SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarter ended May 31, 2000
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File Number 000-28729
INFE.COM, INC.
----------
(Exact name of registrant as specified in its charter)
FLORIDA 11-3144463
------------------------------- -----------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
8000 Towers Crescent Drive #640
Vienna, VA 22182
---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
(703) 734-5650
----------------------------------------------------
(Registrant's telephone number, including area code)
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) has been subject to
such filing requirements for the past 90 days.
Yes X No
--------- ---------
Number of shares outstanding of the issuer's common stock, as of
May 31, 2000
Common Stock, par value $.0001 per share 12,165,681
---------------------------------------- ----------------------------
Class Number of shares outstanding
Page 1
<PAGE>
INFE.COM, INC.
FORM 10-QSB
INDEX
Page Number
-----------
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
Balance Sheets 3
May 31, 2000 and November 30, 1999
Statements of Operations 4
Three months and Six months ended
May 31, 2000 and May 31, 1999
Statements of Cash Flows 5
Three months and Six months ended
May 31, 2000 and May 31, 1999
6-9
Notes to Interim Financial Statements
Item 2. Management's Discussion and Analysis of Financial 10-11
Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures
About Market Risk 12
Part II. OTHER INFORMATION
Item 1. Legal Proceedings 12
Item 2. Changes in Securities and Use of Proceeds 12
Item 4. Submission of Matters to a Vote of Security Holders 12
Item 6. Exhibits and Report on Form 8-K 13
SIGNATURE 13
EXHIBIT INDEX 13
Page 2
<PAGE>
PART I FINANCIAL INFORMATION
----------------------------
Item 1. Financial Statements
--------------------
INFE.COM, INC.
BALANCE SHEETS
<TABLE>
<CAPTION>
May 31, November 30,
2000 1999
(Unaudited)
-------------- ------------
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash $ - $ 117,227
Certificate of deposit - restricted 50,000 50,000
Trade accounts receivable, net 132,528 32,880
Investments 195,977 -
Stock and warrants receivable 489,038 -
Note receivable 50,000 -
Accrued interest receivable 1,608 -
Prepaid expenses 1,255,086 -
------------- ------------
Total current assets 2,174,237 200,107
PROPERTY AND EQUIPMENT, net 30,706 24,246
OTHER ASSETS:
Software development costs, net 99,655 38,010
Intangible assets, net 1,568,789 -
Deferred Costs - 25,000
Deposits 11,028 6,028
------------- ------------
Total other assets 1,679,472 69,038
------------- ------------
$ 3,884,415 $ 293,391
============= ============
LIABILITIES AND STOCKHOLDERS' DEFICIT
CURRENT LIABILITIES:
Line of credit - bank $ 45,000 $ 45,000
Note Payable - 12,245
Capital lease obligation 4,102 4,589
Accounts payable and accrued expenses 167,322 122,958
Deferred revenue 394,688 -
Loan payable - shareholder 1,350 41,616
------------- ------------
Total current liabilities 612,462 226,408
OTHER LIABILITIES:
Capital lease obligation 1,921 3,978
Liability for stock to be issued 2,037,331 309,280
------------- ------------
Total other liabilities 2,039,252 313,258
------------- ------------
TOTAL LIABILITIES 2,651,714 539,666
------------- ------------
COMMITMENTS AND CONTINGENCIES -
STOCKHOLDERS' EQUITY:
Common stock, $.0001 par value; 100,000,000
shares authorized; 12,165,681 shares issued
and outstanding 1,217 854
Additional paid-in capital 4,180,947 1,227,145
Accumulated deficit (2,783,482) (1,474,274)
Treasury stock, at cost (17,234) -
Accumulated other comprehensive loss (148,750) -
------------- ------------
Total stockholders' equity 1,232,701 (246,275)
------------- ------------
$ 3,884,415 $ 293,391
============= ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
Page 3
<PAGE>
INFE.COM, INC.
