<PAGE>   1

                    U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

                     ANNUAL REPORT UNDER SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                    FOR THE FISCAL YEAR ENDED MARCH 31, 2000

                       COMMISSION FILE NO. 33-80321

FTM Media, Inc.
(Name of Small Business Issuer as specified in its charter)

Delaware                                       84-1295720
(State of Incorporation)                       (IRS Employer Identification No.)
6991 E. Camelback Road
Suite D103
Scottsdale, Arizona 85251
(Address of principal executive offices)                              (Zip Code)


         ISSUER'S TELEPHONE NUMBER, INCLUDING AREA CODE: (480) 425-0099

SECURITIES REGISTERED UNDER SECTION 12(B) OF THE EXCHANGE ACT: None

SECURITIES REGISTERED UNDER SECTION 12(G) OF THE EXCHANGE ACT: Common Stock, Par
Value $0.001 per share

Check whether the Issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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 [ ]

Check if there is no disclosure of delinquent filer in response to Item 405 of
Regulation S-B contained in this form and no disclosure will be contained, to
the best of the Issuer's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment of this Form 10-KSB. [ ]


Issuer's revenues from continuing operations for its most recent fiscal year
were $108,911.

As of June 27, 2000, the number of shares of Common Stock outstanding was
9,618,156 and the aggregate market value of the Common Stock (based on the
closing price on that date) held by non-affiliates of the Issuer was
approximately $17,371,236.



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Transitional Small Business Disclosure Format:

YES [ ]     NO [X]



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                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                               Page
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<S>      <C>                                                                                   <C>
ITEM 1.  DESCRIPTION OF BUSINESS.................................................................1

ITEM 2.  DESCRIPTION OF PROPERTY................................................................14

ITEM 3.  LEGAL PROCEEDINGS......................................................................14

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS....................................14

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS...............................15

ITEM 6.  MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
         OPERATIONS.............................................................................17

ITEM 7.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA............................................19

ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
         DISCLOSURE.............................................................................20

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH
         SECTION 16(A) OF THE EXCHANGE ACT......................................................20

ITEM 10. EXECUTIVE COMPENSATION.................................................................23

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.........................28

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.........................................30

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K.......................................................31

         FINANCIAL STATEMENTS..................................................................F-1
</TABLE>



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        This Annual Report on Form 10-KSB, including information incorporated
herein by reference, contains "forward-looking statements" within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. These statements relate to expectations concerning matters
that are not historical facts. Words such as "projects," "believes,"
"anticipates," "plans," "expects," "intends," and similar words and expressions
are intended to identify forward-looking statements. Although we believe that
such forward-looking statements are reasonable, we cannot assure you that such
expectations will prove to be correct. Important factors that could cause actual
results to differ materially from such expectations are disclosed herein
including, without limitation, in the section titled "Risk Factors" below, and
all forward-looking statements are expressly qualified in their entirety by such
factors. We do not undertake any obligation to update any forward-looking
statements.

ITEM 1. DESCRIPTION OF BUSINESS

THE COMPANY

        FTM Media, Inc.'s (the "Company" or "FTM" or "Us" or "Our" or "We")
principal business is providing Web sites to radio stations in the 25 largest
U.S. markets, so that those radio stations can extend their brands and generate
additional revenues. Our services include Web site design, development,
implementation, hosting and management (our "Web site services"). We currently
have seven Web sites operating, including Web sites for alternative rock
stations KROQ.com in Los Angeles, LIVE105.com in San Francisco, WHFS.com in
Washington D.C. and WBCN.com in Boston, a contemporary hit station in Chicago,
B96.com, and news/talk stations KCBS.com in San Francisco and FMTALKi.com in Los
Angeles. We have additional Web sites under development.

THE CBS AGREEMENT

        Pursuant to an agreement with Infinity Broadcasting Corporation, a
subsidiary of CBS Corporation ("CBS Radio"), CBS Radio has agreed to provide us,
until March 2003, access to contact radio stations owned and/or operated by CBS
Radio for the purposes of our soliciting such Stations to (1) participate in the
FTM Internet Network, (2) engage us to develop, operate and maintain Web
sites for CBS Radio affiliated radio stations and (3) engage us to function
as an Internet access provider. Partially in consideration for such access
rights, we have agreed to (i) use commercially reasonable efforts to provide
unimpeded and uninterrupted access and operability of Web sites to the CBS Radio
affiliated stations for which we provide services, and (ii) propose to our
shareholders that, for so long as CBS Radio continues to own at least ten
percent (10%) of the issued and outstanding shares of our Common Stock (on a
fully diluted basis), a representative designated by CBS Radio will be elected
to our board of directors.

STRATEGY

        We have identified approximately 200 targeted radio stations which we
have organized into eight potential Internet networks, with each potential
network consisting of



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approximately 25 radio stations, one in each of the 25 largest U.S. cities. The
25 radio stations in each potential network would have the same programming
format. The eight programming formats the Company is pursuing are:
Alternative/Modern Rock, Classic Rock, News/Talk/FM Talk, Contemporary Hit
Radio, Adult Contemporary Radio, Oldies, Jazz/Smooth Jazz/Classical and Country.
We believe that a significant number of listeners in these formats own computers
and use the Internet.

        BY CREATING OUR RELATED INTERNET NETWORKS WE PLAN TO BE ABLE TO OFFER
        OUR AFFILIATED RADIO STATIONS THE FOLLOWING BENEFITS:

-       An enhanced opportunity to generate revenue from national advertising
        and sponsorships as an FTM Internet network affiliate that might not be
        available if a radio station had a stand alone Web site;

-       New revenue from existing and new local advertisers wanting advertising
        on the station's Web site;

-       New revenue from existing and new local advertisers wanting to advertise
        as part of streaming the station's terrestrial broadcast signal through
        the Web site;

-       In-depth information and market research about listeners who visit the
        Web site;

-       An advanced, content-rich Web site that would probably be too expensive
        and time consuming for most radio stations to develop and maintain on
        their own; and

-       Potential income from e-commerce from the sale and distribution of
        various goods, services and information.

        Our radio station Web sites are made up of both local and national
content. The local content includes pages and features that are specifically
designed for local radio stations' audiences. The national content contains
pages and features that can be wide-ranging for use across all formats or
specifically designed to be shared by stations with similar programming formats.
The national content is integrated into the look and feel of each individual
station's Web site so that end-users will not realize that part of their local
radio station Web site contains our national content. We believe that by
producing national content that is shared among radio stations, we will be able
to provide our Web site services at a lower cost than individual stations could
achieve on their own. Through this strategy, we believe that radio stations
which engage us will benefit by having content-rich Web sites that enhance each
individual station's brand identity.

        WE BELIEVE THAT OUR OPERATING MODEL HAS SEVERAL IMPORTANT COMPONENTS:

-       WE SHOULD NOT INCUR THE COST OF DEVELOPING AND ESTABLISHING A BRAND. Our
        brand is transparent and the radio station brand associated with each
        one of our Web sites is already well established in each individual
        market place;

-       WE SHOULD NOT INCUR THE COST OF ATTRACTING CONSUMERS TO EACH RADIO
        STATION WEB SITE. The 200 targeted radio stations for which we are
        seeking to provide our Web site services enjoy a weekly cumulative
        listening audience of approximately eighty



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        (80) million people. We plan to access these customers through the Web
        sites we develop for affiliated radio stations and will make it our
        mission to provide each radio station's listening audience with a
        positive Web site experience. We plan to attract these end-users by each
        individual radio station promoting its Web site throughout its broadcast
        day;

-       WE WILL NOT INCUR THE COST OF A LARGE SALES AND MARKETING STAFF. Our
        affiliate stations' individual sales staffs are expected to sell the
        majority of Web site advertising; we expect our monthly ad-unit
        inventory to be sold by Interep, Inc., a national sales organization
        already selling ad units for affiliated radio stations; and

-       THE COST OF CONTENT DEVELOPMENT SHOULD BE DISTRIBUTED OVER MULTIPLE WEB
        SITES AS A RESULT OF THE COMPANY'S DEVELOPMENT OF RELATED INTERNET
        NETWORKS.

        WE PLAN TO DERIVE REVENUES FROM THE FOLLOWING PRINCIPAL SOURCES:

-       The sale of broadcast radio advertising units received on a weekly basis
        from radio stations in exchange for our Web site services. These units
        are expected to be generally within the 6 a.m. to 10 p.m. timeframe and
        are considered readily saleable. We recently began receiving these ad
        units from our existing Web sites;

-       Local and national advertising and sponsorships on our radio station Web
        sites; and

-       The sale of e-commerce products, services and information over our radio
        station Web sites.

        We anticipate that the revenue sources listed above will represent the
majority of our operating revenues. However, we plan to generate additional
revenues from other sources, including the sale of music compilations, station-
branded Internet services, classified advertising, personals, tickets, auctions,
specialty Web-based-only entertainment events, emerging artist management, and
market specific consumer data.

        We plan to utilize advanced profiling technology. This technology is
expected to allow us to profile individual visitors and anonymously track their
activity, which in turn should allow advertisers to target their advertising to
specific demographic groups. The technology should also provide real-time
feedback through online reports on the performance of each ad. The net effect is
expected to give us the ability to offer precision-targeted advertising. As a
Web site visitor returns to any of our Web sites, generalized demographic
information will be supplemented by information about that user's particular
preferences. National advertisers are expected thereby to have a way to gain
effective access to our radio stations' listeners, and conduct meaningful
real-time advanced research on consumer preferences.

        OUR STRATEGIES CAN BE SUMMARIZED AS FOLLOWS:

-       Aggregate millions of targeted consumers to deliver to advertisers
        through state of the art customer profiling technologies;

-       Keep loyal radio station listeners within the confines of those local
        radio station Web sites;



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-       Employ economies of scale to develop unique, full-featured Web sites
        that individual radio stations could not afford to duplicate and manage;
        and

-       Deliver a personalized, compelling Web experience to each visitor that
        entices that visitor to remain on the Web site for a lengthy period and
        return frequently.

EACH WEB SITE'S DESIGN IS EXPECTED TO BE DICTATED BY FOUR KEY ELEMENTS:

-       The theme, reflecting each individual radio station's look, feel,
        personality, and programming format;

-       Original content/features reflecting the station's local demographic
        scene;

-       Original features reflecting our format-specific network of content; and

-       A non-intrusive Web site architecture which allows maximum
        commercialization.

        Although each radio station Web site is expected to be built utilizing
the same platform and architecture, no two radio station Web sites within the
same programming format will look exactly the same. Our focus is on delivering
unique Web site communities to each of our radio station affiliates. Critical to
our strategy is our aim to ensure that a local radio station Web site visitor
will never get the sense that he or she has left the station's Web site, even
while that visitor is enjoying national content and other syndicated programming
features.

THE MARKET

        The market for interactive multimedia Web sites, promotions, games,
information, and online commerce is a growing segment of the United States
economy. An estimate of 1999 Web use by Nielsen Media Research placed Web users
at 92 million persons, up from 70 million in 1998. A January 1999
Arbitron/Edison Media Research survey of Arbitron's Fall `98 diarykeepers found
that 57% of United States households have a computer, and more than half of all
Americans have online access (at home, work, school, or other locations).

        As the Internet becomes more accessible, functional, and widely used by
consumers and businesses, its commercial potential is expected to grow in terms
of both e-commerce and ad spending.

        There is a potential for overlap between Web users and radio listeners,
according to an Arbitron/Edison study. It is estimated that 82% of partisan
Alternative Rock listeners have computers at home, compared to the estimated 57%
of total homes. Of those PC-owning Alternative Rock listeners, it is estimated
that 91% already have Internet access. In fact, most young people - the most
active radio listeners - are online. Moreover, 81% of those ages 12-17 and 71%
of those ages 18-24 are online. Penetration is high among older listeners as
well, including those ages 25-54, where over half are online.

        We believe broadcast advertising is a powerful driver of Web traffic. We
further believe that radio is well positioned to capitalize on this because of
its convenience, reach, and devoted audience. According to the Arbitron/Edison
study mentioned above, two-thirds of those surveyed had



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heard a station promote its Web site on-air, and a third had actually visited a
station Web site (rising to 44% among Modern Rock listeners).

SALES AND MARKETING

        Our sales and marketing activities are directed toward two principal
groups, major market radio stations and national advertisers. Our affiliate
radio stations are largely responsible for generating local ad sales and driving
listeners to their Web sites.

RADIO STATIONS

        We will continue to present our Web site services to the managers of
targeted top 25 market radio stations through our team of radio and Internet
experts. We will emphasize the following features and benefits:

        -       Two-thirds of the advertising space on each radio station Web
                site are expected to be dedicated to "local" advertising.
                Because we expect to share in this revenue, we take an active
                role in training and supporting local station sales personnel;

        -       As we build radio station Web sites in the top 25 markets, we
                aim to become a lifestyle demographic "vertical portal." While
                emphasis will always remain focused on the individual radio
                station Web sites, our "vertical portal" with local entry points
                is expected to become an advertising and marketing vehicle for
                national advertisers. We hope that participation in our
                "vertical portal" will create significant new revenue sources
                for each of our affiliated radio stations;

        -       Our Web site services are "turn-key" and include all Web site
                development, ongoing maintenance, content refreshing, and
                technology upgrades. Through our "turn-key" Web sites,
                individual radio stations should be able to offer Web site
                services far superior than what they could afford to do
                individually;

        -       Each Web site we create and manage will be customized for each
                participating radio station; and

        -       Our radio station Web sites are expected to be equipped with
                sophisticated tracking and reporting systems following the
                activity of each Web site visitor that should, in turn, provide
                each station with timely and accurate loyal listener data and
                demographics.

