET CORP.
300 Mercer Street, Suite 26J, New York, NY 10003
http://www.marketcentral.net
2
<PAGE>
MarketCentral.net Corp.
formerly, All American Consultant Aircraft, Inc.
formerly, Great American Leasing, Inc.
NOTICE OF 2000 ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD July 21, 2000
To the Shareholders of MarketCentral.net Corp.:
NOTICE IS HEREBY GIVEN that the 2000 Annual Meeting of Shareholders (the
"Meeting") of MarketCentral.net Corp. will be held at 34700 Pacific Coast Hwy,
Suite 303, Capistrano Beach, CA 92624, on July 21, 2000 at 10:00 a.m., local
time, and for the following purposes:
Purposes of the Meeting
The Meeting is called by the Management to consider and vote upon the
following Proposals and to transact such other business as may come before the
Meeting or any postponement or adjournment thereof.
PROPOSAL NO. 1. Re-Elect the existing two Directors to serve as the Board of
Directors until the next meeting of shareholders.
PROPOSAL NO. 2. Re-Confirm the engagement of Rogoff & Co., P.C., of New York, as
our Corporate Auditors, to review and render opinions as to our Financial
Statements. List of proposals to go here, if applicable.
Only holders of record of the Company's common stock at the close of
business on "Record Date" shall be entitled to notice of and to vote at the
Meeting. The vote of each shareholder will be important at this Meeting.
Your attention is directed to the accompanying Proxy Statement. You are
urged to attend in person or by proxy. If you do not plan to attend personally,
and wish to have your vote counted, you are urged to execute and return the
attached Proxy at your earliest convenience. Please Return Proxies to :
WILLIAM STOCKER
34700 Pacific Coast Hwy, Suite 303
Capistrano Beach, CA 92624.
The prompt return of the proxy will be of assistance in preparing for the
Meeting and your cooperation in this respect will be greatly appreciated.
Dated: June 20, 2000
/s/
Roy Spectorman, President/Director
Our Annual Report to Shareholders is provided under the cover page titled
Exhibit A.
3
<PAGE>
MarketCentral.net Corp.
a Texas Corporation
formerly, All American Consultant Aircraft, Inc.
formerly, Great American Leasing, Inc.
300 Mercer Street, Suite 26J, New York, NY 10003
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
July 21, 2000
This Proxy Statement is furnished in connection with the solicitation of
Proxies by the Board of Directors of MarketCentral.net Corp., a Texas
Corporation, (the "Company"), to be voted at a Meeting of Shareholders (the
"Meeting") to be held at 34700 Pacific Coast Hwy, Suite 303, Capistrano Beach,
CA 92624, on July 21, 2000 at 10:00 a.m., local time, and for the purposes
stated in the notice of shareholders meetings furnished herewith.
The Proposals as described herein are submitted to the Company's
shareholders after due consideration and upon recommendation by the Company's
Board of Directors. Solicitations will be made by mail expenses incurred in
connection with the solicitation will be borne by the Company. This statement
was sent on June 21, 2000 to all the shareholders of record as of the close of
business on June 9, 2000 (the "Record Date") stated in the notice of
shareholders meeting furnished herewith.
THE PROXY
The enclosed Proxy, even though executed and returned, may be revoked at
any time before being voted, by written notice, mailed or delivered to the
Company, or by a request for return of the Proxy at the Meeting. By returning
your signed proxy on the enclosed form, you authorize the proxy holder to vote
your shares as you indicate on the items of business to be presented at the
meeting and to vote your shares in accordance with the proxy holder's best
judgment in response to proposals initiated by others at the meeting. Proxies,
which are executed but do not specify a vote for, against, or in abstention,
will be voted for the proposals contained herein. The proxy must be received by
the Company prior to the Meeting to be effective.
All costs incurred for the solicitation of proxies shall be borne by the
Company. The Company anticipates paying no other compensation for the
solicitation of proxies, but the Company may reimburse brokers or other persons
holding stock in their names, or in the names of nominees, for the expenses
incurred in transmitting proxy materials to the principals.
VOTING SECURITIES
The Company presently has only one class of voting stock outstanding,
namely its common stock. This Company's Common Voting Stock of par value $0.001
per share, of which 100,000,000 shares are authorized and 4,198,932 shares are
issued and outstanding as of the closing date on the Record Date. Each
outstanding share is entitled to one vote. Only shareholders of record at the
close of business on the Record Date are entitled to notice and to vote at the
Meeting. The presence at the Meeting in person or by Proxy of a majority of the
shares entitled to vote shall constitute a quorum for the transaction of
business.
4
<PAGE>
PROPOSALS BY SHAREHOLDERS
A shareholder proposal is your recommendation or requirement that the
Company or its Board of Directors take action which action you intend to propose
at the Meeting. Your proposal should state as clearly as possible the course of
action that you believe the company should follow. If your proposal is placed on
the company's proxy ballot, the company must also provide in the form of the
proxy ballot, we must provide boxes for shareholders to vote in favor, against,
or to abstain. The Next Annual Meeting of shareholders is tentatively scheduled
for the Third Monday of July, 2000. If you desire to place such a proposal
before shareholders at the next annual meeting of shareholders, you must do so
in compliance with regulations and procedures established by the Securities and
Exchange Commission. The deadline for submitting shareholder proposals within
this process is .
ITEM 1. OUR COMPANY. Please see our Revised Annual Report on Form 10-K-SB
(furnished with this Information Statement) for further information. Our company
is an SEC reporting company.
ITEM 2. BUSINESS TO BE ACQUIRED. There are no businesses or assets sought to be
acquired by us at the Meeting.
ITEM 3. CHANGE OF CONTROL OF THE COMPANY. No proposal or action proposed for the
Meeting involves any change of control of our company.
ITEM 4. DISCUSSION OF SPECIFIC PROPOSALS.
PROPOSAL NO. 1
--------------------------------------------------------------------------------
Re-Elect the existing two Directors to serve as the Board of Directors until the
next meeting of shareholders.
--------------------------------------------------------------------------------
The present Board of Directors is recommending that the following two
existing Directors be re-elected as Directors of the Company and that said
individuals be appointed as Directors on behalf of the corporation until the
next Meeting of Shareholders. The affirmative vote of a majority of the shares
present in person or by proxy, assuming a quorum is present, is required to
elect the Board of Directors. Unless authority to vote is withheld on a proxy,
proxies in the Company form will be voted to elect as Directors the nominees as
identified above and below. If any nominee is not available for election (a
contingency which the Company does not now foresee), the remaining Board of
Directors will appoint a new Director.
The business experience and biographies of all the proposed Directors are as
follows:
Roy Spectorman, age 49, MarketCentral's President and founder, will be
coordinating the efforts of the MarketCentral management team and will guide the
Registrant's implementation of its strategic plan. Mr. Spectorman has developed
the content of the MarketCentral Website, investment guide and newsletter. He
will be responsible for the newsletter and investment guide updates and will be
attempting to establish relationships and alliances within the financial
services industry. From 1989 until his founding of the Registrant, Mr.
Spectorman has served as President of New Horizons Asset Management Corporation
from 1989, a financial management consulting firm. Mr. Spectorman has over 20
years experience in the financial markets. Mr. Spectorman was President of
Environmental Life Products from 1986-1989. He was responsible for developing
the product line, creating marketing materials and building a sales
organization. Mr. Spectorman was Vice-President of Palace Industries from
1973-1986. He developed product lines for this textile manufacturer, managed a
sales organization and developed marketing strategies. Mr. Spectorman attended
Adelphi University from 1974-1976 where he received a Masters Degree in Business
Administration in Management and graduated Summa Cum Laude. He attended The
State University of New York at Stony Brook from 1968-1972 where he received a
B.A. in Liberal Arts.
Jerry Kaplan, age 53, MarketCentral's Vice-President-Operations, appointed
Secretary-Treasurer in November 1999, and one of its Directors, will be heading
the operations department. He will be responsible for credit card transactions,
computer technical support, product warehousing and shipping operations. Mr.
Kaplan has used, programmed and overseen several computer system installations
over the last thirty years, and brings a thorough understanding of their
workings, capabilities and limitations. Mr. Kaplan has been President of
Universal Chemicals, a privately held chemical distributor primarily selling
water treatment chemicals since 1992. He has been in the chemical industry since
1970 when he joined Alden Leeds, Inc., a swimming pool chemical manufacturer.
His experience includes all phases of operating within the chemical industry,
including chemical manufacture, sales, distribution, labor relations, data
processing, accounting, and government regulations. Mr. Kaplan worked for IBM
from 1969 to 1970 as a computer operator, at the first Management Information
Systems (MIS) center in the U.S. He received in-house training from IBM in
computer operations, job control language and various computer programming
languages. Mr. Kaplan attended the University of Tampa between 1964 and 1966
where he majored in biology. He attended Hofstra University between 1966-1968
where he majored in business, with a minor in chemistry. Mr Kaplan devotes only
such time to the business of the Registrant as is necessary to perform his
duties as an officer and director.
EXECUTIVES OFFICERS AND DIRECTORS COMPENSATION AND OPTIONS
Our Officers and Directors serve without compensation at this time, except
that Roy Spectorman, the Registrant's president, receives indirect compensation
as explained hereinafter. No plan of compensation has been adopted or is under
consideration at this time. None of the Directors currently receives, or has
ever received, any salary from the Registrant in their capacities as such, and
none are expected to be compensated in their capacities as such. No officers are
expected to receive any compensation for their services. No officers or
directors are under an employment contract with the Registrant. The Registrant
has no retirement, pension, profit sharing, or insurance or medical
reimbursement plans.
Certain Management Options to acquire additional shares of common stock, at
an exercise price of $5.00 per share for five years from February 5, 1999, have
been contemplated for future grant to management and certain others as follows:
<TABLE>
<CAPTION>
<S> <C>
--------------------------
Roy Spectorman 170,000
Jerry Kaplan 25,000
Peter Waters 50,000
Alan Kessler 5,000
Frank Evanshen 75,000
Gerald Yakimishyn 75,000
==========================
</TABLE>
The options were issued pursuant to the exemption provided by 4(2) of the
Securities Act of 1933. Roy Spectorman benefits from indirect compensation in
the amount of $9,000.00 per month, by virtue of a Management Services Agreement
with a consultant to us, of which consulting firm, Mr. Spectorman is the
President and beneficial owner.
