QUEPASA COM INC, S-1/A, 1999-06-24

QUEPASA COM INC
S-1/A, 1999-06-24
ADVERTISING

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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 24, 1999.

REGISTRATION NO. 333-74201
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- --------------------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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AMENDMENT NO. 7 TO

FORM S-1
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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quepasa.com, inc.
(Exact name of registrant as specified in charter)

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<S> <C> <C>
NEVADA 7379 86-0879433
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification Number)
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ONE ARIZONA CENTER
400 EAST VAN BUREN, FOURTH FLOOR
PHOENIX, ARIZONA 85004
(602) 716-0106
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
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GARY L. TRUJILLO, CHIEF EXECUTIVE OFFICER
quepasa.com, inc.
ONE ARIZONA CENTER
400 EAST VAN BUREN, FOURTH FLOOR
PHOENIX, ARIZONA 85004
(602) 716-0106
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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Copies of all communications to:

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<S> <C>
JEFFREY M. KNETSCH JOSEPH P. RICHARDSON
BROWNSTEIN HYATT & FARBER, P.C. BRYAN CAVE LLP
410 SEVENTEENTH STREET TWO NORTH CENTRAL AVE., #22000
DENVER, CO 80202 PHOENIX, AZ 85004
(303) 223-1100 (602) 364-7000
(303) 223-1111 (FAX) (602) 364-7070 (FAX)
</TABLE>

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC: As soon as
practicable after the effective date of this registration statement.

If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act,
check the following box. [ ]

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]

If delivery of the prospectus is expected to be made pursuant to Rule 434,
check the following box: [ ]

CALCULATION OF REGISTRATION FEE

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<CAPTION>
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TITLE OF EACH CLASS AMOUNT PROPOSED PROPOSED MAXIMUM AMOUNT
OF SECURITIES TO BE MAXIMUM PRICE AGGREGATE OF
TO BE REGISTERED REGISTERED PER SHARE OFFERING PRICE(1) REGISTRATION FEE
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<S> <C> <C> <C> <C>
Common Stock, $.001 par value.... 4,600,000 shares(2) $12.00 $55,200,000 $16,284
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Representative's Warrants........ 400,000 warrants -- $100 --
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Common Stock underlying the
Representative's Warrants(3)... 400,000 shares $14.40 $ 5,760,000 $ 1,699
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Total................... $17,983(4)
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(1) Estimated solely for computing the amount of the registration fee pursuant
to Rule 457(a) under the Securities Act.
(2) Includes the overallotment option granted to the representative of 600,000
shares.
(3) Pursuant to Rule 416 of the Securities Act of 1933, as amended, the number
of shares of common stock issuable upon exercise of the representative's
warrants is subject to adjustment in accordance with the anti-dilution
provisions of such warrants.
(4) Previously paid.

THE REGISTRANT HEREBY AMENDS THE REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933, OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
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<PAGE> 2

SUBJECT TO COMPLETION DATED JUNE 23, 1999

4,000,000 SHARES OF COMMON STOCK

[QUEPASA.COM LOGO]

Quepasa.com, inc. operates an Internet portal and online community that
provides users with information and interactive content centered around the
Spanish language. The quepasa.com community includes a search engine, free
e-mail, Spanish-language news feeds, chat rooms and message boards.

We are offering 4,000,000 shares of common stock at between $10.00 and
$12.00 per share.

We have applied to list our common stock on the Nasdaq National Market
under the symbol "PASA."

SEE "RISK FACTORS" BEGINNING ON PAGE 5 TO READ ABOUT FACTORS YOU SHOULD
CONSIDER BEFORE BUYING SHARES OF OUR COMMON STOCK.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

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PER SHARE TOTAL
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<S> <C> <C>
Public offering price:...................................... $ $
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Underwriting discounts and commissions:..................... $ $
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Proceeds to quepasa.com, inc.:.............................. $ $
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We have granted the underwriters an option for 45 days to purchase up to an
additional 600,000 shares at the same price indicated above solely to cover
overallotments.

[H.C. Wainwright & Co. Logo]
[Cruttenden Roth Logo]

The date of this prospectus is , 1999.

THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND WE ARE NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
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[INSIDE FRONT COVER PAGE: SCREENSHOT OF QUEPASA.COM HOMEPAGE]

YOU MAY RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS. WE HAVE
NOT AUTHORIZED ANYONE TO PROVIDE INFORMATION DIFFERENT FROM THAT CONTAINED IN
THIS PROSPECTUS. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR SALE OF COMMON
STOCK MEANS THAT INFORMATION CONTAINED IN THIS PROSPECTUS IS CORRECT AFTER THE
DATE OF THIS PROSPECTUS. THIS PROSPECTUS IS NOT AN OFFER TO SELL OR SOLICITATION
OF AN OFFER TO BUY THESE SHARES OF COMMON STOCK IN ANY CIRCUMSTANCES UNDER WHICH
THE OFFER OR SOLICITATION IS UNLAWFUL.

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TABLE OF CONTENTS

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PAGE
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Prospectus Summary.......................................... 2
Risk Factors................................................ 5
Use of Proceeds............................................. 10
Dividend Policy............................................. 10
Dilution.................................................... 11
Capitalization.............................................. 12
Selected Financial Data..................................... 13
Management's Discussion and Analysis of Financial Condition
and Results of Operations................................. 14
Our Business................................................ 19
Our Management.............................................. 29
Principal Stockholders...................................... 34
Related Party and Other Material Transactions............... 34
Description of Securities................................... 36
Underwriting................................................ 38
Legal Matters............................................... 40
Experts..................................................... 40
Change of Accountants....................................... 41
Additional Information...................................... 41
Financial Statements........................................ F-1
</TABLE>

<PAGE> 4

PROSPECTUS SUMMARY

The following summary includes all material items relating to the offering
and should be read with the more detailed information and financial statements
and notes thereto appearing elsewhere in this prospectus.

OUR BUSINESS

Quepasa.com is a Spanish-language Internet portal and online community
focused initially on the U.S. Hispanic market. We provide users with information
and interactive content centered around the Spanish language. Because the
language preference of many acculturated U.S. Hispanics is English, we also
offer our users the ability to access information and services in the English
language. We draw viewers to our Web site by providing a one-stop destination
for identifying, selecting and accessing resources, services, content and
information on the Web. Our online community includes a search engine, free
e-mail, Spanish-language news feeds, chat rooms and message boards. We are a
development stage company having launched the quepasa.com Web site in November
1998 and have not yet generated significant revenue. We anticipate that our
principal source of revenue will be fees paid by third parties for advertising
their products and services on our Web site.

OUR MARKET OPPORTUNITY

Our objective is to establish quepasa.com as a leading worldwide
Spanish-language online community, offering our services to Spanish-speaking
Internet users residing in the United States, Latin America, Europe and other
regions of the world. We believe that the Spanish-language Internet market is
presently underserved. Our initial focus is the U.S. Hispanic market where we
believe there will continue to be dramatic growth among Internet users. With
respect to the Spanish-language Internet market:

- The U.S. Hispanic population totals 29.6 million people or 11% of the
U.S. population and is expected to grow to 41.1 million or 14% of the
total U.S. population by 2010;

- Total U.S. Hispanic purchasing power is projected to be $383.0 billion in
1999, representing an increase of approximately 84% since 1990;

- Between 1994 and 1998, the percentage of U.S. Hispanic households that
owned computers increased from 13% to 30%, which amounted to
approximately 130% growth in four years;

- Between 1994 and 1998, the percentage of U.S. Hispanic households with
Internet access grew from 2% to 15%, which amounted to approximately 650%
growth in four years;

- According to International Data Corporation, the number of Internet users
in Latin America, excluding Portuguese-speaking Brazilians, is expected
to increase from 2.5 million at year end 1998 to 11.7 million by year end
2003;

- Spanish is the world's third most spoken language, used by approximately
350 million native speakers; and

- Twenty-one countries consider Spanish their primary language.

OUR STRATEGY

We are establishing quepasa.com as a leading Spanish-language online
community by executing a business strategy that includes:

- Developing quepasa.com in the United States and then globally as a
leading brand associated with the Internet for Spanish-language users;

- Acquiring and developing additional content and features for the
quepasa.com community;

- Entering into strategic relationships with business partners who offer
unique media, content, technology and distribution capabilities;

- Expanding into additional Spanish-speaking markets; and

- Generating revenue from the sale of advertising and through electronic
commerce.

OUR STRATEGIC RELATIONSHIPS

We have developed strategic relationships with leading providers of media
and content, including:

- Telemundo Network Group LLC, a U.S. Spanish-language television
network owned by Sony and Liberty Media;

- Miami Herald Online;

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- Fox Sports World Espanol;

- Arizona Diamondbacks;

- Reuters NewMedia; and

- WeatherLabs.

Our search engine is provided by Inktomi, a leader in search technology.
Exodus and GTE, two of the largest companies involved in connecting users to the
Internet, provide high-speed connections between our users, quepasa.com and
Inktomi. We have an agreement with 24/7 Media, Inc., a leading provider of
Internet advertising solutions, to sell advertising on our Web site to customers
solicited by 24/7 Media.

We believe growth in our Web site traffic was the result of advertising
campaigns and the continued development of our Web site content and features.
Our page views, which represent the number of times our server delivers a page
to a user, grew from approximately 103,700 in January 1999 to approximately
4,600,000 in May 1999 and our user session length grew from an average of
approximately 7.0 minutes to approximately 17.2 minutes. Total user sessions
grew from 40,284 in January 1999 to 418,200 in May 1999. Between February 28 and
June 15, 1999 our registered e-mail users grew from 201 to approximately 34,000.

OUR HISTORY

We were incorporated in Nevada in June 1997 under the name Internet
Century, Inc. and changed our name in December 1998 to quepasa.com, inc. to
reflect our decision to operate a Spanish-language portal and online community.
Our corporate offices are located at One Arizona Center, 400 East Van Buren,
Fourth Floor, Phoenix, Arizona 85004, telephone number (602) 716-0106. Our
quepasa.com Web site is located at www.quepasa.com. Information contained in our
Web site should not be considered a part of this prospectus.

THE OFFERING

Unless otherwise indicated, all information in this prospectus assumes (1)
no exercise of the overallotment option granted to the underwriters and (2) an
offering price of $11.00 per share.

Securities Offered(1)...... 4,000,000 shares of common stock.

Common Stock Outstanding
Prior to Offering(2)..... 9,775,833 shares of common stock.

Common Stock to be
Outstanding After
Offering(2).............. 13,775,833 shares of common stock.

Use of Proceeds............ Marketing and advertising expenses; development and
acquisition costs for additional Web site content
and features; general, administrative and other
operating expenses; technology and equipment
purchases; repayment of a working capital loan and
working capital.

Proposed Nasdaq National
Market Symbol............ PASA

Risk Factors............... Investment in our common stock involves a high
degree of risk and could result in a loss of your
entire investment.
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(1) If the overallotment option granted to the underwriters is exercised in
full, 600,000 additional shares of common stock will be sold, with estimated
net proceeds to be received of $5,940,000 after deducting commissions and
expenses.

(2) Excludes an aggregate of 3,398,000 shares of common stock issuable upon
exercise of outstanding stock options and common stock purchase warrants and
400,000 shares of common stock issuable upon exercise of common stock
purchase warrants to be issued to the representative of the underwriters
upon completion of the offering. See "Management -- Stock Option Plan" and
"Underwriting."

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SUMMARY FINANCIAL DATA

The following tables set forth financial information which has been derived
from our audited financial statements for the period from inception, June 25,
1997, through December 31, 1997, for the year ended December 31, 1998 and
cumulative from inception, June 25, 1997 to December 31, 1998. The tables also
include financial information which has been derived from our unaudited
financial statements as of March 31, 1999, the three months ended March 31, 1999
and 1998 and cumulative from inception (June 25, 1997) through March 31, 1999.

<TABLE>
<CAPTION>
CUMULATIVE
INCEPTION CUMULATIVE FROM INCEPTION
THREE MONTHS ENDED (JUNE 25, 1997) FROM INCEPTION (JUNE 25, 1997)
MARCH 31, YEAR ENDED TO (JUNE 25, 1997) TO
STATEMENT OF ------------------------ DECEMBER 31, DECEMBER 31, TO DECEMBER 31,
OPERATIONS DATA 1999 1998 1998 1997 MARCH 31, 1999 1998
--------------- ----------- ---------- ------------ --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Product and content
development
expenses........... $ 186,691 $ 4,330 $ 414,873 $ -- $ 601,564 $ 414,873
Advertising and
marketing
expenses........... 2,062,607 -- 250,419 -- 2,313,026 250,419
Stock-based
compensation
expenses........... 479,000 -- 5,265,364 -- 5,744,364 5,265,364
General and
administrative
expenses........... 950,299 9,137 534,632 3,703 1,488,634 538,335
Net loss............. $(3,683,219) $ (13,467) $(6,513,228) $ (2,903) $(10,199,350) $(6,516,131)
Weighted average
number of shares
outstanding........ 9,075,833 9,075,833 9,075,833 9,075,833 9,075,833 9,075,833
Net loss per share... $ (.41) -- $ (.72) -- $ (1.12) $ (.72)
</TABLE>

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DECEMBER 31,
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1997 1998 MARCH 31, 1999
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BALANCE SHEET DATA ACTUAL ACTUAL ACTUAL AS ADJUSTED(1)
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<S> <C> <C> <C> <C>
Working capital (deficit)................... $ (2,883) $3,563,302 $ (516,157) $38,523,843
Total assets................................ $ 2,582 $4,611,464 $3,290,957 $40,330,957
Total liabilities........................... $ 5,465 $ 691,042 $2,574,754 $ 574,754
Stockholders' (deficit) equity.............. $ (2,883) $3,920,422 $ 716,203 $39,756,203
</TABLE>

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(1) As adjusted to reflect the sale of 4,000,000 shares of common stock offered
hereby at an assumed offering price of $11.00 per share and the application
of the net proceeds. See "Use of Proceeds."

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RISK FACTORS

This offering involves a high degree of risk. You should carefully consider
the risks and uncertainties described below and the other information in this
prospectus before deciding whether to invest in shares of our common stock. If
any of these risks occur, our business, results of operations and financial
condition could be adversely affected. This could cause the trading price of our
common stock to decline, and you might lose part or all of your investment.

OUR OPERATING HISTORY IS EXTREMELY LIMITED; WE EXPECT FUTURE LOSSES AND MAY NEED
MORE CAPITAL

We were incorporated in June 1997 and have generated no significant revenue
from our quepasa.com Web site. Accordingly, we have no operating history upon
which an investor can evaluate us, and our prospects are subject to the risks
and uncertainties encountered by companies that operate in the new and rapidly
evolving Internet market.

As of March 31, 1999, we had an accumulated deficit of approximately $10.6
million. Our limited operating history and the uncertainty of the Internet
market in which we operate our business make any prediction of our future
results of operations difficult or impossible. We expect to increase
considerably our operating expenses in the future, particularly advertising
expenses to develop and extend our quepasa.com brand and expenses relating to
content and features that we intend to develop, purchase or otherwise acquire
and add to our Web site. We do not expect that our revenue will cover those
expenses. As a result, we will continue to incur significant losses and may need
to raise additional capital. We cannot assure that we will be able to raise
additional capital and we do not know what the terms of such capital raising
would be. Any future sale of our equity securities would dilute the ownership
and control of our stockholders and could be at prices substantially below the
offering price.

WE WILL BE UNABLE TO GENERATE SUFFICIENT ADVERTISING REVENUE IF OUR TARGET
AUDIENCE DOES NOT ACCEPT OUR PRODUCTS AND SERVICES

We have only recently begun to promote our site and we cannot give
assurances that the Spanish-speaking population will accept our products and
services or that we will attract repeat users to our Web site. Because the
market for our products and services is new and evolving, it is difficult to
predict the future growth rate, if any, and the size of the market we have
targeted. If the market develops more slowly than we expect or becomes saturated
with competitors, or if our products and services are not accepted by the
market, we will be unable to generate enough advertising revenue to offset our
expenses and to earn profits.

OUR INABILITY TO DEVELOP THE QUEPASA.COM BRAND WILL SIGNIFICANTLY REDUCE OUR
ADVERTISING REVENUE

We intend to spend a significant portion of the net proceeds from this
offering to create and sustain a distinct brand loyalty among our targeted
population of Internet users. We believe that establishing and maintaining the
quepasa.com brand is of critical importance to our efforts to attract and expand
our audience. We also believe that brand recognition will become more important
due to the increasing number of Internet sites. Promotion and enhancement of the
quepasa.com brand will depend largely on our success in providing high quality
products and services and Web site content that is of interest to the worldwide
Spanish-speaking population. We cannot assure that success. Even if our desired
results are achieved, it is likely that we will expend significant additional
amounts in further developing and maintaining brand loyalty. Failure to develop
brand loyalty among our users could result in our being unable to generate
enough advertising revenue to offset our expenses and to earn profits.

IF WEB-BASED ADVERTISING IS NOT ACCEPTED BY ADVERTISERS OUR ADVERTISING REVENUE
MAY NOT BE SUFFICIENT TO OFFSET OUR EXPENSES

We will need revenue from the sale of advertisements on our Web pages to
offset expenses. At the present time, Web advertisers generally enter into only
short-term advertising contracts. Because Web site advertising is a new
phenomenon, few advertisers have significant experience with the Web as an

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advertising medium. Consequently, many advertisers have not devoted a
substantial portion of their advertising expenditures to Web-based advertising,
and may not find Web-based advertising to be effective for promoting their
products and services as compared to traditional print and broadcast media.

No standards have yet been widely accepted for the measurement of the
effectiveness of Web-based advertising, and we can give no assurance that such
standards will be developed or adopted sufficiently to sustain Web-based
advertising as a significant advertising medium. We cannot give assurances that
banner advertising, the predominant revenue producing mode of advertising
currently used on the Web, will be accepted as an effective advertising medium
or that we can effectively transition to any other forms of Web-based
advertising, should they develop. Recently, software programs became available
that limit or remove advertisements from an Internet user's desktop. This
software, if generally adopted by users, may materially and adversely affect
Web-based advertising.

WE MAY BE REQUIRED TO RESCIND UP TO $5.5 MILLION OF STOCK PURCHASED BY TWO
AFFILIATED INVESTORS

In April 1999 we sold 600,000 shares of our common stock to Telemundo for
$5.0 million of advertising credit on the Telemundo television network and
50,000 shares to Garcia/LKS for $500,000 of advertising services. The Chief
Operating Officer of Telemundo is one of our directors and one of the owners of
Garcia/LKS was one of our directors. In the view of the Securities and Exchange
Commission, these sales may not have been eligible for an exemption from
registration under the Securities Act of 1933. In the absence of such an
exemption, Telemundo and Garcia/LKS could bring suit against us to rescind their
stock purchases, in which event we could be liable for rescission payments to
these two investors of up to $5.5 million.

OUR WEB SITE OPERATIONS COULD BE IMPAIRED IF WE LOSE THE SERVICES OF THIRD PARTY
TECHNOLOGY AND CONTENT PROVIDERS

Our business depends upon third parties, including providers of technology,
infrastructure, content and features.

We supplement our Web site directory listings with Web search results
provided by Inktomi under a non-exclusive agreement. We depend upon Inktomi for
ongoing maintenance and technical support to ensure accurate and rapid
presentation of search results to users of our Web site. Termination of our
relationship with Inktomi or Inktomi's failure to renew our agreement upon
expiration could result in substantial additional costs to us in developing or
replacing technology. We also rely upon Exodus and GTE for our Internet and
e-mail connections. Any interruption in the Internet access provided by Exodus
or GTE or any other provider of access could disrupt our Web site operations and
impair relations with our users.

We license content, including technology and related databases, from third
parties for portions of our quepasa.com Web site, including news from Reuters,
weather from WeatherLabs and chat services from Volano. Any errors, delays or
failures experienced in connection with these third party technologies and
services could have a negative effect on our relationship with users of our Web
site, could materially and adversely affect our brand and our business and could
subject us to liability to third parties for business negligence such as
defamation or libel.

SYSTEM FAILURE COULD DISRUPT OUR WEB SITE OPERATIONS

The continued and uninterrupted performance of our hardware and software is
critical to our reputation and our success in attracting traffic to our Web
site. Users of our site and our services, such as our e-mail services, may
become dissatisfied by system failures that may limit our Web site services.
Sustained or repeated system failures could significantly reduce the traffic on
our Web site and may impair our reputation and brand name. Our operations depend
on our ability to protect our computer systems from damage from fire, power
loss, water damage, telecommunications failures, vandalism and other malicious
acts, and similar unexpected adverse events. We may not carry enough business
interruption insurance to compensate for losses that may occur as a result of
any of these events. We also depend upon
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Internet browsers and Internet service providers that provide users with access
to the Internet and our Web site. Users may experience difficulties due to
system failures unrelated to our systems. Any disruption in Internet access by
Internet service providers and other third party access providers, or any
failure of such providers to handle higher volumes of user traffic, could
disrupt our Web site operations and impair relations with our users.

OUR MANAGEMENT IS INEXPERIENCED AND MAY NOT BE ABLE TO MANAGE OUR GROWTH

Several executive officers and members of our board of directors joined us
recently, our management team has worked together for only a short time, and
none of our executive officers has extensive experience managing a rapidly
growing business enterprise. Any growth we experience will place a significant
strain on our management and financial resources. Any inability of our
management to manage growth effectively could significantly increase our
operating expenses, impair our marketing efforts and limit the development of
our Web site.

GROWTH OF OUR WEB SITE MAY BE LIMITED BY GOVERNMENTAL REGULATIONS

Laws and regulations may be adopted with respect to the Internet covering
issues ranging from user privacy and defamation to taxation and intellectual
property ownership. Any laws or regulations adopted in the future affecting the
Internet could subject us to substantial liability. Such laws or regulations
could also adversely affect the growth of the Internet generally, and decrease
the acceptance of the Internet as a communications and commercial medium. In
addition, the growing use of the Internet has burdened the existing
telecommunications infrastructure. Areas with high Internet use relative to the
existing telecommunications structure have experienced interruptions in phone
service leading local telephone carriers to petition regulators to govern
Internet service providers and impose access fees on them. Such regulations, if
adopted in the United States or other places, could increase significantly the
costs of communicating over the Internet, which could in turn decrease the
demand for our products and services. The adoption of various proposals to
impose additional taxes on the sale of goods and services through the Internet
could also reduce the demand for Web-based commerce.

WE MAY FACE LIABILITY FOR INFORMATION CONTENT AND COMMERCE-RELATED ACTIVITIES

Because materials may be downloaded by the services that we operate or
facilitate and the materials may subsequently be distributed to others, we could
face claims for errors, defamation, negligence, or copyright or trademark
infringement based on the nature and content of such materials. We could also be
exposed to liability because of the listings that we select and make available
through our Web site, or through content and materials posted by users in chat
room and message board services that we provide. Even to the extent that claims
made against us do not result in liability, we may incur substantial costs in
investigating and defending such claims.