        Our key marketing executives are in the process of making in-person
presentations to the general managers and program directors of select top 25
market radio stations that fit our target customer profile.

NATIONAL ADVERTISERS

        Our marketing efforts to national advertisers are expected to be through
advertising agencies and, to a lesser extent, direct sales. We will focus on
communicating to advertisers the benefits of individually targeted, interactive
ads on our network of Web sites. We expect that we will be able to



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closely match these advertisements to a consumer's lifestyle and demographics
and allow consumer interaction, and we believe these advertisements are more
effective at building brand equity and generating sales and revenue than
traditional banner ads.

COMPETITION

        FTM's direct competitors include:

-       OnRadio - OnRadio supplies basic, template-based Web sites to radio
        stations in exchange for the radio station providing a "link" to OnRadio
        national content. There is also a banner ad revenue split, and the
        participating radio stations barter some advertising time to OnRadio in
        exchange for its services. OnRadio has been in operation for more than
        three years and operates over 300 radio station Web sites, mostly in
        small and medium-sized markets.

-       FIMC/RadCity - First Internet Media Corporation offers Stations a
        market-exclusive licensing arrangement for each "RadCity," a local Web
        portal comprised of third-party information providers. The strategy is
        currently being tested in six small markets and one major city (San
        Francisco).

-       Radio Data Group, Inc.- RDG is owned by CBS, Clear Channel, and Colfax
        Communications. RDG helps radio stations set up Web sites and markets
        radio-oriented Web site software to them. Its software package includes
        ad tracking, invoicing, ad placements, and Web site administration,
        among other programs. RDG claims to have created over 250 Web sites.

-       MP3Radio.com - Cox Enterprises and MP3 have created this joint venture
        company that builds radio station Web sites using templates. The content
        of each site, currently 20 in number, is identical and MP3 driven.

-       Clear Channel - Clear Channel is the largest owner of radio stations in
        the U.S. and is one of our targeted customers. Clear Channel has made
        public statements that it intends to control its radio-related Internet
        initiative internally, which could limit the relationship the Company
        might build with Clear Channel. At present, no specifics of Clear
        Channel's overall Internet plan have been revealed to the public.

-       SiteShell Corporation - This entity is new in the radio/Internet space
        and is controlled by the same principals of Sabre Communications, Inc.
        and Excalibur Media, Inc., which together own and operate nineteen radio
        stations in seven markets. SiteShell offers a market exclusive templated
        Web site with format specific content, e-commerce, and advertising
        opportunities.

        Recently the number of competitors in the Company's Internet space has
declined. However, there can be no assurance that the number of direct and
indirect competitors will not increase significantly in the future. The market
for Internet products and services is growing exponentially and there are
relatively few barriers to entry into the marketplace. There can be no assurance
that our current or potential competitors will not develop Internet products and
services comparable or superior to those to be developed by us or adapt more
quickly than us to new technologies, evolving industry trends, or changing
Internet user preferences. Increased competition could result in price
reductions, reduced margins, or loss



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of market share. In addition, if we expand internationally, we may face new
competition in these marketplaces.

EMPLOYEES

        As of March 31, 2000, we employed approximately 76 full- and part-time
employees, including 46 in Web site development, 17 in engineering and MIS, 11
in administration and 2 in sales and marketing. Additional administrative,
marketing and technical personnel will be hired from time to time to meet our
operating requirements.

RISK FACTORS

        You should carefully consider the following risks and the other
information in this Report and our other filings with the SEC before you decide
to invest in our company or to maintain or increase your investment. The risks
and uncertainties described below are not the only ones facing us. Additional
risks and uncertainties may also adversely impact and impair our business. If
any of the following risks actually occur, our business, results of operations,
or financial condition would likely suffer. In such case, the trading price of
our common stock could decline, and you may lose all or part of your investment.

        This Report contains forward-looking statements based on the current
expectations, assumptions, estimates, and projections about us and the Internet
industry. These forward-looking statements involve risks and uncertainties. Our
actual results could differ materially from those discussed in these
forward-looking statements as a result of certain factors, as more fully
described in this section and elsewhere in this Report. We do not undertake to
update publicly any forward-looking statements for any reason, even if new
information becomes available or other events occur in the future.

--      Our operating history is limited and we have not yet earned any
significant revenues.

        We have only been operating since March 1998, and we have a limited
operating history on which you may evaluate our business. Additionally, we have
generated only minimal revenues. Our limited operating history makes the
prediction of our future operating results difficult or impossible, and there
can be no assurance that we will generate sufficient revenues to achieve or
maintain profitability.

--      We have a history of losses.

        We have a history of operating losses, and an accumulated deficit of
$23.8 million as of March 31, 2000. Our prospects are subject to risks and
uncertainties frequently encountered by start-up companies in new and rapidly
evolving markets such as the Internet and e-commerce markets.



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        We have had negative cash flow since inception and expect to continue to
have negative cash flow until such time as our sales revenues increase
substantially. There can be no assurance that we will be able to achieve or
maintain profitable operations or positive cash flow at any time in the future.
Our lack of financial strength may be a negative factor in our ability to
execute our business plan irrespective of the quality and benefits of our
products.

--      We may not be able to raise the capital we need.

        To date, we have covered our operating losses by borrowing cash and
selling securities. We currently anticipate that available funds will be
sufficient to meet our needs for working capital for 30 - 45 days beyond the
date of filing of this Report. Thereafter, we will need to raise additional
funds. If additional funds are raised through the issuance of equity or
convertible debt securities, the percentage ownership of our shareholders will
be reduced and securities may have rights, preferences and privileges senior to
those securities that are being sold by the selling stockholders. There can be
no assurance that additional financing will be available on terms favorable to
us or at all. If adequate funds are not available or are not available on
acceptable terms, we may not be able to fund our development plans, develop or
enhance services or products, respond to competitive pressures, or continue
operations.

--      Our future revenues and profitability are unpredictable.

        To date, we have no significant revenues and expect that initial
revenues from providing our Web site services to radio stations will be in the
form of barter broadcast radio ad units, which we must re-sell to produce cash
income or exchange with third parties for technical services, advertising,
editorial and software content, or prizes. Additionally, our future prospects
depend significantly on our ability to generate revenue from sources other than
reselling broadcast radio ad units, such as the sale of local and national
advertising on our radio station Web sites, the sale of e-commerce products and
services offered on our radio station Web sites, among other potential revenue
sources. Any failure to generate such revenue would have a material adverse
effect on our business, prospects, financial condition, and operating results.
As a result, our future operating results are not predictable.

        Our current and anticipated future expense levels are based largely on
management's assessment of prospects and estimates of future revenues. It is
expected that expense levels will be fixed to a significant extent. Accordingly,
we may be unable to adjust spending in a timely manner to compensate for any
unexpected revenue shortfall, and a shortfall in actual revenue as compared to
estimated revenue could have an immediate material adverse effect on our
financial condition. In addition, we currently intend to increase sales and
marketing expenses, particularly for additional sales and marketing staff
necessary to develop and maintain relationships with radio stations, national
advertising customers, advertising agencies, and other third parties, and to
increase production and engineering expenses, including increasing engineering
staff levels necessary to develop and produce Web sites, as well as to
continuously improve existing technology. Increases in operating expenses may
also occur in response to increased hardware and software infrastructure
requirements needed to handle larger amounts of traffic and to attract, retain
and motivate qualified personnel. To the extent these expenditures do not result
in a substantial increase in revenues, our financial condition would be
materially adversely affected.



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--      We have only limited marketing experience with respect to our products
and services.

        We have conducted limited marketing activities and have only limited
marketing experience with respect to our products and services. As is typical
with new products and services, demand and market acceptance for products is
subject to a high level of uncertainty. Achieving widespread market acceptance
for these products will require substantial marketing efforts and the
expenditure of sufficient funds to create market recognition and customer
demand. To date, members of our senior management team have conducted
substantially all marketing activities. The ability to build a customer base
will depend, in part, on our ability to locate, hire and retain sufficiently
qualified marketing personnel and to fund marketing efforts. There can be no
assurance that our products and services will achieve widespread market
acceptance or that marketing efforts will result in profitable operations.

--       We are dependent on our relationship with CBS Radio.

        In March 1998, we entered into a five-year agreement with CBS Radio. The
agreement generally provides us with access to all CBS-owned radio stations for
purposes of soliciting these stations to purchase Internet products and
services. Although we are currently providing Web site services for seven
CBS-owned radio stations and are in negotiations with other CBS-owned radio
stations regarding the provision of such services, no agreements have been
entered into between us and any radio stations, and there is no assurance that
any such agreements will be entered into. The failure to enter into such
agreements could materially and adversely impact our results. The termination or
expiration without renewal of our agreements with radio stations and/or the
deterioration of our relationship with CBS Radio could have a material adverse
effect on our business, prospects, financial condition, or operating results.

--      We may not be able to enter into satisfactory agreements with radio
stations.

        Our strategy is dependent on our ability to provide our Internet
products and services to radio stations at a profit. The costs to us of
complying with obligations arising out of agreements we expect to enter into
with radio stations should be substantial, and there are no assurances that the
costs to develop, maintain, host, update, and support the Web sites will be
offset by the revenues from radio stations and the other revenues generated by
our products and services.

--      Our Web site advertising revenue is uncertain.

        Our failure to market and sell either local or national Web site
advertising on attractive terms would have a material adverse effect on our
business, prospects, financial condition, or operating results. Furthermore, it
is expected that the radio stations that contract with us will have substantial
discretion in the substance and quantity of promotional services they provide in
connection with the Web sites, and there can be no assurance that the
promotional services provided by radio stations will enable the Web sites to
attract sufficient advertising and sponsorship revenues to generate profits for
us.



                                      -9-
<PAGE>   13

--      Fluctuations in advertising revenues could impact our operating results.

        Advertising sales in television, radio, and print media fluctuate
unpredictably and are typically lower in the first and third calendar quarters
of each year. Advertising expenditures also fluctuate significantly with
economic cycles, which may negatively affect our results of operation. A number
of factors may affect our ability to generate advertising revenues, including:

-       acceptance and continued growth of the Internet as an advertising
        medium;

-       continued consumer Internet use;

-       traffic on our Web sites;

-       pricing of advertising on other Web sites;

-       our ability to generate listener demographic characteristics that are
        attractive to advertisers;

-       development and expansion of our advertising sales force; and

-       the establishment and retention or maintenance of desirable advertising
        sales agency relationships.

--      Uncertainty of directing viewers to radio Web sites could affect our
future prospects.

        Other Web sites, particularly search engines, directories, and other
navigational tools managed by Internet Service Providers and Web browser
companies, may significantly affect traffic to our Web sites. Our ability to
develop original and compelling Internet content is also dependent on
maintaining relationships with and using products provided by third party
vendors of Internet development tools and technologies. Developing and
maintaining satisfactory relationships with third parties could become more
difficult and more expensive as competition increases among Internet content
providers. If we are unable to develop and maintain satisfactory relationships
with such third parties on acceptable commercial terms, or if our competitors
are better able to leverage such relationships, our business, prospects,
financial condition, or operating results will be materially adversely affected.

--      We are dependent on relationships with advertisers, sponsors, partners,
and radio stations.

        Most of our arrangements with advertisers, sponsors, partners and radio
stations:

-       do not require minimum commitments to use our services,

-       are not exclusive, and

-       are short-term or may be terminated at any time by the other party.



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         There is a risk that these third parties may:

-       not regard their relationship with us as important to their own
        respective businesses and operations,

-       reassess their commitment to us in the future, or

-       develop their own competitive services or products.

        There is no assurance that the services and products of the third
parties with which we deal will achieve market acceptance or commercial success.
As a result, there is no guarantee that our existing relationships with these
parties will result in sustained or successful business partnerships or
significant revenues for us.

        We are currently, and expect in the future to be, dependent on our
relationships with a number of third parties. These relationships include
arrangements relating to the creation of traffic on Web sites that are
affiliated with us and the resulting generation of advertising and
commerce-related revenue. If these affiliated Web sites terminate or fail to
renew their relationships with us on reasonable terms, it could harm our
business.

--      Management of our growth may place a significant strain on our
management.

        Our growth has placed, and is expected to continue to place, a
significant strain on our managerial, operational and financial resources.
Further, as the number of our affiliate radio stations, users, advertisers, and
other business partners grows, we will be required to manage multiple
relationships with various customers, strategic partners, and other third
parties. These requirements will be exacerbated in the event of our further
growth or in the event of further increases in the number of our strategic and
sponsorship relationships. Our business systems, procedures, and controls may
not be adequate to support our operations in the future. If our growth
continues, our management may not be able to achieve the rapid execution
necessary to successfully offer our products and services and execute our plan.

--      The loss of key executives could adversely affect our ability to manage
our business.

        We are highly dependent on the services of our top ranking officers. In
addition, our future success is dependent on our ability to attract, train,
retain, and motivate high quality personnel. The loss of the services of any of
our executive officers or key employees would harm our business. Our future
success also depends on our continuing ability to attract, train, retain, and
motivate other highly qualified technical and managerial personnel. Competition
for such personnel is intense and we may not be able to attract, train, retain,
or motivate other highly qualified technical and managerial personnel in the
future.

--      The development of our products and services is substantially
incomplete.

