Planet City status as of 08/25/00:
SEC Filing status: Our efforts to file our SEC Form 10-SB to become a Fully Reporting company continue to consume a lot of time and money. We have been trying to obtain an audit since last November, when our auditors told us that a former subsidiary's accounting records were insufficient to satisfy the requirements of an audit. Over the following few months, we made several attempts at alternative methods to circumvent the problem, but finally had to resort to contacting the former subsidiary's banks, vendors, suppliers, and creditors to ask them for whatever information of the subsidiary they had in their records. This process has taken an extraordinary amount of time. Finally, in early July of this year, the auditors started preparing the audit, even though they didn't have all the information they requested.
We received the first draft of the 1999 audit on 07/27/00, with a recommendation from the auditors that the results of the former subsidiary be broken out into a separate "Discontinued Operations" category to more fairly represent the performance of our company without the influence of the subsidiary's activities. We accepted that recommendation, with the understanding that the changes were relatively easy and could be ready by the end of the following week.
They sent a copy of the reworked audit the following Tuesday afternoon, 8/1/00, earlier than they anticipated. At that point, we were prepared to send the audit to the lawyers, who state they should be able to file in about three days of receiving the completed audit. In an earlier status report, I had predicted that Planet City's filing should be completed sometime around mid-August, so this was right in line with my estimate.
However, at the last minute the auditors added another stipulation that has to be satisfied prior to their signing off on the completed audit. That is, the former subsidiary's legal counsel(s) must produce a formal letter to be included with the audit stating there are no liabilities or lawsuits against the subsidiary that were not uncovered during the audit procedure. According to the auditors, this is required because of the scarcity of "backup documentation" that was obtained from vendors, suppliers, etc.. This provides an additional assurance that the Montreal subsidiary disclosed all pertinent legal and financial information during the data collection.
We then sent written requests to each of the law firms, asking them to provide a statement containing the auditors' requested information. In one particular case, after waiting several days for a response to the request and for a reply to repeated voice mails, it became obvious that one of the lawyers was avoiding the auditors' request. When we were finally able to contact him, he declined to participate, citing a broken relationship with the President of the former subsidiary.
We are now waiting for the auditors to instruct us as to the proper handling of this situation, which they will do as soon as their research into the legal aspects is complete. This situation is similar to others we have had to endure since last November. We again have to wait on the completion of a process completely outside of our control before we can file our SEC Form 10-SB. This is extremely frustrating, particularly since there are investors who won't take a position in our company until we get filed and provide full disclosure, and there are companies that won't collaborate with us until we get re-listed on the OTC BB. These delays have caused, and continue to cause, a great deal of damage to our company, all because of the after effects of a subsidiary that is no longer a part of our company.
To top this all off, the audit firm's employee moved out of town after completing our audit, so the entire package of documentation has been turned over to another employee at the firm. They say this shouldn't cause any further delays while he familiarizes himself with our situation.
Business status: We announced two strategic partnerships within the last month. Both CRD Capital, Inc. and Collective Intelligence, Inc. will extend our marketing and sales capability, and expand our technical services marketplace to other regions of the United States. With these latest alliances, Planet City Software can now "reach" into the SouthEast and NorthEast, as well as here in the SouthWest where our headquarters are.
The entire list of our current software and services partners can be reviewed on our corporate web site's "Partners" page (http://www.planetcity.com/partners.html). You can see that we have aligned ourselves with major vendors of software, as well as firms with significant experience in various areas of Information Technology disciplines.
We completed the first version of a prototype of a mobile handheld medical application for a medical services firm, and it is now being reviewed by the requesting client. We will make any changes to the prototype that they request, then contract to complete the application. While we are building the final application, they will use the prototype for marketing and pre-sales activities.
A partnership with a public company that provides wireless access services is still on hold, and will remain that way until they get beyond their current business startup challenges. We intend to use them as the supplier of wireless communications for our clients.
A prospect for a mobile handheld real estate application decided to table their project until they could get appropriate funding, and a similar situation exists for a prospect in the building construction trade.
One of our business partners is defining a mobile handheld application for a specific vertical market. They have requested Planet City to develop the application for them. Negotiations are underway.
We are still waiting on a public company to decide whether Planet City Software will be chosen to assist them with the development of a major wireless application in the e-Business arena.
A disclaimer statement follows my sign off.
Regards,
Terry E. Dennis, President & CEO
Planet City Corp (OTC: PINC)
planetcity.com
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. |