5
<PAGE>
The following table discloses the existence and the effect of certain
management options, as if exercised, on the share ownership of management and
affiliates.
EFFECT OF OPTION EXERCISE ON SHARE OWNERSHIP
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Option Owner Shares % Options Total if %
Actual and Options
as Exercised
Attributed
--------------------------------------------------------------------
Roy Spectorman 794,813 18.93 170,000 964,813 20.98
--------------------------------------------------------------------
Gerald 115,113 2.74 75,000 190,113 4.13
Yakimishyn
--------------------------------------------------------------------
Jerry Kaplan 198,703 4.73 25,000 223,703 4.86
--------------------------------------------------------------------
Peter Waters 389,813 9.28 50,000 439,813 9.56
--------------------------------------------------------------------
Frank Evanshen 503,125 11.98 75,000 578,125 12.57
(See Note 2 above)
--------------------------------------------------------------------
Alan Kessler 45,562 1.09 5,000 50,562 1.10
--------------------------------------------------------------------
Total 4,198,932 100.00 400,000 4,598,932 100.00
Shares/Options
Outstanding
--------------------------------------------------------------------
</TABLE>
PROPOSAL NO. 2
--------------------------------------------------------------------------------
Re-Confirm the engagement of Rogoff & Co., P.C., of New York, as our Corporate
Auditors, to review and render opinions as to our Financial Statements.
--------------------------------------------------------------------------------
This proposal suggests the continuation of our relationship with our
current independent auditing firm.
ITEM 5. SEC REPORTING. Please see our Annual Report on Form 10-K-SB for further
information (furnished with this statement). Our company is an SEC reporting
Company.
ITEM 6. VOTE REQUIRED BY STATE LAW. Over fifty percent of the outstanding shares
of the Company's Common Stock must be present in person or by proxy for a quorum
to conduct business, and each matter must be approved by a majority of those
shares present in order to be validly authorized.
ITEM 7. STOCK. Please see our Annual Report on Form 10-K-SB for further
information (furnished with this statement). Our company is an SEC reporting
Company.
ITEM 8. FINANCIAL STATEMENTS. Please see our Annual Report on Form 10-K-SB for
our latest audited financial statements. We have also enclosed un-audited
financial statements for the quarter ending March 31, 2000.
6
<PAGE>
ITEM 9. OTHER MATTERS. As of the date of this proxy statement, the Board of
Directors of the Company knows of no matters to be presented to the Meeting
other than those matters set forth in the notice of the meeting. Nevertheless,
if any other matters are presented at the meeting, it is the intention of the
proxies named in the enclosed form of proxy to vote on such matters exercising
their judgment.
(additional Information concerning our Corporation is available upon
request)
Dated: June 20, 2000
By Order of the Board of Directors.
/s/
Roy Spectorman, President/Director
7
<PAGE>
--------------------------------------------------------------------------------
EXHIBIT A
ANNUAL REPORT TO SHAREHOLDERS
INCLUDING INTERIM INFORMATION THROUGH THE PERIOD ENDING JUNE 9, 2000
--------------------------------------------------------------------------------
8
<PAGE>
ANNUAL REPORT TO SHAREHOLDERS
[COMPANY LOGO]
MARKETCENTRAL.NET CORP.
A TEXAS CORPORATION
formerly, All American Consultant Aircraft, Inc.
formerly, Great American Leasing, Inc.
CORPORATE HEADQUARTERS
300 Mercer Street, Suite 26J
New York NY 10003
The following Securities are registered pursuant to
Section 12(g) of the Securities Exchange Act of 1934:
CLASS-A COMMON VOTING EQUITY STOCK
4,198,932
9
<PAGE>
ITEM 1. CORPORATE ORGANIZATION AND HISTORY.
(1) CORPORATE NAME. This Corporation MarketCentral.net Corp., formerly All
American Consultant Aircraft, Inc. was first incorporated in the State of Texas
on December 28, 1988 as Great American Leasing, Inc. The first name change
occurred on or about March 21, 1997. The most recent and current name change
occurred on or about March 1, 1999. MarketCentral.Net Corp. is also the name of
our wholly-owned Delaware subsidiary. Please note the subtle difference in the
spelling of the two corporate names.
(2) SECURITY ORGANIZATION. On December 28, 1988 we made our initial issuance of
180,000 Common Shares for organizational services of $1,000. On or about April
8, 1997, we made a Limited Offering, pursuant to Regulation D, Rule 504, as
promulgated by the Securities and Exchange Commission, pursuant to the
Securities Act of 1933 ( the Act ). The Offering closed on May 8, 1997, 100,000
shares having been placed at $1.00 per share. On or about May 22, 1998, we made
a Limited Offering, pursuant to Rule 504. The Offering closed on May 22, 1998,
2,900 shares having been placed at $1.00 per share. On or about July 1, 1998, we
made a Limited Offering, pursuant to Regulation D, Rule 504. The Offering closed
on July 1, 1998, 84,000 shares having been placed at $0.10 per share. On or
about January 5, 1999, we placed an additional 1,600,000 shares at $0.025 per
share, also pursuant to Regulation D, Rule 504, with the resulting total
1,966,900 issued and outstanding. On or about February 21, 1999 the Issuer
agreed to issue and reserved for issuance 2,025,000 shares pursuant to 4(2) of
the Act, in reliance on Rule 145, to the shareholders of the acquired
corporation in exchange for shares of that target corporation, for the
reorganization and acquisition of MarketCentral.Net Corp., a Delaware
corporation. Rule 145 provides that securities issued in exchange for securities
of an acquired corporation are new restricted securities, as defined by Rule
144(a), issued for investment and not for resale. On March 1, 1999 we changed
our name to our present name which is that of our acquired business.
As more fully described later in this Report to Shareholders, we acquired
the target company MarketCentral.Net Corp. in a reverse acquisition. A reverse
acquisition is the acquisition of a private company by a public company, by
which the private company's shareholders acquired control of the public company.
At the time of the reverse acquisition the Issuer was a development stage issuer
with no significant assets, liabilities or business or financial resources. The
target company, also in the development stage, was a private corporation with an
active business and some initial operations.
The purpose of the acquisition of MarketCentral.Net Corp. by All American
Consultant Aircraft (this Issuer) was to effect a business combination for the
benefit of shareholders, by the acquisition for stock of an attractive business
in development stage. We are presently committed to the development of our
acquired business.
On October 18, 1999, 36,032 shares were issued to attorneys for legal
services rendered. These shares were issued at a value of $1.50 per share and
have been duly registered pursuant to Section 5 of the Securities Act of 1933 by
filing of a S-8 Registration Statement. On November 12, 1999, 100,000 shares of
stock were issued to G. Richard Eakle as compensation for consulting services
rendered pursuant to Section 4(2) of the Act and are restricted securities as
10
<PAGE>
defined by Rule 144(a). On March 10, 2000, 39,000 shares were issued for
services. On April 12, 2000, 20,000 shares were issued for services. On May 22,
2000, 12,000 shares were issued to attorneys for legal services rendered. As a
result of the foregoing issuances, the Registrant had 4,198,932 shares
outstanding as of June 9, 2000.
The issuances by series referred to previously are displayed in the
following table. The reference to Series of Common Stock is for descriptive
purposes only.
<TABLE>
<CAPTION>
<S> <C>
Series #/Exemption Issuances
---------------------------------------
1. 4(2) 180,000
for services valued at
1,000
---------------------------------------
2. 504 100,000
April 18, 1997-May 8, 1997
---------------------------------------
3. 504 2,900
May 22, 1998
---------------------------------------
4. 504 84,000
July 1, 1998
---------------------------------------
5. 504 1,600,000
January 5, 1999
---------------------------------------
6. 4(2) 2,025,000
for acquisition
---------------------------------------
7. S-8 36,032
Services
---------------------------------------
8. 4(2) 100,000
Services
---------------------------------------
9. 4(2) 39,000
Services
---------------------------------------
10. 4(2) 20,000
Services
---------------------------------------
11
<PAGE>
---------------------------------------
11. S-8 12,000
Services
---------------------------------------
Issued and Outstanding 4,198,932
=======================================
</TABLE>
12
<PAGE>
ITEM 2. OUR ACQUISITION AND REORGANIZATION.
MarketCentral.net Corp., a private New York Corporation first merged with
and into MarketCentral.Net Corp., a newly formed private Delaware Corporation;
following that merger, we acquired the Delaware company as a wholly-owned
subsidiary. J. Dan Sifford resigned as Director and President, and Mr. Gerald
Yakimishyn assumed the Presidency of the Corporation as Sole Interim Officer and
Director, and a Majority Shareholder Action was taken, and Gerald Yakimishyn,
Roy Spectorman, and Jerry Kaplan were elected Directors. The acquisition and
reorganization was accomplished in the following manner:
(i) That certain Merger Agreement and Plan of Acquisition and
Reorganization, dated February 5, 1999, was ratified, approved and adopted.
(ii) The Officers were empowered and Directed to change the name of this
Texas Corporation (All American Consultant Aircraft, Inc.) to MarketCentral.net
Corp.
(iii) The agreement, by which Meridian Mercantile, Inc. would employ its
best efforts to raise a minimum of $3,000,000 of capital for the reorganized
corporation following the subsidiary merger, was ratified, approved and adopted.
(iv) The Meridian Mercantile, Inc. Subscription Agreement" for the
purchase of an aggregate of up to 56,014 shares of All American Common Stock
over a 24 month period at a purchase price of $5.57 per share pursuant to the
terms thereof, as set forth on Schedule 1.3(vi) of Merger Agreement was
ratified, approved and adopted.
(v) The granting of an aggregate of 400,000 five-year options to purchase
All American Common Stock at an exercise price equal to Five Dollars U.S.