        The development of our products and services is substantially
incomplete. For example, we have not yet completed the development of national
content for all of our target radio formats. We anticipate that our future
research and development activities, combined with experience gained from
commercial use of our Internet products and services, could result in the need
for further refinement and development. We also expect to modify the products
for particular customer applications. There can be no assurance that unforeseen



                                      -11-
<PAGE>   15

circumstances will not require expensive additional development of our products
and their applications. In addition, we may, in the future, need to make
improvements in our Internet products and services in order for our Internet
products and services to remain competitive.

--      We operate in a very competitive business environment which can
adversely affect our business and operations.

        The market for Internet products and services is already highly
competitive. Exacerbating this situation is the fact that the market for
Internet products and services lacks significant barriers to entry, making it
relatively easy for new businesses to enter this market. Competition in the
market for Internet products and services may intensify in the future. Numerous
well-established companies and smaller entrepreneurial companies are focusing
significant resources on developing and marketing products and services that
will compete with our products and services. In addition, many of our current
and potential competitors have greater financial, technical, operational, and
marketing resources than we do. We may not be able to compete successfully
against these competitors in selling our goods and services. Competitive
pressures may also force prices for Internet goods and services down and such
price reductions likely would reduce our revenues.

        A significant factor in the ability of our Internet products and
services to compete successfully in the market will be our ability to secure and
maintain relationships with major national chains of radio stations. There can
be no assurance that our business plan to develop and maintain such
relationships can be successfully implemented. We will compete with established
individuals and entities, many of which will have significantly greater
operating history, name recognition and resources.

--      The rapidly evolving and uncertain nature of our market could adversely
affect our business.

        The market for interactive/multimedia Web sites and other Internet
features and promotions is at a very early stage of development, is rapidly
evolving and is characterized by an increasing number of entrants that are
introducing or developing competing products and services. As is typical in the
case of a new and rapidly evolving industry, demand and market acceptance for
recently introduced products and services is subject to a high level of
uncertainty and risk. Because the market for our Internet products and services
is new and evolving, it is difficult to predict with any assurance the market's
size, growth rate, or durability.

--      Rapid technological change could adversely affect our business.

        The market in which we compete is characterized by rapidly changing
technology, evolving industry standards, frequent new service and product
announcements, introductions and enhancements and changing customer demands.
These market characteristics are exacerbated by the emerging nature of the
Internet and the apparent need of companies from a multitude of industries to
offer Internet-based products and services. Accordingly, if we are unable to
adapt to rapidly changing technologies, to adapt our services to evolving
industry standards and to continually improve the performance, features and
reliability of our service in response to competitive service and product
offerings and evolving demands of the marketplace our business will be adversely
affected. In addition, the widespread adoption of new Internet, networking, or
telecommunications technologies, or other



                                      -12-
<PAGE>   16

technological changes, could require substantial expenditures by us to modify or
adapt our services or infrastructure, which could have a material adverse effect
on our business, results of operations and financial condition.

--      We may have liability for information retrieved from the Internet.

        Because materials may be downloaded from the Internet and subsequently
distributed to others, there is a potential that claims may be made against us
for defamation, negligence, copyright or trademark infringement, personal
injury, or other theories based on the nature, content, publication and
distribution of such materials.

--      Changes to governmental regulation and legislation could adversely
affect our business.

        We are not currently subject to direct federal, state, or local
regulation, and laws or regulations applicable to access to or commerce on the
Internet, other than regulations applicable to businesses generally. However,
due to the increasing popularity and use of the Internet and other online
services, it is possible that a number of laws and regulations may be adopted
with respect to the Internet or other online services covering issues such as
user privacy, freedom of expression, pricing, content and quality of products
and services, taxation, advertising, IP rights and information security. The
adoption of any such laws or regulations might also decrease the rate of growth
of Internet use, which in turn could decrease the demand for our service or
increase the cost of doing business or in some other manner have a material
adverse effect on our business, results of operations and financial condition.
In addition, applicability to the Internet of existing laws governing issues
such as property ownership, copyrights and other IP issues, taxation, libel,
obscenity and personal privacy is uncertain. The vast majority of such laws were
adopted prior to the advent of the Internet and related technologies and, as a
result, do not contemplate or address the unique issues of the Internet and
related technologies.

--      Our common stock is not widely traded resulting in reduced liquidity and
increased volatility.

        Our common stock is thinly traded. As a result, prices quoted for our
stock may not reflect the actual fair market value of the stock. Also, because
of the low volume of trading in our common stock, it may be difficult for our
stockholders to sell their shares.

--      Our principal stockholders have the ability to exercise significant
control over us and could limit the ability of our other stockholders to
influence the outcome of director elections and other transactions submitted to
a vote of our stockholders.

        As of March 31, 2000, our executive officers, directors and principal
stockholders beneficially owned 49.1% of our outstanding common stock. These
stockholders will be able to exercise substantial influence over all matters
requiring approval by our stockholders, including the election of directors and
approval of significant corporate transactions. This concentration of ownership
may also have the effect of delaying or preventing a change in control.



                                      -13-
<PAGE>   17

--      The issuance of additional stock, options and warrants will dilute
current stockholders.

We currently have outstanding obligations to issue shares of our common stock
upon the exercise of options, warrants and upon the conversion of convertible
notes and shares of preferred stock. We have adopted a stock option plan, and
may in the future adopt one or more stock option plans pursuant to which we will
grant stock options under such plans or otherwise to our employees, officers,
directors or others. To the extent that options, warrants or other obligations
for issuance of common stock are granted and exercised, dilution to the
interests of our investors will occur. Moreover, the terms upon which we will be
able to obtain additional equity capital may be adversely affected since any
holders of outstanding options, warrants or other obligations can be expected to
exercise them at a time when we would, in all likelihood, be able to obtain any
needed capital on terms more favorable to us than those provided by such
outstanding obligations.

ITEM 2. DESCRIPTION OF PROPERTY

        The Company leases 1,990 square feet of office space in Scottsdale, AZ
for use as executive offices under a lease that expires January 31, 2001. The
Company also subleases and leases approximately 30,957 square feet of space in
Burbank, CA for use as a Web site development center under a sublease and lease
that expires December 31, 2006. The Company has the option to extend this lease
for two successive periods of five years each. The company also rents on a month
to month basis an apartment in Burbank, California.

ITEM 3. LEGAL PROCEEDINGS

        The Company from time to time may be a party to litigation arising in
the ordinary course of business. The company does not believe the results of
such litigation, even if the outcome is unfavorable to us, would have a material
adverse effect on our financial position.

        On May 26, 2000 Cohanzick Partners LP ("Cohnzick") filed a lawsuit
against us in the United States District Court for the Southern District of New
York. Cohanzick alleges that the Company has failed to honor a $400,000
promissory note that the company executed in favor of Cohanzick. Cohanzick seeks
repayment of the note, along with the accrued interest thereon and legal
fees and reasonable costs. On June 2, 2000, the Company filed a lawsuit against
Cohanzick and Cohanzick Management LLC in the Superior Court of Maricopa County,
Arizona. The Company alleges that these entities failed to honor their
commitment to convert their $400,000 note into the common stock of the Company.
The Company has asked for specific performance of this commitment along with
legal fees and reasonable costs.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

        At a July 19, 1999 Special Meeting of Stockholders of Redwood
Broadcasting, Inc., a Colorado corporation and the predecessor to FTM
("Redwood"), the Redwood stockholders voted to approve a proposed amendment to
the Company's Articles of Incorporation to change Redwood's name to "FTM
Media, Inc." The name change was approved by a vote of 3,672,070 in favor, 0
opposed, 0 abstained.



                                      -14-
<PAGE>   18

        At an October 15, 1999 Special Meeting of Stockholders of FTM Media,
Inc., a Colorado corporation ("FTM Colorado"), FTM Colorado's stockholders voted

1.      To approve the reincorporation of FTM Colorado from Colorado to Delaware
        by the adoption of a Plan and Agreement of Merger pursuant to which FTM
        Colorado was to be merged with and into FTM Media, Inc., a Delaware
        corporation. This reincorporation merger was closed on January 7,
        2000. The reincorporation merger was approved by a vote of 4,170,024 in
        favor, 0 opposed, 0 abstained.

2.      The adoption of the FTM Media, Inc. 1999 stock option plan. The FTM
        stock option plan was approved by a vote of 3,153,064 in favor, 0
        opposed, 656,250 abstained.

No other matters were submitted to a vote of security holders.

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

MARKET PRICE

        Our Common Stock is traded over the counter and quoted on the OTC
Electronic Bulletin Board ("Bulletin Board") on a limited and sporadic basis
under the symbol "FTMM." The reported high and low bid and ask prices are shown
below for the period through March 31, 2000. The prices presented are bid and
ask prices which represent prices between broker-dealers and do not include
retail mark-ups or mark-downs or any commission to the broker-dealer. The
prices do not necessarily reflect actual transactions:

<TABLE>
<CAPTION>
                                          HIGH            LOW
                                          ----            ---
<S>                                   <C>             <C>
FISCAL YEAR ENDING 3/31/1999:
Quarter Ending 6/30/98                $     2.750     $    1.750
Quarter Ending 9/30/98                $     2.000     $    1.250
Quarter Ending 12/31/99               $     2.500     $    1.875
Quarter Ending 3/31/99                $    10.250     $    4.000

FISCAL YEAR ENDING 3/31/2000:
Quarter Ending 6/30/99                $    14.875     $    8.250
Quarter Ending 9/30/99                $    11.500     $    7.375
Quarter Ending 12/31/99               $    12.000     $    8.625
Quarter Ending 3/31/00                $    14.250     $    9.000
</TABLE>

        The bid and ask prices of the Common Stock on June 27, 2000 were
$3.53125 and $3.5625, respectively, as quoted on the Bulletin Board. As of June
27, 2000, there were 9,618,156 shares of the Company's Common Stock held by
approximately 1,500 stockholders of record.

THE SECURITIES ENFORCEMENT AND PENNY STOCK REFORM ACT OF 1990

        The Securities Enforcement and Penny Stock Reform Act of 1990 requires
additional disclosure, relating to the market for penny stocks, in connection
with trades in any stock defined as a penny stock. The Commission recently
adopted regulations that generally define a penny stock to be any equity
security that has a market price of less than $5.00 per



                                      -15-
<PAGE>   19

share, subject to certain exceptions. Such exceptions include any equity
security listed on NASDAQ and any equity security issued by an issuer that has
(i) net tangible assets of at least $2,000,000, if such issuer has been in
continuous operation for three years, (ii) net tangible assets of at least
$5,000,000, if such issuer has been in continuous operation for less than three
years, or (iii) average annual revenue of at least $6,000,000, if such issuer
has been in continuous operation for less than three years. Unless an exception
is available, the regulations require the delivery, prior to any transaction
involving a penny stock, of a disclosure schedule explaining the penny stock
market and the risks associated therewith.

        Our securities are subject to rules adopted by the Commission regulating
broker-dealer practices in connection with transactions in "penny stocks." Those
disclosure rules applicable to penny stocks require a broker-dealer, prior to a
transaction in a penny stock not otherwise exempt from the rules, to deliver a
standardized list disclosure document prepared by the Commission. That
disclosure document advises an investor that investments in penny stocks can be
very risky and that the investor's salesperson or broker is not an impartial
advisor but rather paid to sell the shares. It contains an explanation and
disclosure of the bid and offer prices of the security, any retail charges added
by the dealer to those prices ("markup" or "markdown"), and the amount of
compensation or profit to be paid to or received by the salesperson in
connection with the transaction. The disclosure contains further admonitions for
the investor to exercise caution in connection with an investment in penny
stocks, to independently investigate the security as well as the salesperson
with whom the investor is working, and to understand the risky nature of an
investment in the security. Further, the disclosure includes information
regarding the market for penny stocks, explanations regarding the influence that
market makers may have upon the market for penny stocks and the risk that one or
two dealers may exercise domination over the market for such security and
therefore control and set prices for the security not based upon competitive
forces. The broker-dealer must also provide the customer with certain other
information and must make a special written determination that the penny stock
is a suitable investment for the purchaser and receive the purchaser's written
agreement to the transaction. Further, the rules require that following the
proposed transaction the broker provide the customer with monthly account
statements containing market information about the prices of the securities.
These disclosure requirements may have the effect of reducing the level of
trading activity in the secondary market for a stock that becomes subject to the
penny stock rules. Many brokers may be unwilling to engage in transactions in
the Common Stock because of the added disclosure requirements, thereby making it
more difficult for security holders to dispose of their securities.

DIVIDENDS

        Since inception, we have not paid or declared any cash dividends on our
Common Stock. Our Board of Directors does not currently intend to pay any cash
dividends on our Common Stock in the future.

        We have outstanding an aggregate of 40,636 shares of Series A
Convertible Preferred Stock ("Series A Preferred Stock") which has a liquidation
value of $10 per share plus any unpaid accrued dividends. Holders of the
outstanding shares of Series A Preferred Stock are entitled to receive a
dividend equal to 7% per annum accruing from the date of first issuance. As of
March 31, 2000, $38,094 in accrued and unpaid cumulative dividends was due and
owing to holders of outstanding shares of Series A Preferred Stock.



                                      -16-
<PAGE>   20
        In addition, as of March 31, 2000, we had outstanding an aggregate of
259,828 shares of Series B Convertible Preferred Stock ("Series B Preferred
Stock"), which are convertible into 405,331 shares of Common Stock. Holders of
the outstanding shares of Series B Preferred Stock are entitled to receive a
dividend equal to 70.2 cents per share per annum accruing from the date of first
issuance. There are presently no accrued and unpaid dividends on the Series B
Preferred Stock.

