U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED
MARCH 31, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM
______________ TO ______________
COMMISSION FILE NUMBER: 33-43621
INTERNET BUSINESS'S INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
Nevada 33-0845463
(State or jurisdiction of incorporation (I.R.S. Employer
or organization) Identification No.)
4634 South Maryland Parkway, Suite 101, Las Vegas, Nevada 89119
(Address of principal executive offices (Zip Code)
Registrant's telephone number: (702) 968-0008
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the Registrant was required to
file such reports), and (2) been subject to such filing
requirements for the past 90 days. Yes X No .
As of March 31, 2000, the Registrant had 200,395,113 shares
of common stock issued and outstanding.
TABLE OF CONTENTS
PART I - FINANCIAL INFORMATION PAGE
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED BALANCE SHEETS
AS OF JUNE 30, 1999 AND MARCH 31, 2000 3
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS AND NINE MONTHS
ENDED MARCH 31, 1999 AND MARCH 31, 2000 4
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED MARCH 31, 1999
AND MARCH 31, 2000 5
NOTES TO FINANCIAL STATEMENTS 6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 11
PART II
ITEM 1. LEGAL PROCEEDINGS 13
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS 13
ITEM 3. DEFAULTS UPON SENIOR SECURITIES 13
ITEM 4. SUBMISSION OF MATTERS TO A VOTE
OF SECURITY HOLDERS 13
ITEM 5. OTHER INFORMATION 13
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 13
SIGNATURE 14
PART I.
ITEM 1. FINANCAL STATEMENTS.
INTERNET BUSINESS'S INTERNATIONAL, INC.
CONSOLIDATED BALANCE SHEETS (Unaudited)
June 30 March 31
1999 2000
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 82,577 $3,314,429
Accounts Receivable 4,576 102,193
Inventories 85,101
Other assets 308,120 60,408
Total Current Assets 395,273 3,562,131
FIXED ASSETS:
Equipment 0 450,527
Accumulated Depreciation 0 (184,586)
Total Fixed Assets 0 265,941
INVESTMENTS: 1,885,000 2,480,088
OTHER ASSETS
Note Receivable: Iron Horse Holdings 1,735,000 1,735,000
Prepaid Expenses 0 167,356
Total Other Assets 1,735,000 1,902,356
Total Assets $4,015,273 $8,210,516
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts Payable 28,247 236,004
Taxes Payable 0 158,942
Current Portion of Long-Term Debt 0 54,034
Total Current Liabilities 28,247 448,980
LONG TERM DEBT:
Long Term Debt 1,800 79,076
Less Current Portion 0 (54,034)
Total Long Term Debt 1,800 25,042
Total Liabilities 30,047 474,022
SHAREHOLDERS' EQUITY:
Preferred Stock Issued 2,390,000 2,390,000
Common Stock Issued 1,773,030 2,003,951
Additional paid-in capital 356,930 3,687,794
Retained earnings (deficit) (534,734) (534,734)
Current earnings 0 189,483
Total Shareholders' Equity 3,985,226 7,736,494
Total Liabilities & Shareholders' Equity $4,015,273 $8,210,516
See Accompanying Notes to Financial Statement
INTERNET BUSINESS'S INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Three Months Ended Nine Months Ended
March 31 March 31 March 31 March 31
1999 2000 1999 2000
REVENUES $ 0 $1,205,361 $ 0 $2,034,693
COST OF SALES 0 139,818 0 401,840
GROSS PROFIT 0 $1,065,543 1,632,853
EXTRAORDINARY INCOME 0 0 2,274,644 0
OPERATING EXPENSES:
Selling and distribution 502,841 0 529,393
General and administration 18,231 443,441 55,943 822,971
Total Operating Expense 18,231 946,282 55,943 1,352,364
NET ORDINARY INCOME (18,231) 119,261 2,218,701 280,489
OTHER INCOME/EXPENSE-TAXES 0 (88,597) 2,386 (91,006)
NET INCOME (LOSS) $(18,231) 30,664 $2,221,087 $189,483
NET INCOME (LOSS) nil nil .01 nil
PER COMMON SHARE
WEIGHTED AVERAGE
NUMBER OF COMMON 177,302,997 189,179,555 177,302,997 189,179,555
SHARES OUTSTANDING
See Accompanying Notes to Financial Statements
INTERNET BUSINESS'S INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
Nine Months Ended
March 31, 1999 March 31, 2000
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income (Loss) $ 2,221,087 $ 189,483
Adjustments for non-cash items:
from Extra Ordinary Income (2,274,644) 0
Adjustments to reconcile net income
(loss) to net cash provided by
(used in) operating activities:
Changes in assets and liabilities:
Accounts receivable 0 (102,192)
Inventories 0 (85,101)
Accounts payable 52,455 236,004
Current Long Term Debt 0 54,034
Accrued Taxes 0 (60,183)
Net cash provided by (used in)
operating activities (1,102) 232,045
CASH FLOWS FROM INVESTING ACTIVITIES:
Equipment 0 (450,527)
Accumulated Depreciation 0 184,586
Internet Investments 0 477,585
Prepaid expenses 0 (167,356)
Net cash provided by (used in)
investing activities 0 44,288
CASH FLOWS FROM FINANCING ACTIVITIES:
LTD 0 79,076
Less Current Portion LTD 0 (54,034)
Common Stock Issued 0 (757,789)
Additional Paid-In Capital 0 3,687,794
Net cash provided by (used in)
financing activities 0 2,955,047
NET INCREASE (DECREASE) IN CASH (1,102) 3,231,380
CASH AND CASH EQUIVALENTS,
beginning of period 1,102 83,050
CASH AND CASH EQUIVALENTS,
end of period 0 3,314,430
See Accompanying Notes to Financial Statement
INTERNET BUSINESS'S INTERNATIONAL, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1 Description of the Business
Internet Business's International, Inc. (the "Registrant") was in
the manufacturing business, these operations ceased as of
December 31, l997. In December 1998, after new management was in
place, a decision was made to change the Registrant into an
internet company offering e-commerce, internet access as an
Internet Service Provider, hosting through our own server, web
hosting, directory services, auction sites and chat rooms. It was
also determined to change the Registrant's name to better reflect
the Registrant's operations, this name came to be Internet
Business's International. During 1999, the management began to
implement the Registrant's new direction and operations.
Note 2 Change in Control
In November 1998 new stockholders bought majority control a
private transaction. Immediately after the stock. ownership
changed, the former majority stock holder resigned as the Chief
Executive Officer and President of the Registrant, and then the
former majority stockholder was also the sole director, resigned
after nominating and electing two new directors from the group
that bought controlling shares of stock.