($5.00) per share, in favor of certain persons as set forth on Schedule 1.3(vi)
of Merger Agreement, was ratified, approved and adopted.
13
<PAGE>
ITEM 3. OUR BUSINESS.
(A) SUMMARY. MarketCentral.net Corp. is a comprehensive financial content
provider that offers its users a one-stop destination for financial services,
news, e-commerce and a wide array of information services. Through its Hub site,
www.marketcentral.net, the Company serves visitors interested in investment
information, financial products and services and on-line shopping.
TARGET MARKET. The rapidly changing Internet space, the increasing
volatility of stock markets and the growing interest by investors in managing
their own portfolios is spurring a huge market opportunity for financial
services Web sites. Dataquest has estimated that 15 million U.S. adults invest
online, and projects that the number will double to 30 million by 2003.
Forrester Research, is estimating the online financial services opportunity will
grow to over $80 billion by 2003, an increase of tenfold from today s market.
According to research from First Albany Corp., demand for online financial
services from investors 55 or older will increase as baby boomers reach
retirement age. Jupiter Communications projects that more than 7 million people
age 55 or older were investing online in 1998, up from 3.8 million just two
years earlier. Jupiter Communications forecasts that by 2002, this number will
grow to nearly 11 million. These investors are typically well educated and have
annual incomes often exceeding $100,000 and investment portfolios with more than
$250,000. This provides a very targeted demographic for potential advertisers.
Targeted Web properties are emerging as more efficient vehicles for advertisers
in terms of revenue generated per page delivered.
We are building on our current Web site to deliver a comprehensive Web site
that we believe will offer a unique value proposition to both businesses and
consumers. We are adding the following new key elements:
PROPRIETARY CONTENT. We will offer original editorial content and
proprietary newsletters written by Richard Eakle, former Market Strategist from
Morgan Stanley, and Joan E. Lappin, CIO of New York-based Gramercy Capital
Management Corp., a registered investment advisory and money-management firm
that has been ranked number one in the United States for five-year performance.
We will also provide access to MarketCentral's Investment Newsletter, which
provides timely market information and analysis for the individual investor.
Additionally, we are in negotiations with Zachs Investment Research, Screaming
Media, Hyperfeed and Virtual Advisor, all recognized sources of valuable
financial information. We believe these services will improve user satisfaction
and stimulate a significant increase in advertising revenues.
WIRELESS ACCESS. MarketCentral will create a special version of its Web
site that uses Wireless Application Protocol (WAP), allowing users to access
vital financial information through our Web site from cell phones, palm pilots
and other devices.
AUTO LOANS TRANSACTIONS. There are currently very few readily available
sources of non-dealership provided retail automobile loans for most consumers.
This is especially true for consumers with poor credit ratings. We are in the
process of establishing alliances for loan closing functions to offer these
services to our members.
14
<PAGE>
HOME MORTGAGES TRANSACTIONS. We are in the process of establishing
strategic alliances that will allow us to provide the consumer with the ability
to shop for a home loan without the pressure or the influence of a loan officer.
The customer will have the choice of selecting an available interest rate, term
and loan program at a reduced cost, all in the comfort of his or her own home.
BILL PAYING TRANSACTIONS. We are establishing relationships that will
provide these services, benefiting consumers by providing easier access and
better control over the bill paying process - saving them time, money and
aggravation. Furthermore, this service helps consumers and merchants reduce the
expense of mailing paper bills, improving their ability to serve customers, via
an online relationship.
15
<PAGE>
STOCK MARKET TRANSACTIONS. We are in the process of developing strategic
alliances with leading online brokerage firms. These alliances will enable us to
offer our clients stock market transactions services.
WEB-BASED E-MAIL SYSTEM. We plan to implement a Web-based E-mail system
that enables our clients to send and receive e-mail through their own e-mail
accounts, thus providing MarketCentral with a new marketing opportunity.
USER PROFILING. MarketCentral.net plans to implement a user profiling and
tracking system in an effort to increase advertising revenue and to increase
user personalization. This system will enable MarketCentral.net to get a clearer
understanding of its user demographics and will work in conjunction with its
banner ad rotation system to deliver user specific advertising.
(B) BUSINESS STRATEGY.
Our strategy is to establish MarketCentral as a leading financial
information hub on the Internet, and then to follow with the expansion of
MarketCentral and the development of complementary sports and weather sites. Our
objective is to raise approximately $6.0 million equity in this current round of
financing. The funds will be used to help us implement the following key
elements of our business strategy:
1. Developing significant strategic alliances;
2. Re-launching our Web site;
3. Expanding sales and marketing; and
4. Adding proprietary financial information and services.
(1) DEVELOPING SIGNIFICANT STRATEGIC CO-BRANDING ALLIANCES.
MarketCentral.net plans to pursue alliances that it perceives to be strategic,
which can add value to its Web site and enhance the experience of its users and
subscribers.
To date, MarketCentral.net has entered into numerous arrangements and
co-brands for the information that is currently available to all
16
<PAGE>
MarketCentral.net visitors for free. Among them are the IPO Maven, VectorVest
Special Reports, free research from Zack's, free stock analysis from VectorVest,
Top Headline News and Breaking Stories from I-Syndicate, the Market Mavens
reports, Bob Bose's Weekly Market Updates, BizSuccess Stories, Go2Net's Stock
Site Daily Market Reports and Movers and Losers, charts from Big Charts,
Personal Portfolio, stock quotes from Data Broadcasting Corp., Stock of the Day,
Magic 25 and Industry Group Performance from Individual Investor, Business
Cartoon of the Day, free Annual Reports Services from PRARS, and many more
information sources.
We plan to establish significant strategic co-branding alliances with
e-finance companies prior to re-launching our Web site in the areas of home
mortgage transactions, auto loan transactions, insurance, bill paying
transactions and payment by e-mail transactions. Since most of these companies
are relatively young, MarketCentral feels that by offering them the ability to
gain additional exposure through the aggregation of products and services, it
will gain interest from players in each area.
(2) RE-LAUNCHING OUR WEB SITE. Upon establishing significant co-branding
alliances we plan to redesign and rebuild our Web site so that it is heavily
transaction oriented. We anticipate the cost to rebuild our site will be
approximately $1.5-$2 million. The new site will support and array of e-finance
services as well as containing vast financial information, and will offer users
the ability to dial in remotely through WAP. The site will also offer free
e-mail accounts to its users, online trading, personalization abilities and an
e-commerce mall containing a variety of products.
Wireless Access MarketCentral will create a special version of its Web site
that uses Wireless Application Protocol (WAP), allowing users to access vital
financial information through our Web site from cell phones, palm pilots
and other devices.
Web-Based E-mail System In an effort to provide more services to its
many registered users, MarketCentral.net plans to implement a Web-based E-mail
system. This system will allow visitors to create their own e-mail accounts and
send and receive e-mail by logging onto the MarketCentral.net Web site.
Increase the Dynamic Nature of the Site Database The existing
MarketCentral.net Web site consists of over 500 individual pages. Each page is
loaded using static HTML that enables excellent tracking methods, but makes the
site very difficult to update and maintain. MarketCentral.net will automate many
facets of the site using dynamically created Web pages and a centralized
database. Sections such as the What s New Area, Press Releases, Special Offers
and Events will be made dynamic to improve the updating process.
User Profiling In an effort to increase advertising revenue and to improve
user satisfaction, MarketCentral.net plans to implement a user profiling and
tracking system. This system will enable MarketCentral to get a clearer
understanding of its user demographics and will work in conjunction with its
banner ad rotation system to deliver user specific advertising.
Personalization - My MarketCentral.net MarketCentral.net believes the
addition of a personalized home page will make the user experience more
enjoyable. As a result, users will be able to select which section within
MarketCentral.net they would like to make their home page.
Upgrade Current Ad Rotation Software MarketCentral currently uses the
latest version of AdJuggler Banner Rotation software. Under heavy loads of 1
million visitors per day, this software will show serious strain. As a
result, MarketCentral has realized that a new Ad Rotation package is necessary.
Furthermore, with the addition of the User Profiling Module, MarketCentral.net
has the need to present visitors with targeted advertising.
Upgrade Current Usage Management System
MarketCentral currently uses Web Trends Professional Suite Reporting Software.
In order to provide greater reporting capabilities and real-time detail,
MarketCentral will upgrade this software.
(3) EXPANDING SALES AND MARKETING. We are budgeting substantial increases
in sales personnel and expenses in order to assure the rapid generation of new
business. We plan to run aggressive PR and advertising campaigns to drive
significant traffic to the site. Additionally, we plan to run several
promotional contests, with significant cash prizes in order to drive traffic to
the site. Our total marketing and sales budget for 2001 is $860,000.
(4) ADDITION OF PROPRIETARY INFORMATION AND SERVICES. The current
MarketCentral Web site is primarily a directory for users to visit different
sites containing specific information concerning finance. However, in an effort
to increase advertising revenues and to improve user satisfaction, MarketCentral
will produce more original content. Several key content areas throughout the
site will be identified as proprietary content areas. Consequently, proprietary
content will be developed for each area while the links to the partner sites are
eventually phased out. MarketCentral has budgeted $1 million for strategic
acquisitions of additional proprietary content and/or alliances.
MarketCentral is currently in the process of adding proprietary financial
information and services from various sources including:
Lappin Newsletter - written by Joan Lappin, President and Chief Investment
officer of Gramercy Capital Corp. Nelson s Investment Research has ranked Joan
number one for her five-year performance.
Eakle Newsletter- written by G. Richard Eakle, former Market Strategist for
Morgan Stanley and Chief Strategist at Cowen and Company.
Screaming Media- the premier real time digital content network, bringing
together content providers and hundreds of large and small Web site subscribers.
Screaming Media s unique technology aggregates the content, then filters and
streams it customized and delivered in real time, providing Web sites with
content that makes them stickier.
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<PAGE>
Zacks Investment Research- The Zacks Signature series is one of the most
complete and comprehensive packages of investment research available on the
Internet. This detailed company analysis is currently only available to a select
group of financial Web sites including: Discover Brokerage, Waterhouse
Securities and SureTrade (Quick&Reilly). This will allow MarketCentral
subscribers to access research from over 3,000 analysts. In addition, Zacks
signature series offers a mutual fund screener allowing investors to screen
mutual funds using over 50 different components. On average, Zacks signature
series receives over 500,000 monthly impressions from each of its partners.