STATEMENTS OF OPERATIONS
(unaudited)
<TABLE>
<CAPTION>
For the Three Months For the Six Months Ended
Ended May 31, Ended May 3
2000 1999 2000 1999
------------------------------- -------------------------------
<S> <C> <C> <C> <C>
REVENUE:
IT Staffing $ 63,351 $ 93,480 $ 135,884 $ 116,220
Management consulting fees 164,350 - 194,350 -
------------- ------------- ------------- -------------
Total revenue 227,701 93,480 330,234 116,220
COST OF REVENUES 41,990 88,526 98,630 116,830
------------- ------------- ------------- -------------
Gross profit 185,711 4,954 231,604 (610)
OPERATING EXPENSES 970,159 175,761 1,412,884 366,123
------------- ------------- ------------- -------------
Loss from operations (784,448) (170,807) (1,181,280) (366,733)
OTHER (INCOME) EXPENSES:
Depreciation and amortization 51,667 2,362 53,841 4,209
Realized loss on investments 14,998 - 14,998 -
Unrealized holding losses
on investments 36,816 - 39,495 -
Interest income (1,783) - (2,395) (2,407)
Interest expense 20,941 - 21,989 286
------------- ------------- ------------- -------------
Total other (income) expenses 122,639 2,362 127,928 2,088
------------- ------------- ------------- -------------
NET LOSS $ (907,087) $ (173,169) $ (1,309,208) $ (368,821)
============= ============= ============= =============
Net loss per common share (basic) $ (0.08) $ (0.02) $ (0.13) $ (0.05)
============= ============= ============= =============
Weighted average number of 11,374,634 7,512,763 10,454,449 7,429,430
common shares outstanding ============= ============= ============= =============
Net loss per common share
(diluted) $ (0.08) $ (0.02) $ (0.13) $ (0.05)
============= ============= ============= =============
Weighted average number of 11,374,634 7,512,763 10,454,449 7,429,430
common shares outstanding ============= ============= ============= =============
</TABLE>
The accompanying notes are an integral part of these financial statements.
Page 4
<PAGE>
INFE.COM, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED MAY 31, 2000 AND MAY 31, 1999
(unaudited)
<TABLE>
<CAPTION>
For the Six Months Ended
May 31, 2000 May 31, 1999
-------------- --------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (1,309,208) $ (368,821)
Adjustments to reconcile net loss to net cash
used in operating activities:
Depreciation and amortization 53,841 4,209
Unrealized holding losses on investments 39,495 -
Stock issued in lieu of cash for professional services 710,803 234,072
Stock to be issued in lieu of cash for professional services 118,813 -
Stock to be issued in lieu of interest 19,156 -
Stock to be received in lieu of cash for services rendered (514,038) -
Changes in assets and liabilities affecting operations:
Trade accounts receivable, net (94,648) (31,875)
Accrued interest receivable (1,608) -
Prepaid expenses (5,084) -
Deferred costs 25,000 -
Accounts payable and accrued expenses 32,119 56,483
Deferred revenue 394,688 -
-------------- --------------
Net cash used in operating activities (530,674) (105,932)
-------------- --------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of investments (363,300) -
Proceeds from the sale of investments 263,098 -
Purchase of property and equipment (12,310) (1,408)
Payments received from (issuance of) note receivable (75,000) 69,438
Payments of capital lease obligation (2,544) (1,918)
Investment in software development costs - (42)
Deposit paid to investee (5,000) -
-------------- --------------
Net cash provided by (used in) investing activities (195,056) 66,070
-------------- --------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of note payable - 669
Proceeds from (repayments of) loans from shareholder, net (40,266) 20,107
Proceeds received for stock to be issued 606,000 -
Net proceeds from issuance of common stock 60,000 15,000
Payments for treasury stock (17,231) -
-------------- --------------
Net cash provided by financing activities 608,503 35,776
-------------- --------------
NET CHANGE IN CASH (117,227) (4,086)
CASH, BEGINNING OF PERIOD 117,227 4,086
-------------- --------------
CASH, END OF PERIOD $ - $ -
============== ==============
SUPPLEMENTAL DISCLOSURE:
Interest paid during period $ 23,597 $ 286
============== ==============
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Financed acquisition of equipment $ - $ 11,576
============== ==============
Stock received in satisfaction of trade account
receivable and note receivable $ 45,000 $ -
============== ==============
Purchase of intangible assets through issuance of stock
and liability for stock to be issued $ 1,613,612 $ -
============== ==============
Purchase of internal use software through issuance
of stock $ 64,813 $ -
============== ==============
Stock issued as a reduction of the liability for stock
to be issued $ 309,280 $ -
============== ==============
Stock issued in exchange for investments $ 239,020 $ -
============== ==============
Stock issued and to be issued for services to be
received $ 1,250,002 $ -
============== ==============
</TABLE>
The accompanying notes are an integral part of these financial statements.