COMPETITION FOR INTERNET USERS MAY LIMIT TRAFFIC ON, AND THE VALUE OF, OUR WEB
SITE

The market for Internet products and services and the market for Internet
advertising and electronic commerce arrangements are extremely competitive, and
we expect that competition will continue to intensify. We believe that the
principal competitive factors in these markets are name recognition,
distribution arrangements, functionality, performance, ease of use, the number
of services and features provided and the quality of support. Our primary
competitors are other companies providing portal or other online services,
especially to Spanish-language Internet users such as Yahoo!, America Online,
StarMedia Network, Prodigy, Microsoft, Lycos and Ole. Most of our competitors,
as well as a number of potential new competitors, have significantly greater
financial, technical and marketing resources than we do. Our competitors may
offer Internet products and services that are superior to ours or that achieve
greater market acceptance. There can be no assurance that competition will not
limit traffic on, and the value of, our Website.

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TECHNOLOGICAL CHANGES COULD IMPAIR OUR ABILITY TO COMPETE AND SUBJECT US TO
SIGNIFICANT EXPENDITURES

The market for Internet products and services is characterized by rapid
technological developments, frequent new product introductions and evolving
industry standards. The emerging character of these products and services and
their rapid evolution will require that we continually improve the performance,
features and reliability of our Internet content, particularly in response to
competitive offerings. There can be no assurance that we will be successful in
responding quickly, cost effectively and sufficiently to these developments. In
addition, the widespread adoption of new Internet technologies or standards
could require substantial expenditures by us to modify or adapt our Web site and
services and could fundamentally affect the character, viability and frequency
of Web-based advertising, either of which could have a material adverse effect
on our business. In addition, new Internet services or enhancements offered by
us may contain design flaws or other defects that could require costly
modifications or result in a loss of consumer confidence.

FAILURE OF OUR COMPUTER SYSTEM OR THE SYSTEMS OF THIRD PARTIES TO ACHIEVE YEAR
2000 COMPLIANCE COULD ADVERSELY AFFECT OUR BUSINESS

Many currently installed computer systems and software products are coded
to accept only two-digit entries to represent years in the date code field.
Computer systems and products that do not accept four-digit entries will need to
be upgraded or replaced to accept four-digit entries to distinguish years
beginning with 2000 from prior years. We are currently evaluating the Year 2000
issue as it relates to our entire internal computer system as well as computer
systems operated by third parties. We are incurring internal staff costs and may
incur consulting and other expenses related to making our computer systems Year
2000 compliant. We will expense these costs as incurred. In addition, computer
systems operated by third parties with which our systems interface may not
continue to properly interface with our systems or be compliant on a timely
basis with Year 2000 requirements. Any failure of our computer system or the
systems of third parties to achieve Year 2000 compliance could adversely affect
our business.

FUTURE SALES OF OUR COMMON STOCK OR SHARES ISSUABLE UPON EXERCISE OF STOCK
OPTIONS COULD ADVERSELY AFFECT OUR STOCK PRICE AND OUR ABILITY TO RAISE FUNDS IN
NEW STOCK OFFERINGS

We currently have 9,775,833 shares of common stock outstanding, of which
1,981,886 shares may now be sold, at the rate of at least 13,775 shares by each
of our stockholders every 90 days, under Rule 144 of the Securities Act and of
which 7,793,947 shares may be sold subject to the same volume limitation
commencing May 1999 through April 2000. Sale of substantial amounts of common
stock, or the perception that sales could occur, could reduce the market price
of the common stock. Substantially, all of our stockholders have entered into
lock-up agreements under which they will not sell or otherwise transfer any of
their shares until 180 days from the date of this prospectus without the prior
written consent of the representative of the underwriters. Cruttenden Roth
Incorporated has agreed with two of our stockholders to release a total of
221,750 shares from the lock-up agreements prior to the end of the 180-day
period if, after the offering, at least 2,000,000 shares of the common stock
trade on the Nasdaq National Market at a price at least equal to the lesser of
120% of the public offering price or $14.40, and to release an additional
221,750 shares, if at least 4,000,000 shares trade at a price at least equal to
the lesser of 120% of the public offering price or $14.40. Cruttenden Roth
Incorporated agreed to these release provisions as a further inducement to the
two stockholders to purchase the shares of common stock owned by the former
stockholder and employee described under "Change of Accountants." See "Related
Party and Other Material Transactions." In addition, one of our executive
officers has entered into a lock-up agreement with us under which he will not
sell or otherwise transfer any of his shares until two years from the date of
this prospectus. A total of 6,000,000 shares of common stock have been reserved
for issuance upon the exercise of stock options granted under our Stock Option
Plan and 400,000 shares have been reserved upon exercise of common stock
purchase warrants to be issued to the representative of the underwriters.
Currently, there are outstanding stock options or common stock purchase warrants
to acquire 3,398,000 shares of common stock at exercise prices ranging from
$1.00 to the greater of $12.00 or 120%

8
<PAGE> 11

of the offering price per share, including 1,400,000 common stock purchase
warrants subject to demand and piggy-back registration rights. See
"Management -- Executive Compensation."

FORWARD-LOOKING STATEMENTS MAY BE UNRELIABLE

This prospectus contains forward-looking statements regarding our intent,
belief or current expectations. Discussions in this prospectus under the
headings "Summary," "Risk Factors," "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and "Our Business," as well as in
other parts of this prospectus include such forward-looking statements. These
statements are subject to a variety of risks and uncertainties, many of which
are beyond our control, which could cause our actual future results to differ
materially from those contemplated in the forward-looking statements. In
particular, the risks and uncertainties described under "Risk Factors" in this
prospectus could cause our actual future results to differ from what we
contemplate. Investors are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date of this prospectus.

9
<PAGE> 12

USE OF PROCEEDS

After payment of underwriting commissions and other expenses of the
offering, the net proceeds of the offering are estimated to be $39 million, or
$44.9 million if the overallotment option is exercised. We expect to use the net
proceeds approximately as follows:

- $21.5 million for marketing and advertising expenses in order to globally
develop and maintain the quepasa.com brand;

- $8.0 million to further develop and acquire additional content and
features for the quepasa.com Web site;

- $4.0 million for general, administrative and other operating expenses
including the recruitment, training and payment of salaries of new
employees;

- $2.0 million to purchase additional technology and equipment;

- $2.0 million to repay a working capital loan bearing interest at 12% per
annum due the earlier of the closing date of the offering or March 2001
advanced to us by a former stockholder; and

- $1.5 million for working capital.

There may be changes in our proposed use of proceeds due to changes in our
business or the Internet industry in general.

Proceeds not immediately needed will be invested in bank certificates of
deposit, treasury bills, insured bank deposits or similar investments.

DIVIDEND POLICY

We have never declared or paid dividends on our common stock and do not
intend to pay dividends on our common stock in the foreseeable future. Instead,
we will retain any earnings to finance the expansion of our business and for
general corporate purposes.

10
<PAGE> 13

DILUTION

At March 31, 1999, the net tangible book value of our outstanding shares of
common stock was a deficit of approximately $58,000, or $.01 per common share.
"Net tangible book value" per share represents the total amount of our tangible
assets, less the total amount of our liabilities, divided by the number of
shares of common stock outstanding. Without taking into account any changes in
net tangible book value after March 31, 1999, other than to give effect to the
sale of the shares of common stock offered hereby at an assumed initial public
offering price of $11.00 per share, less underwriting discounts and commissions
and estimated costs of the offering, our net tangible book value at March 31,
1999 would have been approximately $39 million, or $2.98 per share. This
represents an immediate increase in net tangible book value of $2.99 per share
of common stock to our existing stockholders and an immediate dilution of $8.02
per share to new investors. "Dilution" per share represents the difference
between the price to be paid by the new stockholders and the net tangible book
value per share of common stock immediately after this offering.

The following table illustrates this per share dilution:

<TABLE>
<S> <C> <C>
Assumed initial public offering price per share............. $11.00
Net tangible book value per share before the offering..... $(.01)
Increase in net tangible book value per share attributable
to new investors purchasing in the offering............ $2.99
-----
Net tangible book value per share after the offering........ $ 2.98
------
Dilution per share to new investors......................... $ 8.02
======
</TABLE>

The following table sets forth the number of shares of common stock
purchased, the total consideration paid and the average price per share paid by
our existing stockholders as of March 31, 1999 and new investors purchasing the
shares of common stock offered hereby:

<TABLE>
<CAPTION>
SHARES PURCHASED TOTAL CONSIDERATION AVERAGE
----------------------- ------------------------ PRICE
NUMBER PERCENTAGE AMOUNT PERCENTAGE PER SHARE
---------- ---------- ----------- ---------- ---------
<S> <C> <C> <C> <C> <C>
New investors............ 4,000,000 30.6% $44,000,000 88.3% $11.00
Existing
stockholders(1)........ 9,075,833 69.4% $ 5,811,776 11.7% $ .64
---------- ----- ----------- -----
TOTALS................... 13,075,833 100.0% $49,811,776 100.0%
</TABLE>

- ---------------

(1) Excludes 700,000 shares issued subsequent to March 31, 1999 and shares of
common stock issuable upon exercise of stock options and common stock
purchase warrants. See "Management -- Stock Option Plan" and "Underwriting."

11
<PAGE> 14

CAPITALIZATION

The following table sets forth our historical and as adjusted
capitalization as of March 31, 1999, after deducting underwriting discounts and
commissions and estimated offering expenses. As adjusted capitalization reflects
the sale of the 4,000,000 shares of common stock offered hereby at an assumed
offering price of $11.00 per share and the application of the net proceeds.

<TABLE>
<CAPTION>
MARCH 31, 1999 MARCH 31, 1999
ACTUAL AS ADJUSTED
-------------- --------------
<S> <C> <C>
Long-term liabilities(1).................................... $ -- $ --
Stockholders' equity
Preferred stock, 5,000,000 no par value shares authorized,
no shares issued....................................... -- --
Common stock, 50,000,000, $.001 par value shares
authorized, 9,075,833 shares outstanding, 13,075,833
shares outstanding as adjusted(2)...................... 9,076 13,076
Additional paid-in capital................................ 10,906,477 49,942,477
Retained (deficit)........................................ (10,199,350) (10,199,350)
------------ ------------
Total stockholders' equity........................ $ 716,203 $ 39,756,203
============ ============
Total capitalization.............................. $ 716,203 $ 39,756,203
============ ============
</TABLE>

- ---------------

(1) Excludes approximately $2.3 million loaned to us subsequent to March 31,
1999 by our Chief Technology Officer. See "Related Party and Other Material
Transactions."

(2) Excludes 700,000 shares issued subsequent to March 31, 1999 and shares of
common stock issuable upon exercise of stock options and common stock
purchase warrants. See "Management -- Stock Option Plan" and "Underwriting."

12
<PAGE> 15

SELECTED FINANCIAL DATA

The following tables set forth financial information which has been derived
from our audited financial statements for the period from inception, June 25,
1997, through December 31, 1997, for the year ended December 31, 1998 and
cumulative from inception, June 25, 1997 to December 31, 1998. The tables also
include financial information derived from our unaudited financial statements as
of March 31, 1999, the three months ended March 31, 1999 and 1998 and cumulative
from inception (June 25, 1997) through March 31, 1999.

<TABLE>
<CAPTION>
CUMULATIVE
INCEPTION CUMULATIVE FROM INCEPTION
THREE MONTHS ENDED (JUNE 25, 1997) FROM INCEPTION (JUNE 25, 1997)
MARCH 31, YEAR ENDED TO (JUNE 25, 1997) TO
STATEMENT OF ------------------------ DECEMBER 31, DECEMBER 31, TO DECEMBER 31,
OPERATIONS DATA 1999 1998 1998 1997 MARCH 31, 1999 1998
--------------- ----------- ---------- ------------ --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Product and content
development
expenses........... $ 186,691 $ 4,330 $ 414,873 $ -- $ 601,564 $ 414,873
Advertising and
marketing
expenses........... 2,062,607 -- 250,419 -- 2,313,026 250,419
Stock-based
compensation
expense............ 479,000 -- 5,265,364 -- 5,744,364 5,265,364
General and
administrative
expenses........... 950,299 9,137 534,632 3,703 1,488,634 538,335
Other -- net......... 4,622 -- 47,940 (800) 51,762 47,140
----------- ---------- ----------- ---------- ------------ -----------
Net loss............. $(3,683,219) $ (13,467) $(6,513,228) $ (2,903) $(10,199,350) $(6,516,131)
=========== ========== =========== ========== ============ ===========
Weighted average
number of shares
outstanding........ 9,075,833 9,075,833 9,075,833 9,075,833 9,075,833 9,075,833
=========== ========== =========== ========== ============ ===========
Net loss per share... $ (.41) -- $ (.72) -- $ (1.12) $ (.72)
=========== ========== =========== ========== ============ ===========
</TABLE>

<TABLE>
<CAPTION>
DECEMBER 31,
-----------------------
1997 1998 MARCH 31, 1999
---------- ---------- ---------------------------
BALANCE SHEET DATA ACTUAL ACTUAL ACTUAL AS ADJUSTED(1)
- ------------------ ---------- ---------- ---------- --------------
<S> <C> <C> <C> <C>
Working capital (deficit)................... $ (2,883) $3,563,302 $ (516,157) $38,523,843
Total assets................................ $ 2,582 $4,611,464 $3,290,957 $40,330,957
Total liabilities........................... $ 5,465 $ 691,042 $2,574,754 $ 574,754
Stockholders' (deficit) equity.............. $ (2,883) $3,920,422 $ 716,203 $39,756,203
</TABLE>

- ---------------

(1) As adjusted to reflect the sale of 4,000,000 shares of common stock offered
hereby at an assumed offering price of $11.00 per share and the application
of the net proceeds. See "Use of Proceeds."

13
<PAGE> 16

MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion of our financial condition and results of
operations for the three months ended March 31, 1999 and 1998 and the year ended
December 31, 1998 and the period from June 25, 1997 (inception) through December
31, 1997 should be read in conjunction with our financial statements, the notes
related thereto, and the other financial data included elsewhere in this
prospectus.

RESULTS OF OPERATIONS

We are a development stage company and commenced operations on June 25,
1997. Our operations for the period June 25, 1997 through approximately May 1998
were limited to organizing our company, raising operating capital, hiring
initial employees and drafting our business plan. For this reason our results of
operations for the three months ended March 31, 1998 and the period ended
December 31, 1997 are not comparable to the results of operations for the three
months ended March 31, 1999 and the year ended December 31, 1998, respectively.

In 1998 we hired many of our current management and employees, raised
working capital for development and operations and launched the quepasa.com Web
site. We have had no significant revenue to date, but incurred $3.7 million and
$6.9 million of operating losses during the three months ended March 31, 1999
and the year ended December 31, 1998, respectively.

During the three months ended March 31, 1999, our $3.7 million operating
loss was comprised primarily of the following:

- $2.1 million for advertising and marketing expenses which primarily
included $1.2 million for our radio broadcast agreement with Heftel,
$300,000 for our advertising agreement with Garcia/LKS and $123,000 for
our television broadcast agreement with Telemundo;

- $950,000 for general and administrative expenses which primarily included
$600,000 of salaries and related expenses, professional fees of $150,000
and other office and related expenses of $200,000;

- $479,000 for stock-based compensation; and

- $187,000 for product and content development expenses which primarily
included $119,000 for Internet service costs and our Inktomi license
agreement.

During the three months ended March 31, 1999, interest expense was incurred
on a $2.0 million loan from The Monolith Limited Partnership, a former
stockholder.

During the year ended December 31, 1998, our $6.5 million operating loss
was comprised primarily of the following:

- $5.3 million for stock-based compensation;

- $535,000 for general and administrative expenses which primarily included
$260,000 of salaries and related expenses, professional fees of $75,000,
rent of $27,000 and other office and related expenses of $173,000;

- $415,000 for product and content development expenses which primarily
included $187,000 for Internet service costs and our Inktomi license
agreement; and

- $250,000 for advertising and marketing.

During the year ended December 31, 1998, interest expense was related to
interest incurred on convertible notes payable.

We expect in the near term to incur significant continuing losses due to
ongoing substantial operating expenses offset by negligible revenue.

14
<PAGE> 17

Details of the stock option grants and common stock issuances, discussed
above which resulted in stock based compensation for the three months ended
March 31, 1999 and the year ended December 31, 1998 are as follows:

<TABLE>
<CAPTION>
NUMBER OF STOCK BASED VESTING
THREE MONTHS ENDED MARCH 31, 1999 SHARES/OPTIONS EXERCISE PRICE COMPENSATION(1) PERIOD
--------------------------------- -------------- -------------- --------------- -------
<S> <C> <C> <C> <C>
STOCK OPTION GRANTS
Directors............................ 50,000 $1.50 to $8.00 $426,500 (2)
Employees............................ 35,000 $1.00 $ 52,500 3 years

YEAR ENDED DECEMBER 31, 1998
STOCK OPTION GRANTS
Officer.............................. 50,000 $1.50 $113,000 (2)
Employees............................ 65,000 $1.00 to $1.50 $166,000 (2)
</TABLE>

<TABLE>
<CAPTION>
NUMBER OF FAIR STOCK BASED
YEAR ENDED DECEMBER 31, 1998 SHARES/OPTIONS VALUE(3) COMPENSATION
---------------------------- -------------- -------- ------------
<S> <C> <C> <C>
COMMON STOCK ISSUANCE
Officer.................................................. 1,420,000 $1.00 $1,420,000
COMMON STOCK TRANSFER BY EXISTING STOCKHOLDERS
Officers and Directors................................... 297,621 1.00 298,000
Consultants.............................................. 1,607,151 1.00 1,607,000
Employees................................................ 1,661,942 1.00 1,662,000
</TABLE>

- ---------------

(1) The fair value of the options granted to directors is estimated on the date
of grant utilizing the Black-Scholes option pricing model based upon an
expected life of ten years, no volatility, risk free interest rates of 6%
and zero dividend yield. Stock-based compensation for employees is
determined using the intrinsic value of the option.

(2) These options became exercisable on their date of grant.

(3) The fair value of the common stock on the date of these issuances was based
on the cash price paid for common stock and the conversion rate on debt
issued at the approximate times of the above transactions.

In addition, we will record an approximate $4.5 million charge to earnings
for the three months ending June 30, 1999 as a result of various other stock
option grants and common stock issuances which occurred between April 1, 1999
and June 23, 1999. The $4.5 million charge includes $2.5 million related to
stock options and common stock issued to our President and $2.0 million related
to 385,000 stock options issued to 11 officers, directors and employees
subsequent to March 31, 1999. See Note 8 to the financial statements.

LIQUIDITY AND CAPITAL RESOURCES

Inception to March 31, 1999

Net cash used in operations was approximately $5.4 million from inception
to March 31, 1999, which resulted from $10.2 million in losses from inception
reduced by $5.7 million of stock-based compensation.

Net cash used in investing activities from inception was related to the
purchase of approximately $870,000 in fixed assets. Net cash provided by
financing activities from inception to March 31, 1999 of approximately $6.8
million resulted from $4.1 million from private placements, $1.1 million from
the issuance of convertible notes payable and $2.0 million from the issuance of
a note payable.

Since inception, we have received approximately $5.2 million to fund our
operations from private placements of common stock and convertible debt and $2.0
million from a loan advanced by Monolith, a former principal stockholder.
Additionally, our Chief Technology Officer has agreed to lend us up to

15
<PAGE> 18

$3.0 million as needed for operations of which approximately $2.3 million was
advanced through May 12, 1999. There are no conversion features associated with
these loans. The loan from Monolith will be repaid with a portion of the
proceeds of this offering. The loan from our Chief Technology Officer will be
due 24 months from the date funds are advanced.

Three Months Ended March 31, 1999

Net cash used in operations was approximately $2.4 million for the three
months ended March 31, 1999. This resulted from an approximately $3.7 million
loss offset by receipt of a $1.5 million refundable deposit, an increase of
approximately $317,000 in accounts payable and other operating activities.
Additionally, we used approximately $1.1 million for prepaid broadcast
advertising.

Net cash used in investing activities was approximately $570,000 for the
three months ended March 31, 1999, consisting of $510,000 of fixed asset
purchases which primarily included technology products, furniture and fixtures
and $60,000 paid under the Inktomi licensing agreement.

Net cash provided by financing activities was approximately $1.3 million
for the three months ended March 31, 1999 and consisted of a $2.0 million loan
from Monolith, one of our principal stockholders. This loan was offset by
deferred initial public offering costs of approximately $340,000 and the payment
of accrued commissions and stock subscriptions refundable of approximately
$191,000 and $338,000, respectively.

Year Ended December 31, 1998

Net cash used in operations was approximately $3.0 million for the year
ended December 31, 1998. This resulted from the approximately $6.5 million net
loss of which approximately $5.3 million was a non-cash charge for stock-based
compensation and the timing of receipt of an approximately $1.5 million deposit
receivable.

Net cash used in investing activities for the year ended December 31, 1998
was related to purchases of approximately $360,000 of fixed assets.

Net cash provided by financing activities was approximately $5.6 million
for the year ended December 31, 1998 and consisted of approximately $4.1 million
in proceeds from private placements, approximately $1.1 million from the
issuance of convertible notes payable and approximately $550,000 from accrued
commissions and stock subscriptions refundable.

Currently, we have commitments under non-cancelable operating leases for
office facilities and office equipment requiring payments of $168,000 through
December, 1999 and $734,000 thereafter. We are required to pay $650,000 pursuant
to the terms of the Inktomi licensing agreement through September 2001. The
Inktomi agreement may require additional payments based upon our level of use;
however, we believe the additional payments, if any, will not be material. We
are also obligated to pay approximately $246,000 in 1999 and $129,000 in 2000
for technology and content used on our Web site portal provided by Reuters,
WeatherLabs, GTE and Exodus. We are required to pay an additional $1.0 million
under our sponsorship agreement with the Arizona Diamondbacks, $1.0 million
under our advertising agreement with Telemundo, and $400,000 under our agreement
with the Miami Herald. These agreements are described under "Our
Business -- Marketing and Advertising of the Quepasa.com site" and "Our
Business -- Our Strategic Relationships." We will recognize the expense related
to our advertising, content and technology agreements in a manner consistent
with how we receive the services provided for under the terms of the respective
agreements. Generally, the services are received evenly over the terms of the
agreements.