ITEM 6. MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
        OPERATIONS

OVERVIEW

        Our principal business is providing Web sites to radio stations in the
25 largest U.S. markets, so that those radio stations can extend their brands
and generate additional revenues. Our services include Web site design,
development, implementation, hosting and management (our "Web site services").
We currently have seven Web sites operating, including Web sites for alternative
rock stations KROQ.com in Los Angeles, LIVE105.com in San Francisco, WHFS.com in
Washington, D.C. and WBCN.com in Boston, B96.com, a contemporary hit Station in
Chicago and news/talk stations KCBS.com in San Francisco and FMTALKi.com in Los
Angeles. We have additional Web sites under development.

        WE PLAN TO DERIVE REVENUES FROM THE FOLLOWING PRINCIPAL SOURCES:

-       The sale of broadcast Radio advertising units received on a weekly basis
        from Radio Stations in exchange for our Web site services. These units
        are expected to be generally within the 6 a.m. to 10 p.m. timeframe and
        are considered readily saleable. We recently began receiving these ad
        units from our existing Web sites;

-       Local and national advertising and sponsorships on our Radio Station Web
        sites; and

-       The sale of e-commerce products, services and information over our Radio
        Station Web sites.

        We anticipate that the revenue sources listed above will represent the
majority of our operating revenues. However, we plan to generate additional
revenues from other sources, including the sale of music compilations, Station
branded Internet services, classified advertising, personals, tickets, auctions,
specialty Web-based-only entertainment events, emerging artist management, and
market specific consumer data.

        OUR STRATEGIES CAN BE SUMMARIZED AS FOLLOWS:

-       Aggregate millions of targeted consumers to deliver to advertisers
        through state of the art customer profiling technologies;

-       Keep loyal Radio Station listeners within the confines of those local
        Radio Station Web sites;

-       Employ economies of scale to develop unique, full-featured Web sites
        that individual Radio Stations could not afford to duplicate and manage;
        and

-       Deliver a personalized, compelling Web experience to each visitor that
        entices that visitor to remain on the Web site for a lengthy period and
        return frequently.

        We have a very limited operating history on which to base an evaluation
of our business and prospects. Our prospects must be considered in light of the
risks, uncertainties, expenses and difficulties frequently encountered by
companies in their early stages of development, particularly companies in new
and rapidly evolving markets such as the Internet market. In view of the rapidly
evolving nature of our business and our limited operating history, we believe
that period-to-period comparisons are not necessarily meaningful and should not
be relied upon as indications of future performance. Please see "Risk Factors"
above.

        In November 1999, we began generating revenues from the sale of
merchandise from our Web sites. Also, radio stations began selling
advertising on our Web sites, of which we receive a percentage of the revenues
collected by the station for such advertising. We believe that we will continue
to generate both sales from selling items on the Web sites and from advertising
on the Web sites and that in the future, these revenue streams will become more
significant.


LIQUIDITY AND CAPITAL RESOURCES -- MARCH 31, 2000 COMPARED TO MARCH 31, 1999

        Since our inception on February 22, 1994, we have had significant
negative cash flows from our operations. For the years ended March 31, 1999 and
2000, we used $786,247 and $5,742,394 of cash, respectively, in our operations.
Cash used in operating activities in each period resulted primarily from net
losses in those periods, offset by non-cash charges and changes in current
assets and liabilities.

        For the years ended March 31, 1999 and 2000, we used cash totaling
$72,613, and $2,237,790, respectively, in our investing activities. The
increase in 2000 was the result of the purchase of computers and related
equipment.

        Net cash provided by financing activities for the years ended March 31,
1999 and 2000, was $2,883,897 and $6,357,704, respectively. Since inception, we
have financed our operations primarily from the issuance of common stock,
proceeds of notes payable and the sale of Series A Preferred Stock and Series B
Preferred Stock. Funds provided by financing in the year ended March 31, 1999
consisted of the issuance of INRG common stock for $2,883,897. Funds provided by
financing activities in 2000 included net proceeds from the sale of common stock
and units of $1,620,243, net proceeds from the sale of preferred stock of
$1,585,461, the sale of notes payable with gross proceeds of $3,350,000. Funds
used in financing activities related to the payment of $198,000 in dividends on
the Series B preferred stock.

                                      -17-
<PAGE>   21
        As of March 31, 2000, our principal source of liquidity was $405,353
cash. In April 2000, the Company closed a private placement financing in which
it raised a gross amount of $6,656,252 (of which $991,527 was received in cash
in the fiscal year ended March 31, 2000).

        We have entered into several non-cancelable lease commitments that will
require payments of approximately $2,800,000 million over the next five years.

        We believe that as of the filing of this Report we have sufficient cash
and cash equivalents to fund our operating and investing activities for a period
of 30 to 45 days following the date of filing of this report. We therefore will
need to raise additional funds through public or private financings or other
arrangements. Any additional financings might not be available on reasonable
terms or at all. Failure to raise capital when needed could materially harm our
business, financial condition and results of operations and could result in our
ceasing operations.

        Other than the foregoing and the risk factors discussed above, we know
of no trends, demands, or uncertainties that are reasonably likely to have a
material impact on our short term liquidity or capital resources.

RESULTS OF OPERATIONS - MARCH 31, 2000 COMPARED TO MARCH 31, 1999

REVENUE. Revenue presently consists of money received from the sale of
merchandise on our Web sites and the selling of advertising on such sites.
Revenue was $0 for the year ended March 31, 1999 and $108,911 for the year ended
March 31, 2000. The growth in revenue was attributable to the rollout of our
first Web sites.

WEB SITE DEVELOPMENT AND E-COMMERCE COSTS. Web site development and E-commerce
costs consist of our costs related to the development of our Web sites and costs
related to the selling of goods from our Web sites. Web site development costs
include expenses incurred by us to develop, enhance, manage, monitor and operate
our Web sites and to develop new products. These costs consist primarily of
salaries and fees paid to employees and consultants to develop and maintain the
software and information contained on our Web sites. For the year ended March
31, 1999, these costs were $21,705, and for the year ended March 31, 2000, these
costs were $5,150,322. These costs related primarily to the increase in staff
necessary to the development of content and tools for our Web sites. E- Commerce
costs consist mainly of the cost of the items sold, shipping and handling
charges and salaries of E-commerce employees. For the year ended March 31, 1999,
these costs were $0 and for the year ended March 31, 2000 these costs increased
to $203,292. This increase was due to the commencement of the selling of
merchandise on our Web sites.

SALES AND MARKETING EXPENSE. Sales and Marketing expense includes expenses
incurred by the Company to obtain and maintain client and advertiser
relationships. These costs included salaries and fees paid to employees and
consultants. For the year ended March 31, 1999, Sales and Marketing expenses
were $0 and for the year ended March 31, 2000, Sales and Marketing expenses were
$433,849, consisting primarily of costs associated



                                      -18-
<PAGE>   22

with the development of client marketing programs and of new prototype marketing
and advertising programs.

GENERAL AND ADMINISTRATIVE EXPENSES. Our general and administrative expenses
consist primarily of compensation for personnel and, to a lesser extent, fees
for professional services, rent and communications costs. Our general and
administrative expenses increased from $863,757 for the year ended March 31,
1999, to $2,918,032 for the year ended March 31, 2000. The increase is primarily
attributable to the increased size of our executive and administrative staff.
Expenses related to personnel costs of our general and administrative personnel
increased from $57,783 for the year ended March 31, 1999, to $906,557 for the
year ended March 31, 2000. Legal and Accounting fees increased from $300,948 to
$498,637 for the years ended March 31, 1999 and 2000, respectively. Rent
increased from $17,649 for the year ended March 31, 1999, to $217,875 for the
year ended March 31, 2000, as the result of our move into a new production
facility.

DEPRECIATION AND AMORTIZATION. Depreciation and amortization expense includes
depreciation of tangible assets and software, using the straight-line method,
over the estimated useful lives of the assets. Amortization expense includes
intangible assets such as goodwill. For the year ended March 31, 1999,
depreciation and amortization expense was $4,077 and $765,118 for the year ended
March 31, 2000. The increases are primarily due to the growth of the Company and
the need for much additional equipment, and the amortization of goodwill as a
result of the acquisition of the minority interest in INRG.

OTHER EXPENSE. Interest expense increased from $9,519 to $163,294 for the years
ended March 31, 1999 and 2000, respectively. The increase relates to primarily
to interest accrued on the bridge loan financing of $3,800,000.

        Inflation did not have a material effect on our operations for 2000 and
1999. We have and will continue to attempt to mitigate the impact of cost
increases by evaluating our suppliers, by increasing our effectiveness, and by
adjusting our prices for services rendered and products sold. While we do not
expect inflation to have a material impact on 2001 operations, there are no
guarantees that future cost increases would not have an adverse impact.

        Other than the foregoing and the risk factors described above,
management knows of no trends, demands, or uncertainties that are reasonably
likely to have a material impact on our results of operations.

        NET OPERATING LOSS CARRYFORWARDS - At March 31, 2000, we had a net
operating loss carryforward for income tax purposes of approximately $11,442,272
million, which expires beginning in 2020. Under the Tax Reform Act of 1986, the
amounts of and the benefits from net operating loss carryforwards are subject to
certain limitations in the amount of net operating losses that we may utilize to
offset future taxable income.

ITEM 7. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

        The financial statements and schedules are included herewith commencing
on page F-1.



                                      -19-
<PAGE>   23

ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE

        None.

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
        WITH SECTION 16(A) OF THE EXCHANGE ACT.

        Our Executive Officers and Directors and their ages, are as follows:

<TABLE>
<CAPTION>
        Name                                 Age      Position
        ----                                 ---      --------
<S>                                          <C>      <C>
        Frank Wood                           56       Chairman/Director
        Robert Wilson                        52       Vice Chairman/Director
        Ronald Conquest                      56       Chief Executive Officer/Director
        David Kendrick                       50       Chief Operating Officer/President
        Scott Manson                         40       Chief Financial Officer & General Counsel
        John Gehron                          52       Director
        Robert Buziak                        57       Director
        Gregory Mastroieni                   50       Director
        Andy Schuon                          34       Director
</TABLE>

        Frank Wood - Chairman & Director. Frank Wood is President and CEO of
Secret Communications, L.P., which owned and operated radio stations in nine
major markets since its formation in 1994. The entire portfolio of stations was
recently sold but Secret continues to pursue broadcasting opportunities. Mr.
Wood is also a co-founder and principal in The Darwin Group, a recently
organized venture capital firm. He has been involved with the founding or
management of such other entities as Jacor Communications, Inc., Rich
Communications, Inc., Critical Mass Media, Eastman Radio, Circe Communication,
Broadcast Alchemy L.P., T.C. Monte, Inc., Brute Force Cybernetics and Trebuchet
Corporation. He graduated A.B. cum laude, Economics from Harvard and Juris
Doctor from the University of Chicago Law School.

        Robert Wilson - Vice Chairman & Director. Bob Wilson is best known as
the founder of Radio & Records (R&R), a company that he built from a trade
publication into one of the radio and music industry's information leaders. Over
the course of two decades, Mr. Wilson continually expanded R&R's editorial scope
and led R&R into the development of electronically delivered news and
information services to better meet the needs of decision-makers at all
management levels of the radio and music industries. Prior to founding R&R in
1973, Mr. Wilson was program director for a number of California radio stations.
As an independent producer of theatrical film, home video and television
projects in the mid-1980's, Mr. Wilson was also co-creator of Solid Gold, one of
the most profitable and long-running syndicated weekly music programs in the
history of television.

        Ronald Conquest - Chief Executive Officer & Director. Ron Conquest has
over 30 years of experience as a businessman, consultant and entrepreneur and
since 1987 has



                                      -20-
<PAGE>   24

served as partner and Chairman/CEO of Warwick-Clarendon Investors Ltd., a
diverse investment/merchant banking entity providing a variety of business,
financial and development services to emerging private and public companies.
Form 1978 to 1985, Mr. Conquest was Chairman/CEO of an Oklahoma based oil & gas
exploration/operating company. He attended the University of Oklahoma studying
mathematics and engineering.

        David Kendrick - President and Chief Operating Officer since January 17,
2000. Mr. Kendrick was formerly our Senior Vice President - Marketing and Sales
from April 1999 to January 17, 2000. Mr. Kendrick has extensive experience in
radio management, sales and marketing and the Internet. Mr. Kendrick worked as
an account executive for the national radio rep firm McGavren Guild from 1973 to
1975. From 1977 to 1987 he was General Sales Manager of NBC's San Francisco
flagship radio station, KNBR, and managed its local and national sales groups.
From 1987 to 1997 Mr. Kendrick was General Manager for Brown Broadcasting's
California station group.

        Scott Manson - Chief Financial Officer/General Counsel Scott Manson is a
CPA and Attorney at Law. Mr. Manson has over 15 years of financial and legal
experience with publicly held and emerging growth companies. Recently Mr. Manson
was CFO of Imaging Management Associates, a NASDAQ listed owner and operator of
diagnostic imaging centers. In addition Mr. Manson was one of the founders of
both "MagazineWeek" and Health New England, the first for profit HMO in the
state of Massachusetts. Mr. Manson received a Juris Doctor from Hofstra
University School of Law and a B.B.A cum laude in Accounting from Hofstra
University. Mr. Manson resigned effective April 7 as our Secretary and
Treasurer. Mr. Manson has also tendered his resignation as Chief Financial
Officer and General Counsel to be effective June 30, 2000.