Hyperfeed gives its clients access to the latest trade and quote information
for over 425,000 North American stock, option and commodity issues in a
real-time or delayed format.
Virtual Advisor provides sophisticated portfolio tracking options including
mutual fund style, asset allocation and sector analysis.
Lipper Analytical - provides our clients daily updated information on mutual
funds.
(C) RISK FACTORS. The Company makes no representation or warranties, expressed
or implied, as to the accuracy or completeness of the information presented
herein. Nothing contained in this document should be relied upon as a promise or
representation of the future performance of the Company. The projections
presented in this business plan are based upon estimates and assumptions
concerning future events. These projections may be materially and adversely
affected by changes of circumstances and numerous other variables, which are
difficult to predict, and beyond the Company s control. The financial results
could be significantly less favorable than those presented here.
In addition to the general business risk inherent in any start-up Company,
MarketCentral identifies several specific risk factors to be considered:
Early Stage Company in a Rapidly Evolving Market.-The Company has a limited
operating history upon which to base an evaluation of its business and
prospects. The Company s business and prospects must be considered in light of
the risks, expenses and difficulties frequently encountered by companies in
their early stage of development, particularly companies in new and rapidly
evolving markets such as the e-finance market.
Competition.-Competition in the financial services industry might intensify
in the future. Increased competition might result in price pressure, reduced
gross margins and loss of market share, any of which could seriously harm the
Company s sales and operating results. Many of its competitors have advantages
18
<PAGE>
over the Company, including longer operating histories, greater brand
recognition and greater financial, sales and marketing resources.
Need for Alliances.-The Company plans to engage in one or more alliances
with established entities in order to facilitate and accelerate its sales and
industry recognition. Should the Company fail to establish advantageous
alliances, it could materially affect the Company s ability to market and
distribute its products, and would materially affect the Company s business and
financial results.
Ability to offer future products.-Any impediment to MarketCentral s ability
to develop future products and services could have a dramatic affect on its
ability to gain new customers, as well as its ability to retain old customers.
Ability to hire and retain qualified sales personnel.-MarketCentral s
financial success is highly dependent upon the growth and productivity of its
direct sales force. Obtaining and maintaining this sales force could be
difficult and expensive in today s tight labor market.
Future Financing Requirements. The Company cannot be certain that
additional financing will be available to it on favorable terms when required,
or at all. If the Company raises additional funds through the issuance of
equity, equity-related or debt securities, the securities may have rights,
preferences or privileges senior to those of the rights of the Company s common
stock and its stockholders may experience additional dilution.
(D) EMPLOYEES. None as of December 31, 1999. Within the next twelve months
additional staff will be hired.
19
<PAGE>
ITEM 4. DESCRIPTION OF PROPERTY.
The Registrant has no property and enjoys the non-exclusive use of offices
and telephone of its officers and attorneys. This Registrant's principal offices
are located at 300 Mercer Street, Suite 26J, New York NY 10003. Its telephone
number is (212) 979-0805.
Upon completion of our secondary financing, plans are to open new corporate
offices in Manhattan, NYC.
ITEM 5. DIRECTORS, EXECUTIVE OFFICERS PROMOTERS AND CONTROL PERSONS.
The following two persons first listed below are the Directors of
Registrant, having taken office from the inception of the target company, and
having been appointed to become Directors upon the reorganization of the
Registrant by which the target company was acquired. The present two Directors
are to serve until their successors might be elected or appointed, or until the
next meeting of shareholders, general or special, whichever occurs first. A
third Officer is identified in the following disclosure. Each of the Officers
and Directors listed below are significant shareholders of the Registrant, and
presently serve without compensation arrangements. (See Executive Compensation,
and Relationships and Transactions, in the succeeding items 6 and 7, of this
Part.)
Roy Spectorman, age 49, MarketCentral's President and founder, will be
coordinating the efforts of the MarketCentral management team and will guide the
Registrant's implementation of its strategic plan. Mr. Spectorman has developed
the content of the MarketCentral Web site, investment guide and newsletter. He
will be responsible for the newsletter and investment guide updates and will be
attempting to establish relationships and alliances within the financial
services industry. From 1989 until his founding of the Registrant, Mr.
Spectorman has served as President of New Horizons Asset Management Corporation
from 1989, a financial management consulting firm. Mr. Spectorman has over 20
years experience in the financial markets. Mr. Spectorman was President of
Environmental Life Products from 1986-1989. He was responsible for developing
the product line, creating marketing materials and building a sales
organization. Mr. Spectorman was Vice-President of Palace Industries from
1973-1986. He developed product lines for this textile manufacturer, managed a
sales organization and developed marketing strategies. Mr. Spectorman attended
Adelphi University from 1974-1976 where he received a Masters Degree in Business
Administration in Management and graduated Summa Cum Laude. He attended The
State University of New York at Stony Brook from 1968-1972 where he received a
B.A. in Liberal Arts.
Jerry Kaplan, age 53, MarketCentral's Vice-President-Operations, appointed
Secretary-Treasurer in November 1999, and one of its Directors, will be heading
the operations department. He will be responsible for credit card transactions,
computer technical support, product warehousing and shipping operations. Mr.
Kaplan has used, programmed and overseen several computer system installations
over the last thirty years, and brings a thorough understanding of their
workings, capabilities and limitations. Mr. Kaplan has been President of
Universal Chemicals, a privately held chemical distributor primarily selling
20
<PAGE>
water treatment chemicals since 1992. He has been in the chemical industry since
1970 when he joined Alden Leeds, Inc., a swimming pool chemical manufacturer.
His experience includes all phases of operating within the chemical industry,
including chemical manufacture, sales, distribution, labor relations, data
processing, accounting, and government regulations. Mr. Kaplan worked for IBM
from 1969 to 1970 as a computer operator, at the first Management Information
Systems (MIS) center in the U.S. He received in-house training from IBM in
computer operations, job control language and various computer programming
languages. Mr. Kaplan attended the University of Tampa between 1964 and 1966
where he majored in biology. He attended Hofstra University between 1966-1968
where he majored in business, with a minor in chemistry. Mr Kaplan devotes only
such time to the business of the Registrant as is necessary to perform his
duties as an officer and director.
Peter J. Waters, is MarketCentral's Marketing Director [not a Director on the
Board of Directors] in charge of advertising sales and site promotion. From 1983
until present, Mr. Waters has been President of his own Marketing Consulting
firm specializing in implementing marketing/advertising programs for the New
York City real estate industry. He has successfully hired and managed a sales
organization and has been affiliated with Kenart Realty as Vice-President. From
1981 to 1989 Mr. Waters served as President of Classic Trading Inc., an
Import/Export firm specializing in the marketing and distribution of industrial
products in the United States and Canada. Mr. Waters devotes only such time to
the business of the Registrant as is necessary to perform his duties as its
Marketing Director.
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<PAGE>
ITEM 6. EXECUTIVE COMPENSATION.
Our Officers and Directors serve without compensation at this time, except
that Roy Spectorman, the Registrant's president, receives indirect compensation
as explained hereinafter. No plan of compensation has been adopted or is under
consideration at this time. None of the Directors currently receives, or has
ever received, any salary from the Registrant in their capacities as such, and
none are expected to be compensated in their capacities as such. No officers are
expected to receive any compensation for their services. No officers or
directors are under an employment contract with the Registrant. The Registrant
has no retirement, pension, profit sharing, or insurance or medical
reimbursement plans.
Certain Management Options to acquire additional shares of common stock, at
an exercise price of $5.00 per share for five years from February 5, 1999, have
been contemplated for future grant to management and certain others as follows:
<TABLE>
<CAPTION>
<S> <C>
Roy Spectorman 170,000
--------------------------
Jerry Kaplan 25,000
--------------------------
Peter Waters 50,000
--------------------------
Alan Kessler 5,000
--------------------------
Frank Evanshen 75,000
--------------------------
Gerald Yakimishyn 75,000
==========================
</TABLE>
The options were issued pursuant to the exemption provided by 4(2) of the
Securities Act of 1933. Roy Spectorman benefits from indirect compensation in
the amount of $9,000.00 per month, by virtue of a Management Services Agreement
with a consultant to us, of which consulting firm, Mr. Spectorman is the
President and beneficial owner.
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<PAGE>
ITEM 7. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
(A) SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS. To the best of
Registrant's knowledge and belief the following disclosure presents the total
security ownership of all persons, entities and groups, known to or discoverable
by Registrant, to be the beneficial owner or owners of more than five percent of
any voting class of Registrant's stock. More than one person, entity or group
could be beneficially interested in the same securities, so that the total of
all percentages may accordingly exceed one hundred percent of some or any
classes. Please refer to explanatory notes if any, for clarification or
additional information. The Issuer has only one class of stock; namely Common
Stock.
(B) SECURITY OWNERSHIP OF MANAGEMENT. To the best of Registrant's knowledge
and belief the following disclosure presents the total beneficial security
ownership of all Directors and Nominees, naming them, and by all Officers and
Directors as a group, without naming them, of Registrant, known to or
discoverable by Registrant. More than one person, entity or group could be
beneficially interested in the same securities, so that the total of all
percentages may accordingly exceed one hundred percent of some or any classes.
Please note that the column Attributed Shares shows that certain shareholders
are related and that the shares of each are attributed to the others. This means
that each member of each group is treated as the owner of all of the shares of
that group, for purposes of determining the 5% threshold for disclosure, and the
10% threshold for affiliation. Please refer to explanatory notes for
clarification of the attribution of share ownership.
Table A following discloses the share ownership actually issued and the
attribution of shares among and between related shareholder family groups, (1)
the Yakimishyn group, and (2) the Evanshen group. This information is drawn from
our annual SEC filing for 1999, on Form 10-K-SB.