We expect to incur significantly higher costs, particularly marketing and
advertising costs, product content and development costs, general and
administrative costs and additional technology and equipment purchase costs
during the remainder of our calendar year in order to expand our business. We
expect to expend the largest portion of our existing capital and offering
proceeds on marketing and advertising expenses and do not expect significant
revenue to be realized, if at all, in 1999. Nevertheless, we believe that the
proceeds from this offering, together with our cash on hand and the $3.0 million
line of credit
16
<PAGE> 19

provided by our Chief Technology Officer will be sufficient to meet our working
capital and capital expenditure needs for two years. Although we do not believe
it will be necessary for us to raise additional funds in the next six months, we
may need additional funds at a later date to respond to competitive pressures or
to acquire complementary products, features, businesses or technologies.

Rescission Issue

YEAR 2000 ISSUE

We depend on the delivery of information over the Internet, a medium which
is susceptible to the Year 2000 Issue. The "Year 2000 Issue" is typically the
result of limitations of certain software written using two digits rather than
four to define the applicable year. If software with date-sensitive functions is
not Year 2000 compliant, it may recognize a date using "00" as the year 1900
rather than the year 2000. The Year 2000 Issue could result in a system failure
or miscalculations causing significant disruption of our operations, including,
among other things, interruptions in Internet traffic, accessibility of our Web
site, delivery of our service, transaction processing or searching and other
features of our services. It is possible that this disruption will continue for
an extended period of time.

We depend on information contained primarily in electronic format in
databases and computer systems maintained by third parties and us. The
disruption of third-party systems or our systems interacting with these third
party systems could prevent us from delivering search results or other services
in a timely manner which could materially adversely affect our business and
results of operations.

We have assessed our information technology equipment and systems, which
includes our development servers and workstations and production server
monitoring software. We also use multiple software systems for internal business
purposes, including accounting, e-mail, human resources and development. All of
this equipment and software has been purchased within the last 18 months. We
have obtained Year 2000 compliance information from the vendors of this
equipment and software. Based on this research we do not believe that these
systems contain Year 2000 deficiencies. However, we have not conducted our own
tests to determine to what extent software running on any of our hardware
platforms fails to properly recognize Year 2000 dates.

We have reviewed the current version of our internally developed free
e-mail application to determine Year 2000 compliance. We have searched through
the software code for this application and we have determined that it correctly
recognizes Year 2000 date codes.

We have identified and have begun assessing non-information technology
embedded systems such as voice mail, office security, fire prevention and other
systems. We generally believe that our non-information technology embedded
systems do not present Year 2000 issues.

Although we believe that we will be Year 2000 compliant, we use third party
equipment and software that may not be Year 2000 compliant. We have contacted
the majority of our critical third party service suppliers by telephone asking
about the status of their Year 2000 program. We have received responses from
approximately 72% of our third party suppliers. We have received a written
response from GTE and have been referred to information made publicly available
by Reuters, Exodus, Microsoft and Dell Computer. We intend to send letters to
the remaining third party service suppliers regarding their Year 2000 readiness.
All suppliers responding to date have asserted that their products will be Year
2000

17
<PAGE> 20

compliant. In the event we do not receive satisfactory commitments from a key
supplier, we will make plans for continuing availability of service through
alternate channels. We expect to have certification that all key vendors and
suppliers are Year 2000 compliant during the third quarter of 1999.

To date we have not incurred any material expenditures in connection with
evaluating Year 2000 issues. All of our expenses have related to the opportunity
cost of time spent by one of our employees identifying and evaluating Year 2000
compliance matters.

We have not developed a Year 2000-specific contingency plan. If Year 2000
compliance issues are discovered, we then will evaluate the need for contingency
plans relating to such issues. We intend to actively work with our suppliers to
minimize the risks of business disruptions resulting from Year 2000 issues and
develop contingency plans where necessary. Such plans may include using
alternative suppliers and service providers. We expect to have such plans in
place by the fourth quarter of 1999.

The worst case scenario related to Year 2000 issues would involve a major
shutdown of the Internet, which would result in a total loss of revenue to us
until it was resolved.

18
<PAGE> 21

OUR BUSINESS

INTRODUCTION

INDUSTRY BACKGROUND

Growth of the Internet and the World Wide Web

The Internet is evolving into a global medium, allowing millions of
individuals throughout the world to communicate, share information and engage in
commerce electronically. The Web is an interactive environment which facilitates
the exchange of information and entertainment among users worldwide. According
to International Data Corporation, the number of people worldwide accessing the
Web will grow from approximately 100 million at year end 1998 to 320 million by
2002. This growth is expected to be driven by the large and growing number of
personal computers installed in homes and offices, the declining prices of
personal computers, the improvements in network infrastructure, the availability
of faster and cheaper Internet access, and the increasing familiarity with and
acceptance of the Internet by businesses and consumers. Web usage is also
expected to continue to grow rapidly due to unique characteristics that
differentiate it from traditional media, such as real-time access to interactive
content, real-time communication capabilities and the absence of geographic or
temporal limitations.

Growth of Internet Advertising and Internet Commerce

With the growth in the number of Internet users and content providers, the
Internet is developing the attributes of a conventional mass medium, where
advertising subsidizes content delivered to users. In fact, technological
advances and the acceptance of the medium by businesses have led to rapid growth
in Internet advertising spending. Tools not available in traditional advertising
media, such as real-time measurement of consumers accessing an advertiser's Web
site through an advertising banner, further increase the attractiveness of Web
advertising by giving advertisers real-time feedback on advertising campaigns.
Forrester Research, Inc. estimates that spending on Web-based advertising will
increase from $1.5 billion in 1998 to more than $15.0 billion in 2003.

The growing acceptance and use of the Web has created an opportunity for
businesses to conduct commerce over the Internet. International Data Corporation
estimates that transactions on the Internet are expected to increase from
approximately $32.0 billion in 1998 to more than $425.0 billion in 2002.
Businesses typically use the Internet to offer standard products and services
that can be easily described with graphics and text and that do not necessarily
require a physical presence for purchase of items, such as airline tickets,
books and investment securities. The focus of electronic commerce transactions
evolved from companies facilitating Internet transactions between businesses to,
more recently, companies targeting business-to-consumer transactions. Internet
commerce enables these companies to develop relationships with customers on a
global basis without making significant investments in traditional sales and
distribution infrastructure.

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<PAGE> 22

OUR MARKET IN THE UNITED STATES

We believe that the Spanish-language Internet market in the United States
is characterized by a growing Hispanic population, increasing Hispanic
purchasing power, greater advertising spending on Spanish-language media,
continuing use of the Spanish language by U.S. Hispanics and increasing computer
ownership and Internet usage by Hispanic households.

Hispanic Population Growth and Concentration

A large number of our users are Hispanics, one of the most rapidly growing
segments of the U.S. population. According to the U.S. Census Bureau and
published sources, the Hispanic population:

- Is estimated to be 29.6 million or 11% of the total U.S. population in
1998, an increase of approximately 31% from 22.5 million or 9% of the
total U.S. population in 1990;

- Is expected to account for 40% of the total U.S. population growth
between 1995 and 2010 and is expected to grow to 41.1 million or 14% of
the total U.S. population by 2010; and

- Is relatively young, with almost 70% of U.S. Hispanics under 35, compared
with less than 50% of non-Hispanics, and with a median age of 26,
compared to 35 for the rest of the population.

We believe the relative youth of the Hispanic population will furnish
growth opportunities for products and services that appeal to a younger market,
such as that found on the Internet. In addition, 70% of all U.S. Hispanics live
in 12 metropolitan areas, which makes U.S. Hispanics an attractive demographic
group for advertisers, enabling them to cost effectively deliver messages to a
highly targeted audience.

Increasing Hispanic Purchasing Power

Total U.S. Hispanic purchasing power:

- Has risen at a compound annual growth rate of 7.5%, compared with 5% for
the rest of the population from 1993 to 1998.

- Is projected to be $383.0 billion in 1999, an increase of approximately
84% since 1990.

- Is expected to account for $443.0 billion or 7% of U.S. consumer
expenditures by 2000, and $938.0 billion or 9% of U.S. consumer
expenditures by 2010.

Greater Spanish-language Advertising Spending

According to Hispanic Business Magazine, $1.7 billion of total advertising
expenditures in the U.S. were directed toward Spanish-language media in 1998,
representing a 21% increase over 1997's total, and the highest year-to-year
percentage increase since 1993. In only five years, total advertising
expenditures in the Hispanic market have more than doubled from $829.7 million.

Continuing Use of the Spanish-language by U.S. Hispanics

According to published sources, approximately 90% of U.S. Hispanic adults
speak Spanish at home. Moreover, U.S. Hispanics are expected to continue to
speak Spanish because:

- Approximately two-thirds of U.S. Hispanic adults were born outside the
U.S.;

- Hispanic immigration into the U.S. is continuing;

- Hispanics generally seek to preserve their cultural identity; and

- Population concentration encourages communication in Spanish.

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Increasing Computer Ownership and Internet Usage by Hispanics

A February 1998 study by The Tomas Rivera Policy Institute estimates that
between 1994 and 1998 the percentage of U.S. Hispanic households that owned
computers increased from 13% to 30%, while U.S. Hispanic households with
Internet access grew from 2% to 15%, which amounted to approximately 650%
Internet access growth in four years. In addition, an independent study
indicated that as of 1998 approximately 2.4 million Hispanics owned personal
home computers in the top seven U.S. Hispanic markets, an increase of 58% from
1996.

OUR MARKET OUTSIDE THE UNITED STATES

Spanish is the world's third most spoken language, used by approximately
350 million native speakers. In addition, twenty-one countries consider Spanish
their primary language. Internet usage in Spain is increasing rapidly. For
example, a recent study by the Spanish Internet Users Association indicated that
approximately 2.3 million Spaniards accessed the Internet in 1998 and the number
is projected to grow to 8.7 million by 2001.

The Spanish-speaking Latin American market is comprised of Mexico, Central
America, parts of South America and the Spanish-speaking countries of the
Caribbean. Factors such as growing competition in telecommunications markets,
declining prices for personal computers and Internet access and favorable
demographics position Latin America as a strong potential growth market for
Internet products and services. According to International Data Corporation, the
number of Internet users in Latin America, excluding Portuguese-speaking
Brazilians, is expected to increase from 2.5 million at year end 1998 to 11.7
million at year end 2003. In particular, the number of Internet users in Mexico
is expected to increase from approximately 700,000 at year end 1998 to
approximately 3.9 million by the end of 2003, which represents a 43% compounded
annual growth rate.

THE QUEPASA.COM STRATEGY

We believe that a branded, multi-featured, Spanish-language Internet
community that focuses primarily on the needs of the Spanish-language market
would be uniquely positioned to capitalize on the growth of this market segment.
Therefore, our strategy is to establish quepasa.com as a leading worldwide
Spanish-language online community offering the quepasa.com services to
Spanish-speaking Internet users residing in the United States, Latin America,
Europe and other regions of the world. In order to accomplish this objective, we
intend to continue to focus on developing content, a high volume of traffic and
strong brand recognition of the quepasa.com name. The basis of our strategy is
to provide Spanish-language Internet users with an innovative,
technologically-advanced, content-rich Web community that creates value for the
user and establishes our platform as an attractive medium for advertisers,
marketers and companies engaged in electronic commerce.

We are establishing quepasa.com as a leading Spanish-language Web community
by executing a business strategy that includes:

Developing quepasa.com in the United States and then globally as a leading
brand associated with the Internet for Spanish-language users

Our short range goal is to establish quepasa.com as the leading brand among
U.S. Spanish-speaking Internet users. We believe that establishing and then
promoting the quepasa.com brand is critical to our ability to attract users and
advertisers to our Web site. We also believe that branding and consumer loyalty
on the Internet are dependent upon our ability to differentiate our services and
to enhance our users' experience by continually offering innovative technology
and appealing features and effectively marketing these features to existing and
potential users of our Web site. We intend to improve our technical expertise

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to develop innovative new services, as well as enhance and expand existing
services. We also intend to continue our brand development through:

- Network television and national cable advertising;

- Network radio advertising;

- National print, outdoor and Internet advertising;

- Additional strategic partnerships;

- Additional marketing and distribution arrangements;

- Special event sponsorships; and

- Public and community relations programs.

Acquiring and Developing Additional Content and Features for the quepasa.com
Community

In addition to its search engine, quepasa.com provides content and
community features for the Spanish-speaking Internet user, including free
e-mail, Spanish-language news feeds, worldwide weather information, chat rooms
and message boards. In order to provide some of this content, we have entered
into agreements with content providers such as Reuters for Spanish-language news
and WeatherLabs for worldwide weather information. These arrangements allow us
to increase our Web site content in order to attract and retain Spanish-speaking
Internet users and to solidify our position as an easy-to-use interface for
Spanish-language Web services and information. We have also internally developed
other content such as our e-mail and message boards and have begun development
of our own chat services. We recently entered into relationships with Telemundo,
Miami Herald Online and Fox Sports World Espanol that will provide us with
unique content. We intend to add additional content and features through
acquisition, licensing and internal development.

Entering Into Strategic Relationships with Business Partners Who Offer Unique
Media, Content, Technology and Distribution Capabilities

We intend to continue to establish strategic relationships with companies
that will enhance our services and increase our user base. We have strategic
relationships with companies such as Telemundo, Miami Herald Online, Inktomi,
Arizona Diamondbacks, GTE, Reuters and Exodus. These and other relationships are
summarized under "Our Business -- Our Strategic Relationships."

Expanding Into Additional Spanish-speaking Markets

We seek to establish quepasa.com as a leading destination site for
Spanish-speaking Internet users throughout the world. At the present time, the
majority of our users reside in the United States. As Internet access improves
and usage increases, we intend to allocate future resources to develop our brand
in non-U.S. Spanish-speaking markets, such as Latin America and Spain.

Generating Revenue from the Sale of Advertising and Through Electronic Commerce

We have an agreement with 24/7 Media, Inc., a leading provider of Internet
advertising solutions, to sell advertising on our Web site to customers
solicited by 24/7 Media. We intend to generate revenue from other electronic
commerce retailers that sell products or services to users through our Web site.
These products and services will be targeted toward the distinct tastes and
preferences of Spanish-speaking consumers and may include recorded music,
educational software and books.

THE QUEPASA.COM COMMUNITY

Services and Content. In November 1998, we launched the quepasa.com Web
site which allows individuals to quickly access content and features which
appeal to Spanish-language Internet users. Although our content is directed
toward Spanish-speaking users, to better serve the U.S. Hispanic
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population, quepasa.com is also offered in English. By combining existing
services with specialized information from leading content providers,
quepasa.com provides subject or category specific content including topical
news, worldwide weather information, free e-mail, chat, message boards and
search capabilities.

The quepasa.com Web site currently offers a number of categories of topical
interest, including the following:

Arte y Cultura (Art and Culture)
Ciencia y Tecnologia (Science and Technology)
Ciencias Sociales (Social Sciences)
Computadoras y Internet (Computers and Internet)
Deportes y Recreacion (Sports and Recreation)
Economia y Negocios (Economy and Business)
Educacion (Education)
Empleos (Jobs)
Entretenimiento (Entertainment)
Noticias y Medios (News and Media)
Politica y Gobierno (Politics and Government)
Regional (Regional)
Salud (Health)
Temas de Sociedad (People and Society)
Viajes y Turismo (Travel and Tourism)

Search Engine. The quepasa.com search engine helps users find information
on the Web by searching through quepasa.com's index of Web documents. Our search
technology is provided by Inktomi which enables us to provide customers with a
variety of online search services.

Personalization Feature. We offer our users the ability to personalize
their quepasa.com home page. Quepasa.com users can create a personal profile to
select and update information of interest by category, such as news headlines,
business, sports scores, weather information and horoscopes. Users can also
arrange the position and location of the content on their quepasa.com home page
to suit their specific tastes and preferences.

Free E-Mail, Chat and Message Board Features. Quepasa.com offers free
e-mail and free Web community services that consist of chat services and message
boards. These features enable users to discuss topics of mutual interest by
participating in ongoing discussions or by creating their own topics for
discussion.

24 Hour Real-time News and Weather. Quepasa.com offers worldwide news
coverage from Reuters including worldwide editorialized, topical news covering
areas of special interest to Spanish-speaking users (in Spanish and English), as
well as a Spanish-language news feed that we intend to format and edit
internally to provide broad coverage of news that will be of special interest to
Spanish-speaking users. Our users are also able to search a database of archived
news stories published by Reuters over the prior 30-day period. We have also
arranged with the Miami Herald Online to obtain Spanish and English language
news content in the near future. Through an agreement with WeatherLabs, we also
offer worldwide weather information, including real time weather reports and
forecasts, for 5,000 U.S. and 2,400 international cities.

OUR STRATEGIC RELATIONSHIPS

We have established strategic relationships with leading providers of
media, content and technology designed to:

- provide access to unique content;

- enhance our services;

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<PAGE> 26

- extend our audience reach;

- increase user traffic on our Web site;

- provide enhanced Web site functionality; and

- provide us with additional revenues.

These relationships include:

Telemundo. In April 1999, we entered into a strategic agreement with
Telemundo, a leading Spanish-language television broadcaster that has served the
U.S. Hispanic market for over 11 years. Under this agreement, we issued
Telemundo 600,000 shares of our common stock and warrants to purchase 1,000,000
shares of our common stock exercisable for two years from the date of this
prospectus at 120% of the public offering price per share. In exchange, we
received a $5.0 million advertising credit on the Telemundo television network
at the rate of $1.0 million for each of the next five years. We also agreed to
purchase an additional $1.0 million of advertising from Telemundo to be
broadcast over 26 weeks commencing in August 1999. This agreement also provides
that we will collaborate regarding online content development, co-branded
marketing promotions and other complementary aspects of our businesses. The
agreement may be cancelled by either party if we do not complete the offering of
our common stock by June 27, 1999 at a price of at least $10.00 per share.

Miami Herald Online. In April 1999, we entered into an agreement with
Miami Herald Online regarding content development and management. Under our
agreement, we will pay $720,000 to Miami Herald Online over a one year period
for its editorial staff to produce a Spanish and an English news channel for us,
in addition to providing us with news from El Nuevo Herald, a Spanish-language
daily newspaper, The Miami Herald, the Knight Ridder national reporting staff
and other Knight Ridder newspapers. Additionally, Miami Herald Online will
designate us as the preferred search engine of El Nuevo Herald Digital and will
provide us with 200,000 banner impressions per month on its network of sites.

Fox Sports World Espanol. In April 1999, we entered into a one season
sponsorship and content agreement with Fox Sports World Espanol involving the
Copa America 1999 soccer tournament scheduled to take place June 29 - July 18,
1999. Fox Sports World Espanol holds the exclusive U.S. television rights for
the tournament. Our agreement calls for us to pay Fox Sports World Espanol
$425,000 and for the parties to collaborate on the development of a co-branded
"copaamerica1999.com" event Web site. We will operate the event Web site that
will feature content such as match previews, summary articles, Copa America
updates, wire service news coverage and real-time scoring updates. The
arrangement also involves numerous media elements and joint marketing
promotions.

Other Strategic Relationships. We have entered into agreements to purchase
marketing, technology and content with:

- Arizona Diamondbacks -- a $1.5 million marketing, promotions and sports
information plan for the 1999 major league baseball season;

- Inktomi -- a three year, $750,000 search technology agreement;

- GTE Internetworking -- a one year, $168,000 networking technology
agreement;

- Exodus Communications -- a one year networking technology services
agreement which we estimate will require us to pay less than $10,000 per
year;

- Reuters NewMedia -- a 26 month, $120,000 per year agreement under which
we obtain news, business and sports information;

- WeatherLabs -- a one year, $36,000 weather information agreement; and

- 24/7 Media -- a four month commission-based Internet advertising sales
services agreement.

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MARKETING AND ADVERTISING OF THE QUEPASA.COM SITE

Our marketing goal is to increase traffic on the quepasa.com Web site and
to develop the quepasa.com brand in the United States and then globally as a
leading brand associated with the Internet for Spanish-speaking users. Our
marketing plan includes the use of multiple advertising media, such as national
network and cable television, network radio, national print, outdoor and
Web-based advertising.

In February 1999, we chose Garcia/ LKS advertising agency as our global
marketing partner because of its strong track record in building brands and
launching products in the Hispanic market. Garcia/ LKS is led by principals
Lionel Sosa and Luis Garcia. The agency has represented Fortune 500 companies,
including Coca Cola, Levi-Strauss, Proctor & Gamble and Sprint. The agency has
also provided demographic specific marketing expertise for the political
campaigns of President Ronald Reagan, President George Bush and Texas Governor
George W. Bush. We pay Garcia/LKS $78,000 per month under an agreement
cancellable by either party on 30 days notice.

In March 1999, we launched an approximately $800,000 26-week nationwide
advertising campaign with the Telemundo Network Group. Telemundo, which is owned
by Sony and Liberty Media, is a leading Spanish-language television broadcaster
that has served the U.S. Hispanic market for over 11 years. Telemundo's
affiliate base, covering 63 television markets, reaches approximately 85% of all
U.S. Hispanic households. Sony and Liberty Media provide Telemundo with
substantial financial resources, strong management and a vast programming
library. Telemundo intends to draw on this library in order to target a younger,
bilingual Hispanic audience. Telemundo's programming includes shows such as
"Cinemundo Primer," a primetime program featuring popular U.S. and Latin
American movies, many appearing for the first time on Spanish-language
television, "Ocurrio Asi de Noche," an Emmy award-winning investigative news
magazine, and "Discovery" offering nature, science, technology and history
programming from the Discovery Channel.

In April 1999, we initiated an approximately $780,000, nine-week nationwide
radio advertising campaign with Heftel Broadcasting Corporation, the largest
Spanish radio broadcaster in the United States, with approximately 19 million
Spanish-speaking listeners. Heftel owns and operates 39 stations in 11 of the
top 15 Hispanic markets, including the most-listened to Spanish-language
stations in nine markets. We believe the sponsorship with Heftel will provide us
with an effective platform to communicate our message to our target audience,
because approximately 65% of U.S. Hispanics reside in Heftel's top 15 markets.
The quepasa.com sponsorship with Heftel includes the purchase of air time in the
top Hispanic radio markets, "on-air promos" by radio personalities and prominent
sponsorships of Hispanic community festivals and events involving Heftel radio
stations, such as the Calle Ocho Festival in the Little Havana area of Miami.
Calle Ocho is the largest street festival in the U.S., attended by more than one
million people in 1998.

Our Copa America sponsorship with Fox Sports World Espanol covers one
soccer season for which we have agreed to pay $425,000 and provides that we will
be the only Internet search engine and portal to advertise on the network in the
United States. As a major sponsor of this event we are entitled to the following
advertising and promotional elements:

- Commercial announcements during Copa America soccer matches;

- On-air mentions and graphics directing viewers to our event Web site;

- On-screen displays of our logo next to the soccer game clock;

- Title sponsorship of two Copa America consumer promotions; and

- An exclusive promotional partnership with Fox Sports World Espanol which
places our logo on at least 600,000 printed promotional pieces;

- Commercial announcements and on-screen displays of our logo during Fox
Sports World's weekly telecasts of South American Soccer for 39 weeks
beginning on April 19, 1999.