        John Gehron - Director. John Gehron has been Co-Chief Operating Officer
for CBS Radio since June 1994. Mr. Gehron joined American Radio Systems (which
was subsequently acquired by CBS Radio) as Co-Chief Operating Officer in May
1994 and has more than twenty years of radio industry experience. Mr. Gehron
began his career as a Program Director in Philadelphia, New York and Chicago
before he joined Capital Cities/ABC in 1983 as VP/GM of WLS AM/FM in Chicago.
Mr. Gehron is a graduate of Pennsylvania State University with a B.S. in
Business Administration.

        Robert Buziak - Director. Robert Buziak is former President of RCA
Records and Sony's TriStar Music Group and has spent 28 years in the music
industry. Since the end of 1995 he has been an independent consultant working
with clients such as AT&T, TCI Music, Liberty Digital as well as traditional
music companies. Mr. Buziak is and has been both a board member and advisory
board member and consultant to several new media, gaming and Internet companies.

        Gregory Mastroieni - Director. Gregory Mastroieni has 25 years of
experience as an entrepreneur and has been President of Unicorp, Inc. since
1975, a "start-up" venture capital organization. Unicorp has developed numerous
projects, including real estate, manufacturing, hi-tech opportunities such as
Quartz products to produce silicon wafers, robotics and music entertainment.
Concurrently for the past 8 years, Mr. Mastroieni has served as C.O.O. of
Strange Forces Productions and Managing Partner of Aftermath Music. These
companies have developed, published, produced and marketed music products and
promoted new talent, including Platinum recording artist Ronny Loren and former
Miss America Sharlene Hawkes. Recently, Aftermath Music completed a 15



                                      -21-
<PAGE>   25

album project for America's largest independent record label, Madacy
Entertainment. Mr. Mastroieni attended the University of California, Berkeley.

        Andy Schuon - Director Andy Schuon is currently President and CEO of The
Farm Club. Before joining the Farm Club, Mr. Schuon was the Executive Vice
President and General Manager of Warner Brothers Records. Before joining Warner
Brothers in March of 1998 he was Executive Vice President, Programming for MTV
where he was responsible for creating many of the hit programs currently being
shown on MTV. His duties at MTV also included overseeing all programming aspects
of MTV's second cable music channel VH1. From 1989 to 1992, Mr. Schuon served as
the Programming Director for KROQ-FM in Los Angeles, the flagship alternative
rock station of the FTM Radio Internet Network.

Director Compensation

        All authorized out of pocket expenses incurred by a Director on behalf
of the Company will be subject to reimbursement upon receipt by the Company of
required documentation substantiating such expense. At present, each Director is
entitled to receive an annual Director's fee in the amount of $5,000. Said
Director's fee is subject to annual review and will be subject to annual
shareholder approval. Each Director will also be eligible to participate in the
Company defined stock option and/or incentive plan(s). At present each of Greg
Mastroieni, John Gehron and Andy Schuon has been granted stock options for
93,750 shares of common stock. Frank Wood has been granted stock options for
243,750 shares of common stock. Bob Buziak has been granted stock options for
75,000 shares of Common Stock. Additionally, each of John Gehron, Andy Schuon
and Frank Wood has received stock grants of 25,000 shares of common stock.

        Directors who are also executive officers of the Company receive no
additional compensation for their services as Directors.

Agreement Regarding Directorships

        Messrs. Wilson, Mastroieni and Conquest are parties to an agreement
pursuant to which each such individual is entitled to serve as a member of a
four/five person executive committee, if such committee is formed (no such
committee has been formed and the current Board has no plans to do so) and will
be nominated to serve as a Director subject to stockholder approval at each
annual meeting.

Board Composition

        Each executive officer will hold office until his or her successor is
duly elected and qualified, until his resignation or until he shall be removed
in the manner provided by our Bylaws. The entire Board of Directors will be up
for election at the next annual meeting of stockholders.

Board Committees

        Our Audit Committee consists of Frank Wood and Andy Schuon. No member of
the Audit Committee will receive any additional compensation for his service as
a member of that Committee. The Audit Committee is responsible for providing
assurance that financial disclosures made by management reasonably portray our
financial condition, results of operations, plan and long-term commitments.



                                      -22-
<PAGE>   26

        Our Compensation Committee consists of Bob Buziak and John Gehron. It is
not expected that the members of the Compensation Committee will receive
additional compensation for service as a member of that Committee. The
Compensation Committee will be responsible for reviewing pertinent data and
making recommendations with respect to compensation standards for the executive
officers, including the President and Chief Executive Officer, establishing
guidelines and making recommendations for the implementation of management
incentive compensation plans, reviewing the performance of the President and
CEO, establishing guidelines and standards for the grant of incentive stock
options to key employees under our Stock Option Plans, and reporting regularly
to the Board of Directors with respect to its recommendations.

Family Relationships

        There are no family relationships among Directors. The present term of
office of each Director will expire at the next annual meeting of stockholders.

Section 16(a) Beneficial Ownership Reporting Compliance

        Section 16(a) of the Exchange Act, as amended, requires the Company's
officers, directors and persons who beneficially own more than ten percent of
the Company's Common Stock to file reports of ownership and changes in ownership
with the commission. These reporting persons also are required to furnish the
Company with copies of all Section 16(a) forms they file. To the Company's
knowledge, based solely on its internal review of the reports it believes should
have been filed, the Company believes that not all Section 16(a) reporting
requirements were complied with during the fiscal year ended March 31, 2000. We
are aware that David Kendrick, Scott Manson and Robert Buziak have not filed
Form 3's during the fiscal year ended March 31, 2000 as required by Section
16(a) of the Exchange Act. In addition, none of our officers, directors and 10%
shareholders have yet filed Forms 5's with respect to the fiscal year ended
March 31, 2000.

ITEM 10. EXECUTIVE COMPENSATION

        The following table and discussion set forth information with respect to
all compensation earned by or paid to our CEO, and our most highly compensated
executive officers other than the CEO, for all services rendered in all
capacities to us and our subsidiaries for each of the last fiscal year.



                                      -23-
<PAGE>   27

                                     TABLE 1
                           SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
                                                 Annual Compensation                             Long-Term Compensation
                                       ----------------------------------------    ------------------------------------------------
                                                                                          Awards                    Payouts
                                                                                   -----------------------      -------------------
                                                                                               SECURITIES
                                                                                               UNDER-LYING                   ALL
                                                                                  RESTRICTED     OPTIONS/                   OTHER
                           2000                                    OTHER ANNUAL     STOCK          SARs          LTIP       COMPEN-
NAME AND                 FISCAL YEAR   SALARY          BONUS       COMPENSATION    AWARD(S)         (#)         PAYOUTS     SATION
PRINCIPAL POSITION          (1)          ($)            ($)            ($)            ($)           (2)           ($)         ($)
------------------       -----------   --------       -------      ------------    --------     ----------      -------     -------
<S>                      <C>           <C>            <C>          <C>            <C>           <C>             <C>         <C>
      Ron Conquest,         2000       $135,000       $50,000           --            --           125,000         --          --
        CEO(1)(2)

     David Kendrick,        2000       $148,583       $35,417           --            --           205,000         --          --
    President and COO(3)

      Scott Manson(4)       2000       $ 76,923                                                     33,000

  CFO & General Counsel
</TABLE>


(1)     The stated salary was paid to a corporation for the provision of Ron
        Conquest's services as our Chief Executive Officer. Prior to January,
        2000, Ron Conquest also served as the Company President

(2)     Ron Conquest has received 125,000 options to purchase shares of our
        common stock during the fiscal year ended March 31, 2000.

(3)     David Kendrick has received 205,000 options to purchase shares of our
        common stock during the fiscal year ended March 31, 2000.

(4)     Scott Manson has resigned as CFO and General Counsel effective June 30,
        2000. Mr. Manson has received 33,000 options to purchase shares of our
        common stock at $6 per share during the fiscal year ended March 31,
        2000; 24,750 of such options will expire in connection with Mr. Manson's
        resignation.

EMPLOYMENT AGREEMENTS

        We have entered into an agreement to pay consulting fees on a monthly
basis to Ingenious Enterprises, LLC., a Nevada limited liability corporation on
behalf of the services provided by Ron Conquest. Conquest, an employee of
Ingenious Enterprises, LLC is the Chief Executive Officer and a Director of the
Corporation. Consulting fees paid during the 12 months ended March 31, 2000 were
$135,000. As of January 1, 2000, the monthly fee payable to Ingenious increased
to $15,000. Until January 17, 2000, Conquest also acted as the Company's
President.

        We have hired David Kendrick to act as our President and Chief Operating
Officer commencing January 17, 2000. Mr. Kendrick's employment is at-will with
an annual salary of $250,000. We have granted to Mr. Kendrick 25,000 shares of
the Company's Common Stock. Mr. Kendrick has also been granted 205,000 stock
options, 66,000 with an exercise price of $3 and 159,000 with an exercise price
of $6 that vest equally over four years.



                                      -24-
<PAGE>   28

STOCK INCENTIVE PLAN

        As of March 31, 2000, options covering an aggregate of 1,973,033 shares
of FTM common stock have been granted. FTM's 1999 Stock Option Plan (the "FTM
Stock Option Plan") was adopted by the board of directors of FTM on September
22, 1999. Options to purchase 973,033 shares of FTM common stock have previously
been granted under the FTM Stock Option Plan. Interactive Radio Group's
("INRG's") 1999 Stock Option Plan (the "INRG Stock Option Plan") was approved
pursuant to the written consent of INRG's majority shareholder. The INRG Stock
Option Plan was adopted by the board of directors of INRG on February 1, 1999.
Options to purchase 800,000 shares of INRG common stock have previously been
granted under the INRG Stock Option Plan. These options converted into options
to purchase 1,000,000 shares of FTM common stock, after the merger of INRG into
FTM on January 7, 2000. 1,750,000 shares of Common Stock have been reserved for
issuance under the FTM Stock Option Plan of which options to purchase an
aggregate of 973,033 options have been granted. No more options will be granted
pursuant to the INRG Plan. The exercise price for the 1,973,033 outstanding
options in FTM are as follows: 1,216,000 of such options are exercisable at $3
per share of common stock; 671,833 of such options are exercisable at $6 per
share of common stock; and 85,200 of such options are exercisable at $7.50 per
share of common stock.

        The following is a brief summary of certain significant provisions of
the FTM Stock Option Plan. This summary highlights selected information from the
FTM Stock Option Plan and does not contain all of the information that may be
important. For more information, you should consult the copy of the FTM Stock
Option Plan. The following description of the FTM Stock Option Plan is qualified
in its entirety by reference the FTM Stock Option Plan. Except with respect to
the maximum number of shares subject to the FTM Stock Option Plan, the INRG
Stock Option Plan is substantially similar to the FTM Stock Option Plan.

Purpose

        The purposes of the FTM Stock Option Plan are to attract and retain the
best available personnel for positions of substantial responsibility, to provide
additional incentive to our key employees, consultants and directors, and to
promote the success of our business. The FTM Stock Option Plan provides for both
the grant awards of common stock as well as options to purchase common stock.

Maximum Number of Shares Subject to the Stock Option Plans

        The FTM Stock Option Plan provides for the granting of awards and
options with respect to up to 1,750,000 shares of FTM common stock. In addition,
options to purchase 1,000,000 shares of common stock are outstanding under the
INRG Plan.

Administration

        The FTM Stock Option Plan is administered by the board of directors or a
committee appointed by the board of directors. The board or applicable committee
has the power to interpret the FTM Stock Option Plan and has discretion to
select participants, establish the manner in which options are granted and
exercised, cancel and modify options in certain situations and otherwise
prescribe all of the terms and provisions of options granted under the FTM Stock
Option Plan.



                                      -25-
<PAGE>   29

Participants

        Eligible participants in the Plan include our employees, directors and
consultants.

Amendments to the FTM Stock Option Plan

        The board of directors may at any time amend, alter, suspend or
terminate the FTM Stock Option Plan.

Term of Options

        Both incentive stock options and non-qualified stock options may be
granted under the FTM Stock Option Plan. No options can be granted under the FTM
Stock Option Plan later than ten years from the date of adoption. Incentive
stock options can have a maximum exercise period of ten years (five years for
option holders who own more than ten percent of the total combined voting power
of all of our classes of stock). Non-qualified stock options can have a maximum
exercise period of ten years from the date of grant. Within these maximum
exercise periods, the FTM Stock Option Plan permits the committee to establish,
in its discretion, the time period within which any individual option can be
exercised. The FTM Stock Option Plan provides that, upon (a) termination of an
optionholder's director, employment or consulting relationship with us for a
cause other than death or disability, the optionholder's right to exercise any
option granted under the FTM Stock Option Plan will terminate within 30 days
following cessation of the director, employment or consulting relationship. In
the event of termination of the consulting or employment relationship due to
death or disability, the same provisions apply except that the period of time
for exercise is six months.

Transferability

        Options granted under the FTM Stock Option Plan are not transferable
except in the event of death. If our common stock becomes tradable on a national
exchange or the NASDAQ National Market, certain transfers of options for estate
planning purposes may be permitted.