Page 5
<PAGE>
INFE.COM, INC.
NOTES TO INTERIM FINANCIAL STATEMENTS
MAY 31, 2000
(unaudited)
A. BASIS OF PRESENTATION
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB and
Item 310 (b) of Regulation S-B. Accordingly, they do not include all
of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion
of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been
included. Operating results for the six months ended May 31, 2000 and
1999 are not necessarily indicative of the results that may be expected
for the year ended November 30, 2000. For further information, refer
to the financial statements and footnotes thereto included in the
Company's Form 10-SB/A filed on January 25, 2000.
B. ORGANIZATION
INFe.com, Inc. was incorporated in the State of Florida on
February 1, 1993, under the name of "Infocall Communications
Corporation". In April 2000, the Company changed its name from
Infocall Communications Corporation to INFe.com, Inc. The Company
is engaged in the operations of providing various management consulting
and human resources services to emerging growth companies.
C. SEGMENT INFORMATION
The Company's reportable operating segments include IT staffing,
management consulting and ClubComputer.com. The IT staffing operating
segment provides human resources and staffing services; the management
consulting operating segment provides financial and management
consulting services to emerging growth companies; and the
ClubComputer.com operating segment is an on-line computer retailer.
The Company does not allocate operating expenses to these segments, nor
does it allocate specific assets to segments other than
ClubComputer.com, which is disclosed below. Therefore, segment
information reported includes only revenues, cost of revenues, gross
margin and assets allocated to ClubComputer.com.
Page 6
<PAGE>
INFE.COM, INC.
NOTES TO INTERIM FINANCIAL STATEMENTS
MAY 31, 2000
(unaudited)
(Continued)
C. SEGMENT INFORMATION (continued)
Operating segment data for the three and six months periods ended
May 31, 2000 and 1999 was as follows:
<TABLE>
<CAPTION>
IT Management ClubCom-
Staffing Consulting puter.com Total
-------- ---------- --------- -----
<S> <C> <C> <C> <C>
Three months ended May 31,
2000:
Revenues $ 63,351 $ 164,350 $ - $ 227,701
Cost of revenues (41,990) - - (41,990)
----------- ----------- ----------- ----------
Gross margin $ 21,361 $ 164,350 $ - $ 185,711
=========== =========== =========== ==========
Three months ended May 31,
1999:
Revenues $ 93,480 $ - $ - $ 93,480
Cost of revenues (88,526) - - (88,526)
----------- ----------- ----------- ----------
Gross margin $ 4,954 $ - $ - $ 4,954
=========== =========== =========== ==========
Six months ended May 31,
2000:
Revenues $ 135,884 $ 194,350 $ - $ 330,234
Cost of revenues (98,630) - -
----------- ----------- ----------- ----------
Gross margin $ 37,254 $ 194,350 $ - $ 231,604
=========== =========== =========== ==========
Intangible assets
as of May 31, 2000 $ - $ - $ 1,568,789 $ 1,568,789
=========== =========== =========== ==========
Six months ended May 31,
1999:
Revenues $ 116,220 $ - $ - $ 116,220
Cost of revenues (116,830) - - (116,830)
----------- ----------- ----------- ----------
Gross margin $ (610) $ - $ - $ (610)
=========== =========== =========== ==========
Intangible assets
as of May 31, 1999 $ - $ - $ - $ -
=========== =========== =========== ==========
</TABLE>
D. INVESTMENTS
In accordance with SFAS No. 115, "Accounting for Certain Debt and
Equity Securities", securities are classified into three categories:
held-to-maturity, available-for-sale and trading. Investments consist
of trading and available-for-sale securities. As a result, the
securities are carried at fair value. In April 2000, the Company
acquired 200,000 shares of Xpedian.com in exchange for 200,000 shares
of the Company's stock for a total investment of approximately
$239,000. The investment in Xpedian.com is classified as
available-for-sale securities. As of May 31, 2000, the Company's
investment in Xpedian.com was valued at approximately $90,000, and
accordingly the Company recorded a $148,000 unrecognized loss as a
component of other comprehensive income.