Note 3 Summary of Significant Accounting Policies
Basis of Presentation
The accompanying unaudited consolidated financial statements are
presented in accordance with the requirements of Form 10-Q and
Regulation SX. Accordingly, they do not include all the
disclosures normally required by generally accepted accounting
principles. Reference should be made to the Registrant's audited
financial statements for the year ended June 30, 1999 as
contained in a Form 10-K filed with the U.S. Securities and
Exchange Commission for additional disclosures including a
summary of accounting policies, which have not significantly
changed.
Principles of Consolidation
The consolidated financial statements of the Registrant include
the accounts of the Registrant and all its wholly-owned
subsidiaries. All significant intercompany transactions and
balances are eliminated.
Fiscal Year
The Registrant's fiscal year is June 30 year end.
Accounts Receivable and Revenues
With the new venture for the Registrant into E-commerce, revenues
will be generated through credit card sales over the Internet,
minimizing the risk of bad debts.
Inventories
With this new line of business, inventories will bc kept to a
minimum.
Fixed Assets
All of the Registrant's fixed assets will be Internet related.
The exact extent of what this will consist of will be determined
with time.
Other Assets
Other assets will consist primarily of software for Internet
programs and other related assets.
Goodwill
Due to the change in the new nature of the business the
Registrant will not include goodwill in its financial reports.
Income Taxes
The Registrant follows Statement of Financial Accounting
Standards ("SPAS") No. 109, "Accounting for Income Taxes." Under
this method, deferred income taxed was recognized for the tax
consequences in future years of difference between the taxes of
assets and liabilities, and their financial reporting amounts at
each year-end based on enacted tax laws and statutory tax rates
applicable to the periods in which the differences were expected
to affect taxable income. Valuation allowances were established,
when necessary to reduce deferred tax assets to the amount
expected to be realized. Under this standard the provision for
income taxes represents the tax payable for the period and the
change during the period in deferred tax assets and liabilities.
Stockholders' Equity Common Shares
Stockholders' equity common shares is based on the reported net
equity divided by the weighted average number of common shares
outstanding.
Cash Equivalents
The Registrant considered highly liquid debt instruments
purchased with a maturity of three months or less to be cash
equivalents.
Fair Value of Financial Instruments
The carrying value of the Registrant's cash and cash
equivalents, accounts receivable, accounts payable, accrued
expenses and notes payable approximates fair value.
Management Estimates
The preparation of financial statements in conformity with
generally accepted accounting principles required management to
make estimates and assumptions that affect the reported amounts
of assets and liabilities at the date of the financial statements
and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those
estimates.
Additional Paid In Capital
The additional paid in capital represented on the balance sheet
is from the difference of the Preferred Stock Issuances as noted
in Note 5-Stock Issuance as per the agreement and actual amount
issued which is $110,000.
Note 4 Commitments
Leases
The Registrant has operating leases for its facilities.
Note 5 Stock Issuance
Current Stock Authorized
The Registrant was authorized to issue up to 199,000,000 shares
of common stock and 1,000,000 of preferred stock. On February 11,
2000 the authorized was increased to 249,000,000 shares of common
stock and 1,000,000 of preferred stock.
Issued and Outstanding Stock
Common Stock. The Registrant by the end of this quarter had
issued 200,395,113 common shares, of which 108,102,329 are
restricted.
Preferred Stock. There were 23,900 shares of Preferred Stock
issued by the end of this Quarter.
Preferred Stock Issuance
On December 15, 1998 the Registrant entered into an agreement
with Iron Horse Holdings, Inc. (IHHI) where IHHI agreed to buy up
to 25,000 of the Registrant's preferred shares at the price of
$100.00 per share. Shares purchased under this agreement are to
be issued to IHHI or its designee. Payment for the shares sold
under this agreement is to be in the form of a promissory note
bearing interest at the rate of 9% per annum, and the obligation
created thereby is to be secured by a "blanket," or all inclusive
security agreement executed by IHHI and perfected by filings as
specified bylaw. Until such note is paid in full, IHHI shall pay,
the 3% coupon on such shares as are issued under this agreement
directly to the shareholder(s) of record at the time such payment
becomes due.
By the end of the third quarter ending March 31, 1999, 23,900
shares were issued according to the agreement with IHHI. The
balance of the shares to be issued of 1,100 at. a par value of
$100.00 per share, or $110,000, are being treated as additional
paid in capital, and are shown as such on the balance sheet. (See
note on Paid In Capital in Note 3.)
Common Stock Issuance On December 15, 1998 the Registrant agreed
to issue common shares to Iron Horse holdings, Inc. (IHHI) for
IHHI to pay its bills in exchange for the issuance of restricted
common stock. Under the terms to this agreement, the Registrant
issued and additional 9,154,999 shares by March 31, 1999.
On December 21, 1998 the Registrant agreed to acquire several
internet sites with issuance of common stock.. Under the terms of
this agreement 8,000,000 shares were issued.
By June 30, 1999 the Registrant issued an additional 2,087,791
shares for advertising and site maintenance.
By the end of September 30,1999, the Registrant issued an
additional 112,667 restricted shares for acquiring additional e-
commerce sites for the Registrant, and issuing shares to the
former President during his tenure of 251,289 for a total of
363,956. The Registrant acquired the sites using the purchase
method of accounting.
The Registrant acquired 100% of LA Internet, Inc. in June of 1999
for $525,000 from IHHI, which was credited towards the note that
is owed by IHHI to the Registrant. The Registrant acquired 100%
of the assets of MBM Capital Group, Inc in July of 1999, for
$72,000 in cash and 112,667 in restricted shares.
Following are the unaudited pro forma revenues and net income
(loss) for the above companies:
Twelve Months Ended June 30, 2000
Revenue Operating Expenses Net Income
LA Internet, Inc. $637,206 $582,323 $54,883
MBM Capital Group, Inc. 531,551 469,880 61,671
By the end of December 31, 1999, the Registrant issued an
additional 11,450,000 shares, of which 6,000,000 were issued for
services. These services allowed the Registrant to obtain the
services of a contract with Microsoft Network, obtain an e-
commerce site, and acquire the Real Estate Mortgage site. The
5,450,000 shares that were issued for the Net 2 Loan site and
for the Optical Brigade site, of which 5,000,000 are held in an
escrow pending performance of the sites. The Registrant acquired
the sites using the purchase method of accounting.
Following are the unaudited proforma revenues and net income
(loss) for the above Registrant sites:
Twelve Months Ended December 31, 2000
Revenue Operating Expenses Net Income
Net 2 Loan $346,423 $147,710 $199,713
Optical Brigade 27,893 19,588 8,305
By the end of March 2000, the Registrant issued an additional
11,268,460 shares of stock, of which 7,000,000 shares of common
stock, where issued in a private placement of the Registrant's
common stock which provided to the Registrant $3,382,560. The
Registrant also acquired 100% of the assets of 2xtreme, a limited
partnership, and all of the stock and assets of Allstates
Communication, Inc., for 230,000 shares of stock and cash, and
80% of Global GPP Corp. for cash. The Registrant also issued
4,038,460 for services which allowed the Registrant to obtain the
aforementioned assets.