Exercise Price

        Generally, the exercise price per share for each non-qualified stock
option granted under the FTM Stock Option Plan cannot be less than 85% of the
fair market value of our common stock on the date of grant. However, in the case
of option holders who own more than ten percent (10%) of the total combined
voting power of all classes of stock of the Company or its parent or subsidiary
corporation or corporations, in which case the exercise price cannot be less
than one hundred ten percent (110%) of the fair market value of a share of the
Common Stock on the date of grant. The aggregate fair market value (determined
as of the time such option is granted) of the Common Stock for which any
employee may have incentive stock options which become exercisable for the first
time in any calendar year may not exceed $100,000.



                                      -26-
<PAGE>   30

Payment of Exercise Price

        The entire option price must be paid at the time the option is
exercised, in cash, or to the extent then permitted by the committee, in the
form of a promissory note or other shares of our common stock having a market
value equal to the exercise price.



                                      -27-
<PAGE>   31

INDEMNIFICATION AND LIMITATION ON LIABILITY OF DIRECTORS

        The Company's Certificate of Incorporation and Bylaws provide that the
Company shall indemnify, to the fullest extent permitted by Delaware law, any
director, officer, employee or agent of the corporation made or threatened to be
made a party to a proceeding, by reason of the former or present office of the
person, against judgments, penalties, fines, settlements and reasonable expenses
incurred by the person in connection with the proceeding if certain standards
are met. At present, to the Company's knowledge, there is no pending litigation
or proceeding involving any director, officer, employee or agent of the Company
where indemnification will be required or permitted. Insofar as indemnification
for liabilities arising under the Securities Act of 1933 may be permitted to
directors, officers and controlling persons of the Company pursuant to the
foregoing provisions, or otherwise, we have been advised that in the opinion of
the Commission such indemnification is against public policy as expressed in the
Act and is, therefore, unenforceable.

        The Company's Certificate of Incorporation and Bylaws limit the
liability of its directors to the fullest extent permitted by Delaware General
Corporation Law. Specifically, directors of the Company shall not be personally
liable to the Company or its stockholders for monetary damages for breach of
fiduciary duty as a director, except for liability (i) for any breach of the
director's duty of loyalty to the Company or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law, (iii) under Section 174 of the Delaware General Corporation
Law, or (iv) for any transaction from which the director derived an improper
personal benefit. If the Delaware General Corporation Law is amended to
authorize corporate action further eliminating or limiting the personal
liability of directors, then the liability of a director of the Company shall be
eliminated or limited to the fullest extent permitted by the Delaware General
Corporation Law, as so amended. Any repeal or modification of this provision
shall not adversely affect any right or protection of a director of the Company
existing at the time of such repeal or modification.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

        The following table sets forth certain information regarding ownership
of our common stock, as of March 31, 2000, by:

        -       each person known to us to own beneficially more than 5% of our
                outstanding common stock;

        -       each of our directors;

        -       each of our executive officers named in the summary compensation
                table; and

        -       all of our directors and executive officers as a group.



                                      -28-
<PAGE>   32

        Share ownership is based on 9,578,328 shares of common stock outstanding
as of March 31, 2000.

<TABLE>
<CAPTION>
NAME AND ADDRESS OF                               NUMBER OF SHARES     PERCENTAGE
BENEFICIAL OWNERS                                BENEFICIALLY OWNED    OWNERSHIP
-----------------                                ------------------    ---------
<S>                                              <C>                   <C>
CBS Corporation                                       1,614,230(1)      16.9%
40 West 57th Street
New York City, New York  10019

Gregory Mastroieni                                      678,748(2)       7.1%
644 North Country Club
Mesa, Arizona  85201

Jeffrey Pollack                                         660,558(3)       6.9%
860 Via De La Paz
Pacific Palisades, CA  90272

Robert Wilson                                           658,126(4)       6.9%
4000 Oakfield Drive
Sherman Oaks, CA  91423

Andaman Investments Ltd.                                  655,310        6.8%
c/o Albert Raponi, Esq.
700 West Pender Street, Suite 505
Vancouver, BC, Canada  V6C 1G8

Ronald Conquest                                         164,250(5)       1.7%
3104 East Camelback Rd.
Phoenix, Arizona  85016

Frank Wood                                               54,688(6)       0.6%
312 Walnut Street
Cincinnati, Ohio  45202

Andy Schuon                                              54,688(7)       0.6%
3300 Warner Brothers Blvd.
Burbank, California  91505

John Gehron                                              54,688(8)       0.6%
455 North City Plaza
Chicago, Illinois  60611

Robert Buziak                                            43,749(9)       0.5%
400 E 52nd Street
Penthouse West
New York, NY  10022

</TABLE>



                                      -29-
<PAGE>   33

<TABLE>
<CAPTION>
NAME AND ADDRESS OF                              NUMBER OF SHARES     PERCENTAGE
BENEFICIAL OWNERS                               BENEFICIALLY OWNED    OWNERSHIP
-----------------                               ------------------    ---------
<S>                                              <C>                   <C>

David Kendrick                                        41,500(10)          0.4%
15 Silk Oak Circle
San Rafael, CA  94901

Scott Manson                                          18,333(11)          0.2%
6962 East Quail Track Drive
Scottsdale, AZ 85331
                                       TOTAL:        4,698,868           49.1%
</TABLE>
       (1) Represents 36,432 shares of Series A Preferred Stock that is
convertible into 114,230 shares of common stock based upon the closing price of
the stock on June 27, 2000.

       (2) Represents currently exercisable options and options which vest
within 60 days that allow the purchase of 23,438 shares at $3 per share

       (3) Represents 1,374 shares of Series A Preferred Stock that is
convertible into 4,308 shares of common stock based upon the closing price of
the stock on June 27, 2000.

       (4) Represents 2,831 shares of Series A Preferred Stock that is
convertible into 8,876 shares of common stock based upon the closing price of
the stock on June 27, 2000.

       (5) Represents currently exercisable options and options which vest
within 60 days that allow the purchase of 31,250 shares at $3 per share

       (6) Represents currently exercisable options and options which vest
within 60 days that allow the purchase of 23,438 shares at $3 per share

       (7) Represents currently exercisable options and options which vest
within 60 days that allow the purchase of 23,438 shares at $3 per share

       (8) Represents currently exercisable options and options which vest
within 60 days that allow the purchase of 23,438 shares at $3 per share

       (9) Represents currently exercisable warrants which vest within 60 days
that allow the purchase of 20,000 shares at an exercise price of $8.00 and
8,547 shares of Series B preferred stock convertible into 13,333 shares of
common stock.

      (10) Represents currently exercisable options and options which vest
within 60 days that allow the purchase of 16,500 shares at $3 per share

      (11) Represents currently exercisable options and options which vest
within 60 days that allow the purchase of 8,333 shares at $6 per share.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

        Except as listed below and as set forth elsewhere in this Memorandum,
there have been no arrangements between us and any of our current or previous
officers, directors, or nominees for election as a director, or any shareholder
owning greater than five percent of our outstanding shares, nor any member of
the above referenced individuals' immediate family. We currently do not have in
force or effect any policies, procedures or controls with respect to entering
into future transactions with its officers, directors, affiliates or a related
party.



                                      -30-
<PAGE>   34
        We have entered into a management agreement to pay consulting fees on a
monthly basis to Ingenious Enterprises, LLC in the amount of $120,000 annually
commencing October 1, 1998. This on behalf of the services provided by Ron
Conquest, our Chief Executive Officer and a Director, and, prior to January,
2000, our president. Such payments increased to $180,000 annually commencing on
January 1, 2000. Mr. Conquest is an employee of Ingenious Enterprises.
Consulting fees paid pursuant to this agreement during the 12 months ended March
31, 1999 were $135,000.

        We are paying a consulting fee on a monthly basis to EchoMedia, a
company owned by Greg Mastroieni, a member of our Board of Directors, in the
amount of $75,000 annually in return for services provided by Mr. Mastroieni.
Fees paid during the 12 months ended March 31, 2000 were $75,000.

        We are paying a consulting fee on a monthly basis to Four Score
Entertainment, Inc., a company owned by Jeff Pollack, a former member of the
Board of Directors, in the amount of $75,000 annually in return for services
provided by Mr. Pollack. Fees paid during the 12 months ended March 31, 1999
were $75,000.

        We are paying a consulting fee on a monthly basis to BW Productions in
the amount of $120,000 annually commencing February 1, 1999 in return for
services provided by Robert Wilson. Mr. Wilson, an employee of BW Productions,
is Vice Chairman of the Company and a member of our Board of Directors.
Consulting fees paid pursuant to this agreement during the 12 months ended March
31, 1999 were $120,000.

        As part of a bridge loan financing, Robert Buziak, one of our Directors,
and Frank Wood, our Chairman, each entered into an agreement in which they each
lent us $100,000 in exchange for a $100,000 note and 20,000 warrants at an
exercise price of $8 per share. We repaid both Mr. Wood's and Mr. Buziak's notes
in full on April 12, 2000 and May 9, 2000 respectively.

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

<TABLE>
<CAPTION>
             EXHIBIT NO.        TITLE
             -----------        -----
<S>          <C>                <C>
(1)              2.1            Agreement and Plan of Merger dated as of
                                September 24, 1999 by and between FTM Media,
                                Inc., a Delaware corporation, and Interactive
                                Radio Group, Inc., a Delaware corporation.

(1)              3.1            Certificate of Incorporation of FTM Media, Inc.,
                                a Delaware corporation

(1)              3.2            Bylaws of FTM Media, Inc. a Delaware Corporation

(1)              4.1            Specimen Certificate of Common Stock

(1)              4.2            Interactive Radio Group, Inc. 1999 Stock Option
                                Plan

(1)              4.3            FTM Media, Inc. 1999 Stock Option Plan

(2)             10.1            Stock Purchase Agreement with Andaman
                                Investments, Inc.

(3)             10.2            Contribution Agreement

(4)             10.3            Stock Purchase Agreement made as of May 25, 1999
                                relating to Series B Convertible Preferred Stock
                                between the Company and the parties listed on
                                Exhibit A thereto.

(*)             10.4            Form of Warrant relating to the private
                                placement of units in April of 2000.

(*)             10.5            Investors' Rights Agreement relating to the
                                private placement of units in April of 2000.

</TABLE>



                                      -31-
<PAGE>   35

<TABLE>
<CAPTION>
             EXHIBIT NO.        TITLE
             -----------        -----
<S>          <C>                <C>
(5)              16.1           Letter on Change and Certifying Accountant

(*)              21             Subsidiaries of Registrant

(*)              27             Financial Data Schedule
</TABLE>


(*)     Filed herewith

(1)     Incorporated by reference from the Company's Registration Statement
        under the Securities Act of 1933 on Form S-4 as filed with the
        Commission on October 5, 1999, and amended on December 30, 1999, January
        4, 2000, and January 18, 2000.


(2)     Incorporated by reference from the Company's Current Report on Form 8-K
        dated December 31, 1998 as filed with the Commission on January 14,
        1999.

(3)     Incorporated by reference from the Company's Current Report on Form 8-K
        dated March 29, 1999 as filed with the Commission on April 15, 1999.

(4)     Incorporated by reference from the Company's Current Report on Form 8-K
        dated June 15, 1999 as filed with the Commission on June 29, 1999.

(5)     Incorporated by reference from the Company's Current Report on Form 8-K
        dated May 17, 1999 as filed with the Commission on May 19, 1999.

Reports on Form 8-K

                1.      The Company filed a form 8-K on January 25, 2000
                        reporting that at an October 15, 1999 Special Meeting of
                        Stockholders of FTM Media, Inc., a Colorado corporation
                        ("FTM Colorado"), FTM Colorado's stockholders voted to
                        approve the reincorporation of FTM Colorado from
                        Colorado to Delaware by the adoption of a Plan and
                        Agreement of Merger pursuant to which FTM Colorado was
                        to be merged with and into FTM Media, Inc., a Delaware
                        corporation ("FTM Delaware") (the "Reincorporation
                        Merger"). The Reincorporation Merger was closed on
                        January 7, 2000. In addition to the Reincorporation
                        Merger discussed above, FTM Colorado, as the majority
                        shareholder of Interactive Radio Group, Inc., a Delaware
                        corporation ("INRG"), authorized its approval of the
                        merger of INRG with and into FTM Delaware (the "INRG
                        Merger"). In this INRG Merger, (i) each holder of INRG
                        common stock received 1.25 shares of FTM Delaware common
                        stock for each share of INRG common stock that they
                        owned, and (ii) each holder of INRG Series A Preferred
                        Stock was converted into Series A preferred stock of FTM
                        Delaware with substantially similar terms. FTM Colorado
                        owned approximately 72% of the outstanding shares of
                        INRG's common stock before the INRG Merger. The INRG
                        Merger resulted in the elimination of the minority
                        interest in INRG. The INRG Merger was consummated on
                        January 7, 2000, after the consummation of the
                        Reincorporation Merger.



                                      -32-
<PAGE>   36

                                   SIGNATURES

        In accordance with Section 13 or 15(d) of the Securities Exchange Act of
1934, the Registrant caused this report to be signed on its behalf by the
undersigned, thereto duly authorized.

        FTM MEDIA, INC.



Dated:   June 29, 2000                      By /s/ RON CONQUEST
                                               ---------------------------------
                                               Ron Conquest
                                               Chief Executive Officer

        In accordance with the Securities Exchange Act of 1934, this report has
been signed below by the following persons on behalf of the Registrant and in
the capacities and the dates indicated.