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We also intend to increase our Web site traffic by increasing the number
and visibility of entry points to the quepasa.com Web site through co-branding
and other marketing arrangements with content providers and high-traffic
Spanish-language Web sites. For instance, we have arranged with the Miami Herald
Online to develop news channels for our Web site and to promote our Web site on
the Miami Herald Online network of sites.

In an effort to increase hits, Web site operators are increasingly adding
content and other features to their sites to encourage users to spend more time
there. We intend to regularly enhance our technological features and services
and update our content in order to encourage consumers to use our Web site more
frequently. To this end, we have launched a flexible, subject-based format for
our services and content to provide consumers with ease of use and flexibility
to customize their quepasa.com site to fit their specific tastes and
preferences. Because customizing these services typically requires some effort
and time on the part of the consumer, we believe that consumers who use these
personalized services are more likely to continue to use quepasa.com and not
change to a competitive service.

Our page views, which represent the number of times our server delivers a
page to a user, grew from approximately 103,700 in January 1999 to approximately
4,600,000 in May 1999 and our user session length grew from an average of
approximately 7.0 minutes to approximately 17.2 minutes. Total user sessions
grew from 40,284 in January 1999 to 418,200 in May 1999. Between February 28 and
June 15, 1999 our registered e-mail users grew from 201 to approximately 34,000.
We believe that this growth in our Web site traffic was a result of our
advertising campaigns with Heftel and Telemundo and the continued development of
our Web site content and features.

We intend to use approximately $21.5 million of the proceeds of the
offering to further advertise and market the quepasa.com Web site. See "Use of
Proceeds."

OUR PLAN TO SELL ADVERTISING ON THE QUEPASA.COM SITE

We have had nominal advertising revenue to date, but we expect to earn a
significant portion of our future revenue from the sale of advertisements placed
on our Web site. In exchange for up to 50% of our advertising revenue, we have
entered into an agreement with 24/7 Media, Inc. to use its best efforts to sell
advertising on our Web site to customers solicited by 24/7 Media. The agreement
may be terminated by either party by giving the other at least four months'
written notice. 24/7 Media is a leading provider of Internet advertising and
online direct marketing solutions with one of the largest Internet sales forces
in the industry. 24/7 Media's clients include AT&T WorldNet, EarthLink and the
Associated Press. In the future, we may elect to develop an internal advertising
staff. We do not expect significant revenue from advertising in 1999.

We expect advertisements on the quepasa.com site to be of the banner or
billboard style, which are designed to display additional advertisements as the
consumer selects various topics on the Web site. From each advertisement screen,
users can proceed directly to an advertiser's own Web site, thus enabling the
advertiser to directly interact with a user who has expressed interest in the
advertisement. We believe that since users view advertisements only after they
request a new page, the focus of the user's attention to the advertisement is
likely to be higher than it is in other forms of media. With our subject-based
format, growing number of services and ability to target user interest from an
attractive demographic group with appropriate advertising, we believe we can
increase the effectiveness of advertisements placed on the quepasa.com Web site.
We hope this will permit us to command higher advertising returns than many
other Web sites.

We also intend to develop innovative approaches for advertisers through
advancements by others in demographic trending and consumer tracking. We seek to
attract the largest possible Web audience in the Spanish-speaking Internet
market, in order to give advertisers the most efficient and effective
advertising placements. We are developing services that encourage consumers to
provide demographic and interest information that can be used to more
effectively target our advertising. Our recently launched membership
registration system requires users to create a quepasa.com account in order to
access our chat, e-mail and message board services. At the time of registration,
users are assigned a unique user identification and
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password after providing us with personal information that will allow
advertisers to target users with a specific demographic profile. Users can
access their quepasa.com account and personalized settings from any Internet
access device.

OUR DEVELOPMENT AND ACQUISITION OF WEB SITE TECHNOLOGIES

We believe we can differentiate our services and promote the quepasa.com
brand by developing innovative proprietary technology and integrating technology
licensed from third parties where appropriate. Our strategy is to develop or
obtain technologies that are able to expand with the growth in content of the
Internet. For instance, we recently developed our own e-mail service which we
believe provides functionality, message volume, data storage and incoming and
outgoing file attachment capabilities that is superior to most other free e-mail
services.

In July 1998, we entered into a three-year agreement with Inktomi to
provide search engine capability for our quepasa.com Web site. Under the terms
of the agreement, we will pay Inktomi a minimum fee of $750,000 over the
three-year period for Inktomi's search engine services. The fee could increase
based upon the number of searches performed by Inktomi for our users.

Inktomi's search engine technology enables us to provide a variety of
online search services to our customers. Inktomi provides and manages all
hardware, software and operational aspects of its search engine and the
associated database of Internet content. Inktomi also provides us with a
programming interface and software tools to enable us to custom design our
search service user interface. Separating the user interface enables this
portion of the service to reside in a different physical location from the
Inktomi search engine and to run on our choice of computer equipment. In
addition, we can customize our user interface as to look, feel and functionality
and can change the user interface at any time without affecting the operation of
the Inktomi search engine.

Inktomi's search engine consists of a crawler, an indexer and search engine
servers. The crawler and indexer are software programs that collect and organize
information and store that information on the cluster of search engine servers.
The search engine servers are a collection of workstations that are linked
together as a coupled cluster through the use of Inktomi's software. The search
engine servers provide powerful full-text query operations, including full
Boolean support, phrase and adjacency searching, date restrictions and the
recognition of multimedia files and other embedded objects. Search results are
relevance-ranked using state-of-the-art text indexing methods.

Services which link our users to our Web site and to Inktomi's search
engine are provided to us by Exodus and GTE. Exodus is one of the largest
companies involved in connecting users to the Internet, with a client list that
includes Microsoft Hotmail, Ebay, GeoCities, HotBot and Inktomi. GTE delivers
complete network solutions, dedicated Internet access, high performance Internet
hosting, managed Internet security, network management, systems integration and
Web-based applications development for integrating the Internet into business
operations.

COMPETITORS AND COMPETITIVE FACTORS AFFECTING OUR BUSINESS

The market for Internet products, services, advertising and commerce is
intensely competitive, and we expect that competition will continue to
intensify. We believe that the principal competitive factors in these markets
are name recognition, distribution arrangements, functionality, performance,
ease of use, the number of value-added services and features, and quality of
support. Our primary competitors are other companies providing portal and online
community services, especially to the Spanish-language Internet users, such as
Yahoo!, America Online, StarMedia Network, Prodigy, Microsoft networks in Latin
America, Mexico and Spain, Lycos and Ole.

Other portal competitors include AltaVista, Excite and Infoseek. In
addition, a number of companies offering Internet products and services,
including our direct competitors, recently began integrating multiple features
within the products and services they offer to users. Integration of Internet
products and services is occurring through development of competing products and
through acquisitions of, or entering into joint

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ventures and/or licensing arrangements involving, competitors. For example, the
Web browsers offered by Netscape and Microsoft, which are the two most
widely-used browsers and substantial sources of traffic for us, may incorporate
and promote information, search and retrieval capabilities in future releases or
upgrades that could make it more difficult for Internet viewers to find and use
our products and services.

Microsoft recently announced it intended to license products and services
from AltaVista and that it will feature and promote AltaVista services on the
Microsoft Network and other Microsoft online properties. We expect that such
search services may be tightly integrated into the Microsoft operating system,
the Internet Explorer browser, and other software applications, and that
Microsoft will promote such services within the Microsoft Network or through
other Microsoft-affiliated end-user services such as MSNBC or WebTV Networks,
Inc.

Many large media companies have announced that they are contemplating
developing Internet navigation services and are attempting to become "gateway"
sites for Web users. In the event these companies develop such portal or
community sites, we could lose a substantial portion of our user traffic.
Further, entities that sponsor or maintain high-traffic Web sites or that
provide an initial point of entry for Internet viewers, such as the Regional
Bell Operating Companies or Internet service providers, such as Microsoft and
America Online, currently offer and can be expected to consider further
development, acquisition or licensing of Internet search and navigation
functions. These functions may be competitive with those offered by us. Our
competitors could also take actions that could make it more difficult for
viewers to find and use our products and services. Consolidations, integration
and strategic relationships involving competitors could have a material adverse
effect on our business.

In addition to the larger portals and online communities, we compete with a
number of smaller portals and communities that provide region-specific
information to users or market to users with specific interests.

Most of our existing competitors, as well as new competitors such as
Spanish-language media companies, other portals, communities and Internet
industry consolidators, have significantly greater financial, technical and
marketing resources than we do. As a development stage company, we need to hire
a number of additional employees, especially in the areas of business
development and marketing. There can be no assurance that our competitors will
not offer Internet products and services that are superior to ours or that
achieve greater market acceptance. There can be no assurance that we will be
able to compete successfully against current or future competitors or that
competition will not have a material adverse effect on our business.

EMPLOYEES

At May 31, 1999, we had 45 employees, including our seven executive
officers.

FACILITIES

We lease approximately 13,277 square feet of space for our executive
offices in Phoenix, Arizona for $24,341 per month pursuant to a lease which
expires in October 2002.

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OUR MANAGEMENT

OFFICERS AND DIRECTORS

Information concerning each of our executive officers and directors is set
forth below:

<TABLE>
<CAPTION>
NAME AGE POSITION
- ---- --- --------
<S> <C> <C>
Gary L. Trujillo............ 38 Chairman of the Board of Directors, Chief Executive
Officer and President
Jeffrey S. Peterson......... 26 Chief Technology Officer, Founder and Director
Juan C. Galan............... 33 Chief Financial Officer
Bryan L. Ross............... 25 Vice President -- Technology
Robert J. Taylor............ 30 Vice President -- Strategy and Operations
Victor H. Roldan............ 31 Vice President
L. William Seidman.......... 79 Director
Jerry J. Colangelo.......... 59 Director
Jose Maria Figueres......... 44 Director
Alan J. Sokol............... 40 Director
Louis Olivas................ 52 Director
</TABLE>

Directors hold office for a period of one year from their election at the
annual meeting of stockholders or until their successors are duly elected and
qualified. Officers are elected by, and serve at the discretion of, the board of
directors. Our audit committee is chaired by Mr. Seidman and consists of Messrs.
Seidman, Figueres and Olivas. We intend to add at least one additional
independent director to our board of directors upon completion of the offering.

GARY L. TRUJILLO joined us in April 1999 as President and a director and
was appointed Chairman, Chief Executive Officer and President in June 1999. In
1990, Mr. Trujillo founded Southwest Harvard Group, a Hispanic-owned and
operated business consulting firm, and has served as its President and Chief
Executive Officer from inception to present. Mr. Trujillo is a director of
Southwest Harvard Group, Blue Cross and Blue Shield of Arizona, Wells Fargo &
Co., Arizona (Advisory Board), Corella Electric Wire & Cable, The Arizona
Community Foundation and South Mountain Community College ACE Entrepreneur
Program. Mr. Trujillo is a member of the Greater Phoenix Leadership and The
Young Presidents Organization. In 1998, Mr. Trujillo received the Individual
Business Minority Advocate Award and was voted by Arizona Business Journal as
one of the most influential member of the Arizona Hispanic business community.
Mr. Trujillo started his career as an investment banker with Salomon Brothers,
Inc. in New York City. Mr. Trujillo holds a B.S. degree in Accounting from
Arizona State University and an M.B.A. degree from Harvard Business School.

JEFFREY S. PETERSON founded our company and was our Chairman of the board
of directors and Chief Executive Officer from May 1998 to June 1999 when he was
appointed Chief Technology Officer. He was also our Chief Technology Officer
from July 1997 until May 1998 and our President in June 1999 until Mr. Trujillo
was appointed our President later in the month. From January 1997 to June 1997,
Mr. Peterson served as co-owner of NetCentury, an Internet design firm he
founded. From July 1995 until December 1996, Mr. Peterson was a general
securities principal and registered representative with West America Securities
Corporation. From February 1995 to May 1995, he was a general securities
principal and registered representative with Kensington Securities, Inc. From
August 1993 to April 1995, Mr. Peterson was a self-employed computer consultant
for JP Consulting, a computer-based consulting company he founded. Mr. Peterson
is an experienced Modula, Java, and C++ programmer, who has been involved in the
programming and operations of computers and digital communications for over 15
years. He has developed software applications for operating systems and digital
platforms, beginning with Cp/M based systems in the early 1980s to Unix (Sun
Solaris, BSD, Linux, Irix) and Windows NT. Mr. Peterson is bilingual in English
and Spanish.

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<PAGE> 32

JUAN C. GALAN joined us in January 1999 as our Chief Financial Officer.
From April 1997 to January 1999, he was employed by Vistoso Partners LLC, a
Phoenix, Arizona real estate development company, as Controller. From June 1993
to April 1997, Mr. Galan was employed by Nielsen Media Research, formerly a Dun
& Bradstreet company, as Administration Manager-Technology and Business
Services, having joined the company initially as a Senior Financial Analyst.
From March 1992 to June 1993, Mr. Galan was the Controller and Project Manager
for Newport Realty, Inc. in Tampa, Florida. Mr. Galan holds a B.S. degree in
Finance from Western Kentucky University.

BRYAN L. ROSS was our Chief Technology Officer from November 1998 to June
1999 and was appointed our Vice President -- Technology in June 1999. From July
1998 to November 1998, he was Director of Software Development for Today.com,
Inc., a Web design firm. From July 1997 to June 1998, he was lead computer
programmer for the Kemtah Group, an Internet consulting firm. From 1994 to 1997,
he was a Web Master first at Bethany College and subsequently at MicroAge, a
computer distributor, where he designed and maintained Interactive Web sites.
From 1991 to July 1996, Mr. Ross was an independent computer consultant in
Scotts Valley, California.

ROBERT J. TAYLOR joined us in March 1999 as Vice President of Strategy and
Operations. From August 1997 to March 1999, he was a Senior Consultant for CSC
Index, the management consulting division of Computer Sciences Corporation.
During his tenure with CSC, Mr. Taylor focused his business consulting on
large-scale change initiatives, strategy implementation, new business start-ups
and organizational design for Fortune 500 organizations. From January 1992 to
August 1995, Mr. Taylor held the positions of Production Supervisor and Senior
Industrial Engineer with Michelin Tire Corporation. Mr. Taylor received a
Bachelor of Science degree in Industrial and Systems Engineering from Virginia
Tech University and an M.M.M. degree from the J.L. Kellogg Graduate School of
Management at Northwestern University in 1995.

VICTOR H. ROLDAN joined us in January 1999 as a Vice President. From
October 1997 to January 1999, Mr. Roldan founded and operated Roldan &
Associates, a business consulting firm. From January 1995 to October 1997 he
practiced law in Costa Rica, first for Montero Bejarano & Associates and then
for Alfredo Fournier & Associates. Mr. Roldan holds a B.A. and a degree of Law
from the Francisco Marroquin University, Guatemala and a degree of Law from the
University of Costa Rica, San Jose.

L. WILLIAM SEIDMAN joined us as a director in June 1999. He is the Chief
Business Commentator on cable network's CNBC-TV, the publisher of Bank Director
magazine and the founder of Board Member magazine. Since 1991 he has consulted
with numerous organizations, including Deposit Corporation of Japan, Tiger
Management, J.P. Morgan, Inc., The World Bank, BDO Seidman, Nippon Credit Bank
of Japan and The Capital Group. He is currently a member of the Board of
Directors of Fiserv, Inc., Intelidata, Inc., and Clark Bardes. From 1985 to 1991
he served as the fourteenth chairman of the Federal Deposit Insurance
Corporation (FDIC). He became the first chairman of the Resolution Trust
Corporation (RTC) in 1989 and served until 1991. While at the RTC, he supervised
the creation of an 8,000 person agency handling over $500 billion in assets from
failed S&Ls. Prior to serving as Chairman of the FDIC, he was Dean of the
College of Business at Arizona State University, Tempe, Arizona, one of
America's largest business colleges.

Mr. Seidman served under President Gerald Ford as Assistant for Economic
Affairs from 1974 to 1977 and under President Ronald Reagan as co-chair of the
White House Conference on Productivity from 1983 to 1984. Mr. Seidman was
Vice-Chairman and Chief Financial Officer of Phelps Dodge Corporation from 1977
to 1982. He was a director of Phelps Dodge Corporation, The Conference Board and
United Bancorp of Arizona. In the 1960's he founded Sumercom, a TV, radio and
newspaper company, where he was Chief Executive Officer until 1974 when the
company was sold. Mr. Seidman was managing partner of Seidman and Seidman,
certified public accountants (now BDO Seidman), from 1968 to 1974. Under his
management, the firm expanded from a small family enterprise to become one of
the largest public accounting firms in the nation. Mr. Seidman also served as
chairman (1970) and director of the Detroit Bank of the Federal Reserve Bank of
Chicago from 1966 to 1970. Mr. Seidman holds an A.B.

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<PAGE> 33

degree from Dartmouth (Phi Beta Kappa), and an LL.B degree from Harvard Law
School, and is an honors graduate with an MBA degree from the University of
Michigan.

JERRY J. COLANGELO joined us as a director in April 1999. He has been the
President and Chief Executive Officer of the Phoenix Suns professional
basketball team since 1987 and was the Suns' General Manager from 1968 to 1987.
He has also served as Chief Executive Officer and Managing General Partner of
the Arizona Diamondbacks professional baseball team since 1995. He is a director
of US West, Inc. and Stratford American Corporation, a holding company for real
estate property.

JOSE MARIA FIGUERES joined us as a director in May 1999. He served as the
elected President of Costa Rica from 1994 to 1998, and has served since 1998 as
president of the Costa Rican Foundation for Sustainable Development. He also
serves in executive positions with numerous charities in Costa Rica and
elsewhere. Mr. Figueres-Olsen studied industrial engineering at the United
States Military Academy at West Point and earned a Masters Degree in public
administration at Harvard University.

ALAN J. SOKOL joined us as a director in April 1999 in connection with our
strategic relationship agreement with Telemundo. He has been the Chief Operating
Officer of Telemundo since August 1998. He served as Senior Vice President,
Corporate Development of Sony Pictures Entertainment from June 1996 to August
1998. From April 1995 to June 1996 he was a Senior Vice President of Savoy
Pictures, Inc., a motion picture production and distribution company. Prior to
that time he was a partner in the Los Angeles law firm of Jeffer, Mangels,
Butler & Marmaro.

LOUIS OLIVAS joined us as a director in June 1999. He has been employed by
Arizona State University since 1979, first as ASU's assistant director for the
Center for Executive Development and then as the Center's director from 1982 to
1986. He is a tenured associate professor in the Management Department, College
of Business. He has published nearly 50 articles in the fields of personnel,
management, training and small business operations. Dr. Olivas has served on
numerous national boards and commissions, including Chairman of the Hispanic
Caucus and the American Association for Higher Education and Dean of the
National Hispanic Corporate Council Institute. For the past ten years, Dr.
Olivas has also served as the assistant vice president for academic affairs at
ASU. Previously he served as the director of Executive Development and Education
for Western Savings and Loan Association, director of Employee Development for
the City of Phoenix, and as a consultant, instructor, and developer of various
executive development programs involving Fortune 500 companies.

KEY EMPLOYEES

MICHAEL J. OFFENBECHER has served as a Vice President since November 1998.
He was the Chief Engineer for software development of InfoPak, Incorporated, a
Web design firm, from 1993 to 1997 where he was responsible for software
development projects. From 1997 until November 1998, he was a Senior Software
Engineer for Cyclone Software Corporation in Scottsdale, Arizona. Mr.
Offenbecher earned a Bachelor of Science degree and Electrical Engineering
degree from Kansas State University.

LUIS GARCIA has served as our Vice President -- Design and Content since
February 1999. He was a Web developer, Software Engineer and subsequently, Vice
President of Operations for Cybertoons Digital of Milwaukee, Wisconsin from
September 1996 until February 1999. From April 1996 until September 1996, he was
a Web developer for Platinum Creative in Winter Park, Florida. Mr. Garcia
received a B.S. degree in Systems Engineering from the Universidad Metropolitana
in Caracas, Venezuela and subsequently was a programming instructor there from
October 1994 to April 1996.

We have employment agreements with Michael J. Offenbecher and Luis Garcia
terminating in October 2000 and February 2001, respectively.

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<PAGE> 34

EXECUTIVE COMPENSATION

The following table provides certain summary information concerning
compensation paid to our Chief Executive Officer since we were formed in June
1997. No officer has been paid compensation for services in excess of $100,000
per year through December 31, 1998.

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG TERM COMPENSATION AWARDS
--------------------------------------- --------------------------------------
OTHER RESTRICTED SHARES ALL
NAME AND ANNUAL STOCK UNDERLYING OTHER
PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION AWARD(S) OPTIONS COMPENSATION
- ------------------ ---- ------- ------- ------------ ---------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Jeffrey S. Peterson 1998 $31,500 -- -- -- 50,000 $81,500
Chief Executive 1997 -- -- -- -- -- --
Officer(1)
</TABLE>

- ---------------

(1) Mr. Peterson served as our Chief Executive Officer until June 1999.

The following executive officers are expected to receive total compensation
in excess of $100,000 during 1999. Each of these executive officers has executed
employment agreements that contain non-competition and confidentiality
agreements, expire on the dates indicated and provide for the payment of annual
salaries and the forgivable loans indicated below.

<TABLE>
<CAPTION>
FORGIVABLE TOTAL EXPIRATION
NAME ANNUAL SALARY LOAN(3) COMPENSATION(4) DATE
- ---- ------------- ----------- --------------- ----------
<S> <C> <C> <C> <C>
Gary L. Trujillo............................ $125,000 $100,000 $225,000 4/03
Jeffrey S. Peterson(1)...................... $150,000 $100,000 $250,000 11/02
Juan C. Galan(2)............................ $100,000 $ 20,000 $120,000 1/02
Bryan L. Ross(2)............................ $ 75,000 $ 40,000 $115,000 11/00
Victor H. Roldan(2)......................... $ 60,000 $ 5,000 $ 65,000 1/02
Robert J. Taylor(2)......................... $ 80,000 $ 20,000 $100,000 3/02
</TABLE>

- ---------------

(1) Mr. Peterson's employment agreement also provides for:

- The issuance of 200,000 stock options exercisable at $12.00 per share,
500,000 stock options exercisable at $8.00 per share and 50,000 stock
options exercisable at $1.50 per share; and

- The payment of $500,000 plus salary for the remainder of the term of the
employment agreement if Mr. Peterson's services are terminated for any
reason other than cause or if we materially change his duties as defined
by his employment agreement.