The Remainder of this Page is Intentionally left Blank
23
<PAGE>
TABLE A
OFFICERS AND DIRECTORS AND OWNERS OF 5% OR MORE
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Name and Address of Beneficial Owner Actual % Attributed %
Shares Shares
------------------------------------------------------------------------------------
Roy Spectorman, President/Director 794,813 18.93
300 Mercer Street, Suite 26J
New York NY 1003
------------------------------------------------------------------------------------
Jerry Kaplan Director 198,703 4.73
300 Mercer Street, Suite 26J
New York NY 1003
------------------------------------------------------------------------------------
Peter Waters Marketing And Site Promotion 389,813 9.28
300 Mercer Street, Suite 26J
New York NY 1003
------------------------------------------------------------------------------------
Officers and Directors as a Group 1,383,329 32.95
====================================================================================
Frank Evanshen (1) 150,000 3.57 503,125 11.98
3710 Southridge Place
West Vancouver, B.C. Canada V7Y 3H8
------------------------------------------------------------------------------------
Molly Evanshen (1) 150,000 3.57
3710 Southridge Place
West Vancouver, B.C. Canada V7Y 3H8
------------------------------------------------------------------------------------
Meridian Mercantile Inc. (1) 100,000 2.38
#1407 - 650 W. Georgia Street
Vancouver, B.C. Canada V6B 4N7
------------------------------------------------------------------------------------
Adina Trowhill (1) 3,125 0.07
#106 - 2288 Marstrand Avenue
Vancouver, B.C. Canada V6K 4S9
------------------------------------------------------------------------------------
Sandra-Marie Hendrickson (1) 100,000 2.38
106 - 1230 Haro Street
Vancouver, B.C. Canada V6E 4J9
------------------------------------------------------------------------------------
Total Other 5% Owners of the Issuer 503,125 11.98
------------------------------------------------------------------------------------
Total Shares Issued and Outstanding 4,198,932 100.00 4,198,932 100.00
====================================================================================
</TABLE>
(1) These shareholders ( the Evanshen Group ) are a single family group.
Accordingly the shares of each are attributed to the other, and each is treated
as if he, she or it were the owner of all of the group's combined ownership, for
purposes of deterring the percentage of ownership. No single member of his
family owns 5%, but the combined ownership of the family is more than 11.98%.
Accordingly, each member of the family is disclosed as a 10% owner, and an
effective affiliate of the Issuer, by reason of such attribution of ownership.
24
<PAGE>
Table B following discloses the existence and the effect of certain
management options, as if exercised, on the share ownership of management and
affiliates.
TABLE B
EFFECT OF OPTION EXERCISE ON SHARE OWNERSHIP
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Option Owner Shares Actual % Options Total if %
and as Options
Attributed Exercised
-----------------------------------------------------------------------
Roy Spectorman 794,813 18.93 170,000 964,813 20.98
-----------------------------------------------------------------------
Gerald 115,113 2.74 75,000 190,113 4.13
Yakimishyn
-----------------------------------------------------------------------
Jerry Kaplan 198,703 4.73 25,000 223,703 4.86
-----------------------------------------------------------------------
Peter Waters 389,813 9.28 50,000 439,813 9.56
-----------------------------------------------------------------------
Frank Evanshen 503,125 11.98 75,000 578,125 12.57
(See Note 2 above)
-----------------------------------------------------------------------
Alan Kessler 45,562 1.09 5,000 50,562 1.10
=======================================================================
Total 4,198,932 100.00 400,000 4,598,932 100.00
Shares/Options
Outstanding
=======================================================================
</TABLE>
(C) CHANGES IN CONTROL. There are no arrangements known to Registrant,
including any pledge by any persons, of securities of Registrant, which may at a
subsequent date result in a change of control of the Issuer.
25
<PAGE>
ITEM 8. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
Copies of material contracts are exhibits to our Annual SEC Report on Form
10-K-SB. Copies of that form can be accessed on the SEC's EDGAR web site. They
are public information.
ITEM 9. MARKET INFORMATION AND STOCKHOLDER MATTERS.
(a) MARKET INFORMATION. The Common Stock of this Issuer is quoted Over the
Counter on the Bulletin Board ( "OTCBB" ). There was no substantial market
activity before December 1998. Based upon standard reporting sources, the
following quarterly information is provided:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
period high bid low bid period high bid low bid
--------------------------------------------------------
1st 1999 7.00 3.50 3rd 1999 5.00 0.85
2nd 1999 10.75 1.25 4th 1999 10.00 0.75
======== ======== ======= ======== ======== =======
</TABLE>
The foregoing price information is based upon inter-dealer prices without retail
mark-up, mark-down or commissions and may not reflect actual transactions.
(b) HOLDERS. There are 80 holders of the Issuer's common stock, as of June 5,
2000.
(c) DIVIDENDS. No cash dividends have been paid by the Company on its Common
Stock or other Stock and no such payment is anticipated in the foreseeable
future.
(d) LEGAL PROCEEDINGS. There are no proceedings, legal, enforcement or
administrative, pending, threatened or anticipated involving or affecting this
Issuer or to which it or any of its property are subject, nor to its knowledge
are any such proceedings contemplated.
(E) CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS. There have been no
disagreements of any sort or kind with Auditors or Accountants respecting any
matter or item reflected in the financial statements of this Issuer.
26
<PAGE>
ITEM 10. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
(A) PLAN OF OPERATION THE NEXT TWELVE MONTHS.
(1) CASH REQUIREMENTS AND OF NEED FOR ADDITIONAL FUNDS, TWELVE MONTHS.
There can be no assurance that the Issuer will not exhaust its present cash
before the end of calendar year 2000. The Issuer has divided its cash
requirement into two levels. Level One, the basic operational level is provided
by an agreement and subscription receivable which funds the Issuer a total of
$312,000 at $13,000.00 monthly (note that the $13,000 monthly payment is
scheduled to be paid for a total of twenty-four months). This program started
February 5, 1999 and ends February of 2001. This level of funding is sufficient
to keep the Issuer in operation for the next ten months This is the only firm
commitment the Issuer has for funding. Meridian Mercantile, an affiliate of the
Issuer, has agreed to this funding, as disclosed in Exhibit 6.1 to our Form
10-SB-A1. It may be necessary for additional funding for the last two of the
next twelve months.
Level Two is the level of funding necessary for aggressive site promotion
and expansion and growth of the business. This level of funding must be provided
by secondary capital formation efforts. The Merger Agreement mentions that the
company will retain Meridian Mercantile to raise an additional investment of a
minimum of $3,000,000 on a best efforts basis, no agreement has been reached as
to the consideration to be paid to Meridian for such performance. Accordingly,
no present reliance is placed upon that specific program.
The MarketCentral.net web site has received numerous industry awards for
valuable content, superior web site design and excellent navigational features
including the Snap.com Editors Designation. The site is designed to appeal to an
upscale audience of investors and consumers looking for financial information,
investment products and related services.
Level Two funding may be achieved by an offering of securities pursuant to
a 1933 Act Registered offering; or Level Two funding may be achieved by limited
offerings pursuant to Regulation D, Rules 505 and/or 506. The Issuer believes
that the Company's program is sufficiently promising to attract the modest
amounts of Level Two funding required. If successful, this Level Two funding
will provide ample cash to meet the requirements of the business for expansion,
growth and aggressive site promotion. However, there is no assurance to be given
that this additional financing will be completed. MarketCentral.net Corp.
expects to use the funds from secondary financing to create a world-class
internet site featuring the finest investment information and tools available to
the individual investor. The site will feature state-of-the-art E-commerce
throughout the site and in the Super Mall. The Issuer believes that its
MarketCentral.net web site appeals to well established advertisers looking to
reach the upscale audience of investors and consumers who are attracted to the
MarketCentral.net web site's content and exciting format. MarketCentral.net
Corp. plans to aggressively promote the site throughout a variety of online and
traditional media sources.
27
<PAGE>
The Company has hired a business consultant to assist in the development of
a business plan that will focus on MarketCentral.net becoming a comprehensive
financial content provider that will offer users a one-stop destination for
financial services, news, e-commerce and a wide array of information services.
The hub site will serve visitors interested in investment information, financial
products and services and on-line shopping. The business plan, which is being
paid for by a shareholder of the Company by a loan of $20,000, is expected to be
completed in the second quarter of 2000.
The Company has entered into agreements with Richard Eakle, former Market
Strategist for
Morgan Stanley, and with Gramercy Capital (Joan Lappin, CIO) a registered
investment advisory and money-management firm that has been ranked number one in
performance for five years, to provide original investment newsletters for the
hub web site.
MarketCentral.net has successfully negotiated a contract to be consummated
upon the completion of secondary financing with Stanford-Keene, a mergers and
acquisitions specialist. Stanford-Keene will assist MarketCentral.net in
locating qualified candidates for strategic alliances in financial services
including mortgages, bill-paying services, credit cards, auto loans, stock
trading transactions, real estate transactions and other related services.
(2) SUMMARY OF PRODUCT RESEARCH AND DEVELOPMENT. MarketCentral.net
Corp.'s online shopping mall, called the Super Mall, can be promoted as a
separate site and is unique in the content and entertainment provided.
(3) EXPECTED PURCHASE OR SALE OF PLANT AND SIGNIFICANT EQUIPMENT.
MarketCentral.net Corp. intends to build an internet based store to sell its own
proprietary products and services. Beyond the proprietary newsletter and other
investment products, the Issuer will sell novelty items, gift items and other
specialty items as they become available. The store will be available for
co-branding through other sites throughout the internet. There is no assurance
that the Issuer will be successful in any of these endeavors. The Issuer has no
other plans for the purchase or sale of significant business plant or equipment.
(4) EXPECTED SIGNIFICANT CHANGE IN THE NUMBER OF EMPLOYEES. None at this
time. Within the next twelve months additional staff will include a financial
journalist to provide MarketCentral.net with its own news department, an
e-commerce expert to manage and develop the mall, and an editorial assistant to
help in the production of MarketCentral.net's proprietary newsletter, the Eakle
newsletter and the Lappin Report.