Page 7
<PAGE>
INFE.COM, INC.
NOTES TO INTERIM FINANCIAL STATEMENTS
MAY 31, 2000
(unaudited)
(Continued)
E. REVENUE RECOGNITION
The Company earns revenue from IT Staffing fees and management
consulting fees, both of which are recognized as the services are
rendered, generally over the life of an agreement.
The Company periodically receives equity instruments and warrants from
companies for which it performs services, in addition to the cash paid
for such services. Primarily all of the equity instruments are in
public companies, with limited trading activity. Equity instruments
and warrants for which there is not a readily available market value,
are valued based on factors such as significant equity financing by
sophisticated, unrelated new investors, a history of cash flow from
operations, and other pertinent factors. Management also considers
recent offers to purchase a portfolio of the company's securities and
the filings of registration statements in connection with other
offerings of the company's securities. During the six months ending
May 31, 2000, the Company recognized revenue associated with the stock
and warrants received or to be received in the amount of $194,000.
F. NOTE RECEIVABLE
The Company has an unsecured convertible subordinated debenture dated
May 2000 in the original amount of $50,000 with interest payable
quarterly at an interest rate of 9% per annum, maturing in one year
from the date of the note. The debenture is convertible at any time
at the holder's option into shares of the borrowing company's
corporate stock.
G. LIABILITY FOR STOCK TO BE ISSUED
The amount due of $2,037,000 at May 31, 2000 represents stock to be
issued to individuals from which the Company has received payment,
stock to be issued to individuals for services rendered during the
period, as well as stock to be issued in conjunction with the
acquisition described in Note I.
H. COMPREHENSIVE INCOME (LOSS)
The components of comprehensive income (loss) are as follows:
<TABLE>
<CAPTION>
Three months Six months
ended May 31, ended May 31,
------------- --------------
2000 1999 2000 1999
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net loss $ (907,087) $ (173,169) $ (1,309,208) $ (368,821)
Unrealized loss on
available for-sale
securities (148,750) - (148,750) -
------------ ---------- ------------ ----------
$ (1,055,837) $ (173,169) $ (1,457,958) $ (368,821)
============ ========== ============ ==========
</TABLE>
Page 8
<PAGE>
INFE.COM, INC.
NOTES TO INTERIM FINANCIAL STATEMENTS
MAY 31, 2000
(unaudited)
(Continued)
I. ACQUISITION
Effective April 10, 2000, the Company acquired the intangible assets of
ClubComputer.com, Inc. in exchange for consideration consisting of (1)
250,000 shares of the Company's restricted common stock at closing, and
(2) seven equal installments of $250,000 in the Company's restricted
common stock every three months from the date of closing. The
acquisition was accounted for as a purchase. Under the purchase method
of accounting, the purchase price of approximately $1.6 million has
been assigned to intangible assets acquired based on estimated fair
values at April 10, 2000, the date of acquisition. The intangible
assets are being amortized over a three year period.
As of May 31, 2000, 250,000 restricted shares had been issued to
ClubComputer, with the fair value of the remaining shares, discounted
for present value, included in the liability for stock to be issued
(see Note G).