(2) Messrs. Trujillo, Ross, Galan, Roldan and Taylor have been granted stock
options to purchase, respectively, 350,000 shares at $7.00 per share,
115,000 shares at $8.00 per share, 100,000 shares at $8.00 per share, 20,000
shares at $1.00 per share and 100,000 shares, of which 60,000 shares are
exercisable at $8.00 per share and 40,000 shares are exercisable at $10.00
per share.

(3) We have made loans to each of the executive officers in the amounts shown.
50% of each loan will be forgiven on the six month anniversary of employment
and the balance of the loan will be forgiven on the one year anniversary of
employment. All loans bear interest at 10% per annum until paid or forgiven.

(4) Does not include car allowances, health insurance, housing allowances and
other non-material compensation.

Our outside directors do not receive any cash compensation for services as
directors, although they are reimbursed for out-of-pocket expenses in attending
board of directors' meetings and we intend to issue them stock options in the
future.

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<PAGE> 35

STOCK OPTION PLAN

We have a stock option plan (the "Plan") which provides for the grant of
options intended to qualify as "incentive stock options" or "nonqualified stock
options" within the meaning of Section 422 of the United States Internal Revenue
Code of 1986 (the "Code"). Incentive stock options are issuable only to
employees.

The purposes of the Plan are to attract and retain the best available
personnel, to provide additional incentives to our employees and to promote the
success of our business.

We have reserved 6,000,000 shares of common stock for issuance under the
Plan, which is administered by the compensation committee of our board of
directors. Under the Plan, the compensation committee determines which
individuals will receive options, the time period during which the options may
be partially or fully exercised, the number of shares of common stock that may
be purchased under each option and the option price. As of the date hereof,
options to purchase 3,398,000 shares of common stock at a weighted average
exercise price of $9.32 per share were outstanding under the Plan and 2,602,000
shares remained available for future option grants. Of these options, 2,685,000
have been issued to executive officers and directors at an average exercise
price of $10.01 per share.

The per share exercise price of the common stock subject to options must
not be less than the fair market value of the common stock on the date the
option is granted. In the case of incentive stock options, the aggregate fair
market value (determined as of the date the option is granted) of the common
stock that any person may purchase in any calendar year pursuant to the exercise
of incentive stock options must not exceed $100,000. No person who owns,
directly or indirectly, at the time of the granting of an incentive stock
option, more than 10% of the total combined voting power of all classes of our
stock is eligible to receive incentive stock options under the Plan unless the
option price is at least 110% of the fair market value of the common stock
subject to the option on the date of grant. The stock options are subject to
anti-dilution provisions in the event of stock splits, stock dividends and the
like.

No incentive stock options are transferable by an optionee other than by
will or the laws of descent and distribution, and during the lifetime of an
optionee, the option is only exercisable by the optionee. The exercise date of
an option granted under the Plan must not be later than ten years from the date
of grant. Any options that expire unexercised or that terminate upon an
optionee's ceasing to be employed by us will become available once again for
issuance. Shares issued upon exercise of an option rank equally with other
shares then outstanding. No options have been exercised under the Plan.

The following table sets forth certain information regarding grants of
stock options to Jeffrey S. Peterson, the only executive officer who received
stock options during 1998. The fair value of the option grant has been estimated
on the date of the grant utilizing the Black-Scholes option pricing model with
the following assumptions: no volatility, ten year life, risk free rate of
return of 6% and a 0% dividend yield.

<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
--------------------------------------
NUMBER OF
SECURITIES % OF TOTAL
UNDERLYING OPTIONS/SARS EXERCISE
OPTIONS/SARS GRANTED TO OR BASE GRANT DATE
GRANTED EMPLOYEES PRICE GRANT DATE PRESENT VALUE
------------ ------------ -------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Jeffrey Peterson.................... 50,000 23% $1.50 November 1998 $146,000
</TABLE>

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<PAGE> 36

PRINCIPAL STOCKHOLDERS

The following table sets forth certain information regarding the holdings
of common stock (1) by each person who, as of June 15, 1999, holds of record or
is known by us to hold beneficially or of record, more than 5% of our common
stock, (2) by each executive officer and director, and (3) by all officers and
directors as a group. The address of each person is our address at One Arizona
Center, 400 E. Van Buren, Fourth Floor, Phoenix, Arizona 85004.

<TABLE>
<CAPTION>
PERCENT PERCENT
SHARES OF CLASS OF CLASS
NAME OWNED(1) PRIOR TO OFFERING(1) AFTER OFFERING
- ---- --------- -------------------- --------------
<S> <C> <C> <C>
Gary L. Trujillo(2)................................. 440,000 4.3% 3.1%
Jeffrey S. Peterson................................. 1,871,083 18.1% 13.1%
Juan C. Galan....................................... 50,000 * *
Bryan L. Ross....................................... 115,000 1.2% *
Robert J. Taylor.................................... 50,000 * *
Victor H. Roldan.................................... 35,000 * *
L. William Seidman(3)............................... 1,750,704 17.7% 12.6%
Jerry J. Colangelo(4)............................... 335,000 3.4% 2.4%
Jose Maria Figueres................................. 50,000 * *
Alan J. Sokol(5).................................... 1,600,000 14.8% 10.8%
Louis Olivas........................................ 25,000 * *
Michael D. Silberman................................ 829,508 8.5% 6.0%
Telemundo Network Group LLC(6)...................... 1,600,000 14.8% 10.8%
Keith Fredriksen.................................... 574,950 5.9% 4.2%
All executive officers and directors as a group (11
persons)(7)....................................... 5,000,704 41.1% 31.0%
</TABLE>

- ---------------

* Less than 1.0%.

(1) Includes shares of common stock subject to stock options which are presently
exercisable or which may be exercisable within 60 days following the date of
this prospectus.

(2) Includes 25,000 shares owned by Southwest Harvard Group, a company owned by
Mr. Trujillo. Does not include shares subject to the voting trust agreement
described in footnote (3) below.

(3) Includes 1,618,704 shares of common stock which will be voted by Mr. Seidman
and Mr. Trujillo pursuant to a voting trust agreement with two of our
stockholders. See "Related Party and Other Material Transactions."

(4) Includes 260,000 shares owned by Internet Partners, LLC, a limited liability
company in which Mr. Colangelo is one of four members.

(5) Represents 600,000 shares of common stock owned by Telemundo Network Group
LLC, and warrants to purchase 1,000,000 shares of common stock. Mr. Sokol is
the Chief Operating Officer of Telemundo. He disclaims beneficial ownership
of all shares of our common stock owned beneficially by Telemundo.

(6) Includes 1,000,000 shares of common stock underlying currently exercisable
warrants to purchase common stock.

(7) Includes 2,385,000 shares underlying currently exercisable stock options.

RELATED PARTY AND OTHER MATERIAL TRANSACTIONS

In May 1998 Jeffrey S. Peterson, then our Chairman, Chief Executive Officer
and President and currently our Chief Technology Officer, and Michael D.
Silberman, a principal stockholder, conveyed an aggregate of 3,863,106 shares of
their common stock to Michael A. Hubert, Kevin Dieball, Keith Fredriksen, The
Monolith Limited Partnership and Richard Whelan, for $.00035 per share. The
shares were conveyed at that time to induce these five persons to provide
strategic planning and business development services to us. Specifically, these
persons assisted us in the preparation of our initial business and strategic
plan, prepared our pro forma financial projections and the underlying
assumptions, designed our organizational structure, identified recruiting needs,
built alliances with content providers and other strategically desirable
business partners and assisted us in negotiating supplier, marketing and
advertising

34
<PAGE> 37

agreements. At the time these services were provided, we did not have sufficient
funding to hire paid consultants or employees to provide these services.

In order to raise working capital, we have issued the following securities
to investors:

- In May 1998 we issued a $100,000 convertible promissory note to Enver
Zaky for working capital, $50,000 of which was subsequently converted by
Mr. Zaky into our common stock at $1.00 per share.

- In July 1998 we issued a $1.0 million promissory note to Mitchell Price
and Tim Pring which they subsequently converted into our common stock at
$1.56 per share.

- In November and December 1998 we sold 1,259,167 shares of our common
stock to a group of investors for $3.75 per share.

In July 1998 we loaned Mr. Peterson $100,000 pursuant to his employment
agreement. We agreed that if Mr. Peterson was employed by us on April 1, 1999
the loan would be forgiven. The loan bears interest at 10% per annum. Similar
loans were made to several other of our officers including our Chief Executive
Officer, Gary L. Trujillo, to whom we loaned $100,000. Mr. Trujillo's loan bears
interest at 10% per annum with 50% of the loan to be forgiven in October 1999
and the remaining 50% in April 2000. See "Management -- Executive Compensation."

In February 1999 we agreed to pay Garcia/LKS, an advertising agency owned
in part by Lionel Sosa, a former director, for advertising services a monthly
retainer fee of $78,000. We intend to sign an agreement with Garcia/LKS on these
terms, cancelable by either party on 30 days notice. In April 1999 we issued
Garcia/LKS, 50,000 shares of our common stock in exchange for advertising and
marketing services valued at $550,000 to be credited against our monthly
retainer fee.

In March 1999 The Monolith Limited Partnership, a former principal
stockholder, sold 216,436 shares of our common stock at $7.00 per share and
loaned us $2.0 million for working capital. The loan bears interest at 12% per
annum through June 1999 and then 14% per annum through March 2001 and will be
repaid with a portion of the proceeds of the offering.

In March 1999 Mr. Peterson sold 446,000 shares of our common stock,
comprised of 396,000 shares at $7.00 per share and 50,000 shares at $6.00 per
share, to a group of investors, including 25,000 shares sold to each of Jerry J.
Colangelo and Edwin C. Lynch both of whom subsequently became directors. Mr.
Peterson agreed to loan us up to $3.0 million of the proceeds from the sale of
his common stock at any time prior to the completion of the offering to be used
by us for working capital. The loans bear monthly interest of 12% per annum for
four months and then 14% per annum for the next 20 months, at which time each
loan will become due. At April 30, 1999 Mr. Peterson had loaned us a total of
$2.3 million.

In April 1999 we issued 50,000 shares of our common stock in exchange for
consulting services to Southwest Harvard Group, a company owned by Mr. Trujillo
who subsequently became our Chairman and Chief Executive Officer. Later in April
1999 Mr. Peterson transferred an additional 50,000 shares of our common stock to
Mr. Trujillo, in connection with Mr. Trujillo's employment agreement.

In April 1999 we entered into a $1.5 million sponsorship agreement with the
Arizona Diamondbacks, a major league baseball team. Jerry J. Colangelo, who
subsequently became one of our directors, is the Chief Executive Officer and
Managing General Partner of the Arizona Diamondbacks. See "Our Business -- Our
Strategic Relationships."

In April 1999 we entered into a sponsorship agreement with Telemundo.
Subsequently, Telemundo became a principal stockholder of our company and Alan
J. Sokol its Chief Operating Officer became one of our directors. See "Our
Business -- Our Strategic Relationships."

In May 1999, the former stockholder and employee referred to under "Change
of Accountants" sold all of our common stock that he owned (443,500 shares) to
two nonaffiliated investors. Cruttenden Roth Incorporated has agreed to modify
the 180 day lock-up agreement on these shares. See "Underwriting." In May 1999
the former employee also resigned as an employee of WGM Corporation, the general
partner of

35
<PAGE> 38

The Monolith Limited Partnership, a former principal stockholder. The former
employee's background included fines and other sanctions imposed by the NASD and
the Arizona Corporation Commission and a formal order of private investigation
instituted by the Securities and Exchange Commission that formed the basis of a
civil action brought against the former employee in May 1999.

In June 1999 L. William Seidman, one of our directors, purchased 6,794
shares and 348 shares of our common stock from Kevin Dieball and Monolith,
respectively, for $6.75 per share. Mr. Trujillo purchased 15,000 shares of our
common stock from Monolith for $6.75 per share. Also, Internet Partners, LLC, a
limited liability company in which Mr. Colangelo is one of four members,
purchased 260,000 shares of our common stock from Monolith at $6.75 per share.

In June 1999 Mr. Peterson and Michael A. Hubert, a former officer and
director, entered into a voting trust agreement which provides that for a period
of five years from the date of this prospectus Messrs. Seidman and Trujillo
shall vote all shares of our common stock owned by Messrs. Peterson and Hubert
(currently an aggregate of 1,618,704 shares) in the same proportion as those
shares voted by our nonaffiliated stockholders.

In our opinion, the transactions described above were on terms no less
favorable than those which could have been obtained from unaffiliated third
parties.

DESCRIPTION OF SECURITIES

COMMON STOCK

We are authorized to issue 50,000,000 shares of $.001 par value common
stock, of which 9,775,833 shares are outstanding as of the date of this
prospectus. Each share of common stock is entitled to one vote on all matters
submitted to a vote of the stockholders, and cumulative voting is not permitted.
Upon issuance, shares of common stock are not subject to further assessment or
call. Subject to the prior rights of any series of preferred stock that may be
issued by us in the future, holders of common stock are entitled to receive
ratably such dividends that may be declared by the board of directors out of
funds legally available therefor and are entitled to share ratably in all assets
remaining after payment of liabilities in the event of our liquidation,
dissolution or winding up. Holders of common stock have no preemptive rights or
rights to convert their common stock into any other securities. The outstanding
common stock is fully paid and nonassessable.

We have not paid dividends on our common stock since inception and do not
plan to pay dividends in the foreseeable future. Any earnings will be retained
to finance growth.

PREFERRED STOCK

Our articles of incorporation authorize the issuance of up to 5,000,000
shares of preferred stock with such rights and preferences as may be determined
from time to time by our board of directors. Accordingly, under the articles of
incorporation, the board of directors may, without stockholder approval, issue
preferred stock with dividend, liquidation, conversion, voting, redemption or
other rights which could adversely affect the voting power or other rights of
the holders of the common stock. The issuance of any shares of preferred stock
having rights superior to those of the common stock may result in a decrease of
the value or market price of the common stock and could further be used by the
board of directors as a device to prevent a change in our control. We have no
other anti-takeover provisions in our articles of incorporation or Bylaws.
Holders of the preferred stock may have the right to receive dividends, certain
preferences in liquidation and conversion rights.

SHARES ELIGIBLE FOR FUTURE SALE

Prior to this offering, there has been no public market for our common
stock. Future sales of substantial amounts of common stock in the public market
could adversely affect prevailing market prices. Furthermore, since only a
limited number of shares will be available for sale shortly after this offering
36
<PAGE> 39

because of certain contractual and legal restrictions on resale (as described
below), sales of substantial amounts of our common stock in the public market
after the restrictions lapse could adversely affect the prevailing market price
and our ability to raise equity capital in the future.

Upon completion of this offering, we will have outstanding 13,775,833
shares of common stock. Of these shares, all 4,000,000 shares sold in the
offering (plus any shares issued upon exercise of the underwriters'
overallotment option) will be freely tradable without restriction under the
Securities Act, unless purchased by our "affiliates" as that term is defined in
Rule 144 under the Securities Act (generally, our officers, directors or 10%
stockholders).

The remaining 9,775,833 shares outstanding are "restricted securities"
within the meaning of Rule 144 under the Securities Act. Restricted securities
may be sold in the public market only if registered or if they qualify for an
exemption from registration under Rule 144 of the Securities Act. Sales of
restricted securities in the public market, or the availability of such
securities for sale, could adversely affect the market price of the common
stock.

Substantially all of our existing stockholders have entered into lock-up
agreements providing that they will not offer, sell, contract to sell, pledge,
hypothecate or grant any option to purchase or otherwise dispose of our common
stock or any securities exercisable for or convertible into our common stock for
a period of 180 days after the effective date of the offering without the prior
written consent of Cruttenden Roth Incorporated. Cruttenden Roth has agreed with
two of our stockholders to release a total of 221,750 shares from the lock-up
agreements prior to the end of the 180-day period if, after this offering, at
least 2,000,000 shares of the common stocks trade on the Nasdaq National Market
at a price at least equal to the lesser of 120% of the public offering price or
$14.40, and to release an additional 221,750 shares if at least 4,000,000 shares
trade at a price at least equal to the lesser of 120% of the public offering
price or $14.40. Cruttenden Roth agreed to these release provisions as a further
inducement to the two stockholders to purchase the shares of common stock owned
by the employee described under "Change of Accountants". As a result of these
contractual restrictions, notwithstanding possible earlier eligibility for sale
under the provisions of Rule 144, shares subject to lock-up agreements will not
be salable until such agreements expire or are waived by the representative of
the underwriters. Notwithstanding the lock-up agreements, 1,981,886 shares may
be sold, subject to the volume limitations set forth below under Rule 144 of the
Securities Act and the remaining 7,793,947 shares may be sold commencing from
May 1999 through December 1999. In addition, Mr. Peterson has entered into a
lock-up agreement with us under which he will not sell or otherwise transfer any
of his shares until two years from the date of this prospectus.

In general, under Rule 144 as currently in effect, and beginning after the
180 day lock-up period, a person who has beneficially owned restricted
securities for at least one year would be entitled to sell within any
three-month period a number of shares that does not exceed the greater of one
percent of the number of shares of common stock then outstanding, which will
amount to 13,775 shares immediately after the offering, or the average weekly
trading volume of the common stock during the four calendar weeks preceding the
sale. Sales under Rule 144 are also subject to certain manner of sale provisions
and notice requirements and to the availability of current public information
about us. Under Rule 144(k), a person who is not deemed to have been our
affiliate at any time during the three months preceding a sale, and who has
beneficially owned the shares proposed to be sold for at least two years, is
entitled to sell such shares without complying with the manner of sale, public
information, volume limitation or notice provisions of Rule 144.

We have granted demand and piggy-back registration rights covering:

- 400,000 shares of common stock underlying the common stock purchase
warrants to be issued to the representatives of the underwriters

- 1,000,000 common stock purchase warrants issued to Telemundo.

We also intend to register the shares of common stock underlying our Stock
Option Plan, which means that common stock issued upon exercise of stock options
will generally be freely tradeable without
37
<PAGE> 40

restriction under the Securities Act. We have agreed with the underwriters that
we will not file a registration statement covering our Stock Option Plan shares
until at least 180 days after this offering.

TRANSFER AGENT

Corporate Stock Transfer, Inc., Denver, Colorado, is our transfer agent.
The transfer agent's address is 370-17th Street, Suite 2350, Denver, Colorado
80202-4614, and its telephone number is (303)595-3300.

LIMITATION ON LIABILITY

Our Bylaws provide our directors, officers, employees and agents
substantial protection against personal liability related to actions taken in
their capacity as representatives of the Company. The effect of this provision
is that we may be required to pay reasonably incurred expenses such as
attorney's fees, judgments, penalties, fines and amounts paid in settlements
associated with work related actions, suits or proceedings. We shall pay these
expenses if an independent group, as defined in our Bylaws, determines that the
individuals conducted themselves in good faith, and that they reasonably
believed:

- In the case of conduct in their official capacity with us, that their
conduct was in our best interest, or

- In all other cases, except criminal cases, that their conduct was at
least not opposed to our best interest, or

- In the case of any criminal proceeding, that they had no reason to
believe their conduct was unlawful.

Our Bylaws specifically limit the payment of expenses in connection with a
proceeding brought by or in the right of the Company to reasonable expenses,
including attorney's fees.

UNDERWRITING

Subject to the terms and conditions of our underwriting agreement, the
underwriters named below, for whom Cruttenden Roth Incorporated and H.C.
Wainwright & Co. Inc. are acting as representatives, have severally agreed to
purchase from us and we have agreed to sell to the underwriters, the respective
number of shares of common stock set forth opposite each underwriter's name
below:

<TABLE>
<CAPTION>
NUMBER OF
UNDERWRITERS SHARES
------------ ---------
<S> <C>
Cruttenden Roth Incorporated................................
H.C. Wainwright & Co., Inc. ................................
---------
Total............................................. 4,000,000
=========
</TABLE>

Our underwriting agreement provides that the obligations of the
underwriters are subject to certain conditions precedent, including the absence
of any material adverse change in our business, the receipt of certificates,
opinions and letters from our counsel and independent public accountants. The
nature of the underwriters' obligation is such that they are committed to
purchase and pay for all the shares of common stock if any are purchased.

We have been advised by the representatives that the underwriters propose
to offer the shares of common stock directly to the public on the terms set
forth on the cover page of this prospectus. The underwriters may allow selected
dealers a concession of not more than $ per share, and the underwriters may
allow, and such selected dealers may reallow, a concession of not more than
$ per share, to other dealers. After the initial public offering of the
shares, the public offering price and other selling terms may be changed by the
representatives. No change in such terms shall change the amount of proceeds to
be received by us as set forth on the cover page of this prospectus.

38
<PAGE> 41

We have granted an option to the underwriters, exercisable for a period of
45 days after the date of this prospectus, to purchase up to an additional
600,000 shares of common stock at the same price per share as the initial shares
to be purchased by the underwriters to cover overallotments, if any. To the
extent that the underwriters exercise this option, each of the underwriters will
be committed, subject to certain conditions, to purchase such additional shares
of common stock in approximately the same proportion as set forth in the above
table.

The representatives of the underwriters have advised us that they do not
expect any sales of the shares of common stock offered hereby to be made to
discretionary accounts controlled by the underwriters.

We have agreed to pay the representatives a nonaccountable expense
allowance equal to 2% of the aggregate price of the shares of common stock
offered hereby (including with respect to shares of common stock underlying the
overallotment option, if and to the extent it is exercised) set forth on the
front cover of this prospectus. The representatives' expenses in excess of the
nonaccountable expense allowance, including legal expenses, will be borne by the
representatives.

We have agreed to issue to the representatives at the closing of the
offering warrants to purchase up to 400,000 shares of common stock at an
exercise price per share equal to 165% of the initial per share public offering
price. The representatives' warrants are exercisable for a period of four years
beginning one year from the date of this prospectus.

The holders of the representatives' warrants will have no voting, dividend
or other shareholder rights until the representatives' warrants are exercised.
The terms of the representatives' warrants were established as the result of
negotiations between the representatives and us. If the representatives'
warrants are exercised, the representatives may realize additional compensation.
By their terms, the representatives' warrants will be restricted from sale,
transfer, assignment or hypothecation, except to persons that are officers of
either of the representative. The number of shares covered by the
representatives' warrants and the exercise price are subject to adjustment to
prevent dilution. In addition, we have granted certain rights to the holders of
the representatives' warrants to register the representatives' warrants and the
common stock underlying the representatives' warrants under the Securities Act.

Total compensation to the representatives and the underwriters is as
follows:

- Commissions -- $ per share of common stock sold;

- Nonaccountable expense allowance -- $ per share of common stock
sold; and

- Warrants to purchase up to 400,000 shares of common stock at 165% of
the per share offering price.