<TABLE>
<CAPTION>
Signature and Title                                                    Dated
-------------------                                                    -----
<S>                                                                <C>
/s/ RON CONQUEST                                                   June 29, 2000
---------------------------------
Ron Conquest
Chief Executive Officer and Director



/s/ SCOTT MANSON                                                   June 29, 2000
---------------------------------
Scott Manson, JD, CPA
Chief Financial Officer (and principal
accounting officer)



/s/ ROBERT WILSON                                                  June 29, 2000
---------------------------------
Robert Wilson
Vice Chairman and Director



/s/ GREG MASTROIENI                                                June 29, 2000
---------------------------------
Greg Mastroieni, Director



/s/ ROBERT BUZIAK                                                  June 29, 2000
---------------------------------
Robert Buziak, Director
</TABLE>



                                      -33-
<PAGE>   37

                                 FTM MEDIA, INC.
                      (FORMERLY REDWOOD BROADCASTING, INC.)
                                 AND SUBSIDIARY
                            (A DELAWARE CORPORATION)
                               SCOTTSDALE, ARIZONA

                      -------------------------------------
                                FINANCIAL REPORTS

                                       AT

                                 MARCH 31, 2000
                      -------------------------------------


<PAGE>   38


FTM MEDIA, INC.
(FORMERLY REDWOOD BROADCASTING, INC.)
AND SUBSIDIARY
(A DELAWARE CORPORATION)
SCOTTSDALE, ARIZONA


TABLE OF CONTENTS
--------------------------------------------------------------------------------
<TABLE>
<S>                                                                           <C>
Independent Auditor's Report                                                       1

Consolidated Balance Sheets at March 31, 2000 and 1999                            F-2

Consolidated Statements of Changes in Stockholders' Equity/(Deficit)
  for the Years Ended March 31, 2000, 1999, and 1998                              F-3

Consolidated Statements of Operations for the Years Ended
  March 31, 2000, 1999, and 1998                                                  F-4

Consolidated Statements of Cash Flows for the Years Ended
  March 31, 2000, 1999, and 1998                                                  F-5

Notes to the Consolidated Financial Statements                                F-6 - F-13
</TABLE>


<PAGE>   39


        INDEPENDENT AUDITOR'S REPORT



To the Board of Directors
  and Stockholders
FTM Media, Inc.
(Formerly Redwood Broadcasting, Inc.)
  and Subsidiary
  (A Delaware Corporation)
Scottsdale, Arizona


        We have audited the accompanying consolidated balance sheets of FTM
Media, Inc. and Subsidiary as of March 31, 2000 and 1999, and the related
consolidated statements of changes in stockholders' equity/(deficit), operations
and cash flows for each of the three years in the period ended March 31, 2000.
These financial statements are the responsibility of the company's management.
Our responsibility is to express an opinion on these financial statements based
on our audits.

        We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audits to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

        In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial position of
FTM Media, Inc. and Subsidiary as of March 31, 2000 and 1999 and the
consolidated results of their operations and their cash flows for each of the
three years in the period ended March 31, 2000, in conformity with generally
accepted accounting principles.

        The accompanying financial statements have been prepared assuming the
Company will continue as a going concern. The Company's ability to continue as a
going concern is dependent upon ultimately achieving profitable operations and
raising additional equity capital. Achievement of the Company's business
objectives is dependent upon, amongst other factors: attaining new customers,
i.e., radio stations, the sale of radio advertising and e-commerce services, and
the continued success of raising equity capital. The ability of the Company to
recover its investment in Web site development technology for radio stations is
dependent upon the future profitability of the Web site services it provides to
its radio station customers. The outcome of these matters cannot be predicted at
this time.


/s/

Rotenberg & Company, LLP
Rochester, New York
  June 20, 2000


                                      F-1
<PAGE>   40


FTM MEDIA, INC.
(FORMERLY REDWOOD BROADCASTING, INC.)
AND SUBSIDIARY
(A DELAWARE CORPORATION)
SCOTTSDALE, ARIZONA

CONSOLIDATED BALANCE SHEETS
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
March 31,                                                          2000               1999
                                                               ------------       ------------
<S>                                                            <C>                <C>
ASSETS

CURRENT ASSETS
Cash and Cash Equivalents                                      $    405,353       $  2,027,833
Cash Held in Escrow from Private Placement Offering               5,183,225                 --
Accounts Receivable                                                  52,809                 --
Prepaid Expenses                                                     84,400             23,968
                                                               ------------       ------------
TOTAL CURRENT ASSETS                                              5,725,787          2,051,801

PROPERTY AND EQUIPMENT - NET OF ACCUMULATED DEPRECIATION          1,991,372             70,499

OTHER ASSETS
Lease Deposits                                                      132,419             20,535
Website Development - In Progress                                        --            131,568
Goodwill - Net of Accumulated Amortization                        3,402,787             76,550
                                                               ------------       ------------
TOTAL ASSETS                                                   $ 11,252,365       $  2,350,953
                                                               ============       ============

LIABILITIES AND STOCKHOLDERS' EQUITY/(DEFICIT)

CURRENT LIABILITIES
Accounts Payable                                               $  1,611,590       $    208,101
Accrued Payroll and Related Liabilities                             260,299             64,820
Short Term Notes Payable                                          3,350,000                 --
                                                               ------------       ------------
TOTAL LIABILITIES                                                 5,221,889            272,921

MINORITY INTEREST
Preferred Stock of Subsidiary                                            --            415,889
Common Stock of Subsidiary                                               --          2,771,261
                                                               ------------       ------------
TOTAL MINORITY INTEREST                                                  --          3,187,150
                                                               ------------       ------------
STOCKHOLDERS' EQUITY/(DEFICIT)
Preferred Stock - $.001 Par; 5,000,000 Shares Authorized;
    322,688 Issued and Outstanding                                      323                 --
Common Stock - $.001 Par; 50,000,000 Shares Authorized;
9,574,139 Issued and Outstanding                                      9,574             25,278
Additional Paid-In-Capital                                       29,082,318                 --
Deficit                                                         (23,061,739)        (1,134,396)
                                                               ------------       ------------
TOTAL STOCKHOLDERS' EQUITY/(DEFICIT)                              6,030,476         (1,109,118)
                                                               ------------       ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY/(DEFICIT)           $ 11,252,365       $  2,350,953
                                                               ============       ============
</TABLE>


    The accompanying notes are an integral part of this financial statement.


                                    - F-2 -

<PAGE>   41


FTM MEDIA, INC.
(FORMERLY REDWOOD BROADCASTING, INC.)
AND SUBSIDIARY
(A DELAWARE CORPORATION)
SCOTTSDALE, ARIZONA


STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY/(DEFICIT)
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                                             Additional                     Total
                                               Par      Common   Preferred    Paid-In                   Stockholders'     Minority
                                    Shares    Value     Stock      Stock      Capital       Deficit    Equity/(Deficit)   Interest
                                   ---------  ------   --------  ---------   ----------   -----------  ----------------  ----------
<S>                                <C>        <C>      <C>       <C>         <C>          <C>          <C>               <C>
BALANCE - MARCH 31, 1997           6,319,542  $0.004   $ 25,278      $--      $     --    $  (299,527)    $  (274,249)   $  377,819

Net Loss                                                     --       --            --        (20,224)        (20,224)       (2,037)
                                   ---------  ------   --------      ---      --------    -----------     -----------    ----------

BALANCE - MARCH 31, 1998           6,319,542   0.004     25,278       --            --       (319,751)       (294,473)      375,782

Increase in Liquidation Value
  of INRG's Preferred Stock               --      --         --       --            --             --              --         9,519

INRG Stock Subscribed for by
  Minority Shareholders                   --      --         --       --            --             --              --     2,883,897

Net Loss                                  --      --         --       --            --       (814,645)       (814,645)      (82,048)
                                   ---------  ------   --------      ---      --------    -----------     -----------    ----------

BALANCE - MARCH 31, 1999           6,319,542   0.004     25,278       --            --     (1,134,396)     (1,109,118)    3,187,150

INRG Stock Purchased by
  Minority Shareholders                   --      --         --       --            --             --              --       360,036

Warrant Exercised                     43,814   0.004        175       --          (175)            --              --            --

FTM Stock Issued to Employees
  for Compensation                   127,585   0.004        510       --       888,120             --         888,630       291,000

Reincorporation of FTM
in Delaware                               --      --    (19,471)      --        19,471             --              --            --
                                   ---------  ------   --------      ---      --------    -----------     -----------    ----------
</TABLE>


<PAGE>   42
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY/(DEFICIT) - CONTINUED
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
                                                                           Additional                     Total
                                              Par     Common   Preferred    Paid-In                   Stockholders'    Minority
                                   Shares    Value    Stock      Stock      Capital       Deficit    Equity/(Deficit)  Interest
                                  ---------  ------   ------   ---------  -----------   ------------ ---------------- -----------
<S>                               <C>        <C>      <C>      <C>        <C>           <C>          <C>              <C>

FTM Stock Issued to Employees
for Compensation                     14,200   0.001       14       --         112,485             --         112,499           --

FTM Stock Issued for
Services Rendered                    23,059   0.001       23       --         138,331             --         138,354           --

Private Offering of Units at
$7.50 per Unit consisting of
Common Stock and Warrants,
Net of Offering Costs               892,493   0.001      892       --       6,442,540             --       6,443,432           --

Acquisition of Minority
Interest in INRG:
  Common Stock Distributed        2,153,446   0.001    2,153       --      19,648,042             --      19,650,195   (2,650,347)
  Preferred Stock Distributed        40,637   0.001       --       41         415,848             --         415,889     (415,889)

Private Offering at $5.85 per
Share, Net of Offering Costs        282,051   0.001       --      282       1,585,179             --       1,585,461           --

Increase in Liquidation Value
of Series A Preferred Stock              --      --       --       --          30,477             --          30,477           --

Series B Preferred Stock
Dividends                                --      --       --       --        (198,000)            --        (198,000)          --

Net Loss                                 --      --       --       --              --    (21,927,343)    (21,927,343)    (771,950)
                                  ---------  ------   ------     ----     -----------   ------------    ------------  -----------
BALANCE - MARCH 31, 2000          9,896,827  $0.001   $9,574     $323     $29,082,318   $(23,061,739)   $  6,030,476  $        --
                                  =========  ======   ======     ====     ===========   ============    ============  ===========
</TABLE>


    The accompanying notes are an integral part of this financial statement.


                                     - F-3 -

<PAGE>   43


FTM MEDIA, INC.
(FORMERLY REDWOOD BROADCASTING, INC.)
AND SUBSIDIARY
(A DELAWARE CORPORATION)
SCOTTSDALE, ARIZONA

CONSOLIDATED STATEMENTS OF OPERATIONS
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
Year Ended March 31,                                       2000              1999              1998
--------------------                                   ------------       -----------       -----------
<S>                                                    <C>                <C>               <C>
OPERATING REVENUE
Website Services                                       $    108,911       $        --       $        --
                                                       ------------       -----------       -----------
TOTAL REVENUE                                               108,911                --                --
                                                       ------------       -----------       -----------
OPERATING EXPENSES
Amortization Expense                                        448,201             1,963                --
Depreciation Expense                                        316,917             2,114                --
E-Commerce                                                  203,292                --                --
General and Administrative Expenses                       2,918,032           863,757            22,261
Impairment of Goodwill - INRG Acquisition                13,225,410                --                --
Selling and Marketing Expenses                              433,849                --                --
Website Development                                       5,150,322            21,705                --
                                                       ------------       -----------       -----------
TOTAL OPERATING EXPENSES                                 22,696,023           889,539            22,261
                                                       ------------       -----------       -----------
OPERATING LOSS BEFORE OTHER INCOME AND (EXPENSES)       (22,587,112)         (889,539)          (22,261)
                                                       ------------       -----------       -----------
OTHER INCOME AND (EXPENSES)
Interest Expense                                           (163,294)           (9,519)               --
Interest Income                                              51,113             2,365                --
                                                       ------------       -----------       -----------
Total Other Income and (Expenses)                          (112,181)           (7,154)               --
                                                       ------------       -----------       -----------
LOSS BEFORE MINORITY INTEREST                           (22,699,293)         (896,693)          (22,261)
Minority Interest                                          (771,950)          (82,047)           (2,037)
                                                       ------------       -----------       -----------
NET LOSS                                               $(21,927,343)      $  (814,646)      $   (20,224)
                                                       ============       ===========       ===========
Preferred Stock Dividends                              $    198,000       $        --       $        --
NET LOSS AVAILABLE TO COMMON STOCKHOLDERS              $(22,125,343)      $  (814,646)      $   (20,224)
                                                       ============       ===========       ===========
LOSS PER COMMON SHARE - BASIC AND DILUTED              $     (2.898)      $    (0.129)      $    (0.003)
                                                       ============       ===========       ===========
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING                                 7,635,134         6,319,542         6,319,542
                                                       ============       ===========       ===========
</TABLE>


    The accompanying notes are an integral part of this financial statement.