Following are the unaudited proforma revenues and net income
(loss) for the above Registrant assets and companies:
Nine Months Ended December 31, 2000
Revenue Operating Expenses Net Income
2xtreme $ 95,920 $ 85,232 $10,688
Allstates Communications,
Inc. 183,566 93,562 90,004
Note 6 Extraordinary Income
After review by legal counsel about the collect ability of the
previous Registrant's unsecured prior debts, it was determined by
management to show those debts as uncollectible. Therefore,
management has decided to write those debts off and according to
IRS codes that uncollectible debt has to be shown as
extraordinary income.
Note 7 Net Loss Carry Forward
The Net Loss Carry Forward that was incurred due to the prior
Registrant's operation will be used to offset the impact of the
extraordinary income as indicated above.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FIINANCIAL
CONDITION AND RESULTS OF OPERATIONS.
The following discussion should be read in conjunction with the
financial statements of the Registrant and notes thereto
contained elsewhere in this report.
Results of Operations.
Revenues for the nine month period ended March 31, 2000 of
$2,034,693 increased 100% when compared with revenues of $0 in
the prior year comparable period due to the start up of
operations of the Registrant in its new business line in the
first calendar quarter of 1999.
The gross profits margin of 80.25% for the nine months ended
March 31, 2000 is a significant increase from the gross profit
margin of 0% for the same three month period of the previous
fiscal year. Current year margins in the past nine months
reflect the reopening and expansion of the business as an
internet company.
Selling, general, and administrative expenses for the nine months
ended March 31, 2000 were $1,352,364 when compared with the
$55,943 for the prior year comparable period, again due to the
reopening of the new business of the Registrant.
The resulting profit for the nine months ended March 31, 2000 was
$189,483 when compared with a profit of $2,221,087 due to the
write-off of previous unsecured debts as uncollectible for the
same six month period of the previous fiscal year.
Liquidity and Capital Resources.
Net cash provided by the operations of the Registrant was
$232,044 for the nine months ended March 31, 2000 versus cash
used in operating activities of $1,102 in the comparable prior
year period.
In March 2000, the Registrant issued 7,000,000 shares of
common stock in connection with a private placement of its stock.
This offering resulted in proceeds to the Registrant of
$3,382,560.
Capital Expenditures.
Other than as set forth below, no material capital expenditures
were made during the quarter ended on March 31, 2000: (a)
purchase in January 2000 of three Cisco Systems routers for a
total of $83,000; (b) purchase in February 2000 of two Dell
Computer servers; and (c) purchase in March 2000 of one IBM
server.
Projection - Global GPP Corp.
On March 21, 2000, the Registrant entered into an agreement with
Roanoke Technology Corp., and Global GPP Corp. (a newly formed
corporation) for the purpose of developing a business to business
website in Eastern Europe. This agreement specifies that the
Registrant owns 80% of Global GPP Corp. Subsequently, on March
30, 2000, the Registrant, through a newly formed Hungary
corporation (GPP Hungary Kft) wholly owned by Global GPP Corp.,
entered into an agreement with Haitec Magyarorazagi Kft for the
specific development of this website in Hungary. Based on
contracts currently being negotiated, the Registrant projects the
following approximate figures for Global GPP Corp. (which has not
had any revenue to date) through December 31, 2000: Revenue of
$4,000,000, operating expenses of $2,000,000, and net income of
$2,000,000.
Year 2000 Issue.
The Year 2000 issue arises because many computerized systems
use two digits rather than four to identify a year. Date
sensitive systems may recognize the year 2000 as 1900 or some
other date, resulting in errors when information using the year
2000 date is processed. In addition, similar problems may arise
in some systems which use certain dates in 1999 to represent
something other than a date. The effects of the Year 2000 issue
may be experienced before, on, or after January 1, 2000, and if
not addressed, the impact on operations and financial reporting
may range from minor errors to significant system failure which
could affect the Registrant's ability to conduct normal business
operations. This creates potential risk for all companies, even
if their own computer systems are Year 2000 compliant. It is not
possible to be certain that all aspects of the Year 2000 issue
affecting the Registrant, including those related to the efforts
of customers, suppliers, or other third parties, will be fully
resolved.
The Registrant currently believes that its systems are Year 2000
compliant in all material respects. Although management is not
aware of any material operational issues or costs associated with
preparing its internal systems for the Year 2000, the Registrant
may experience serious unanticipated negative consequences (such
as significant downtime for one or more of its web site
properties) or material costs caused by undetected errors or
defects in the technology used in its internal systems.
Furthermore, the purchasing patterns of advertisers may be
affected by Year 2000 issues as companies expend significant
resources to correct their current systems for Year 2000
compliance. The Registrant does not currently have any
information about the Year 2000 status of its advertising
customers. However, these expenditures may result in reduced
funds available for web advertising or sponsorship of web
services, which could have a material adverse effect on its
business, results of operations, and financial condition. The
Registrant's Year 2000 plans are based on management's best
estimates.
Forward Looking Statements.
The foregoing Management's Discussion and Analysis contains
"forward looking statements" within the meaning of Rule 175 of
the Securities Act of 1933, as amended, and Rule 3b-6 of the
Securities Act of 1934, as amended, including statements
regarding, among other items, the Registrant's business
strategies, continued growth in the Registrant's markets,
projections, and anticipated trends in the Registrant's business
and the industry in which it operates. The words "believe,"
"expect," "anticipate," "intends," "forecast," "project," and
similar expressions identify forward-looking statements. These
forward-looking statements are based largely on the Registrant's
expectations and are subject to a number of risks and
uncertainties, certain of which are beyond the Registrant's
control. The Registrant cautions that these statements are
further qualified by important factors that could cause actual
results to differ materially from those in the forward looking
statements, including, among others, the following: reduced or
lack of increase in demand for the Registrant's products,
competitive pricing pressures, changes in the market price of
ingredients used in the Registrant's products and the level of
expenses incurred in the Registrant's operations. In light of
these risks and uncertainties, there can be no assurance that the
forward-looking information contained herein will in fact
transpire or prove to be accurate. The Registrant disclaims any
intent or obligation to update "forward looking statements."
PART II.
ITEM 1. LEGAL PROCEEDINGS.
The Registrant is not a party to any material pending legal
proceedings and, to the best of its knowledge, no such action by
or against the Registrant has been threatened.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
Not Applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None.