Substantially all of our stockholders have entered into lock-up agreements
with Cruttenden Roth Incorporated which provide that they will not offer, sell
or otherwise dispose of any common stock for a period of 180 days after the
commencement of the offering without the prior written consent of Cruttenden
Roth. Cruttenden Roth has no present intention to release the locked-up shares
prior to expiration of the 180-day-period although Cruttenden Roth may release
the locked-up shares prior to expiration of such period. The granting of any
release would be conditioned, in the judgment of Cruttenden Roth, on such sale
not materially adversely impacting the prevailing trading market for the common
stock on the Nasdaq National Market. Specifically, factors such as average
trading volume, recent price trends, and the need for additional public float in
the market for the common stock would be considered in evaluating such a
request. With respect to an aggregate of 443,500 shares, Cruttenden Roth has
agreed with two of our stockholders, Charles W. Stewart and Donald J. Sliter,
neither of whom is an officer, director or employee, to release one-half of such
shares from the lock-up agreement prior to the end of the 180-day period if,
after this offering, at least 2,000,000 shares of the common stock trade on the
Nasdaq National Market at a price at least equal to the lesser of 120% of the
public offering price or $14.40, and to release the remainder of such shares if
at least 4,000,000 shares trade at a price at least equal to the lesser of 120%
of the public offering price or $14.40. Cruttenden Roth agreed to these release
provisions as a further

39
<PAGE> 42

inducement to these individuals to purchase the shares of common stock owned by
the employee described under "Change of Accountants."

Prior to the offering, there has been no established trading market for the
common stock. Consequently, the initial public offering price for the common
stock offered hereby has been determined by negotiations between the
representatives and us. Among the factors considered in such negotiations were
the preliminary demand for the common stock, the prevailing market and economic
conditions, our results of operations, estimates of our business potential and
prospects, the present state of our business operations, an assessment of our
management, the consideration of these factors in relation to the market
valuation of comparable companies in related businesses, the current condition
of the markets in which we operate, and other factors deemed relevant. There can
be no assurance that an active trading market will develop for the common stock
or that the common stock will trade in the public market after the offering at
or above the initial public offering price.

The representatives have advised us that, pursuant to Regulation M under
the Securities Act, some persons participating in the offering may engage in
transactions, including stabilizing bids, syndicate covering transactions or the
imposition of penalty bids, that may have the effect of stabilizing or
maintaining the market price of the shares of common stock at a level above that
which might otherwise prevail in the open market. A "stabilizing bid" is a bid
for or the purchase of shares of common stock on behalf of the underwriters for
the purpose of fixing or maintaining the price of the common stock. A "syndicate
covering transaction" is the bid for or purchase of common stock on behalf of
the underwriters to reduce a short position incurred by the underwriters in
connection with the offering. A "penalty bid" is an arrangement permitting the
representatives to reclaim the selling concession otherwise accruing to an
underwriter or syndicate member in connection with the offering if the common
stock originally sold by such underwriter or syndicate member purchased by the
representatives in a syndicate covering transaction and has therefore not been
effectively placed by such underwriter or syndicate member. The representatives
have advised us that such transactions may be effected on the Nasdaq National
Market or otherwise and, if commenced, may be discontinued at any time.

The underwriting agreement provides that we will indemnify the underwriters
and their controlling persons against liabilities under the Securities Act or
will contribute to payments the underwriters and their controlling persons may
be required to make in respect thereof.

LEGAL MATTERS

The validity of the common stock offered hereby will be passed upon for us
by Kummer Kaempfer Bonner & Renshaw, Las Vegas, Nevada. Certain legal matters in
connection with the offering will be passed upon for us by Brownstein Hyatt &
Farber, P.C., Denver, Colorado and the Law Office of Gary A. Agron, Englewood,
Colorado and for the underwriters by Bryan Cave LLP, Phoenix, Arizona.

EXPERTS

Our financial statements for the year ended December 31, 1998 and for the
period from inception (June 25, 1997) to December 31, 1997, have been included
in this prospectus in reliance on the report of Ehrhardt Keefe Steiner & Hottman
PC, independent public accountants, as given upon the authority of said firm as
experts in accounting and auditing. With respect to the unaudited interim
financial information for the three months ended March 31, 1999 and 1998 and the
March 31, 1999 information included in the period cumulative from inception
(June 25, 1997) to March 31, 1999, the independent public accountants have not
audited or reviewed such financial information and have not expressed an opinion
or any other form of assurance with respect to such financial information.

40
<PAGE> 43

CHANGE OF ACCOUNTANTS

On December 11, 1998 we engaged BDO Seidman, LLP as our independent public
accountant. BDO Seidman, LLP resigned as our independent public accountant on
February 4, 1999 because they were unwilling to be associated with our financial
statements due to the background of one of our employees. We employed this
employee from January 1, 1999 through February 15, 1999 at which time he
resigned. The employee was never appointed as an officer or director of
quepasa.com, inc. He owned 443,500 shares of our common stock and was an
employee of WGM Corporation, the general partner of The Monolith Limited
Partnership, a former principal stockholder. See "Related Party and Other
Material Transactions."

Prior to their resignation, BDO Seidman, LLC had not completed their audits
of any of our financial statements for any period. There were no disagreements
between us and BDO Seidman, LLC on any matter of accounting principles or
practices, financial statement disclosure, or auditing scope or procedures
which, if not resolved to the satisfaction of BDO Seidman, LLC would have caused
them to make reference to the matter in their report. We allowed BDO Seidman,
LLC to read and make comment on this disclosure.

On February 10, 1999, we engaged Ehrhardt Keefe Steiner & Hottman, PC as
our independent public accountants. Prior to their appointment, we did not
consult with them on issues relating to our accounting principles or the type of
audit opinion with respect to our financial statements to be issued by them.

ADDITIONAL INFORMATION

We have filed with the Securities and Exchange Commission a Registration
Statement under the Securities Act of 1933, as amended, covering the common
stock. As permitted by the rules and regulations of the Commission, this
prospectus does not contain all of the information set forth in the Registration
Statement and the exhibits. For further information with respect to our company
and the common stock, reference is made to the Registration Statement and the
exhibits, which may be examined without charge at the public reference
facilities maintained by the Commission at Judiciary Plaza, 450 Fifth Street
N.W., Washington, D.C. 20549, copies of which may be obtained from the
Commission upon payment of the prescribed fees.

We will be subject to the informational requirements of the Securities
Exchange Act of 1934, as amended, and will file reports, proxy statements and
other information with the Commission. Such reports, proxy statements and other
information may be inspected at the public reference facilities of the
Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549.
Copies of these materials may be obtained at prescribed rates from the
Commission at that address. The reports, proxy statements and other information
can also be inspected at the Commission's regional offices at 7 World Trade
Center, Suite 300, New York, New York 10048 and at Northwestern Atrium Center,
500 West Madison, Chicago, Illinois 60621 and on the Commission's Web site at
www.sec.gov.

We will furnish to our stockholders annual reports which will include
audited financial statements. We may also furnish to our stockholders quarterly
financial statements and other reports that may be authorized by our board of
directors.

41
<PAGE> 44

INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Independent Auditors' Report................................ F-2
Financial Statements
Balance Sheets............................................ F-3
Statements of Operations.................................. F-4
Statement of Changes in Stockholders' Equity (Deficit).... F-5
Statements of Cash Flows.................................. F-6
Notes to Financial Statements............................... F-8
</TABLE>

F-1
<PAGE> 45

INDEPENDENT AUDITORS' REPORT

Board of Directors and Stockholders
quepasa.com, inc.
Phoenix, Arizona

We have audited the accompanying balance sheets of quepasa.com, inc. (a
development stage company) as of December 31, 1998 and 1997 and the related
statements of operations, changes in stockholders' equity (deficit) and cash
flows for the year ended December 31, 1998 and from Inception (June 25, 1997) to
December 31, 1997 and cumulative from Inception to December 31, 1998. 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 audits.

We conducted our audits 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 audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of quepasa.com, inc. as of
December 31, 1998 and 1997, and the results of its operations and its cash flows
for the year ended December 31, 1998 and from Inception (June 25, 1997) to
December 31, 1997 and cumulative from Inception to December 31, 1998 in
conformity with generally accepted accounting principles.

Ehrhardt Keefe Steiner & Hottman PC

February 17, 1999
Denver, Colorado

F-2
<PAGE> 46

QUEPASA.COM, INC.
(A DEVELOPMENT STAGE COMPANY)

BALANCE SHEETS

ASSETS

<TABLE>
<CAPTION>
DECEMBER 31,
MARCH 31, ---------------------
1999 1998 1997
------------ ----------- -------
(UNAUDITED)
<S> <C> <C> <C>
Current assets
Cash and cash equivalents............................. $ 549,974 $ 2,199,172 $ 2,582
Deposits receivable................................... -- 1,533,632 --
Stock subscription receivable (Note 7)................ -- 125,000 --
Forgivable loans (Note 6)............................. 431,705 396,540 --
Prepaid advertising (Note 6).......................... 1,076,918 -- --
------------ ----------- -------
Total current assets.......................... 2,058,597 4,254,344 2,582
------------ ----------- -------
Property and equipment, net of accumulated depreciation
of $35,226 (March 31, 1999) and $6,532 (December 31,
1998) (Note 2)........................................ 836,227 354,620 --
Other assets
Deferred offering costs (Note 6)...................... 342,441 -- --
Deposits and other assets............................. 53,692 2,500 --
------------ ----------- -------
Total other assets............................ 396,133 2,500 --
------------ ----------- -------
Total assets............................................ $ 3,290,957 $ 4,611,464 $ 2,582
============ =========== =======

LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

Current liabilities
Accounts payable........................................ $ 388,436 $ 71,222 $ 5,465
Accrued commissions (Note 7).......................... 24,089 215,233 --
Stock subscription (Note 7)........................... -- 337,500 --
Deferred license fees (Note 3)........................ 66,665 64,165 --
Accrued interest...................................... 20,000 -- --
Accrued payroll and related taxes..................... 75,564 2,922 --
Note payable (Note 4)................................. 2,000,000 -- --
------------ ----------- -------
Total current liabilities..................... 2,574,754 691,042 5,465
------------ ----------- -------
Commitments and contingencies (Notes 3, 6 and 8)
Stockholders' equity (deficit) (Notes 4 and 7)
Preferred stock, authorized 5,000,000 shares -- none
issued or outstanding.............................. -- -- --
Common stock, authorized 50,000,000 shares, $0.001 par
value; issued and outstanding 9,075,833 shares
(March 31, 1999 and December 31, 1998) and
5,680,000 shares (December 31, 1997)............... 9,076 9,076 5,680
Additional paid-in capital............................ 10,906,477 10,427,477 (5,660)
Deficit accumulated during the development stage...... (10,199,350) (6,516,131) (2,903)
------------ ----------- -------
Total stockholders' equity (deficit).......... 716,203 3,920,422 (2,883)
------------ ----------- -------
Total liabilities and stockholders' equity (deficit).... $ 3,290,957 $ 4,611,464 $ 2,582
============ =========== =======
</TABLE>

See notes to financial statements.

F-3
<PAGE> 47

QUEPASA.COM, INC.
(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
CUMULATIVE FROM CUMULATIVE FROM
INCEPTION INCEPTION INCEPTION
THREE MONTHS ENDED (JUNE 25, 1997) (JUNE 25, 1997) (JUNE 25, 1997)
MARCH 31, YEAR ENDED TO TO TO
------------------------ DECEMBER 31, DECEMBER 31, MARCH 31, DECEMBER 31,
1999 1998 1998 1997 1999 1998
----------- ---------- ------------ --------------- --------------- ---------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Product and content
development
expenses........... $ 186,691 $ 4,330 $ 414,873 $ -- $ 601,564 $ 414,873
Advertising and
marketing
expenses........... 2,062,607 -- 250,419 -- 2,313,026 250,419
Stock based
compensation
expenses........... 479,000 -- 5,265,364 -- 5,744,364 5,265,364
General and
administrative
expenses........... 950,299 9,137 534,632 3,703 1,488,634 538,335
----------- ---------- ----------- ---------- ------------ -----------
Total
operating
expenses... 3,678,597 13,467 6,465,288 3,703 10,147,588 6,468,991
----------- ---------- ----------- ---------- ------------ -----------
Loss from
operations......... (3,678,597) (13,467) (6,465,288) (3,703) (10,147,588) (6,468,991)
Other income
(expense)
Interest expense... (20,000) -- (48,994) -- (68,994) (48,994)
Other.............. 15,378 -- 1,054 800 17,232 1,854
----------- ---------- ----------- ---------- ------------ -----------
Net other income
(expenses)......... (4,622) -- (47,940) 800 (51,762) (47,140)
----------- ---------- ----------- ---------- ------------ -----------
Net loss............. $(3,683,219) $ (13,467) $(6,513,228) $ (2,903) $(10,199,350) $(6,516,131)
=========== ========== =========== ========== ============ ===========
Net loss per share,
basic and
diluted............ $ (.41) $ -- $ (.72) $ -- $ (1.12) $ (.72)
=========== ========== =========== ========== ============ ===========
Weighted average
number of shares
outstanding, basic
and diluted........ 9,075,833 9,075,833 9,075,833 9,075,833 9,075,833 9,075,833
=========== ========== =========== ========== ============ ===========
</TABLE>

See notes to financial statements.

F-4
<PAGE> 48

QUEPASA.COM, INC.
(A DEVELOPMENT STAGE COMPANY)

STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)
FOR THE PERIOD FROM INCEPTION (JUNE 25, 1997) TO
DECEMBER 31, 1997, THE YEAR ENDED DECEMBER 31, 1998 AND
THE THREE MONTHS ENDED MARCH 31, 1999 (UNAUDITED)

<TABLE>
<CAPTION>
DEFICIT
ACCUMULATED
COMMON STOCK ADDITIONAL DURING THE
------------------ PAID-IN DEVELOPMENT
SHARES AMOUNT CAPITAL STAGE TOTAL
--------- ------ ----------- ------------ -----------
<S> <C> <C> <C> <C> <C>
Issuance of common stock for cash
from initial capitalization, June
1997 (Note 7)...................... 5,680,000 $5,680 $ (5,660) $ -- $ 20
Net loss for the period.............. -- -- -- (2,903) (2,903)
--------- ------ ----------- ------------ -----------
Balance, December 31, 1997........... 5,680,000 5,680 (5,660) (2,903) (2,883)
Issuance of common stock and stock
based compensation May 1998 (Note
7)................................. 1,420,000 1,420 4,985,294 -- 4,986,714
Issuance of common stock in
conversion of note payable $1.56
per share) November 1998 (Note
4)................................. 666,666 667 1,039,113 -- 1,039,780
Issuance of common stock in
conversion of note payable ($1.00
per share), November 1998 (Note
4)................................. 50,000 50 49,950 -- 50,000
Issuance of common stock for cash at
$3.75 per share, net of $640,587 of
offering costs November and
December 1998 (Note 7)............. 1,259,167 1,259 4,080,030 -- 4,081,289
Issuance of compensatory stock
options to employees October
through December 1998 (Note 7)..... -- -- 278,750 -- 278,750
Net loss for the year................ -- -- -- (6,513,228) (6,513,228)
--------- ------ ----------- ------------ -----------
Balance, December 31, 1998........... 9,075,833 9,076 10,427,477 (6,516,131) 3,920,422
Issuance of compensatory stock
options to employees, January 1999
(Note 7)........................... -- -- 52,500 -- 52,500
Issuance of compensatory stock
options to officers and directors,
March 1999 (Note 7)................ -- -- 426,500 -- 426,500
Net loss for the period
(unaudited)........................ -- -- -- (3,683,219) (3,683,219)
--------- ------ ----------- ------------ -----------
Balance, March 31, 1999
(unaudited)........................ 9,075,833 $9,076 $10,906,477 $(10,199,350) $ 716,203
========= ====== =========== ============ ===========
</TABLE>

See notes to financial statements.

F-5
<PAGE> 49

QUEPASA.COM, INC.
(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
CUMULATIVE CUMULATIVE
FROM FROM
INCEPTION INCEPTION INCEPTION
THREE MONTHS ENDED (JUNE 25, 1997) (JUNE 25, 1997) (JUNE 25, 1997)
MARCH 31, YEAR ENDED TO TO TO
---------------------- DECEMBER 31, DECEMBER 31, MARCH 31, DECEMBER 31,
1999 1998 1998 1997 1999 1998
----------- -------- ------------ --------------- --------------- ---------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Cash flows from operating
activities
Net loss....................... $(3,683,219) $(13,467) $(6,513,228) $(2,903) $(10,199,350) $(6,516,131)
Adjustments to reconcile net
loss to net cash (used in)
provided by operating
activities
Depreciation and
amortization.............. 28,694 -- 6,532 -- 35,226 6,532
Stock based compensation.... 479,000 -- 5,265,364 -- 5,744,364 5,265,364
Accrued interest on
convertible notes
payable................... -- -- 39,780 -- 39,780 39,780
Change in assets and
liabilities
Deposits receivable....... 1,533,632 -- (1,533,632) -- -- (1,533,632)
Forgivable loans.......... (35,165) -- (396,540) -- (431,705) (396,540)
Prepaid advertising....... (1,076,918) -- -- -- (1,076,918) --
Deposits and other
assets................. (51,192) -- (2,500) -- (53,692) (2,500)
Accounts payable.......... 317,214 10,325 65,757 5,465 388,436 71,222
Accrued payroll and
related taxes.......... 72,642 -- 2,922 -- 75,564 2,922
Deferred license fees..... 2,500 -- 64,165 -- 66,665 64,165
----------- -------- ----------- ------- ------------ -----------
1,270,407 10,325 3,511,848 5,465 4,787,720 3,517,313
----------- -------- ----------- ------- ------------ -----------
Net cash (used in)
provided by operating
activities........... (2,412,812) (3,142) (3,001,380) 2,562 (5,411,630) (2,998,818)
----------- -------- ----------- ------- ------------ -----------
Cash flows from investing
activities
Purchase of fixed assets....... (510,301) -- (361,152) -- (871,453) (361,152)
----------- -------- ----------- ------- ------------ -----------
Net cash used in
investing
activities........... (510,301) -- (361,152) -- (871,453) (361,152)
----------- -------- ----------- ------- ------------ -----------
Cash flows from financing
activities
Checks in excess of bank
balance..................... -- 560 -- -- -- --
Stock subscription
receivable.................. 125,000 -- (125,000) -- -- (125,000)
Net proceeds from private
placements.................. -- -- 4,081,289 -- 4,081,289 4,081,289
Proceeds from issuance of note
payable..................... 2,000,000 -- -- -- 2,000,000 --
Proceeds from convertible note
payable..................... -- -- 1,100,000 -- 1,100,000 1,100,000
Accrued interest............... 20,000 -- -- -- 20,000 --
Deferred initial public
offering costs.............. (342,441) -- -- -- (342,441) --
Accrued commissions............ (191,144) -- 215,233 -- 24,089 215,233
Stock subscription............. (337,500) -- 337,500 -- -- 337,500
Proceeds from issuance of
common stock................ -- -- 100 20 120 120
Payments on notes payable...... -- -- (50,000) -- (50,000) (50,000)
----------- -------- ----------- ------- ------------ -----------
Net cash provided by
financing
activities........... 1,273,915 560 5,559,122 20 6,833,057 5,559,142
----------- -------- ----------- ------- ------------ -----------
</TABLE>

F-6
<PAGE> 50

Supplemental disclosure of cash flow information:

Cash paid for interest was $48,994 for the year ended December 31,
1998 and $0 from Inception (June 25, 1997) to December 31, 1997.

Supplemental schedule of non-cash investing and financing activities:

During 1998, convertible notes of $1,050,000 were converted into
common stock.

F-7
<PAGE> 51

QUEPASA.COM, INC.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS
(INFORMATION WITH RESPECT TO MARCH 31, 1999 AND 1998 IS UNAUDITED)

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Quepasa.com, inc. (the Company), a Nevada Corporation, was incorporated in
June 1997. The Company is a Spanish-language Internet portal and community.
Quepasa.com offers a number of services such as news, chat and free e-mail. The
Company's portal draws viewers to their Web sites by providing a one-stop
destination for identifying, selecting and accessing resources, services,
content and information on the Web. The Company is targeted to provide users
with information and interactive content centered around the Spanish language.

The Company is a development stage company that has not had any significant
revenue since inception. The Company realized a net loss of approximately $6.9
million including a $5.3 million non-cash charge for stock based compensation
during the year ended December 31, 1998 and there is no assurance that the
Company will generate revenue or earn profit in the future.

During 1998, the Company changed its name from Internet Century, Inc. to
quepasa.com, inc.

Interim Financial Statements (Unaudited)

In the opinion of management, the accompanying unaudited financial
statements contain all adjustments (consisting of only normal recurring
accruals) necessary to present fairly the financial position of the Company at
March 31, 1999 and the results of its operations and changes in cash flows for
the three months ended March 31, 1999 and 1998 and the three months ended March
31, 1999 included in the period cumulative from inception to March 31, 1999. The
results of operations for the three months ended March 31, 1999 and 1998 are not
necessarily indicative of the results to be expected for a full year.

Stock Split

In October 1998, the Company's board of directors authorized a 284 for one
stock split. The financial statements have been presented as if the split had
occurred at inception.

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand and investments with
original maturities of three months or less.

Deposits Receivable

Accounts receivable at December 31, 1998 represents refunds due from a
media company for advances paid by the Company under an advertising agreement
which was canceled prior to advertising services being rendered. The amount was
received subsequent to December 31, 1998.

Property and Equipment

Property and equipment are recorded at cost. Depreciation and amortization
expense is generally provided on a straight-line basis using estimated useful
lives of three to five years.

Deferred Offering Costs

Deferred offering costs represents cost incurred in conjunction with the
Company's proposed public offering. Deferred offering costs will be offset
against net proceeds, if successful, or expensed in operations if the offering
is unsuccessful.

F-8
<PAGE> 52
QUEPASA.COM, INC.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(INFORMATION WITH RESPECT TO MARCH 31, 1999 AND 1998 IS UNAUDITED)

License Agreement

The Company entered into a licensing agreement pursuant to which the
Company licenses an internet-based search engine. The minimum payments will be
expensed on a straight-line basis over the term of the agreement. (Note 3).

Revenue Recognition

Advertising revenues are expected to be derived principally from short-term
advertising contracts. Revenues are generally recognized ratably over the period
in which the advertisement is displayed, provided that the Company does not have
any significant remaining obligations and collection of the resulting receivable
is probable. To the extent that web site impression deliveries are falling short
of the guarantees, the Company would defer recognition of the corresponding
revenues.