In addition to the above staff, a computer programmer will be hired to
manage the development functions and will provide assistance in the site
maintenance and development. We will also be hiring a marketing person to aid in
the promoting the MarketCentral.net web site and to increase traffic flows.
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<PAGE>
We will be retaining Mr. Peter Waters to coordinate the opening and
staffing of our corporate offices and to head up our Advertising Sales Division.
While most internet companies outsource this function, we will be at an
advantage developing our own sales force due to the lower cost of managing this
area internally.
(B) DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
(1) FINANCIAL CONDITION. This small business Issuer's financial
condition is adequate for its present purposes, as discussed above, by
agreements to provide incremental funding over time. There is no apparent need
for additional funds or cash foreseeable at this time, to continue for the next
twelve months, provided that the Issuer's arrangements for funding proceed as
agreed and expected. The funding arrangements referred to are documented in that
certain stock subscription agreement attached as Exhibit 5 to Form 10-SB-A1.
That agreement provides, in relevant part, that Meridian Mercantile, Inc., an
affiliate of the Issuer, subscribed for the purchase of 56,014 shares of common
stock in consideration of the sum of $312,000.00, payable on or before two years
from February 5, 1999, with a minimum payment of $13,000.00 per month payable
over 24 consecutive months.
The Company cannot be certain that additional financing will be available
to it on favorable terms when required, or at all. If the Company raises
additional funds through the issuance of equity, equity-related or debt
securities, the securities may have rights, preferences or privileges senior to
those of the rights of the Company's common stock and its stockholders may
experience additional dilution.
(2) RESULTS OF OPERATION. This small business Issuer has had limited
significant operations to date. It has some small revenues from advertising
contracts and affiliate site arrangements. It is not presently operating at or
near a profitable level.
With the aggressive changes to the Company's business plan, our earning are
projected to turn positive in the 17th month following the restructure of
operations. There is no assurance that we will ever operate at a profitable
level. The Registrant Company has incurred expenses of $736,317 against revenues
of $14,296, in the twelve months covered by this Report, for a net loss of
$721,894, or $0.19 per share. The Registrant ended the year with a cash balance
of $9,705 compared to a cash balance of $20,130 for the period ending December
31, 1998.
The web site acquired by the Registrant has been on-line since March of
1997, before the private incorporation of MarketCentral.net Corp., the original
private New York Corporation, and before the acquisition by this Registrant. The
operation began as a partnership until its incorporation in New York.
MarketCentral.net Corp. provides financial products and services on the World
Wide Web on a web site located at: http://www.marketcentral.net. The site
provides comprehensive investment tools for the individual investor including
investment newsletters, timely financial news and information, mutual fund
information, World Markets, a proprietary investment guide, MarketCentral.net
Corp.'s own newsletter, online investment bookstore, chat rooms, contests and a
29
<PAGE>
full service shopping mall. The mall includes such brand names as Avon,
Brookstone, Music Boulevard, Reel.com, Fashionmall.com, FAO Schwartz, E-Toys and
Swiss Army Depot.
MarketCentral.net Corp. is currently earning nominal revenues, primarily
from the sale of advertising on its web site. Revenues of $1,149 were earned for
the three months ended March 31, 1999. The Company expects to earn additional
revenues through a variety of means, including sales of advertising to other
financial sites and financial services firms, through affiliate agreements
providing overrides on products and services sold through MarketCentral.net
Corp. and from sales from our bookstore affiliation with Traders Press. In
addition, the Market Mall consists of numerous stores that MarketCentral.net
Corp. has entered into affiliate agreements with. Each of those stores will pay
MarketCentral.net Corp. a commission on the sales generated through the
MarketCentral.net Corp. site. MarketCentral.net Corp. will also be developing a
Financial Newsletter in the next year that will be a paid subscription
newsletter. The newsletter will be marketed to current MarketCentral.net Corp.
members and throughout various online outlets on the internet.
Current revenues are nominal but are expected to increase as site traffic
increases. This will most likely occur as a result of additional promotion and
advertising efforts to build traffic levels on the MarketCentral.net Corp. site.
The Company expects to seek additional capital through a secondary financial
offering expected to occur within the next 12 months, to fund the site expansion
and promotion, and to sustain the company during the period, until profitability
is achieved.
(3) FUTURE PROSPECTS. With the completion of the business plan the
Company is now focusing on developing strategic alliances that are cost
effective and will ensure the growth of the Company.
30
<PAGE>
ITEM 11. FINANCIAL STATEMENTS.
FINANCIAL STATEMENTS PAGE
--------------------------------------------------------------------------------
F-1 Audited Financial Statements for the years ended December 31, 1999 and
1998. F-1 32
F-2 Unaudited Financial Statements for the three months ended March 31, 2000
F-2 42
================================================================================
31
<PAGE>
--------------------------------------------------------------------------------
F-1
AUDITED FINANCIAL STATEMENTS
FOR THE PERIODS ENDING DECEMBER 31, 1999, AND 1998
--------------------------------------------------------------------------------
32
<PAGE>
MARKETCENTRAL.NET, CORP
(A Development Stage Company)
Consolidated Financial Statements
33
<PAGE>
CONTENTS
Independent Accountants Review Report 35
Balance Sheets 36
Statement of Operations 37
Statement of Cash Flows 38
Statement of Changes of Stockholders' Equity 39
Notes to Financial Statements 40
34
<PAGE>
INDEPENDENT AUDITORS REPORT
To the Board of Directors and Stockholders of MarketCentral.net Corp.
We have audited the accompanying consolidated balance sheet of consolidated
statements of operations, MarketCentrai.net Corp. and Subsidiary as of December
31, 1999, and related of stockholders' equity (deficit) and of cash flows for
the year then ended. These financial statements are the responsibility of the
company's management. Our responsibility is to express an opinion on these
financial statements based on our audit. We did not audit the accumulated
amounts of stockholders' equity from inception (December 28, 1988) through
December 31, 1998, which includes an accumulated deficit as of December 31, 1998
of $1,687,144. Those amounts were audited by other auditors whose report
thereon has been furnished to us; and our opinion insofar as it relates to those
accumulated amounts, is based solely on the report of the other auditors.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, based on our audit and the report of other auditors, the
financial statements referred to above present fairly, in all material respects,
the financial position of MarketCentral.net Corp. and Subsidiary at December 31,
1999 and the results of its operations and its cash flows for the year then
ended, in conformity with general accepted accounting principles.
The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 9 to the
financial statements, the Company has incurred substantial losses during the
development stage and is dependent upon financing to continue operations. These
factors raise substantial doubt about its ability to continue as a going
concern. Management ' s plans in regard to these matters are also described in
the Note 9. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
/s/
Rogoff & Company
Date: March 1, 2000
35
<PAGE>
Market Central. Net Corp.
A Subsidiary
(a development Stage Company)
Consolidated Balance Sheet
<TABLE>
<CAPTION>
<S> <C> <C>
1998
1999 Proforma-Unaudited
------------------------------------------------------------------------------
ASSETS
Current Assets
Cash $ 9,705 $ 20,130
Accounts receivable 626 0
Loan Receivable 0 20,000
Subscriptions Receivable 140,371 2,871
Total Current Assets 150,702 43,001
==============================================================================
Software development costs
net of accumulated amortization
of $17,353 and $-0- in 1999 and
1998, respectively 69,411 86,764
$ 220,113 $ 129,765
==============================================================================
Total Assets
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILTIES
Accounts Payable $ 103,737 $ 17,845
Accrued expenses Payable 17,097 0
Note Payable 84,231 53,478
205,065 71,323
Total current Liabilites
Stockholders Equity
Common stock, $0.0001 par value;
100,000,000 shares authorized;
4,183,914 and 3,991,900 issued and
outstanding in 1999 and 1998, respectively 419 399
Paid in Capital 2,423,667 1,745,187
------------------------------------------------------------------------------
Deficit accumulated during the
development stage (2,409,038) (1,687,144)
Total Stockholders' Equity 15,048 58,442
==============================================================================
Total Liabilites and stockholders' Equity $ 220,113 $ 129,765
==============================================================================
</TABLE>
See independent auditors' report and notes to consolidated
Financial statements.
36
<PAGE>
Market Central. Net Corp.
A Subsidiary
(a development Stage Company)
Consolidated Statement of Operations
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Year Ended For the Period
December 31, From Inception
1998 (December 28, 1998)
Proforma to December 31,
1999 Unaudited 1999
------------------------------------------------------------------------------------
Revenue: $ 14,973 $ 0 $ 14,973
Operating expense:
General and administration
Expense 736,867 1,598,258 2,424,011
Net Loss $ 721,894 $1,598,258 $ 2,409,038
------------------------------------------------------------------------------------
Net Loss Per Share (0.19) (4.94) 0.00
------------------------------------------------------------------------------------
Weight average shares outstanding 3,779,820 323,692
</TABLE>
See independent auditors' report and notes to consolidated
Financial statements.
37
<PAGE>
Market Central. Net Corp.
A Subsidiary
(a development Stage Company)
Consolidated Statement of Stockholders' Equity
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Deficit
Accumulated
Common Stock Paid In During the
Shares Amount Capital Development Stage
--------------------------------------------------------------------------------------
Balance at Beginning of Development
Stage - December 28, 1988 0 $ 0 0 0
======================================================================================
Shares issued for organizational
costs 180,000 18 982 0
Net Loss December 31, 1988-1996 0 0 0 (1,000)
--------------------------------------------------------------------------------------
Balance, December 31, 1996 180,000 18 982 (1,000)
======================================================================================
April 8, 1997-Issued at $1.00
per share 100,000 10 99,990 0
Net Loss December 31, 1997 0 0 0 (87,886)
--------------------------------------------------------------------------------------
Balance, December 31, 1997 280,000 28 100,972 (88,886)
======================================================================================
May 22, 1998-issued at $1.00
per share 2,900 1 2,899 0
July 1, 1998-issued at $.10
per share 84,000 8 8,392 0
Shares issued for cash and
services at $1.0 per share 1,600,000 160 1,599,840 0
Net Loss December 31, 1998 0 0 0 (1,598,258)
--------------------------------------------------------------------------------------
Balance, December 31, 1998 1,966,900 197 1,712,103 (1,687,144)
======================================================================================
February 1999 re-organization 2,025,000 202 33,084 0
Stock issued for professional
services rendered 36,000 4 53,996 0
Stock issued for subscription
stock 56,014 6 311,994 0
Stock issued for professional
services rendered 100,000 10 312,490 0
Net Loss December 31, 1999 0 0 0 (712,894)
--------------------------------------------------------------------------------------
Balance as of December 31, 1999 4,183,914 $ 419 2,423,667 (2,409,038)
======================================================================================
</TABLE>
See independent auditors' report and notes to consolidated
Financial statements.