ITEM 5. OTHER INFORMATION.
On December 5, 1997, Louis Cherry, Chairman of the Board of the
Registrant, filed a petition for bankruptcy under Chapter 11
(reorganization) of the Bankruptcy Code in the Bankruptcy Court
in Santa Ana, California (Case No. SA 97-10717 RA). This
petition was dismissed on April 19, 2000.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Reports on Form 8-K. The following reports on Form 8-K were
filed during the third quarter of the fiscal year covered by this
Form 10-Q as follows:
(1) A Form 8-K was filed on February 28, 2000 to reflect the new
transfer agent for the Registrant, effective on February 1, 2000.
(2) A Form 8-K/A was filed on March 10, 2000 to reflect the
change in address of the corporate offices of the Registrants,
and its correct new telephone number.
(b) Exhibits. Exhibits included or incorporated by reference
herein: See Exhibit Index.
SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Internet Business's International, Inc.
Dated: May 18, 2000 By: /s/ Albert R. Reda
Albert R. Reda, Chief Executive Officer
EXHIBIT INDEX
Exhibit Description
No.
2 Agreement and Plan of Merger (incorporated by reference to
Exhibit 2 to the Form 8-K/A filed on November 22, 1999)
3.1 Articles of Incorporation (incorporated by reference to
Exhibit 3.1 to the Form 10-Q filed on December 1, 1999).
3.2 Certificate of Amendment of Articles of Incorporation
(incorporated by reference to Exhibit 3.2 to the Form 10-Q filed
on December 1, 1999).
3.3 Certificate of Amendment of Articles of Incorporation (see
below).
3.4 Certificate of Amendment of Articles of Incorporation (see
below).
3.5 Bylaws (incorporated by reference to Exhibit 3.3 to the Form
10-Q filed on December 1, 1999).
4.1 Retainer Stock Plan for Non-Employee Directors and
Consultants, dated October 1, 1999 (incorporated by reference to
Exhibit 4.1 to Form S-8 filed on October 8, 1999)
4.2 Consulting Agreement between the Registrant and Mark Crist,
dated October 5, 1999 (incorporated by reference to Exhibit 4.2
to Form S-8 filed on October 8, 1999)
10.1 Purchase Agreement (LA Internet) between the Registrant and
Iron Horse Holdings, Incorporated, dated June 10, 1999
(incorporated by reference to Exhibit 10.2 to the Form 10-Q filed
on December 1, 1999).
10.2 Purchase Agreement between the Registrant and the
Stockholders of MBM Capital Group Inc., dated July 1, 1999
(incorporated by reference to Exhibit 10.3 to the Form 10-Q filed
on December 1, 1999).
10.3 Acquisition Agreement (Net 2 Loan) between the Registrant
and Lifestyle Mortgage Partners, dated September 15, 1999
(incorporated by reference to Exhibit 10.4 to the Form 10-Q filed
on February 22, 2000).
10.4 Purchase Agreement (license) between the Registrant and
Stockholders of California Land & Home Sale, Inc., dated October
1, 1999 (incorporated by reference to Exhibit 10.5 to the Form
10-Q filed on February 22, 2000).
10.5 Acquisition Agreement (Optical Brigade) between the
Registrant and Wade Whitley, dated November 1, 1999 (incorporated
by reference to Exhibit 10.6 to the Form 10-Q filed on February
22, 2000).
10.6 Agreement for Acquisition between the Registrant and Direct
Communications, Inc., dated February 25, 2000 (see below).
10.7 Agreement between the Registrant and Internet 2xtreme, dated
March 6, 2000 (see below).
10.8 Agreement between the Registrant, Roanoke Technology Corp.,
and Global GPP Corp., dated March 21, 2000 (see below).
10.9 Agreement between GPP Hungary Kft and Haitec Magyarorazagi
Kft, dated March 30, 2000 (see below).
21 Subsidiaries of the Registrant (see below).
27 Financial Data Schedule (see below).
CERTIFICATE OF AMENDMENT OF
ARTICLES OF INCORPORATION
OF
INTERNET BUSINESS'S INTERNATIONAL, INC.
We, Louis Cherry and Albert R. Reda, certify that:
1. The original articles of International Business Industries,
Inc. were filed with the Office of the Secretary of State on
December 8, 1998.
2. Pursuant to the unanimous written consent of the Board of
Directors, the company hereby adopts the following amendments to
the Articles of Incorporation of this Corporation:
Article Fourth: Capital Stock is amended to read as follows:
Classes and Number of Shares. The total number of shares of all
classes of stock, which the Corporation shall have authority to
issue is Two Hundred Million (200,000,000), consisting of One
Hundred Ninety-Nine Million (199,000,000) shares of common stock,
par value of $0.01 per share ("Common Stock"), and One Million
(1,000,000) shares of preferred stock, par value of $0.01 per
share ("Preferred Stock").
3. On this date, the company has 189,116,953 shares of voting
common stock issued and outstanding. By a written consent of
104,381,502 shares of this stock (which represents 55.19% of the
total shares), the foregoing amendment to the Articles of
Incorporation of this corporation was approved.
/s/ Louis Cherry
Louis Cherry, President/Director
/s/ Albert R. Reda
Albert R. Reda, Secretary/Director
Verification
State of California
SS
County of Orange
On this 22nd day of December, 1999, before me, the
undersigned, a Notary Public in and for said State, personally
appeared Louis Cherry and Albert R. Reda, personally known to me
(or proved to me on the basis of satisfactory evidence) to be the
persons who subscribed their names to the Certificate of
Amendment of Articles of Incorporation and acknowledged to me
that they executed the same freely and voluntarily and for the
use and purposes therein mentioned.
By: /s/
Notary Public in and for said county
CERTIFICATE OF AMENDMENT OF
ARTICLES OF INCORPORATION
OF
INTERNET BUSINESS'S INTERNATIONAL, INC.
The undersigned, Louis Cherry and Albert R. Reda, certify that:
Louis Cherry is the President, and Albert R. Reda is the
Secretary, of Internet Business's International, Inc., a Nevada
corporation ("Company").
The original articles of incorporation of the Company were filed
with the Office of the Secretary of State on December 8, 1998.
As of this date, there is issued and outstanding common and
preferred stock of the Company, but this amendment of the
articles, in compliance with Nevada Revised Statutes, does not
require the approval of the stockholders of the Company.
Pursuant to a Board of Directors meeting at which in excess of
two-thirds voted in favor of the following amendment, the
Company hereby adopts the following amendments to the Articles of
Incorporation of the Company:
Article Fourth: The number of authorized shares of common
stock of the Company shall be 249,000,000. The par value of the
Series A Convertible Preferred Stock of the Company shall be
$100.00 per share.