Income Taxes

The Company recognizes deferred tax liabilities and assets for the expected
future tax consequences of events that have been included in the financial
statements or tax returns. Under this method, deferred tax liabilities and
assets are determined based on the difference between the financial statements
and tax basis of assets and liabilities using the enacted tax rates in effect
for the year in which the differences are expected to reverse. The measurement
of deferred tax assets is reduced, if necessary, by the amount of any tax
benefits that, based on available evidence, are not expected to be realized.

Basic and Diluted Net Loss Per Share

The Company computes net loss per share in accordance with the provisions
of Statement of Financial Accounting Standards No. 128, "Earnings per Share"
("SFAS 128") and SEC Staff Accounting Bulletin No. 98 ("SAB 98"). Under the
provisions of SFAS 128 and SAB 98, basic and diluted net loss per share is
computed by dividing the net loss available to common stockholders for the
period by the weighted average number of common shares outstanding for the
period. The calculation of basic and diluted net loss per share excludes shares
of common stock issuable upon exercise of employee stock options as the effect
of the exercise would be antidilutive.

Use of Estimates

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and revenues and expenses during the reporting periods. Actual
results could differ from those estimates.

Advertising Costs

Advertising costs are expensed as incurred in accordance with Statement of
Position 93-7, "Reporting on Advertising Costs". Advertising costs for the year
ended December 31, 1998 and for the period from Inception (June 25, 1997) to
December 31, 1997 totaled $132,377 and $0, respectively. The Company recognizes
the advertising expense in a manner consistent with how the related advertising
is displayed or broadcast.

F-9
<PAGE> 53
QUEPASA.COM, INC.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(INFORMATION WITH RESPECT TO MARCH 31, 1999 AND 1998 IS UNAUDITED)

Product and Content Development

Costs incurred in the classification and organization of listings within
the Company's Web site and the development of new products and enhancements to
existing products are charged to expense as incurred. Material software
development costs incurred during the application development stage are
capitalized. Based upon the Company's product development process, and the
constant modification of the Company's Web site, costs incurred by the Company
during the application development stage have been insignificant.

Fair Value of Financial Instruments

The carrying amount of the Company's financial instruments, which
principally include cash, deposit receivable, accounts payable, accrued expenses
and a note payable, approximate fair value due to the relatively short maturity
of the financial instruments.

The fair value of the Company's debt instruments are based on the amount of
future cash flows associated with cash instrument using the Company's borrowing
rate. At March 31, 1999 and December 31, 1998 and 1997, the carrying value of
all financial instruments was not materially different from fair value.

Recently Issued Accounting Pronouncements

In June 1998, the Financial Accounting Standards Board issued Statement No.
133, "Accounting for Derivative Instruments and Hedging Activities", which is
effective for financial statements issued for all fiscal quarters of fiscal
years beginning after June 15, 1999. This statement requires companies to
recognize all derivative contracts at either assets or liabilities in the
balance sheet and to measure them at fair value. If certain conditions are not a
derivative may be specifically designated as a hedge, the objective of which is
to match the timing of gain or loss recognition on the hedging derivative with
the recognition (i) the changes in the fair value of the hedged asset or
liability that are attributable to the hedged risk or (ii) the earnings effect
of the hedged forecasted transaction. For a derivative not designated as a
hedging instrument, the gain or loss is recognized in income in the period of
change. Historically, the Company has not entered into derivative contracts to
hedge existing risks or for speculative purposes. Accordingly, the Company does
not expect adoption of the new standards on January 1, 2000 to effect its
financial statements.

NOTE 2 -- PROPERTY AND EQUIPMENT

<TABLE>
<CAPTION>
DECEMBER 31,
MARCH 31, ---------------
1999 1998 1997
----------- -------- ----
(UNAUDITED)
<S> <C> <C> <C>
Computer equipment and software........................ $449,430 $344,948 $ --
Furniture, fixtures and equipment...................... 337,228 16,204 --
Leasehold improvements................................. 84,795 -- --
-------- -------- ----
871,453 361,152 --
Less accumulated depreciation and amortization......... (35,226) (6,532) --
-------- -------- ----
Property and equipment................................. $836,227 $354,620 $ --
</TABLE>

NOTE 3 -- LICENSE AGREEMENT

On July 21, 1998, the Company entered an Information Services Agreement
(the "Agreement") with Inktomi Corporation ("Inktomi") whereby Inktomi will
provide certain services, including but not limited

F-10
<PAGE> 54
QUEPASA.COM, INC.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(INFORMATION WITH RESPECT TO MARCH 31, 1999 AND 1998 IS UNAUDITED)

to, search services enabling the Company to access Inktomi database of Internet
Web sites. The agreement requires quarterly payments ranging from $60,000 to
$75,000 and expires in August 2001. While the agreement provides for certain
additional payments based upon actual use of Inktomi's services, the Company
believes additional payments, if any, will not be material. The license will be
expensed on a straight-line basis over the term of the agreement of three years.

Minimum payments under the licensing agreement are as follows as of March
31, 1999:

<TABLE>
<CAPTION>
YEAR ENDING DECEMBER 31,
------------------------
<S> <C>
1999........................................................ $212,500
2000........................................................ 250,000
2001........................................................ 187,500
--------
$650,000
========
</TABLE>

The license fee expense was $104,165 for the year ended December 31, 1998
and $62,500 for the three months ended March 31, 1999.

In addition to the Inktomi agreement described above, the Company has
various other agreements for technology related to the Company's portal. These
agreements are for one to two years and require payments totaling $81,000 in
1999 and $9,000 in 2000. See note 8 (unaudited) for additional commitments.

NOTE 4 -- NOTES PAYABLE

Convertible Note Payable

In May 1998, the Company issued $100,000 of convertible debt. The
convertible debt accrued interest at 12% per annum and was scheduled to mature
on the earlier of May 31, 2000 or the closing date of the Company's initial
public offering, if any. The Company had the right to convert unpaid note
principal plus any accrued interest into 100,000 shares of common stock at any
time during the term of the Note.

In November 1998, the Company converted $50,000 of the Note into 50,000
shares of the Company's common stock and repaid the balance of $50,000.

In July 1998, the Company issued $1,000,000 of convertible debt. The
convertible debt accrued interest at 12% per annum and was payable on the
earlier of May 31, 2000 or at the closing date of the Company's initial public
offering, if any. The Company had the right to convert unpaid principal plus any
accrued interest into 666,666 shares of common stock at any time during the term
of the notes. The Company believes this conversion feature was based on the fair
market value of the common stock on the date of issuance.

In November 1998, the notes and accrued interest of $39,780 were converted
into 666,666 shares of the Company's common stock.

Loans from Related Parties (Unaudited)

In March of 1999, the Company received a $2 million loan from a former
stockholder of the Company. The note bears interest at 12% through June 1999 and
then 14% through March 2001 per annum and is payable at the earlier of the
closing date of the IPO or March 2001.

The Chief Technology Officer has agreed to lend the Company up to $3
million as needed for operations. Any amounts loaned will bear interest at 12%
per annum for four months and 14% per annum

F-11
<PAGE> 55
QUEPASA.COM, INC.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(INFORMATION WITH RESPECT TO MARCH 31, 1999 AND 1998 IS UNAUDITED)

for the next 20 months and mature 24 months from issuance. In April and May of
1999, the Company was advanced $2,300,000 under the terms of this agreement.

NOTE 5 -- INCOME TAXES

No provision for federal and state income taxes has been recorded as the
Company has incurred net operating losses through March 31, 1999. The following
table sets forth the primary components of deferred tax assets:

<TABLE>
<CAPTION>
DECEMBER 31,
MARCH 31, ---------------------
1999 1998 1997
----------- ----------- -------
(UNAUDITED)
<S> <C> <C> <C>
Net operating loss carryforwards.................. $10,631,000 $ 6,910,000 $ 3,000
Nondeductible expenses............................ (5,744,000) (5,265,000) --
----------- ----------- -------
Gross deferred tax assets......................... 4,887,000 1,645,000 3,000
Valuation allowance............................... (4,887,000) (1,645,000) (3,000)
----------- ----------- -------
$ -- $ -- $ --
=========== =========== =======
</TABLE>

At March 31, 1999 (unaudited) and December 31, 1998 and 1997, the Company
fully reserved its deferred tax assets. The Company believes sufficient
uncertainty exists regarding the reliability of tax assets such that a full
valuation allowance is appropriate.

At December 31, 1998, the Company had approximately $1,645,000 of federal
net operating loss carryforwards for tax reporting purposes available to offset
future taxable income. These carryforwards expire in 2013. The Company has
approximately $1,645,000 of state net operating loss carryforwards for tax
reporting purposes which expire in 2003.

NOTE 6 -- COMMITMENTS AND CONTINGENCIES

Operating Leases

The Company signed a three year lease agreement for an office located in
Las Vegas, Nevada commencing August 15, 1998. The monthly lease payments range
from $1,670 to $1,770. The lease expires August 14, 2001.

The Company signed a three year lease agreement for office equipment
commencing in August 1998. The monthly rent payment is $328 and the lease
expires in September of 2001.

Future minimum rental payments under non-cancelable operating and equipment
leases are as follows:

<TABLE>
<CAPTION>
YEAR ENDING DECEMBER 31,
------------------------
<S> <C>
1999........................................................ $20,240
2000........................................................ 20,847
2001........................................................ 14,168
-------
$55,255
=======
</TABLE>

Facilities and equipment leases expense for the three months ended March
31, 1999 and 1998 and the year ended December 31, 1998 and for the period from
Inception (June 25, 1997) to December 31, 1997 was $47,000, $0, $45,068 and $0,
respectively.

F-12
<PAGE> 56
QUEPASA.COM, INC.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(INFORMATION WITH RESPECT TO MARCH 31, 1999 AND 1998 IS UNAUDITED)

Employment Agreements

The Company has employment agreements with many of its employees and all of
its executive officers. The agreements provide for base salary, forgivable loans
and bonus provisions. The forgivable loans are recognized ratably as expense
over the service period, or upon termination of the employee if the loan is
forgiven at that time. The Chief Technology Officer's agreement provides for a
$500,000 payment upon termination without cause.

Proposed Public Offering

On January 15, 1999, the Company entered into a letter-of-intent with an
investment banker relating to a proposed initial public offering of shares of
common stock of the Company.

The initial public offering is expected to consist of the sale of 4,000,000
shares of common stock, plus an option for the underwriters to sell an
additional 600,000 shares to cover overallotments. The Company has also
authorized the issuance of 400,000 warrants to purchase common stock to the
underwriters at an exercise price equal to 165% of the initial per share public
offering price. These warrants are exercisable for a period of 4 years beginning
one year from the effective date of the offering. Upon issuance of the warrants,
the Company will record offering costs as an offset to stockholders equity equal
to the fair value of the warrants on the date of grant using the Black-Scholes
option pricing method.

Advertising Contracts

In January 1999, the Company entered a 26-week sponsorship agreement with a
Spanish language television broadcaster. Based on the terms of the agreement,
the Company will receive media spots for approximately $800,000. Prepayments
made under this agreement were capitalized and are being amortized over the
period in which the advertisement is broadcasted. As of March 31, 1999
(unaudited), approximately $677,000 is included in prepaid advertising and
$123,000 was expensed as a result of this agreement.

In February 1999, the Company entered a contract for an 8-week nationwide
advertising campaign with a Spanish language radio broadcaster located in the
United States. The contract calls for an initial payment of $1.6 million and
subsequent monthly payments for broadcasting as incurred. The initial payment
made under this agreement was capitalized and is being amortized over the period
in which the advertisement is broadcasted. As of March 31, 1999 (unaudited),
approximately $400,000 is included in prepaid advertising and $1,200,000 was
expensed as a result of this agreement. In addition to the February agreement,
in April 1999, the Company initiated a $780,000 9-week nationwide advertising
campaign.

In February 1999, the Company entered into an advertising agreement with an
entity partially owned by a former Director of the Company. The agreement
provides for advertising services for a flat fee of $78,000 per month and is
cancelable by either party with 30 days written notice. During the three months
ended March 31, 1999 $78,833 was paid under the terms of this agreement. In
addition, approximately $210,000 was paid to the related party in exchange for
other promotional items. All payments made were included in advertising expense
during the three months ended March 31, 1999.

Content

The Company has various agreements with companies which provide content for
the Company's Web site. The agreements are for one to two years and require
payments totaling $165,000 in 1999 and $120,000 in 2000.

F-13
<PAGE> 57
QUEPASA.COM, INC.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(INFORMATION WITH RESPECT TO MARCH 31, 1999 AND 1998 IS UNAUDITED)

Advertising Revenue

The Company entered into a network affiliation agreement with an internet
advertising agency whereby the Company granted the exclusive right to solicit
advertising on the Company's Web site. In exchange for this service the
advertising agency will retain 30% to 50% of all related advertising revenue
based on the number of impressions delivered. The agreement may be terminated by
either party with four months notice. The related advertising revenue will be
recognized ratably over the period in which the advertisement is displayed.

NOTE 7 -- STOCKHOLDERS' EQUITY

Upon incorporation on June 25, 1997, the Company issued 5,680,000 shares of
common stock for $20.00 to the Chief Technology Officer and the other founder of
the Company.

Private Placement

During November and December of 1998, the Company issued 1,259,167 shares
of common stock in a private placement for cash at $3.75 per share. The Company
received proceeds of $4,081,289 net of related costs of $640,587. In January
1999, $125,000 of the proceeds were received and are reflected as stock
subscription receivable. Of the related costs, $24,089 and $215,233 were unpaid
as of March 31, 1999 and December 31, 1998, respectively.

During December 1998, the Company received excess proceeds of $337,500 with
respect to these private placements. These amounts were refunded upon the
investors request in January 1999.

Stock Option Plan

In October 1998 and later amended, the Company adopted a Stock Option Plan
(the "Plan") which provides for the granting of options to officers, directors,
and consultants. The plan permits the granting of "incentive stock options"
meeting the requirements of Section 422A of the Internal Revenue Code as well as
"nonqualified" which do not satisfy the requirements of that section. 6,000,000
shares of common stock have been restricted under the plan for the granting of
options. The Plan will be in effect until November 1, 2009, unless extended by
the Company's stockholders. The options are exercisable to purchase stock for a
period of ten years from the date of grant.

Incentive Stock Options granted pursuant to this Plan may not have an
option price that is less than the fair market value of the stock on the date
the option is granted. Incentive stock options granted to significant
stockholder shall have an option price of not less than 110% of the fair market
value of the stock on the date of the grant. Options granted under the plan vest
one third at the end of each of the three years of service following the grant
date. The board of directors of the Company may waive the vesting requirements
at its discretion. All stock options issued under the Plan are exercisable for a
period of 10 years from the date of grant.

Employee Compensatory Stock and Stock Options

Stock-based Compensation. The Company accounts for stock-based employee
compensation arrangements in accordance with the provisions of Accounting
Principles Board No. 25, Accounting for Stock Issued to Employees; and complies
with the disclosure requirements of SFAS No. 123, Accounting for Stock-Based
Compensation. Under APB No. 25, compensation cost, if any, is recognized over
the respective vesting period based on the difference, on the date of grant,
between the fair value of the Company's common stock and the grant price.
F-14
<PAGE> 58
QUEPASA.COM, INC.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(INFORMATION WITH RESPECT TO MARCH 31, 1999 AND 1998 IS UNAUDITED)

During May of 1998, the Company issued 1,420,000 shares of common stock to
a former officer of the Company and the original stockholders of the Company
transferred 3,566,714 existing shares to several employees and one advisor. The
fair market value of the common stock on the date of these issuances was
determined to be $1.00 based on the issuance of convertible debt in May of 1998
which was convertible into common stock at $1.00 per share. Approximately $5
million in compensation expense is reflected in the December 31, 1998 financial
statements as a result of these transactions.

Throughout 1998, the Company issued "nonqualified" options to purchase
common stock to several employees under the stock option plan. Compensation
expense of approximately $279,000 was recognized based on the difference between
the exercise price and fair value of the stock.

In November 1998, the Company granted 50,000 stock options to purchase
common stock to the Chief Technology Officer. The options are exercisable at
$1.50, vest immediately and have a term of 10 years. Approximately $113,000
(based on the intrinsic value of the option) of compensation expense was
recorded during the year ended December 31, 1998 as a result of this
transaction.

In January 1999, the Company granted 500,000 stock options to purchase
common stock to the Chief Technology Officer. The options are exercisable at
$8.00, vest immediately and have a term of 10 years. As the exercise price was
determined to be equal to fair value on the date of grant no compensation
expense was recorded as a result of this transaction.

In April 1999, the Chief Technology Officer was also granted options to
purchase up to 200,000 shares of common stock exercisable at $12.00 per share
that vest over a three year period. As the exercise price was determined to be
equal to fair value on the date of grant no compensation expense was recorded as
a result of this transaction.

In January 1999, the Company granted 35,000 options to employees with an
exercise price of $1.00. These options vest over a period of three years.
Approximately $52,500 of compensation expense was recognized during the three
months ended March 31, 1999 based on the fair market value on the date of grant
and in consideration of vesting period. Additionally, the Company granted a
total of 50,000 options to two directors. The options, 25,000 at an exercise
price of $1.50 and 25,000 at an exercise price of $8.00 all vested immediately.
The Company recognized approximately $426,500 of compensation expense which was
determined to be the fair value of the options or the date of grant utilizing
the Black-Scholes option pricing method with the following assumptions: expected
life of 10 years, no volatility, risk free interest rates of 6% and a 0%
dividend yield. Additionally, 1,163,000 options were granted to employees with
an exercise price of $8. The exercise price of the options were equal to or
greater than the fair value of the common stock on the date of grant. As the
Company has adopted the disclosure-only provisions of Statement of Financial
Accounting Standard No. 123, "Accounting for Stock-Based Compensation," no
compensation expense has been recognized related to these options.

F-15
<PAGE> 59
QUEPASA.COM, INC.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(INFORMATION WITH RESPECT TO MARCH 31, 1999 AND 1998 IS UNAUDITED)

Had compensation cost for stock-based compensation been determined based on
the fair value or the grant date consistent with the method of SFAS 123, the
Company's net income and earnings per share would have been reduced to the pro
forma amounts presented below:

<TABLE>
<CAPTION>
CUMULATIVE CUMULATIVE
INCEPTION FROM INCEPTION FROM INCEPTION
THREE MONTHS (JUNE 25, 1997) (JUNE 25, 1997) (JUNE 25, 1997)
ENDED YEAR ENDED TO TO TO
MARCH 31, MARCH 31, DECEMBER 31, DECEMBER 31, MARCH 31, DECEMBER 31,
1999 1998 1998 1997 1999 1998
------------ --------- ------------ --------------- --------------- ---------------
(UNAUDITED) (UNAUDITED)
<S> <C> <C> <C> <C> <C> <C>
Net loss
As reported........ $ (3,683,219) $(13,467) $(6,513,228) $2,903 $(10,199,350) $(6,516,131)
Pro forma.......... $ (7,362,091) $(13,467) $(6,728,228) $2,903 $(14,093,222) $(6,731,131)
Basic and diluted
loss per share
As reported........ $ (.41) $ -- $ (.72) $ -- $ (1.12) $ (.72)
Pro forma.......... $ (.81) $ -- $ (.74) $ -- $ (1.55) $ (.74)
</TABLE>

The fair value of option grants is estimated on the date of grants
utilizing the Black-Scholes option pricing model with the following assumptions
for 1998: expected life of 10 years, no volatility, risk-free interest rates of
6%, and a 0% dividend yield.

At March 31, 1999 (unaudited) and December 31, 1998, 1,463,000 and 215,000
of common stock options were outstanding, respectively. All of these potential
common shares were excluded from the computation of diluted earnings per share
because their inclusion would be antidilutive.

Summarized information relating to stock options is as follows:

<TABLE>
<CAPTION>
WEIGHTED
COMMON AVERAGE
STOCK EXERCISE
OPTIONS PRICE
--------- --------
<S> <C> <C>
Outstanding, December 31, 1997.............................. -- --
Issued...................................................... 215,000 2.45
--------- -----
Outstanding, December 31, 1998.............................. 215,000 2.45
Issued...................................................... 1,248,000 7.82
--------- -----
Outstanding, March 31, 1999 (unaudited)..................... 1,463,000 7.35
========= =====
Exercisable, December 31, 1998.............................. 120,000 1.89
========= =====
Exercisable, March 31, 1999................................. 1,251,500 7.91
========= =====
</TABLE>

F-16
<PAGE> 60
QUEPASA.COM, INC.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(INFORMATION WITH RESPECT TO MARCH 31, 1999 AND 1998 IS UNAUDITED)

The weighted average exercise prices for the options outstanding at March
31, 1999 (unaudited) are as follows:

<TABLE>
<CAPTION>
WEIGHTED
COMMON AVERAGE
STOCK EXERCISE
OPTIONS PRICE
--------- --------
<S> <C> <C>
175,000 $1.22
100,000 3.75
1,188,000 8.00
---------
Outstanding March 31, 1999.................................. 1,463,000
=========
</TABLE>

<TABLE>
<CAPTION>
WEIGHTED
COMMON AVERAGE
STOCK EXERCISE
OPTIONS PRICE
--------- --------
<S> <C> <C>
125,000 $1.40
25,000 $3.75
1,056,300 $8.00
---------
Exercisable at March 31, 1999............................... 1,226,500
=========
</TABLE>

The weighted average contractual life is ten years. The weighted average
grant date fair value for all options granted during the year ended December 31,
1998 and the three months ended March 31, 1999 are as follows:

<TABLE>
<CAPTION>
WEIGHTED
AVERAGE
NUMBER OF GRANT DATE
OPTIONS FAIR VALUE
--------- ----------
<S> <C> <C>
Granted during year ended December 31, 1998 at
Less than fair value...................................... 115,000 $3.04
Equal to fair value....................................... 100,000 1.67
Greater than fair value................................... --
---------
215,000
=========

Granted during 3 months ended March 31, 1999 at
Less than fair value...................................... 85,000 $9.22
Equal to fair value....................................... 1,163,000 3.57
Greater than fair value................................... --
---------
1,248,000
=========
</TABLE>

NOTE 8 SUBSEQUENT EVENTS (UNAUDITED)

Advertising Contracts

In April 1999, the Company's Sponsorship Agreement with the Spanish
language television broadcaster (note 6) was expanded under a separate
agreement. Under the terms of the expanded agreement, the Company issued 600,000
shares of common stock and 1,000,000 warrants to purchase common stock. The
warrants are exercisable for a period of 2 years at 120% of the public offering
price

F-17
<PAGE> 61
QUEPASA.COM, INC.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(INFORMATION WITH RESPECT TO MARCH 31, 1999 AND 1998 IS UNAUDITED)

per share. In exchange for the common stock issued, the Company received a $5
million advertising credit to be utilized ratably over 5 years. The advertising
will be valued based on the fair value of the stock ($6,600,000) on the date of
issuance or $11 per share. Due to the fact the agreement may be cancelled by
either party if the proposed initial public offering is not successful, the
Company has not received any advertising through June 1999. The Company
anticipates utilizing the advertising upon the completion of the IPO. Therefore,
as a result of the common stock issued, the Company anticipates utilizing and
expensing approximately $660,000 of advertising (representing six months of the
total 60 months of advertising credit) during the year ended December 31, 1999
and $5,940,000 in subsequent periods. The warrants have no significant value as
determined using the Black Scholes option pricing model. The following
assumptions were used in the option pricing model: stock price of $11, exercise
price of $13.20, option term of two years, risk free interest rate of 6%, no
volatility and a dividend yield of 0%. The fair value of the shares issued was
based on the fair market value of the stock on the date of issuance or $11.
Additionally, the Company agreed to purchase an additional $1 million of
advertising to be broadcast over 26 weeks commencing August, 1999. The agreement
may be cancelled by either party if the proposed initial public offering is not
successful.