J. RELATED PARTY TRANSACTIONS
The President of the Company has loaned the Company money to fund
current operations. At May 31, 2000, the Company was indebted to the
President for $1,350.
The President of the Company was compensated for services to be
rendered during the year ending November 30, 2000 by the granting of
250,000 shares of the Company's common stock. The unearned portion of
this compensation has been included in prepaid expenses. In addition,
as of May 31, 2000, the Company was liable to the President for bonus
amounts representing an additional 205,615 shares of restricted stock;
this amount is included in the liability for stock to be issued.
K. NET LOSS PER COMMON SHARE
As required by SFAS No. 128, the following is a reconciliation of the
basic and diluted EPS calculations for the periods presented:
<TABLE>
<CAPTION>
May 31, 2000 May 31, 1999
------------ ------------
Three Three
Months Six Months Months Six Months
Ended Ended Ended Ended
------------- ------------- ----------- -----------
<S> <C> <C> <C> <C>
Net loss (numerator) $ (907,087) $ (1,309,208) $ (173,169) $ (368,821)
Weighted average share
(denominator) 11,374,634 10,454,449 7,512,763 7,429,430
Basic net loss per share $ (.08) $ (.13) $ (.02) $ (.05)
Dilutive shares
(denominator) 11,374,634 10,454,449 7,512,763 7,429,430
Diluted net loss per
share $ (.08) $ (.13) $ (.02) $ (.05)
</TABLE>
As required by the Securities and Exchange Commission (SEC) Staff
Accounting Bulletin No. 98, the above calculation of EPS is based on
SFAS No. 128, "Earnings Per Share." Thus, 1,130,000 purchase warrants
granted as of May 31, 2000 are not included in the calculation of
diluted EPS as their inclusion would be anti-dilutive. No purchase
warrants were granted during the six months ended May 31, 1999. In
addition, the Company is liable to issue 968,000 shares of common stock
related to cash received and services rendered for the six months
ended May 31, 2000.
Page 9
<PAGE>
Item 2. Managements Discussion and Analysis of Financial Condition and
Results of Operations
---------------------------------------------------------------
INFE.COM, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The matters discussed in this report contain forward-looking statements within
the meaning of Section 21E of the Securities Exchange Act of 1934, as amended,
and Section 27A of the Securities Act of 1933, as amended, that involve risks
and uncertainties. All statements other than statements of historical
information provided herein may be deemed to be forward-looking statements.
Without limiting the foregoing, the words "believes", "anticipates", "plans",
"expects" and similar expressions are intended to identify forward-looking
statements. Factors that could cause actual results to differ materially from
those reflected in the forward-looking statements include, but are not limited
to, those discussed in this section and elsewhere in this report, the risks
discussed in the "Risk Factors and Cautionary Statements" section included in
our Registration Statement on Form 10SB12G filed with the SEC on December 30,
1999, and the risks discussed in the Company's other filings with the SEC.
Readers are cautioned not to place undue reliance on these forward-looking
statements, which reflect our analysis, judgment, belief or expectation only
as of the date hereof. We undertake no obligation to publicly revise these
forward-looking statements to reflect events or circumstances that arise
after the date hereof.
Basis of Presentation
Certain amounts for prior periods in the accompanying financial statements,
and in the discussion below have been reclassified to conform with current
period presentations.
Three months ended May 31, 2000 compared to three months ended May 31, 1999
Revenues for the quarter ended May 31, 2000 increased $134,221, or 144%,
to $227,701 from $93,480 for the quarter ended May 31, 1999. The increase was
largely attributable to an increase of $164,350 in revenues for management
consulting services. We believe that our operating divisions will continue
to develop revenues. We also expect to acquire a professional employer
organization, "PEO", this year to provide additional revenue sources. Any
proposed acquisitions remain subject to customary closing conditions,
including regulatory approval and target company stockholder approval.
Therefore, as a result of both increased revenues by existing divisions, and
revenues from new acquisitions, we expect to report future revenue growth.
