Planet City status as of 6/2/00:
Re: SEC filing status. We still cannot file the SEC Form 10-SB until the auditors deliver a 1999 audit containing the inactive Montreal subsidiary's data through the date we unwound the acquisition, which was Sept 30, '99. The auditors have checking account statements from the subsidiary's bank, and have ordered copies of checks with an amount above a specific dollar figure. After they receive those, they estimate it will take two weeks to complete the audit preparation, then another week or so to have it validated by their internal QA department. After it has received their approval, it will be delivered to the lawyers who can then file the entire Form 10-SB electronically. Giving time estimates on these situations is always touchy because there are so many unforeseen obstacles that crop up. A reasonably conservative, yet realistically pessimistic, estimate would be that the filing might be completed by the first week in August. The SEC will then review the filing and either provide a "no comment" letter, or respond with questions.
Business: Our Sedona, AZ based subsidiary, Planet City Software, Inc. is right at, or near, breakeven on a monthly basis. The legal and accounting expenses of the corporate side (Planet City Corp) are a heavy drag on our profitability.
We have not yet been able to divest ourselves of the Internet Gaming division. The casino is for sale to any qualified buyer.
The financial services firm for which we were going to build a wireless handheld (WPDA) application has notified us they will no longer be needing that application. Their attempts to fund an acquisition were unsuccessful, thus eliminating the need for the wireless access. A project for a separate personal wellness firm to provide handheld access to their application has also been lost. That firm is funded by the same group of financial backers. Our alliance with a provider of wireless services is still on hold pending their SEC filing.
As mentioned in my prior status report, we had been pursuing an acquisition of an East Coast firm. When our stock price tanked in reaction to the stock market correction in technical stocks, the negotiations fell apart. We then tried to work out a Joint Venture where we could utilize our technical resources to assist them with their development effort, and we could become their West Coast marketing and sales organization. They told me a couple of days ago that they have worked out a different way to fulfill their need for short term growth. They will obtain private funding to hire their own development staff, and therefore have broken off discussions with Planet City.
Discussions with a replacement for our Web Services manager terminated when the candidate accepted a position at a startup web development firm. We lost a senior developer from our staff when he decided to cooperate in a software project with a family member. He had been fully engaged in projects with another software services firm as a Planet City sub-contractor for several weeks. At the completion of his current project, he resigned. I'm thankful he didn't leave during the project and leave us scrambling to complete it, but I'm sorry to see him go. He will be available for short term consulting projects as a sub-contractor to us when we need him for overflow work.
We have completed all but one of the web services projects that were active when our former Web Services manager was recruited away from us several weeks ago. Additional web services contracts will not be pursued until we have a competent manager to lead the way. Currently, our revenue generating activities consist of finishing up one remaining web services project, and development of the Java/XML application framework that will be used in future web based consulting services projects.
We are in discussions with an existing client for additional consulting services work, and have contacts within other firms we are hoping will prove fruitful within a month or two. As contracts are secured, we plan to grow our staff. Our staff expansion plans are on hold until we can land some of the projects that are pending. Recruiting for high quality experienced technical personnel is very difficult in this competitive market. Our depressed stock price and non-filing SEC status is adding to the difficulty. The "pink sheets" situation that was caused by the Montreal subsidiary has done a lot of damage. We are doing what we can, within the constraints imposed on us, to correct the situation.
A disclaimer statement follows my sign off.
Regards,
Terry E. Dennis, President & CEO
Planet City Corp (OTC: PINC)
Certain of the statements contained herein which are not historical facts are forward-looking statements with respect to events, the occurrence of which involve risks and uncertainties. Any such forward-looking statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. In addition to the general difficulties inherent in forecasting future operating results, particularly in a rapidly changing global economy, other factors can affect performance. Those factors include, but are not limited to, competitive forces, fluctuations in operating results, reliance on industry standards, dependence on new products, risks associated with acquisitions, intellectual property protection and disputes, economic fluctuations, staff turnover, and naturally occurring phenomena. |