In April 1999, the Company issued 50,000 shares of its Common Stock to an
entity partially owned by a former director of the Company for advertising and
marketing services valued at $550,000. The fair value of the shares issued was
based on the fair market value of the stock on the date of issuance or $11 which
approximates the value of the advertising and marketing services received. The
expense for advertising and marketing services will be recognized as the
services are performed and should be complete by December 31, 1999.

In April 1999, the Company entered into a sponsorship agreement with the
Arizona Diamondbacks. A director of the Company serves as the Arizona
Diamondbacks' Chief Executive Officer and General Manager who subsequently
became a Director of the Company. Under this agreement, the Company will receive
English and Spanish television and radio broadcast time, ballpark signage, and
Internet and print promotions for a sponsorship fee of $1.5 million, $500,000 of
which was paid in April 1999 with the remaining $1 million payable over the 1999
baseball season. The $1.5 million sponsorship fee will be recognized as expense
ratably over the 1999 baseball season.

In April 1999, the Company entered into an agreement with the Miami Herald,
providing for Spanish language news features on the Company's web site and other
promotional item. The agreement requires approximately $720,000 to be paid over
a one year period. The $720,000 will be recognized as expense over the term of
the agreement from April 1999 to April 2000.

In April 1999, the Company entered into an agreement with Fox Sports World
Espanol. The agreement requires total payments of $425,000 and involves numerous
media elements and joint marketing promotions. The advertising expense will be
fully recognized by July 31, 1999.

Common Stock Options

In April 1999, the Company's President received options to purchase 350,000
shares of common stock. The options are exercisable at $7.00 per share, vest
immediately and have a term of 10 years. In addition, the Company's Chief
Technology Officer transferred 50,000 shares to the President and the Company
issued 50,000 shares to an entity owned by the President. As a result of these
transactions, the Company will record an approximate $2,500,000 charge to
earnings in April 1999 for stock based compensation. The fair value of the
shares issued was based on the fair market value of the stock on the date of
issuance of $11. The charge to earnings as a result of the options issued was
based on the intrinsic value as determined by APB 25.

F-18
<PAGE> 62
QUEPASA.COM, INC.
(A DEVELOPMENT STAGE COMPANY)

NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)
(INFORMATION WITH RESPECT TO MARCH 31, 1999 AND 1998 IS UNAUDITED)

As a result of the above transactions, the issuance of 200,000 options to
the Chief Technology Officer in April 1999, and various other subsequent events,
a total of 3,398,000 options and warrants are outstanding as of April 27, 1999
with the weighted average exercise price (assuming an $11.00 IPO price) of
$9.32.

The Company will record an approximate $4.5 million charge to earnings
(which includes the $2.5 million charge described above) for the three months
ending June 30, 1999. The charge, resulting from the options issued, was based
on the intrinsic value of the options as determined by APB 25 for employees and
the fair value of the options issued as determined using the Black Scholes
option pricing model for directors.

The remaining $2.0 million charge is a result of issuing 385,000 options to
11 officers, directors and employees. These 385,000 options have ten year terms,
exercise prices ranging from $7 to $11 and a weighted average exercise price of
$9.00.

Voting Trust Agreement

In June 1999, the Chief Technology Officer and a former officer and
director entered into a voting trust agreement that provides for a period of 5
years from the effective date of the IPO that two directors may vote all shares
of their common stock in the same proportion as those shares voted by the
nonaffiliated stockholders.

Rescission Issue

In April 1999 we sold 600,000 shares of our common stock to Telemundo for
$5.0 million of advertising credit on the Telemundo television network and
50,000 shares to Garcia/LIS for $500,000 of advertising services. The Chief
Operating Officer of Telemundo is one of our directors and one of the owners of
Garcia/LKS was one of our directors. In the view of the Securities and Exchange
Commission, these sales may not have been elegible for an exemption from
registration under the Securities Act of 1933. In the absence of such an
exemption, Telemundo and Garcia/LKS could bring suit against us to rescind their
stock purchases, in which event we could be liable for rescission payments to
these two investors of up to $5.5 million.

F-19
<PAGE> 63

[INSIDE BACK COVER PAGE -- SCREEN SHOT OF MAP REFLECTING
TOTAL U.S. HISPANIC POPULATION BREAKDOWN]
<PAGE> 64

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

[QUEPASA.COM LOGO]

UNTIL , 1999 (25 DAYS AFTER THE DATE OF THIS PROSPECTUS), ALL
DEALERS THAT BUY, SELL OR TRADE THESE SHARES OF COMMON STOCK, WHETHER OR NOT
PARTICIPATING IN THIS OFFERING, MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS IS
IN ADDITION TO THE DEALERS' OBLIGATION TO DELIVER A PROSPECTUS WHEN ACTING AS
UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 65

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION(1)

<TABLE>
<S> <C>
SEC Registration Statement.................................. $ 17,983
NASD Filing Fee............................................. $ 6,596
Blue Sky Filing Fees........................................ $ 2,500
Blue Sky Legal Fees......................................... $ 5,000
Printing Expenses........................................... $ 150,600
Legal Fees and Expenses..................................... $ 575,000
Accounting Fees............................................. $ 125,000
Transfer Agent Fees......................................... $ 5,000
Nasdaq Application Fee...................................... $ 25,000
Miscellaneous Expenses...................................... $ 87,921
----------
Total............................................. $1,000,000
==========
</TABLE>

- ---------------

(1) All expenses, except the SEC registration fee and NASD filing fee, are
estimated.

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS

Article twelfth of the Registrant's amended articles of incorporation
provides as follows:

"The liability of the directors of the Corporation for monetary
damages for breach of fiduciary duty is eliminated to the fullest extent
provided by Nevada law.

Directors and officers of the Corporation shall be indemnified by the
Corporation against any liability to the fullest extent provided by Nevada
law."

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES

During the last three years, the Registrant sold the following securities
which were not registered under the Securities Act, as amended.

<TABLE>
<CAPTION>
NAME DATE NUMBER OF SHARES PRICE PER SHARE
- ---- ------ ---------------- ---------------
<S> <C> <C> <C>
Jeffrey Peterson...................................... Jun-97 2,840,000 $.0000035
Jennifer Ferlaino..................................... Jun-97 2,840,000 $.0000035
Michael Silberman..................................... May-98 1,420,000 $ 0.0001
Enver Zaky(1)......................................... Nov-98 50,000 $ 1.00
Mitchell Pierce(2).................................... Nov-98 333,333 $ 1.56
Tim Pring(2).......................................... Nov-98 333,333 $ 1.56
Louis Grubb........................................... Nov-98 66,667 $ 3.75
Daniel Louis Grubb.................................... Nov-98 66,667 $ 3.75
Bradley T. Pring...................................... Nov-98 106,667 $ 3.75
Marshall Chesrown..................................... Nov-98 100,000 $ 3.75
John Pring............................................ Nov-98 26,667 $ 3.75
John Elway............................................ Nov-98 133,333 $ 3.75
Felix Sabates......................................... Nov-98 66,666 $ 3.75
Mayer Shirazipour..................................... Nov-98 100,000 $ 3.75
Mitchell Pierce....................................... Dec-98 103,333 $ 3.75
Al Monjazeb........................................... Dec-98 30,000 $ 3.75
Anthony Bily.......................................... Dec-98 53,333 $ 3.75
Laurence R. Davis..................................... Dec-98 20,000 $ 3.75
D.A. Huschke.......................................... Dec-98 26,667 $ 3.75
</TABLE>

II-1
<PAGE> 66

<TABLE>
<CAPTION>
NAME DATE NUMBER OF SHARES PRICE PER SHARE
- ---- ------ ---------------- ---------------
<S> <C> <C> <C>
Fredrick Kaefer....................................... Dec-98 27,000 $ 3.75
Michael Maynard....................................... Dec-98 40,000 $ 3.75
John McGrath.......................................... Dec-98 20,000 $ 3.75
James Peterson........................................ Dec-98 20,000 $ 3.75
Peter A. Pfer......................................... Dec-99 27,000 $ 3.75
Lyle Reigel........................................... Dec-98 52,700 $ 3.75
Chester Sawko......................................... Dec-98 20,000 $ 3.75
Rick Scheer........................................... Dec-98 31,800 $ 3.75
Joe Seiwert III....................................... Dec-98 20,000 $ 3.75
David Solana.......................................... Dec-98 26,667 $ 3.75
Martin Sousa.......................................... Dec-98 20,000 $ 3.75
Keith Stone........................................... Dec-98 27,000 $ 3.75
Donald Strate......................................... Dec-98 27,000 $ 3.75
---------
Total....................................... 9,075,833
</TABLE>

- ---------------

(1) Conversion of a promissory note issued by the Registrant in May 1998.

(2) Conversion of a promissory note issued by the Registrant in July 1998.

In April 1999 the Registrant issued (a) 600,000 shares of its common stock
and warrants to purchase 1,000,000 additional shares to Telemundo Network Group
LLC in exchange for, among other things, $5 million of prepaid advertising
credit on the Telemundo Network, (b) 50,000 shares of its common stock to
Garcia/LKS in exchange for $500,000 of prepaid marketing and advertising
services and (c) 50,000 shares of its common stock to Southwest Harvard Group, a
company owned by Gary L. Trujillo who became the Registrant's President later in
April, pursuant to a consulting agreement.

With respect to the sales made, the Registrant relied on Section 4(2) and
Regulation D Rule 506 of the Securities Act of 1933, as amended (the "Securities
Act"). No advertising or general solicitation was employed in offering the
securities. The securities were offered to a limited number of persons all of
whom were business associates of the Registrant or its executive officers and
directors, and the transfer thereof was appropriately restricted by the
Registrant. All persons were accredited investors as that term is defined in
Rule 501 of Regulation D under the Securities Act and were capable of analyzing
the merits and risks of their investment and who acknowledged in writing that
they were acquiring the securities for investment and not with a view toward
distribution or resale and understood the speculative nature of their
investment.

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

II-2
<PAGE> 67

<TABLE>
<CAPTION>
EXHIBIT NO. TITLE
----------- -----
<C> <S>
10.06 -- Employment Agreement with Mr. Silberman, as amended(1)
10.07 -- Employment Agreement with Mr. Galan(1)
10.08 -- Employment Agreement with Mr. Ross(1)
10.09 -- Employment Agreement with Mr. Offenbecher(1)
10.10 -- Employment Agreement with Mr. Roldan(1)
10.11 -- Employment Agreement with Mr. Garcia (Luis)(1)
10.12 -- Agreement with WeatherLabs, Inc.(1)
10.13 -- Agreement with Heftel Broadcasting Company(1)
10.14 -- Agreement with GTE Internetworking, Inc.(1)
10.15 -- Agreement with Exodus Communications, Inc.(1)
10.16 -- Agreement with Telemundo Network Group LLC(1)
10.17 -- Agreement with 24/7 Media, Inc.(1)
10.18 -- Employment Agreement with Mr. Hubert, as amended(1)
10.19 -- Office Lease (Nevada)(1)
10.20 -- 1998 Stock Option Plan, as amended and forms of Option
Agreements(1)
10.21 -- Monolith Promissory Notes(1)
10.22 -- Agreement with Garcia/LKS(1)
10.23 -- Employment Agreement with Mr. Taylor(1)
10.24 -- Form of Voting Trust Agreement(1)
10.25 -- Jeffrey S. Peterson Loan Agreement(1)
10.26 -- Agreement with Telemundo Network Group LLC(1)
10.27 -- Telemundo Warrant(1)
10.28 -- Agreement with Arizona Diamondbacks(1)
10.29 -- Agreement with Miami Herald Online(1)
10.30 -- Amended and Restated Employment Agreement with Mr.
Peterson(1)
10.31 -- Agreement with Fox Sports World Espanol Agreement(1)
10.32 -- Amendment of Employment Agreement with Mr. Galan(1)
10.33 -- Amended and Restated 1998 Stock Option Plan(1)
10.34 -- Employment Agreement with Mr. Trujillo(1)
10.35 -- Employment Agreement with Mr. Trujillo(1)
10.36 -- Consulting Agreement with Mr. Trujillo(1)
10.37 -- Amended Employment Agreement with Mr. Taylor(1)
10.38 -- Amended and Restated Employment Agreement with Mr.
Trujillo(1)
10.39 -- Second Amended and Restated Employment Agreement with Mr.
Peterson(1)
16.01 -- Letter from BDO Seidman, LLP(1)
23.05 -- Consent of Kummer, Kaempfer, Bonner & Renshaw (Included
in Exhibits 5.01 and 5.02 above)(1)
23.06 -- Consent of Ehrhardt Keefe Steiner & Hottman, PC(1)
23.07 -- Consent of Ehrhardt Keefe Steiner & Hottman, PC(1)
23.08 -- Consent of Ehrhardt Keefe Steiner & Hottman, PC(1)
23.09 -- Consent of Ehrhardt Keefe Steiner & Hottman, PC(1)
23.10 -- Consent of Ehrhardt Keefe Steiner & Hottman, PC(1)
23.11 -- Consent of Ehrhardt Keefe Steiner & Hottman, PC(1)
23.12 -- Consent of Ehrhardt Keefe Steiner & Hottman, PC(1)
23.13 -- Consent of Ehrhardt Keefe Steiner & Hottman, P.C.
</TABLE>

- ---------------

(1) Previously filed.

II-3
<PAGE> 68

ITEM 17. UNDERTAKINGS.

The Registrant hereby undertakes:

(a) That insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the Registrant, the Registrant has been advised that in the
opinion of the Securities and Exchange Commission, such indemnification is
against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in
the successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the Registrant will, unless in the opinion of
its counsel the matter has been settled by controlling precedent, submit to
a court of appropriate jurisdiction the question of whether such
indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.

(b) That subject to the terms and conditions of Section 13(a) of the
Securities Exchange Act of 1934, it will file with the Securities and
Exchange Commission such supplementary and periodic information, documents
and reports as may be prescribed by any rule or regulation of the
Commission heretofore or hereafter duly adopted pursuant to authority
conferred in that section.

(c) That any post-effective amendment filed will comply with the
applicable forms, rules and regulations of the Commission in effect at the
time such post-effective amendment is filed.

(d) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:

(i) To include any prospectus required by section 10(a)(3) of the
Securities Act;

(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement;

(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement;

(e) That:

(1) For purposes of determining any liability under the Securities
Act of 1933, the information omitted from the form of prospectus filed
as part of this registration statement in reliance upon Rule 430A and
contained in a form of prospectus filed by the registrant pursuant to
Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed
to be part of this registration statement as of the time it was declared
effective.

(2) For the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains a
form of prospectus shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof.

(f) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.

(g) To provide to the underwriter at the closing specified in the
Underwriting Agreement certificates in such denominations and registered in
such names as required by the underwriter to permit prompt delivery to each
purchaser.

II-4
<PAGE> 69

SIGNATURES

Pursuant to the requirements of the Securities Act, as amended, the
Registrant has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the city of Phoenix,
state of Arizona, on June 23, 1999.

quepasa.com, inc.

By: /s/ GARY L. TRUJILLO
----------------------------------
Gary L. Trujillo
Chief Executive Officer

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Gary L. Trujillo, as his true and lawful
attorney-in-fact and agent, with full power of substitution and resubstitution,
for him and in his name, place and stead, in any and all capacities, to sign any
and all amendments (including post-effective amendments) to this Registration
Statement, and to file the same, with all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange Commission, granting
unto said attorney-in-fact and agent, full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection
therewith, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that said attorney-in-fact and
agent, or his substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.

Pursuant to the requirements of the Securities Act, as amended, this
registration statement has been signed below by the following persons on the
dates indicated.

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>

* Chairman of the Board of June 23, 1999
- ----------------------------------------------------- Directors, Chief Executive
Gary L. Trujillo Officer and President

* Chief Technology Officer and June 23, 1999
- ----------------------------------------------------- Director
Jeffrey S. Peterson

* Chief Financial Officer June 23, 1999
- ----------------------------------------------------- (Principal Accounting Officer)
Juan C. Galan

* Director June 23, 1999
- -----------------------------------------------------
L. William Seidman

* Director June 23, 1999
- -----------------------------------------------------
Jerry J. Colangelo
</TABLE>

II-5
<PAGE> 70

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>

* Director June 23, 1999
- -----------------------------------------------------
Alan J. Sokol

* Director June 23, 1999
- -----------------------------------------------------
Jose Maria Figueres

* Director June 23, 1999
- -----------------------------------------------------
Louis Olivas

/s/ GARY L. TRUJILLO June 23, 1999
- -----------------------------------------------------
*Gary L. Trujillo, as
Attorney-in-Fact
</TABLE>

II-6
<PAGE> 71

EXHIBIT INDEX

<TABLE>
<CAPTION>
EXHIBIT NO. TITLE
----------- -----
<C> <S>
1.01 -- Form of Underwriting Agreement(1)
1.02 -- Form of Representative's Warrant(1)
3.01 -- Articles of Incorporation of the Registrant, as
amended(1)
3.02 -- Bylaws of the Registrant(1)
3.03 -- Amended and Restated Bylaws of the Registrant(1)
3.04 -- Amended and Restated Bylaws of the Registrant(1)
5.01 -- Opinion of Kummer Kaempfer Bonner & Renshaw, regarding
legality of the common stock (includes consent)(1)
5.02 -- Opinion of Kummer Kaempfer Bonner & Renshaw, regarding
legality of the common stock and warrants (includes
consent)(1)
10.01 -- Agreement with Inktomi Corporation(1)
10.02 -- Voting Trust Agreement(1)
10.03 -- Agreement with Reuters NewMedia, Inc., as amended(1)
10.04 -- Office Lease (Arizona)(1)
10.05 -- Employment Agreement with Mr. Peterson, as amended(1)
10.06 -- Employment Agreement with Mr. Silberman, as amended(1)
10.07 -- Employment Agreement with Mr. Galan(1)
10.08 -- Employment Agreement with Mr. Ross(1)
10.09 -- Employment Agreement with Mr. Offenbecher(1)
10.10 -- Employment Agreement with Mr. Roldan(1)
10.11 -- Employment Agreement with Mr. Garcia (Luis)(1)
10.12 -- Agreement with WeatherLabs, Inc.(1)
10.13 -- Agreement with Heftel Broadcasting Company(1)
10.14 -- Agreement with GTE Internetworking, Inc.(1)
10.15 -- Agreement with Exodus Communications, Inc.(1)
10.16 -- Agreement with Telemundo Network Group LLC(1)
10.17 -- Agreement with 24/7 Media, Inc.(1)
10.18 -- Employment Agreement with Mr. Hubert, as amended(1)
10.19 -- Office Lease (Nevada)(1)
10.20 -- 1998 Stock Option Plan, as amended and forms of Option
Agreements(1)
10.21 -- Monolith Promissory Notes(1)
10.22 -- Agreement with Garcia/LKS(1)
10.23 -- Employment Agreement with Mr. Taylor(1)
10.24 -- Form of Voting Trust Agreement(1)
10.25 -- Jeffrey S. Peterson Loan Agreement(1)
10.26 -- Agreement with Telemundo Network Group LLC(1)
10.27 -- Telemundo Warrant(1)
10.28 -- Agreement with Arizona Diamondbacks(1)
10.29 -- Agreement with Miami Herald Online(1)
10.30 -- Amended and Restated Employment Agreement with Mr.
Peterson(1)
</TABLE>

<PAGE> 72

<TABLE>
<CAPTION>
EXHIBIT NO. TITLE
----------- -----
<C> <S>
10.31 -- Agreement with Fox Sports World Espanol Agreement(1)
10.32 -- Amendment of Employment Agreement with Mr. Galan(1)
10.33 -- Amended and Restated 1998 Stock Option Plan(1)
10.34 -- Employment Agreement with Mr. Trujillo(1)
10.35 -- Employment Agreement with Mr. Trujillo(1)
10.36 -- Consulting Agreement with Mr. Trujillo(1)
10.37 -- Amended Employment Agreement with Mr. Taylor(1)
10.38 -- Amended and Restated Employment Agreement with Mr.
Trujillo(1)
10.39 -- Second Amended and Restated Employment Agreement with Mr.
Peterson(1)
16.01 -- Letter from BDO Seidman, LLP(1)
23.05 -- Consent of Kummer, Kaempfer, Bonner & Renshaw (Included
in Exhibits 5.01 and 5.02 above)(1)
23.06 -- Consent of Ehrhardt Keefe Steiner & Hottman, PC(1)
23.07 -- Consent of Ehrhardt Keefe Steiner & Hottman, PC(1)
23.08 -- Consent of Ehrhardt Keefe Steiner & Hottman, PC(1)
23.09 -- Consent of Ehrhardt Keefe Steiner & Hottman, PC(1)
23.10 -- Consent of Ehrhardt Keefe Steiner & Hottman, PC(1)
23.11 -- Consent of Ehrhardt Keefe Steiner & Hottman, PC(1)
23.12 -- Consent of Ehrhardt Keefe Steiner & Hottman, PC(1)
23.13 -- Consent of Ehrhardt Keefe Steiner & Hottman, PC
</TABLE>

- ---------------

(1) Previously filed.

<PAGE> 1
EXHIBIT 23.13

INDEPENDENT AUDITORS' CONSENT

We consent to the use in this Amendment No. 6 to Registration Statement No.
333-74201 of quepasa.com, inc. of our report dated February 17, 1999 appearing
in the Prospectus, which is part of such Registration Statement, and to the
reference to us under the heading "Experts" in such Prospectus.

/s/ Ehrhardt Keefe Steiner & Hottman PC

Ehrhardt Keefe Steiner & Hottman PC

Denver, Colorado
June 24, 1999