/s/ Louis Cherry
Louis Cherry, President/Director
/s/ Albert R. Reda
Albert R. Reda, Secretary/Director
Verification
State of California
SS
County of Orange
On this 9th day of February, 2000, before me, the
undersigned, a Notary Public in and for said State, personally
appeared Louis Cherry and Albert R. Reda, personally known to me
(or proved to me on the basis of satisfactory evidence) to be the
persons who subscribed their names to the Certificate of
Amendment of Articles of Incorporation and acknowledged to me
that they executed the same freely and voluntarily and for the
use and purposes therein mentioned.
By: /s/
Notary Public in and for said state
INTERNET BUSINESS'S INTERNATIONAL, INC.
3900 BIRCH STREET, SUITE 111
NEWPORT BEACH, CALIFORNIA 92664)
PH. 949.833.0261 FAX. 949.333.0762
February 14, 2000
Anthony Lee. President
Direct Communications, Inc.
Las Vegas, NV
(702) 433-9416
Fax. (702) 433-8659
Dear Tony.
Time is of the essence, especially for you, but if we are going
to make a deal, it is certainly going to effect us as well. So,
we need to stop fooling around and really move.
Per our conversation, the new company, Allstates Communications,
Inc. will take over $250,000.00 of your debt and Direct Communications,
Inc. which will consist of Amex of $25,000.00, Community Bank of $91,832.00
IRS of $130,123.00 and Futa Tax $17,582.00. The balance of the
$410,000.00 will be paid by the new company out of profits. You
will, of course, receive 30,000 shares of 144 stock of IBI.
Your employment contract will be for 3 years, with a stating
salary of $6,500.00 per month and, after 90 days from closing,
your salary will go up to $7,000.00 per month. Tony Lee, will be
President of the new company and will serve at the pleasure of
the board of directors. There will) be bonuses for Tony Lee
based on performance. The bonuses will be by way of stock
options. The bonuses will be given to Mr. Lee by the new company
and that will be with IBI common stock and by IBI's discretion
All of the assets of the present company, will be transferred to
the new company. Cash in the bank, inventory and all receivables with a
minimum of $100,000.00.
Sincerely
/s/ Louis Cherry
Louis Cherry
President, IBI, Inc.
I accept this offer on February 25, 2000
/s/ Clyde A. Lee
Clyde A. Lee on 2-25-00 individually and as
President of Direct Communications, Inc
AGREEMENT
Internet 2xtreme, a Partnership ("Seller"), and Internet Business
International, Inc., a Corporation ("Buyer"), agree as follows:
1. Sale and Purchase. Seller agrees to sell, convey and transfer
to Buyer and Buyer agrees to purchase and assume from Seller the,
property hereafter described for the purchase price and upon and
subject to the terms and conditions hereafter set forth. The sale
of the property is entire and inseverable and Buyer shall have no
obligation to purchase any of the property unless all assets of
the classes and character described below shall be simultaneously
sold.
2. Property. The assets to be sold and purchased (the "property") are:
Certain assets used by Seller in connection with its business
consisting of its customer base and accounts, equipment, three
(3) equipment leases (Dimension Funding, Dell Direct Lease, and
Livingston Capitol Corp. (the "Leases"); the real property lease
for the location at 1059 Court Street, Suite 123, Woodland,
California (the "realty lease"); and the goodwill of the
business, including all customer lists.
3. Purchase Price. The purchase price for the property shall be
the sum of SEVEN HUNDRED THIRTY PIVE THOUSAND DOLLARS
($735,000.00). The purchase price is based on Seller having 4800
customers at the closing ("Customer Base"). If the Customer Base
is less than 4800, the purchase price shall be reduced by an
amount equal to the product obtained by multiplying the sum of
$153.13 times the difference between the actual Customer Base and
4800.
4. Payment of Purchase Price. The purchase price shall be payable
by Buyer's debt assumption and/or debt satisfaction as set forth
in paragraph 5 hereof, by a payment in cash at the closing in an
amount equal to $17,635.00, and by the issuance of a sufficient
number of unrestricted shares of common stock of Buyer as shall
equal the sum of $186,883.66, determined as of the close of
business preceding the closing date (the "Shares").
5. Assumption and/ or Satisfaction of Liabilities. Buyer
shall assume and/or satisfy the following liabilities and
obligations of the business and Seller: (i) the Leases; (ii) all
accounts payable; (iii) RTI commission of $49,000.00; (iv) note
payable - H.D. Kicklighter; (v) Dianro Mktg. Design; and (vi)loan
payable - Bank of Lodi.
The approximate owned for each item above is as follow:
ITEM NO. ESTIMATED LIABILITY
(i) $ 37,476.09
(ii) 69,958.14
(iii) 49,000.00
(iv) 100,000.00
(v) 8,229.00
(vi) 240,682.11
plus delinquency
of $25,136.00
Items No. (iii), No. (iv), No. (v), and the $25,136.00
representing the delinquency in item No.(vi) shall be paid in
cash at the closing by a deposit to a joint account where the
consent of both Seller and Buyer shall be required for any
disbursement. These accounts shall be paid in full within ten
(10) days after the closing unless Buyer can negotiate a lesser
pay-off, in which case the lesser amount shall be paid from the
joint account.
6. Closing.
6.1. The transaction shall be closed and possession and of the
property shall be given to Buyer at a closing to be held at the
office of Seller, on March 6, , 2000, or on such other date as
the parties may agree, which date, however determined, is hereby
called the "closing date".
6.2. At the closing;
(a) Seller shall deliver to Buyer all documents and instruments
necessary to carry out the terms and provisions of this Agreement
aid to effectuate the purpose of the transaction.
(b) Buyer shall pay to Seller the cash portion of the
purchase price in negotiable funds, and shall deliver to Seller a
share certificate representing the Shares, and all other
instruments as shall be necessary to fulfill the obligations of
Buyer hereunder which are herein provided to be fulfilled on the
closing date. The parties agree that one twelfth (1/12) of the
shares may be sold each month beginning 60 days after the
closing. All of the shares may be sold one (1) year after the
date of the closing ("Anniversary Date"). After the shares have
been sold by Seller, if the total amount realized by Seller from
the sale of the Shares exceeds the value closing date, Seller
shall pay the excess to Buyer; if total amount realized is less
than the value at the closing, Buyer shall pay Seller the
difference. The excess or the difference, as the cash may be,
shall be paid by the responsible party within three (3) business
days after the last sale. Seller warrants that all taxes shall be
current at the closing.
6.3. Unless otherwise provided herein, all such instruments so
delivered shall be dated the closing date and be satisfactory as
to form and content to each party and its respective counsel.
7. Status. Buyer represents that Buyer is in good standing
under the laws of the state of its incorporation.