Cost of revenues decreased $46,536, or 53%, to $41,990 in the second
quarter of fiscal 2000 from $88,526 for the corresponding period in fiscal
1999. The cost of revenues decreased primarily as a result of lower IT
staffing revenues. Cost of revenues as a percentage of revenues decreased to
18% in the second quarter of fiscal 2000 from 95% in the same period during
the prior year, primarily as a result of our increased focus on improving
margin percentages.
Operating expenses increased $794,398, or 452%, to $970,159 in the quarter
ended May 31, 2000, from $175,761 for the period ended May 31, 1999. This
increase in operating expenses is primarily a result of expanding our
management team in preparation for future growth. These expenses consist
primarily of compensation, rent and professional services fees.
Depreciation and amortization increased $49,305, to $51,667 in the quarter
ended May 31, 2000, from $2,362 for the period ended May 31, 1999. This
increase is due to the amortization of the assets purchased from
ClubComputer.com, Inc. in the prior quarter.
Realized loss on investments increased $14,998, to $14,998 in the quarter
ended May 31, 2000 from $0 for the period ended May 31, 1999. The increase in
this account is due to the sale of certain marketable securities below the
original cost.
Unrealized loss on investments increased $36,816, to $36,816 in the
quarter ended May 31, 2000, from $0 for the period ended May 31, 1999. The
increase in this account is due to a temporary decline, in our opinion, in the
market value of certain marketable securities.
Page 10
<PAGE>
Interest expense for the quarter ended May 31, 2000 was $20,941, and
$0 for the quarter ended May 31, 1999. This increase is due primarily to
interest costs associated with the purchase of assets from ClubComputer.com,
Inc.
Six months ended May 31, 2000 compared to six months ended May 31, 1999
Revenues for the six months ended May 31, 2000 increased $214,014, or 184%, to
$330,234 from $116,220 for the six months ended May 31, 1999. The increase was
largely attributable to an increase of $194,350 in revenues for management
consulting services. We believe that our operating divisions will continue to
develop revenues. We also expect to acquire a professional employer
organization, "PEO", during this fiscal year to provide additional revenue
sources. Any proposed acquisitions remain subject to customary closing
conditions, including regulatory approval and target company stockholder
approval. Therefore, as a result of both increased revenues by existing
divisions, and revenues from new acquisitions, we expect to report future
revenue growth.
Cost of revenues decreased $18,200 or 16%, to $98,630 in the six months
ended May 31, 2000 from $116,830 for the corresponding period in fiscal 1999.
The cost of revenues decreased primarily as a result of our increased focus on
improving margin percentages.
Operating expenses increased $1,046,761, or 286%, to $1,412,884 for the
six months ended May 31, 2000, from $366,123 for the period ended May 31, 1999.
This increase in operating expenses is primarily a result of expanding our
management team in preparation for future growth. These expenses consist
primarily of compensation, rent and professional services fees.
Depreciation and amortization increased $49,632, to $53,841 for the six
months ended May 31, 2000, from $4,209 for the period ended May 31, 1999.
This increase is due to the amortization of the assets purchased from
ClubComputer.com Inc. in the prior quarter.
Realized loss on investments increased $14,998, to $14,998 for the six
months ended May 31, 2000 from $0 for the period ended May 31, 1999. The
increase in this account is due to the sale of certain marketable securities
below the original cost.
Unrealized loss on investments increased $39,495, to $39,495 for the six
months ended May 31, 2000, from $0 for the period ended May 31, 1999. The
increase in this account is due to a temporary decline, in our opinion, in the
market value of certain marketable securities.
Interest expense for the six months ended May 31, 2000 was $21,989, and
$286 for the six months ended May 31, 1999. This increase is due primarily to
interest costs associated with the purchase of assets of ClubComputer.com, Inc.