38
<PAGE>
Market Central. Net Corp.
A Subsidiary
(a development Stage Company)
Consolidated Statement of Cash Flows
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Year Ended For the Period
December 31, From Inception
1998 (December 28, 1998)
Proforma- to December 31,
1999 Unaudited 1999
------------------------------------------------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss ($721,894) ($1,598,258) ($2,409,038)
------------------------------------------------------------------------------------------
Depreciation and amortization
web site cost 17,353 0 17,353
Shares issued for services 366,500 1,560,000 1,927,500
(Increase) in accounts receivable (626) 0 (626)
Increase in accounts payable 85,892 17,845 103,737
Increase in accrued expenses 17,097 0 17,097
Net cash provided (used) by
operating activities (235,678) (20,413) (303,977)
CASH FLOWS FROM INVESTING ACTIVITIES:
(Increase) decrease in loan
receivable 20,000 (20,000) 0
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from notes payable 30,753 0 30,753
Issuances of Common stock 174,500 48,429 322,929
Net cash provided by financing
activities 205,253 48,429 353,682
Net increase (decrease) in cash (10,425) 8,016 9,705
Cash, beginning of period 20,130 12,114 0
Cash, end of period $ 9,705 $ 20,130 $ 9,705
==========================================================================================
Interest Paid $ 0 $ 0 $ 0
------------------------------------------------------------------------------------------
Income taxes paid $ 0 $ 0 $ 0
------------------------------------------------------------------------------------------
</TABLE>
See independent auditors' report and notes to consolidated
Financial statements.
39
<PAGE>
MarketCentral.net Corp.
and Subsidiary
(A DEVELOPMENT STAGE COMPANY)
Notes to Consolidated Financial Statements
December 31, 1999
NOTE 1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
Nature of Business
MarketCentral.net Corp. (formerly All American Consultant Aircraft,
Inc.) (the "Company") was incorporated in Texas. The Company's primary business
is an internet site featuring investment information and tools available to the
individual investor. The site features state-of-the-art e-commerce.
MarketCentral.net Corp.'s online shopping mall, called the Market Mall is
promoted as a separate site.
Basis of Consolidation
The consolidated financial statements include the accounts of
MarketCentral.net. Corp., (formerly All American Consultant Aircraft, Inc.) and
its wholly-owned subsidiary, MarketCentral.Net Corp. All intercompany
transactions and balances have been eliminated.
Summary of Significant Accounting Policies
Software development costs on the balance sheet represent capitalized
costs of design, configuration, installation and testing of the Company's
website up to its initial implementation. The asset is being amortized to
expense over its estimated useful life of 5 years using the straight line
method.
Ongoing website post-implementation costs of operation, including
training and application maintenance, are charged to expense as incurred.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect certain reported amounts and disclosures. Accordingly,
actual results could differ from those estimates.
Income taxes are provided for the tax effects of transactions reported
in the financial statements and consist of taxes currently due plus deferred
taxes related primarily to differences between the bases of certain assets and
liabilities for financial and tax reporting. The deferred taxes represent the
future tax return consequences of those differences, which will either be
taxable when the assets and liabilities are recovered or settled.
NOTE 2. REORGANIZATION
On February 5, 1999 a merger agreement and plan of acquisition and
reorganization was executed, having the following effects:
MarketCentral.net Corp. (a New York Corporation) was acquired by
MarketCentral.Net Corp. (a Delaware Corporation and a wholly-owned subsidiary of
All American Consultant Aircraft, Inc.). MarketCentral.Net Corp. continued as
the surviving corporation and MarketCentral.net Corp. ceased to exist.
40
<PAGE>
MarketCentral.Net Corp.
and Subsidiary
(A DEVELOPMENT STAGE COMPANY)
Notes to Consolidated Financial Statements
December 31, 1999
NOTE 2. REORGANIZATION - continued
The shareholders of MarketCentral.net Corp. received 2,025,000
unregistered shares of All American Consultant Aircraft, Inc. in exchange for
their shares of MarketCentral.net Corp.
All American Consultant Aircraft, Inc. changed its name to
MarketCentral.net Corp. MarketCentral.Net Corp. remains a wholly-owned
subsidiary of MarketCentral.net Corp.
The reorganization was accounted for as a purchase at the book
value of MarketCentral.Net Corp. at December 31, 1998.
In the accompanying financial statements, proforma unaudited
presentations as of and for the year ended December 31, 1998 represent the
consolidated accounts of the companies as if the reorganization described above
had taken place on December 31, 1998.
NOTE 3. SERVICES COMPENSATION
In 1999, Intrepid International LTD rendered financial services at a
fair value of $54,000 and was compensated by issuing 36,000 the Company's
restricted common stock.
An additional 100,000 shares of restricted common stock was issued to
a business consultant who rendered services to the Company and was recorded at
fair value. The value of the stock on the issued date (September 14, 1999) was
$3 1/8 per share.
NOTE. 4 TRANSACTIONS WITH RELATED PARTIES
Subscription Receivable
Meridian Mercantile, Inc. ("Meridian"), an affiliate of the Company,
subscribed for the purchase of 56,014 shares of common stock in consideration of
the sum of $312,000 payable on or before two years from February 5, 1999, with
minimum payment of $13,000 per month over 24 consecutive months. The balance of
this subscription as of December 31, 1999 is $137,500.
Note Payable
The Company has assumed a demand loan to one of its stockholders in
the amount of $53,478. The note bears interest at the rate of 7% per annum.
During 1999, an additional $30,753 advance was obtained from the stockholder and
interest was accrued on the entire balance in the amount of $4,725.
41
<PAGE>
MarketCentral.Net Corp.
and Subsidiary
(A DEVELOPMENT STAGE COMPANY)
Notes to Consolidated Financial Statements
December 31, 1999
NOTE 4. TRANSACTIONS WITH RELATED PARTIES -continued
Management Consultant Fee
The Company utilized a portion of the business, facilities, computers,
telephone and office supplies of New Horizons Asset Management Corp. ("New
Horizons"), 300 Mercer Street, Suite 26-J, New York, New York 10003, and retains
New Horizons as a management consultant. The President and beneficial owner of
New Horizons is also the President of MarketCentral.Net Corp. MarketCentral.net
Corp. has agreed to pay New Horizons Inc. $9,000.00 per month.
MarketCentral.net Corp. has also agreed to remit to New Horizons an additional
payment of $25,000 upon its receipt of funds in an equity or debt financing
transaction.
NOTE 5. STOCK OPTIONS
In February 1999, the Company granted stock options to its key
directors, advisors and consultants to acquire up to total of 400,000 shares of
common stock at an exercise price of $5.00 per share and exercisable for a
period of five years from the date of grant. Additional options to purchase
160,000 shares of restricted common stock for certain consultant services were
granted at an exercise price of $5.00 per share for the 1st 40,000 shares; $7.50
per share for the 2nd 40,000 shares; $10.00 per share for the 3rd 40,000 shares;
$12.50 per share for the last 40,000 shares.
NOTE 6. CAPITAL STOCK
Each share of common stock is entitled to one vote.
NOTE 7. FINANCIAL INSTRUMENTS
Current assets and liabilities are reported at their face amount
which, because of their short-term nature, approximates fair value.
NOTE 8. INCOME TAXES
No provision for income taxes has been recorded due to net operating
loss carryforwards totaling approximately $849,038 that will be offset against
future taxable income. Since the Company is in the development stage, no
provision for income taxes has been made.
Deferred tax assets and the valuation account is as follows at
December 31, 1999 and 1998.
December 31,
1999 1998
--------------------------------------------------------------
Deferred tax asset:
NOL carryforward $ 288,673 $ 43,288
Valuation allowance (288,673) (43,288)
--------- --------
Total $ 0 $ 0
==============================================================
42
<PAGE>
MarketCentral.net Corp.
and Subsidiary
(A DEVELOPMENT STAGE COMPANY)
Notes to Consolidated Financial Statements.
December 31, 1999
NOTE 9. GOING CONCERN MATTERS
The Company has incurred losses totalling $2,409,038 in the
development stage from inception (December 28, 1988) through December 31, 1999.
The company's website became operational in 1998. However, no significant
revenues have been generated.
It is management's plan to raise additional capital and to promote its
website to profitable status.
41
43
<PAGE>
--------------------------------------------------------------------------------
F-2
UN-AUDITED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2000
--------------------------------------------------------------------------------
44
<PAGE>
MarketCentral.net Corp.
(A DEVELOPMENT STAGE COMPANY)
March 31, 2000 and 1999
Table of Contents
-----------------
Page
Independent Accountant's Review Report 44
Balance Sheets 45
Statement of Operations 46
Statement of Cash Flows 47
Statement of Changes in Stockholders' Equity 48
Notes to Financial Statements 49 - 51
45
<PAGE>
ACCOUNTANTS' REVIEW REPORT
To the Board of Directors and Stockholders of
MarketCentral.net Corp.
We have reviewed the accompanying consolidated balance sheets of
MarketCentral.net Corp. and subsidiary as of March 31, 2000 and 1999, and the
related consolidated statement of operations, of stockholders' equity (deficit)
and of cash flows for the three months then ended, in accordance with Statements
on Standards for Accounting and Review Services issued by the American Institute
of Certified Public Accountants. All information included in these financial
statements is the representation of the management of MarketCentral. net Corp.
A review consists principally of inquiries of company personnel and analytical
procedures applied to financial data. It is substantially less in scope than an
audit 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.