8. Conditions. This Agreement, its performance, and the transfer
and conveyance contemplated herein are expressly contingent upon
and subject to the Bank of Lodi consenting to assumption of its
debt by Buyer and the lessors under the Leases consenting to the
assignment and assumption by Buyer.
9. Other Covenants and Agreements.
9.1. Buyer agrees to pay and discharge and to save and
protect Seller free and harmless from all liabilities and
obligations to be assumed by Buyer pursuant to this Agreement and
those which shall arise from the conduct of the business from and
after the closing date.
9.2. The parties waive compliance with the provisions of the
California Bulk Sales Law.
10. Miscellaneous.
10.1. Entire Agreement. This document constitutes the entire
agreement between the parties, all oral agreements being merged
herein, and supersedes all prior representations. There are no
representations, agreements, arrangements, or understandings,
oral or written, between or among the parties relating to the
subject matter of this Agreement that are not fully expressed
herein.
10.2. Survival of Representations. All representations,
warranties, covenants, and agreements of the parties contained in
this Agreement, or, in any instrument, certificate, opinion, or
other writing provided for in it, shall survive the closing.
10.3. Amendment. The provisions of this Agreement may be
modified at any time by agreement of the parties. Any such
agreement hereafter made shall be ineffective to modify this
Agreement in any respect unless in writing and signed by the
parties against whom enforcement of the modification or discharge
is sought.
10.4. Waiver. Any of the terms or conditions of this
Agreement may be waived at any time by the party entitled to the
benefit thereof, but no such waiver shall affect or impair the
right of the waiving party to require observance, performance, or
satisfaction either of that term or condition as it applies on a
subsequent occasion or of any the terms or conditions hereof.
10.5. Succession. Subject to the provisions otherwise
contained in this Agreement, this Agreement shall inure to the
benefit of and be binding on the successors and assigns of the
respective parties hereto.
10.6. Parties in Interest. Nothing in this Agreement, whether
express or implied, is intended to confer any rights or remedies
under or b reason of this Agreement on any persons other assigns,
nor is anything in this Agreement intended to relieve or
discharge the obligation or liability of any third persons to any
party to this Agreement, nor shall any provision give any third
persons any right of subrogation or action over against any party
to this Agreement.
10.7. Specific Performance. Each party's obligations under
this Agreement are unique. The parties each acknowledge that, if
any party should default in performance of the duties and
obligations imposed by this Agreement, it would be extremely
impracticable to measure the resulting damages. Accordingly, the
nondefaulting party, in addition to any other available rights or
remedies, may sue in equity for specific performance, and the
parties each expressly waive the defense that a remedy in damages
will be adequate.
10.8. Notices. Any notice under this Agreement shall be in
writing, and any written notice or other document shall be deemed
to have been duly given on the date of personal service on the
parties or on the third (3rd) business day after mailing, if the
document is mailed by registered or certified mail addressed to
the parties at the addresses set forth below or at the most
recent address specified by the addressee through written notice
under this provision. Failure to conform to the requirement that
mailings be done by registered or certified mail shall not
defeat the effectiveness of notice actually received by the addressee.
10.9. Attorneys' Fees, Prejudgment, Interest. If the services of
an attorney are required by any party to secure the performance
hereof or otherwise upon the breach or default of another patty,
or if any judicial remedy or arbitration is necessary enforce or
interpret any provision of this Agreement or the rights and
duties of any person in relation thereto, the prevailing party
shall be entitled to reasonable attorneys' fees, costs, and other
expenses, in addition to any other relief to which he may be
entitled. Any award of damages following judicial remedy or
arbitration as a result of the breach of this Agreement or any of
its provisions shall include an award of prejudgment interest
from the date of the breach at the maximum amount of interest
allowed by law.
10.10. Counterparts. This Agreement may be executed in any number
of counterparts with the same effect as if the parties had all
signed the same document. All counterparts shall be construed
together and shall constitute one agreement.
10.11. Captions. All paragraph captions are for reference only
and shall not be considered in construing this Agreement.
10.12. Severabilty. If any provision of this Agreement is held by
a court of competent jurisdiction to be invalid or unenforceable,
the remainder of the Agreement shall continue in full force and
effect and shall in no way be impaired or invalidated.
10.13. Governing Law. The rights and obligations of the parties
and the interpretation and performance of this Agreement shall be
governed by he law of California, excluding its conflict of laws
rules.
10.14. Time. Time is of the essence of this Agreement.
10.15. Gender and Number. As used in this Agreement, the
masculine, feminine, or neuter gender, and the singular or plural
number, shall each be deemed to include the others whenever the
context so indicates.
10.16. Cumulative Remedies. No remedy or election hereunder shall
be deemed exclusive but shall whenever possible be cumulative
with all other remedies at law or in equity.
DATED: March 6, 2000.
INTERNET 2EXTREME
By: /s/ Kathryn Kickligther
Kathryn Kickligther
Managing Partner
Address: 1059 Court Street #123
Woodland, CA 95695
INTERNET BUSINESS INTERNATIONAL, INC.
By: /s/ Albert Reda
Albert Reda, Chief Executive Officer
Address: 3900 Birch Street, Suite 113
Newport Beach, CA 92660
ADDENDUM TO PARAGRAPH 6.2(b)
On the fifteenth (15th) day after the end of the fourteenth
(14th) month from date of close, the Seller is to return to the
Buyer the net proceeds received by the Seller from the sale of
the Shares that exceed $186,883.66 ("Excess Funds").
If the Seller is unable to return the Excess Funds for whatever
reason, the Seller will take over a portion of debt payable to
the Bank of Lodi equal to the amount of the Excess Funds not paid
to the Buyer.
DATED: March 6, 2000.
INTERNET 2EXTREME
By: /s/ Kathryn Kickligther
Kathryn Kickligther
Managing Partner
Address: 1059 Court Street #123
Woodland, CA 95695
INTERNET BUSINESS INTERNATIONAL, INC.
By: /s/ Albert Reda
Albert Reda, Chief Executive Officer
Address: 3900 Birch Street, Suite 113
Newport Beach, CA 92660
ADDENDUM NO. 2
Buyer will make a note payable note to Seller, attached as
Exhibit A. hereto, In the amount of principal balance of the loan
to Bank of Lodi. The principal amount of the Note will be reduced
by the principal amount of each payment made by Buyer to Bank of
Lodi.
ADDENDUM TO PARAGRAPH 5 2 (b) of the Agreement is hereby
waived by both parties.
Paragraph 4 of the Agreement, after the phrase "shall equal the
sum of $186,883.88", is amended to Insert the words "plus one
percent (1%) interest monthly on the principal balance due each
month after the sale of each block of stock." All other Parts of
this paragraph shall remain unchanged.