Other
In March, 2000, we raised $421,000 in additional working capital in
exchange for 421,000 shares of restricted, (Rule 144(A)), common stock of
INFe.com, Inc. and 421,000 shares of restricted, (Rule 144(A)), common stock
of IT*CareerNet.com, Inc, a subsidiary of INFe.com, Inc.
Liquidity and Capital Resources
We believe that our existing capital resources together with cash flow
from operations and ongoing fund raising efforts will be sufficient to meet
our short-term operating expenses and capital requirements. However, our
long-term capital requirements will depend upon many factors, some of which
are beyond our control.
Page 11
<PAGE>
Item 3. Quantitative and Qualitative Disclosures About Market Risk
----------------------------------------------------------
We are exposed to equity price risks on the marketable portion of its
equity securities. Our available-for-sale securities at May 31, 2000 include
strategic equity positions in the Internet industry sector, many of which have
experienced significant historical volatility in their stock prices. We
typically do not attempt to reduce or eliminate our market exposure on these
securities.
The carrying values of financial instruments including cash and cash
equivalents, accounts receivable, accounts payable and notes payable,
approximate fair value because of the short maturity of these instruments.
PART II OTHER INFORMATION
-------------------------
Item 1. Legal Proceedings
-----------------
We are subject to claims and lawsuits that arise primarily in the ordinary
course of business. It is our opinion that the disposition or ultimate
resolution of such claims and lawsuits will not have a material adverse effect
on our financial position.
Item 2. Changes in Securities and Use of Proceeds
-----------------------------------------
In March 2000, we issued 1,632,801 shares of our common stock to consultants
with an aggregate value of $1,392,668. These securities were issued pursuant
to an exemption from registration provided by Section 4(2) of the Securities
Act.
In March 2000, we issued 351,880 shares of our common stock to certain
employees for compensation of $265,940. These securities were issued pursuant
to an exemption from the registration provided by Section 4(2) of the
Securities Act.
In April 2000, we issued 200,000 shares of our common stock in return for
200,000 shares of another public company valued at $239,020. These securities
were issued pursuant to an exemption from registration provided by Section 4(2)
of the Securities Act.
In April 2000, we issued 250,000 shares of our common stock in accordance with
the asset purchase agreement for certain assets of ClubComputer.com, Inc. These
securities were issued pursuant to an exemption from registration provided by
Section 4(2) of the Securities Act.
In April 2000, we issued 190,000 shares of our common stock to consultants
with an aggregate value of $244,018. These securities were issued pursuant
to an exemption from registration provided by Section 4(2) of the Securities
Act.
In May 2000, we issued 15,470 shares of our common stock to consultants with
an aggregate value of $13,211. These securities were issued pursuant to an
exemption from registration provided by Section 4(2) of the Securities Act.
Item 3. Defaults Upon Senior Securities
-------------------------------
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders
---------------------------------------------------
Not Applicable
Page 12
<PAGE>
Item 5. Other Information
-----------------
Not Applicable
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) Exhibit No. Exhibit Name
----------- ------------
(b) Reports on Form 8-K
-------------------
The Company, on April 28, 2000 filed on form 8-K information,
pursuant to Item 2, "Acquisition or Disposition of Assets" supplying the
required information regarding the Company's acquisition of a significant
number of assets from ClubComputer.com, Inc. of Nellysford, VA, pursuant to an
Agreement for Sale of Assets.
The Company, on June 26, 2000 filed on form 8-K/A amended
information pursuant to Item 2, "Acquisition or Disposition of Assets"
supplying the required information regarding the Company's acquisition of a
significant number of assets from ClubComputer.com, Inc. of Nellysford, VA,
pursuant to an Agreement for Sale of Assets.
(c) Exhibit No Exhibit Name
---------- ------------
SIGNATURES
Pursuant to the requirements 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.
INFE.COM, INC.
(Registrant)
Date: July 20, 2000 /s/ Tom Richfield
--------------------------------------
Tom Richfield, Chief Executive Officer
Date: July 20, 2000 /s/ Harold Mohn
--------------------------------------
Harold Mohn, Chief Financial Officer
Page 13
<PAGE>