/s/
Rogoff & Company, P.C.
Certified Public Accountants
Date: April 28, 2000
46
<PAGE>
MarketCentral.net Corp.
and Subsidiary
(A DEVELOPMENT STAGE COMPANY)
Consolidated Balance Sheets
As of March 31, 2000 and 1999
ASSETS
------
March 31,
----------
2000 1999
---- ----
CURRENT ASSETS
Cash $ 5,763 $ 18
Accounts receivable 626 0
Loan receivable 0 0
Subscriptions receivable 35,371 2,871
OTHER ASSETS
Software development costs, 65,073 82,426
net of accumulated amortization
of $21,691 and $4,338 ---------- ----------
TOTAL ASSETS $ 106,833 $ 82,444
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
CURRENT LIABILITIES
Accounts payable $ 88,756 $ 36,156
Accrued expenses payable 8,816 0
Note payable 84,231 61,638
Due to related party 0 5,870
---------- ----------
Total current liabilities 181,803 103,664
========== ==========
STOCKHOLDERS' EQUITY
Common stock, $0.0001 par value;
100,000,000 shares authorized;
4,183,946 and 3,991,900 issued and
outstanding in 2000 and 1999, respectively 419 399
Paid in capital 2,423,719 1,745,187
Deficit accumulated during the
development stage (2,499,108) (1,766,806)
---------- ----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 106,833 $ 82,444
========== ==========
See accountants review report and notes to consolidated financial statements.
47
<PAGE>
MarketCentral.net Corp.
and Subsidiary
(A DEVELOPMENT STAGE COMPANY)
Consolidated Statements of Operations
Three Month
Period Ended For the Period
March 31, From Inception
(December 28,1988)
to March 31,
2000 1999 2000
---- ---- ----
Revenue: $ 3,874 $ 1,149 $ 18,847
Operating expense:
General and administration
expense 93,893 80,811 2,517,904
---------- ---------- ----------
Net loss $ (90,019) $ (79,662) $2,499,057
========== ========== ==========
Net loss per share (0.02) (0.03) 0
========== ========== ==========
Weight average shares outstanding 4,183,946 2,698,479
========== ==========
See accountant's review report and notes to consolidated financial statements.
48
<PAGE>
MarketCentral.net Corp.
and Subsidiary
(A DEVELOPMENT STAGE COMPANY)
Consolidated Statement of Cash Flows
Three Month
Period Ended For the Period
March 31, From Inception
(December 28,1988)
to March 31,
2000 1999 2000
--------------------------------------------------------------------------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (90,019) $ (79,662) $(2,499,057)
Depreciation and amortization -
web site cost 4,338 4,338 21,691
Shares issued for services 0 0 1,927,500
(Increase) in accounts receivable 0 0 (626)
Increase (decrease) in accounts
payable (14,981) 0 88,756
Increase (decrease) in accrued
expenses (8,281) (27,183) 8,816
--------------------------------------------------------------------------------
Net cash provided (used) by
operating activities (108,943) 48,142 (452,920)
--------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES:
(Increase) decrease in loan
receivable 0 40,000 0
--------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from notes payable 0 8,160 30,753
Issuances of common stock 0 0 322,929
Decrease subscription receivable 105,000 0 105,000
--------------------------------------------------------------------------------
Net cash provided by financing
activities 105,000 8,160 458,682
--------------------------------------------------------------------------------
Net increase (decrease) in cash (3,943) 18 5,763
Cash, beginning of period 9,705 0 0
--------------------------------------------------------------------------------
Cash, end of period $ 5,762 $ 18 $ 5,763
================================================================================
See accountant's review report and notes to consolidated financial statements.
49
<PAGE>
MarketCentral.net Corp.
and Subsidiary
(A DEVELOPMENT STAGE COMPANY)
Consolidated Statement of Stockholder's Equity
For the Period From Inception (December 28, 1988)
To March 31, 2000
Deficit
Accumulated
Common Stock Paid In During The
Shares Amount Capital Development
Stage
------ ------ ------- -----------
Balance at Beginning of Development
Stage-December 28, 1988 0 $ 0 0 0
Shares issued for organizational
costs 180,000 18 982 0
Net Loss December 31, 1988-1996 0 0 0 (1,000)
--------------------------------------------------------------------------------
Balance, December 31, 1996 180,000 18 982 (1,000)
April 8, 1997-Issued at $1.00
per share 100,000 10 99,990 0
Net Loss December 31, 1997 0 0 0 (87,886)
--------------------------------------------------------------------------------
Balance, December 31, 1997 280,000 28 100,972 (88,886)
May 22, 1998-issued at $1.00
per share 2,900 1 2,899 0
July 1, 1998-issued at $.10
per share 84,000 8 8,392 0
Shares issued for cash and
services at @ 10 per share 1,600,000 160 1,599,840 0
Net Loss December 31, 1998 0 0 0 (1,598,258)
--------------------------------------------------------------------------------
Balance, December 31, 1998 1,966,900 197 1,712,103 (1,687,144)
February 1999 reorganization 2,025,000 202 33,084 0
Stock issued for professional
services rendered 36,032 4 54,048 (52)
Stock issued for subscription
stock 56,014 6 311,994 0
Stock issued for professional
services rendered 100,000 10 312,490 0
Net Loss December 31, 1999 0 0 0 (721,894)
--------------------------------------------------------------------------------
Balance as of December 31, 1999 4,183,946 $419 2,423,719 (2,409,090)
Net loss March 31, 2000 0 0 0 (90,018)
--------------------------------------------------------------------------------
Balance as of March 31, 2000 4,183,946 $419 2,423,719 $(2,499,108)
=========== ===== ========== ==========
See accountant's review report and notes to consolidated financial statements.
50
<PAGE>
MarketCentral.net Corp.
(A DEVELOPMENT STAGE COMPANY)
Notes to Consolidated Financial Statements
March 31, 2000
NOTE 1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
Nature of Business
MarketCentral.net Corp. (formerly All American Consultant Aircraft,
Inc.) (the "Company") was incorporated in Texas. The Company's primary business
is an internet site featuring investment information and tools available to the
individual investor. The site features state-of-the-art e-commerce.
MarketCentral.net Corp.'s online shopping mall, called the Market Mall is
promoted as a separate site.
Basis of Consolidation
The consolidated financial statements include the accounts of
MarketCentral.net. Corp., (formerly All American Consultant Aircraft, Inc.) and
its wholly-owned subsidiary, MarketCentral.Net Corp. All intercompany
transactions and balances have been eliminated.
Summary of Significant Accounting Policies
Software development costs on the balance sheet represent capitalized
costs of design, configuration, installation and testing of the Company's
website up to its initial implementation. The asset is being amortized to
expense over its estimated useful life of 5 years using the straight line
method.
Ongoing website post-implementation costs of operation, including
training and application maintenance, are charged to expense as incurred.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect certain reported amounts and disclosures. Accordingly,
actual results could differ from those estimates.
Income taxes are provided for the tax effects of transactions reported
in the financial statements and consist of taxes currently due plus deferred
taxes related primarily to differences between the bases of certain assets and
liabilities for financial and tax reporting. The deferred taxes represent the
future tax return consequences of those differences, which will either be
taxable when the assets and liabilities are recovered or settled.
51
<PAGE>
MarketCentral.Net Corp.
(A DEVELOPMENT STAGE COMPANY
Notes to Consolidated Financial Statements
March 31, 2000
NOTE 2. SERVICES COMPENSATION
In 1999, Intrepid International LTD rendered financial services at a
fair value of $54,048 and was compensated by issuing 36,032 the Company's
restricted common stock.
An additional 100,000 shares of restricted common stock was issued to
a business consultant who rendered services to the Company and was recorded at
fair value. The value of the stock on the issued date (September 14, 1999) was
$3 1/8 per share.
NOTE. 3 TRANSACTIONS WITH RELATED PARTIES
Subscription Receivable
Meridian Mercantile, Inc. ("Meridian"), an affiliate of the Company,
subscribed for the purchase of 56,014 shares of common stock in consideration of
the sum of $312,000 payable on or before two years from February 5, 1999, with
minimum payment of $13,000 per month over 24 consecutive months. The balance of
this subscription as of March 31, 2000 is $35,371.
Note Payable
The Company has assumed a demand loan to one of its stockholders in
the amount of $53,478. The note bears interest at the rate of 7% per annum.
During 1999, an additional $30,753 advance was obtained from the stockholder and
interest was accrued on the entire balance in the amount of $6,199 as of March
31, 2000.
Management Consultant Fee
The Company utilized a portion of the business, facilities, computers,
telephone and office supplies of New Horizons Asset Management Corp. ("New
Horizons"), 300 Mercer Street, Suite 26-J, New York, New York 10003, and retains
New Horizons as a management consultant. The President and beneficial owner of
New Horizons is also the President of MarketCentral.Net Corp. MarketCentral.net
Corp. has agreed to pay New Horizons Inc. $9,000.00 per month.
MarketCentral.net Corp. has also agreed to remit to New Horizons an additional
payment of $25,000 upon its receipt of funds in an equity or debt financing
transaction.
52
<PAGE>
MarketCentral.Net Corp.
(A DEVELOPMENT STAGE COMPANY)
Notes to Consolidated Financial Statements
March 31, 2000
NOTE 4. STOCK OPTIONS
In February 1999, the Company granted stock options to its key
directors, advisors and consultants to acquire up to total of 400,000 shares of
common stock at an exercise price of $5.00 per share and exercisable for a
period of five years from the date of grant. Additional options to purchase
160,000 shares of restricted common stock for certain consultant services were
granted at an exercise price of $5.00 per share for the 1st 40,000 shares; $7.50
per share for the 2nd 40,000 shares; $10.00 per share for the 3rd 40,000 shares;
$12.50 per share for the last 40,000 shares.
NOTE 5. CAPITAL STOCK
Each share of common stock is entitled to one vote.
NOTE 6. FINANCIAL INSTRUMENTS
Current assets and liabilities are reported at their face amount
which, because of their short-term nature, approximates fair value.
53
<PAGE>