Paragraph 6.2 (b) of the Agreement is hereby amended to include
the following language after the sentence "The parties agree that
one twelfth (12th) of the shares may be sold each month. At
beginning 60 days after the closing." An soon as the total amount
realized firm the sale of the stock by Seller is sufficient to
pay the entire amount plus interest due Seller, the remainder of
the stock held hereunder shall be returned to Buyer. All other
parts of this paragraph shall remain unchanged.
Seller hereby waives compliance with paragraph 5 of the Agreement
and performance thereunder is not required by buyer as a
condition of closing.
Buyer, will submit a letter to Bank of Lodi informing the bank
that Buyer is purchasing Internet 2xtreme from Seller, and that
Buyer will henceforth, be responsible for the payments on the
loan in Sellers name to Bank of Lodi.
The Closing date set forth in paragraph 6. 11 is amended to
close on March 13, 2000, concurrently with execution of ADDENDUM
NO. 2. For the purposes of bookkeeping, the amounts and figures
stated in the Agreement dated March 6, 2000 will prevail.
Seller hereby convoys title to all of the property identified in
the Agreement on this date. Seller will advise all customers of
the transfer of title and cooperate in the transfer of all
assets.
DATED: March 13, 2000.
INTERNET 2EXTREME
By: /s/ Kathryn Kickligther
Kathryn Kickligther
Managing Partner
Address: 1059 Court Street #123
Woodland, CA 95695
INTERNET BUSINESS INTERNATIONAL, INC.
By: /s/ Albert Reda
Albert Reda, Chief Executive Officer
Address: 3900 Birch Street, Suite 113
Newport Beach, CA 92660
AGREEMENT
THIS AGREEMENT, effective on the date of the last signature
hereto by and between:
ROANOKE TECHNOLOGY CORP, a Florida corporation with its principal
place of
business at 1433 Georgia Avenue. Roanoke Rapids, NC 17870
(hereinafter "ROANOKE")
- -and-
INTERNET BUSINESS'S INTERNATIONAL, a Nevada corporation with its
principal place of business at 3900 Birch Street, Suite111, Newport Beach,
California 92660 (hereinafter "IBI").
- -and-
GLOBAL GPP CORP., a North Carolina corporation with its principal
place of business at 1433 Georgia A venue, Roanoke Rapids, NC
27870 (hereinafter "Global").
Witnesseth:
WHEREAS, ROANOKE presently owns 100 shares which represents 100%
of the issued and outstanding common stock of Global GPP Corp., a
North Carolina corporation ("Global"). Global has created a web
site and has a written agreement from IBM Hungary to market such
web site bundled with subsidized IBM web site development.
WHEREAS, IBI has the ability to finance and manage the marketing
of the Global web site with IBM on a worldwide basis.
WHEREAS, ROANOKE desires to sell to IBI, and IBI desires to
purchase from Roanoke 80% of Global on the following terms and
conditions.
NOW, THEREFORE, ROANOKE and IBI, intending to be legally bound
hereby, and in consideration of the mutual covenants contained
herein agree as follows.
1. ROANOKE hereby agrees to sell to IBI, and IBJ agrees to
purchase from ROANOKE 80 shares, which represents 80% of Global.
The consideration for 80% of Global will be $500,000.00, which
will be disbursed as follows: * .
2. ROANOKE shall have the responsibility of managing the Global
web site, any and all web site modifications, the sever housing
the web site, all necessary and required connections to the
Internet and the power for operating the web site. Global agrees
to reimburse ROANOKE for such services at industry standard
rates, which rates must be approved by IBI.
3. IBI hereby agrees to purchase IBM hardware, software and
services from the IBM Solutions Provider in Hungary,
specifically, Haitec Magyarorszagi Kft ("Haitec") For purposes of
purchasing the equipment, software and services, IBI shall be
responsible for providing the required Letter of Credit to Haitec
in the principal amount of no less than $ * within 3 business
days from the date of this Agreement. Full payment of such
hardware, software, and services shall be based on the terms and
conditions of the purchase from Haitec, which shall be mutually
agreed to by ROANOKE and IBI.
4. IBI shall provide Global with $ * of capital for the web
site. $ * shall be available within 3 days of the full execution
of this Agreement. The balance of $ * shall be provided by IBI
based on Schedule A, attached hereto and made a part hereof.
5. Global shall be required to undertake equity and debt
financing to expand the web site all items related thereto to
meet the goals set forth on Schedule B, attached hereto and made
a part hereof.
6. All statements contained in this Agreement shall be deemed
the representations and warranties of the party making said
statements. The representations and warranties and covenants of
the parties contained in this Agreement or in any writhing
delivered pursuant to the provisions of this Agreement shall
survive the consummation of the transactions contemplated hereby.
7. ROANOKE and IBI agree that to the extent any provisions of
this Agreement are held, found or deemed to be unenforceable,
such provision shall be modified by any court of competent
jurisdiction to the extent necessary in order that any such
provision shall] be legally enforceable to the fullest extent
permitted by applicable law. If any provision of this Agreement
shall be held unenforceable to any extent, such provision (except
to such extent) and each of the other provisions hereof shall
nevertheless continue to be binding upon the parties in
accordance with its terms.
8. In the event that a party hereto must resort to legal action
in order to enforce any provision of this Agreement or portion
thereof, or must defend such suit, the prevailing party shall be
entitled to receive reimbursement from the non-prevailing party
for all reasonable attorneys' fees and all other reasonable costs
incurred in commencing or defending such suit.
9. This Agreement embodies the entire understanding between the
parties. Any prior agreement among the parties is merged herein.
No amendment, waiver, modification or other discharge of the
terms of this Agreement shall be valid unless made in writing,
executed with the same formalities of this Agreement, specifying
such change, modification, waiver or cancellation and signed by
all parties.
10. A waiver at any time of compliance with any of the terms and
conditions of this Agreement shall not be deemed or construed as
a modification, cancellation or waiver of those terms and
conditions, or as a further or continuing waiver of any such
condition, or waiver of any prior or subsequent breach of the
terms and conditions of this Agreement, unless expressly so
stated in writing.
11. All references herein to any individual, corporation or
other entity used in this Agreement, and the pronouns and verbs
corresponding thereto, shall be construed in the masculine or the
feminine, and/or neuter, as the case may be; singular or plural,
which ever construction is consistent with the facts prevailing
at any given time. The terms "ROANOKE" and "IBI" shall include
such parties' respective employees and agents.
12. The parties hereto agree to execute any further
instruments and shall perform any acts which are or may become
necessary to effectuate the terms of this Agreement.
13. All notices required or permitted to be given hereunder shall
be in writing and delivered personally or by a recognized
overnight courier service at the addresses set forth in the
preamble to this Agreement. Any party may, by notice, designate a
new address for notices to it. A party's attorney may send notice
on such party's behalf.
14. This Agreement may be executed in several counterparts, and
each counterpart hearing the signature of all parties hereto
shall be deemed a binding original copy of this Agreement, and
all of which shall be considered one and the same agreement.
15. This Agreement shall be construed and interpreted in
accordance with the laws of the Stale of North Carolina,
provided, however, that the conflicts of law principles of the
State of North Carolina shall not apply to the extent they would
operate to apply the laws of another state. The parties
acknowledge that because of the unique character of this
Agreement, the other may irreparably be banned in the event that
this Agreement is not specifically enforced. Accordingly, should
any dispute arise concerning this Agreement, either party may be
entitled to injunctive relief by a Court of Competent
Jurisdiction. Such remedy shall, however, be cumulative and not
exclusive, and shall be in addition to any other remedies, which
the parties may have.
16. The parties hereto acknowledge and agree that they have read
this Agreement in its entirety and that the terms hereof are
fair, adequate and just. The parties hereto acknowledge that they
have had the right and opportunity to review this Agreement by
independent legal counsel of their choice and their signatures,
affixed hereto, indicate their acceptance of the terms and
conditions hereof as their voluntary acts and deeds.
Dated. March 21, 2000
ROANOKE TECHNOLOGY CORP.
By: /s/ David L. Smith, Jr.
David L. Smith, Jr., President
ATTEST:
By: /s/ Edwin E. Foster, Jr.
Edwin E. Foster, Jr., Secretary
INTERNATIONAL BUSINESS'S INTERNATIONAL, INC.
By: /s/ Louis Cherry
Louis Cherry, President
ATTEST:
By: /s/ Albert Reda
Albert Reda, Secretary
GLOBAL GPP CORP.
By: /s/ David L. Smith, Jr.
David L. Smith, Jr., President
ATTEST:
By: /s/ Edwin E. Foster, Jr.
Edwin E. Foster, Secretary
AGREEMENT
The Agreement is entered into on 30 March 2000 between GPP
Hungary Kft ("GPP") and Haitec Magyarorazagi Kft: ("Haitec").
The purpose of this Agreement is to outline the products and
services which will be provided by Haitec and which will be paid
for by GPP.
1. Haitec and GPP will work together to deploy the Global Group
Purchase Program ("GGPP") in Hungary. The GGPP is a business-
to-business reverse auction web site, which allows buyers to list
products and services they wish to procure. Sellers are invited
to bid for the right to provide products and services to buyers
at the lowest possible price. The GGPP service is free to buyers:
sellers will pay a 5% sales commission if the buyer accepts their
bid.
2. To attract and maintain relationships with GGPP buyers, will
be offered free IBM-based E-Business Solutions. Haitec and GPP
will define the E-Business Solutions. Haitec will provide the E-
Business Solutions, which will be paid for by GPP.
3. GPP will pre-pay $30,000 to Haitec for E-Business Solutions
which will be provided to the first GGPP customers, GPP must pre-
approve each E-Business Solution., which is offered to GGPP
clients. GPP Anticipates that these funds will pay for 100 E-
Business Solutions, free small web site, which cost $300 per
unit, and will be distributed to clients during the first 60 days
of operations.
4. Haitec will sell IBM servers, software and services required
to install and operate the hardware and software, which will be
used to provide and host the free E-Business Solution, for GGPP
clients. GPP will pay Haitec $131,000 for this package.
5. Until the equipment is installed at, a location agreed to by
GPP, Haitec will provide use of the servers, software and
services to deliver E-Business Solutions to GPP clients.
6. Haitec will provide the following services for the GGPP,
which will be paid for by GPP.
A. Attila Balogh will be available on a full-time basis, for a
minimum of 6 months from the date of this agreement, to provide
marketing services for the GPP. GPP will pay Haitec $4,200 per
month for full-time services of Attila Balogh.
B. A full-time help desk service provider will be available at
Haitec's office to meet the needs of the GGPP and our clients. GGP will
train this person who will be provided with all necessary resources to
provide services at Haitec's offices. GGPP will pay Haitec $3,000
per month for these services and the resources necessary to provide
the services.
C. Haitec will provide billing and collections management for
the GGPP sellers who will be charged a 5% sales commission if
selected by GGPP buyers.
D. Haitec and GPP will work together to meet the needs of
marketing partners, such as Quaestor Financial Group. In
addition, Haitec and GPP will work with IBM Hungary to introduce
the GGPP in Hungary, as outlined.
7. A total of $191,000 will be transferred to Haitec's bank
account for the items listed in this Agreement. This includes the
$13l, 000 for the hardware, software and services for the E-
Business applications, $30,000 prepayment for the first E-
Business, Solutions and $30,000 prepayment for the services
described in item 6A, and 6B above.
8. GPP will make payment to the attorney who organized the GPP
Hungary Kft in the amount of $1,132.
9. Both parties agree that this preliminary Agreement will be
converted to a permanent agreement after GPP has completed the
necessary registration documents in Hungary..
Agreed:
/s/ March Schechtman
Marc Schechtman for GPP Hungary Kft
/s/ Gabor Teleki
Gabor Teleki for Haitec Magyarorazagi Kft
SUBSIDIARIES OF THE COMPANY
LA Internet, Inc., a California corporation
MBM Capital Group, Inc., a Nevada corporation
Allstates Communication, Inc., a Nevada corporation
Global GPP Corp. (80%), a North Carolina corporation (100% owned
subsidiary: GPP Hungary Kft, a Hungary corporation)
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<PAGE>
<ARTICLE>5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE UNAUDITED FINANCIAL STATEMENTS CONTAINED IN THE
REGISTRANT'S FORM 10-Q AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER>1
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-2000
<PERIOD-START> JUL-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 3,314,429
<SECURITIES> 0
<RECEIVABLES> 102,193
<ALLOWANCES> 0
<INVENTORY> 85,101
<CURRENT-ASSETS> 3,562,131
<PP&E> 450,527
<DEPRECIATION> (184,586)
<TOTAL-ASSETS> 8,210,516
<CURRENT-LIABILITIES> 444,980
<BONDS> 0
0
2,390,000
<COMMON> 2,003,951
<OTHER-SE> 7,736,494
<TOTAL-LIABILITY-AND-EQUITY> 8,210,516
<SALES> 2,034,693
<TOTAL-REVENUES> 2,034,693
<CGS> 401,840
<TOTAL-COSTS> 401,840
<OTHER-EXPENSES> 1,352,364
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 280,489
<INCOME-TAX> 91,006
<INCOME-CONTINUING> 189,483
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 189,483
<EPS-BASIC> .00
<EPS-DILUTED> .00
</TABLE>