                                     - F-4 -

<PAGE>   44


FTM MEDIA, INC.
(FORMERLY REDWOOD BROADCASTING, INC.)
AND SUBSIDIARY
(A DELAWARE CORPORATION)
SCOTTSDALE, ARIZONA

CONSOLIDATED STATEMENTS OF CASH FLOWS
RECONCILIATION OF NET INCOME TO NET CASH FLOWS FROM OPERATING ACTIVITIES
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
Year Ended March 31,                                               2000              1999              1998
--------------------                                           ------------       -----------       -----------
<S>                                                            <C>                <C>               <C>
NET LOSS                                                       $(21,927,343)      $  (814,646)      $   (20,224)

ADJUSTMENTS:
Amortization                                                        448,201             1,963                --
Impairment of Goodwill                                           13,225,410                --                --
Depreciation                                                        316,917             2,114                --
Minority Interest                                                  (771,950)          (82,047)           (2,037)
Increase in Liquidation Value - Minority Interest                        --             9,519                --
Increase in Liquidation Value of Series A Preferred Stock            30,477                --                --
Stock Issued for Employee Compensation                            1,292,129                --                --
Stock Issued for Services Rendered                                  138,354                --                --
CHANGES:
Accounts Receivable                                                 (52,809)               --                --
Prepaid Expenses                                                    (60,432)          (23,968)               --
Website Development Costs - In Process                              131,568          (131,568)               --
Lease Deposits                                                     (111,884)          (20,535)               --
Accounts Payable                                                  1,403,489           208,101                --
Accrued Expenses                                                    195,479            64,820                --
                                                               ------------       -----------       -----------
NET CASH FLOWS FROM OPERATING ACTIVITIES                         (5,742,394)         (786,247)          (22,261)
                                                               ------------       -----------       -----------
CASH FLOWS FROM INVESTING ACTIVITIES
Cash Purchases of Property and Equipment                         (2,237,790)          (72,613)               --
                                                               ------------       -----------       -----------
NET CASH FLOWS FROM INVESTING ACTIVITIES                         (2,237,790)          (72,613)               --
                                                               ------------       -----------       -----------
CASH FLOWS FROM FINANCING ACTIVITIES
Net Proceeds from Sale of Common Stock and Units                  1,620,243                --                --
Net Proceeds from Sale of Preferred Stock                         1,585,461                --                --
Short Term Notes Payable                                          3,350,000                --            25,057
Preferred Stock Dividends                                          (198,000)               --                --
Common Stock Subscribed                                                  --         2,883,897                --
                                                               ------------       -----------       -----------
NET CASH FLOWS FROM FINANCING ACTIVITIES                          6,357,704         2,883,897            25,057
                                                               ------------       -----------       -----------
Net Increase (Decrease) in Cash and Cash Equivalents             (1,622,480)        2,025,037             2,796

Cash and Cash Equivalents - Beginning of Year                     2,027,833             2,796                --
                                                               ------------       -----------       -----------
CASH AND CASH EQUIVALENTS - END OF YEAR                        $    405,353       $ 2,027,833       $     2,796
                                                               ============       ===========       ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash Paid During the Year for Taxes                            $      8,305       $        --       $        --
Cash Paid During the Year for Interest                         $     71,352       $        --       $        --
                                                               ============       ===========       ===========
</TABLE>

<PAGE>   45

NON-CASH INVESTING AND FINANCING ACTIVITIES
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
Year Ended March 31,                                               2000              1999              1998
--------------------                                           ------------       -----------       -----------
<S>                                                            <C>                <C>               <C>
Conversion of Shareholder Loans to Capital in Subsidiary
in Subsidiary                                                   $        --           $--             $25,057

Issuance of Common Stock to Acquire Minority
Interest in INRG                                                $19,650,195           $--             $    --

Goodwill Recorded in Connection with the Acquisition
  of Minority Interest in INRG                                  $16,999,848           $--             $    --

Private Placement Subscriptions Received - Cash Held
in Escrow by Attorney                                           $ 5,183,225           $--             $    --

Increase in Liquidation Value of Series A
Preferred Stock                                                 $    30,477           $--             $    --

Decrease in Par Value of Common Stock
Due to the Recapitalization                                     $    19,471           $--             $    --

Stock Issued - Warrant Exercised                                $       175           $--             $    --
</TABLE>


    The accompanying notes are an integral part of this financial statement.


                                     - F-5 -

<PAGE>   46
FTM MEDIA, INC.
(FORMERLY REDWOOD BROADCASTING, INC.)
AND SUBSIDIARY
(A DELAWARE CORPORATION)
SCOTTSDALE, ARIZONA


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------


NOTE A - SUMMARY OF TRANSACTION

         Pursuant to a Contribution Agreement effective March 31, 1999,
         Interactive Radio Group, Inc. (hereinafter "INRG"), a Delaware
         Corporation, became a majority owned subsidiary of Redwood
         Broadcasting, Inc., a Colorado Corporation (hereinafter "Redwood"). The
         transaction was treated as a reverse acquisition, whereby shareholders
         owning 90.85% of the INRG common stock received 1.25 shares of Redwood
         common stock for each contributed share of INRG common stock. As a
         result of the reverse acquisition, the historical operations of INRG
         were treated as the historical operations of Redwood.

         Effective July 19, 1999, Redwood changed its name to FTM Media, Inc.
         (hereinafter "FTM").

         Effective January 7, 2000, FTM, formerly a Colorado Corporation, became
         reincorporated as a Delaware Corporation, via a reincorporation merger.

         On January 7, 2000, FTM acquired the remaining shares represented by
         the minority interest of INRG. The transaction resulted in INRG being
         merged with and into FTM, with FTM being the surviving company. The
         transaction resulted in the remaining common shareholders of INRG
         receiving 1.25 shares of FTM common stock for each contributed share of
         INRG common stock. The merger was accounted for under the purchase
         method of accounting, effective September 22, 1999, which was the day
         of approval of the merger by the shareholders. Goodwill was recorded
         based on the difference between the fair value of the underlying net
         assets of the minority interest acquired and the fair value of the
         Company's common stock exchanged.

NOTE B - NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
         FTM MEDIA, INC.

         The Company was reincorporated under the laws of the state of Delaware
         on January 7, 2000 and is in the business of providing Internet Web
         sites to radio stations, focusing its efforts on the 25 largest U.S.
         markets. The Company's Web site services include Web site design,
         development, implementation, hosting, and management.

         The Company was formerly in the development stage, when its operations
         principally involved the raising of capital, market research, and
         start-up production. The Company now has seven Web sites operating and
         began receiving revenues from its Web site services during the fiscal
         year beginning April 1, 1999. It is therefore no longer considered to
         be in the development stage.

         INTERACTIVE RADIO GROUP, INC.

         INRG was formed on February 22, 1994 under the laws of the State of
         Delaware. The company was dormant until April 1, 1998 when it began its
         business of designing and hosting Internet Web sites for radio
         stations. INRG became a wholly owned subsidiary of FTM, effective
         September 22, 1999, as described in the Summary of Transaction, and was
         subsequently merged with and into FTM.


                                                                   - continued -



                                     -F-6-
<PAGE>   47
FTM MEDIA, INC.
(FORMERLY REDWOOD BROADCASTING, INC.)
AND SUBSIDIARY
(A DELAWARE CORPORATION)
SCOTTSDALE, ARIZONA


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------


NOTE B - NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -
         CONTINUED

         CYBERMUSIC ACQUISITION CORP.

         Cybermusic Acquisition Corp. (hereinafter "Cybermusic") was formed on
         December 3, 1998 under the laws of the State of Delaware. Cybermusic
         was acquired by INRG and became its wholly owned subsidiary in
         December, 1998. It subsequently became a subsidiary of FTM as a result
         of the acquisition of INRG by FTM.

         PRINCIPLES OF CONSOLIDATION

         The consolidated financial statements include the accounts of FTM
         Media, Inc. and its wholly owned subsidiary, Cybermusic. All of the
         operations are carried out through FTM; Cybermusic has no operations.
         All significant intercompany balances and transactions have been
         eliminated in consolidation.

         SEGMENT DATA, GEOGRAPHIC INFORMATION, AND SIGNIFICANT CUSTOMERS

         The Company operates in one industry segment and will seek to generate
         revenues from its Web site services to radio stations in the 25 largest
         U.S. radio markets.

         METHOD OF ACCOUNTING

         The Company maintains its books and prepares its financial statements
         on the accrual basis of accounting.

         USE OF ESTIMATES

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

         CONCENTRATIONS OF CREDIT RISK

         Financial instruments which potentially expose the Company to
         significant concentrations of credit risk consist principally of bank
         deposits and accounts receivable. Cash is placed primarily in high
         quality short term interest bearing financial instruments. Management
         performs evaluations of accounts receivable and records an allowance
         for doubtful accounts when necessary.

         CASH AND CASH EQUIVALENTS

         Cash and cash equivalents include time deposits, certificates of
         deposit, and all highly liquid debt instruments with original
         maturities of three months or less. The Company maintains cash and cash
         equivalents at financial institutions which periodically may exceed
         federally insured amounts.

         WEB SITE DESIGN - IN PROGRESS

         Web site design - in progress represents costs incurred to develop Web
         sites for radio stations, including labor and materials. The costs were
         fully expensed during the fiscal year ended March 31, 2000, when the
         Company began receiving revenues from its Web site services.


                                                                   - continued -



                                     -F-7-
<PAGE>   48
FTM MEDIA, INC.
(FORMERLY REDWOOD BROADCASTING, INC.)
AND SUBSIDIARY
(A DELAWARE CORPORATION)
SCOTTSDALE, ARIZONA


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------


NOTE B - NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -
         CONTINUED

         PROPERTY, EQUIPMENT AND DEPRECIATION

         Property and equipment are stated at cost, less accumulated
         depreciation computed using the straight line method over the estimated
         useful lives as follows:

<TABLE>
<S>                                                               <C>
             Leasehold Improvements                               5 - 7 Years
             Computer Equipment                                   3 - 5 Years
             Office Furniture                                         5 Years
             Vehicles                                                 5 Years
</TABLE>

         Maintenance and repairs are charged to expense. The cost of the assets
         retired or otherwise disposed of and the related accumulated
         depreciation are removed from the accounts.

         GOODWILL

         Goodwill is being amortized over five to ten years. See note E for
         additional information.

         EARNINGS (LOSS) PER COMMON SHARE

         In accordance with SFAS No. 128, "Earnings Per Share," basic earnings
         per common share is computed by dividing income available to common
         stockholders by the weighted average number of common shares
         outstanding for each period. Diluted earnings per common share is
         calculated by adjusting the number of outstanding shares assuming
         conversion of all potentially dilutive stock options and warrants.

         The incremental shares related to outstanding warrants, stock options,
         convertible preferred stock, and convertible debt, as described in Note
         H, have been excluded from the computation of diluted earnings per
         share due to their antidilutive effect as a result of the company's
         net loss from operations.

         STOCK OPTIONS

         The company accounts for stock-based compensation under Accounting
         Principles Board Opinion No. 25, Accounting for Stock Issued to
         Employees (APB No. 25). Under APB No. 25, the Company's stock option
         and employee stock purchase plans qualify as noncompensatory plans.
         Consequently, no compensation expense is recognized.

         INCOME TAXES

         The Company accounts for income taxes in accordance with SFAS No. 109,
         "Accounting for Income Taxes," using the asset and liability approach,
         which requires recognition of deferred tax liabilities and assets for
         the expected future tax consequences of temporary differences between
         the carrying amounts and the tax basis of such assets and liabilities.
         This method utilizes enacted statutory tax rates in effect for the year
         in which the temporary differences are expected to reverse and gives
         immediate effect to changes in income tax rates upon enactment.
         Deferred tax assets are recognized, net of any valuation allowance, for
         temporary differences and net operating loss and tax credit
         carryforwards. Deferred income tax expense represents the change in net
         deferred assets and liability balances. The Company had no material
         deferred tax assets, net of allowances, or liabilities for the periods
         presented.

         RECLASSIFICATION

         Certain amounts in the prior year financial statements have been
         reclassified to conform with the current year presentation.


                                                                   - continued -



                                     -F-8-
<PAGE>   49
FTM MEDIA, INC.
(FORMERLY REDWOOD BROADCASTING, INC.)
AND SUBSIDIARY
(A DELAWARE CORPORATION)
SCOTTSDALE, ARIZONA


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE C - CASH HELD IN ESCROW FROM PRIVATE PLACEMENT OFFERING

         As of March 31, 2000, the company held $5,183,225 in escrow in
         connection with a private placement. The company received all funds
         held in escrow between April and June of 2000.

         The company raised a total of $6,656,252 in this private placement, as
         of March 31, 2000, which closed in the spring of 2000. The company sold
         892,493 units, each unit consisting of one share of common stock, one
         Class A Warrant to purchase one share of common stock at an exercise
         price of $10.00 per share (subject to certain adjustments) and one
         Class B Warrant to purchase one share of common stock at an exercise
         price of $15.00 per share (subject to certain adjustments). $6,174,752
         of the proceeds were received in the form of cash and $481,500
         represented the conversion of bridge notes and the interest accrued
         thereon.

NOTE D - PROPERTY AND EQUIPMENT

         Property and equipment are recorded at cost and consisted of the
         following:

<TABLE>
<CAPTION>
         ------------------------------------------------------------------
         March 31,                                     2000            1999
         ------------------------------------------------------------------
<S>                                              <C>                <C>
         Leasehold Improvements                  $   80,879         $    --
         Computer Equipment                       1,980,144          56,548
         Office Furniture                           234,880          16,065
         Vehicles                                    14,500              --
         ------------------------------------------------------------------
                                                 $2,310,403         $72,613
         Less:  Accumulated Depreciation            319,031           2,114
         ------------------------------------------------------------------
         Net Property and Equipment              $1,991,372         $70,499
         ==================================================================
</TABLE>

         Depreciation expense for the years ended March 31, 2000, 1999, and 1998
         was $316,917, $2,114, and $-0-, respectively.

NOTE E - GOODWILL

         Goodwill in the amount of $16,999,848 was recorded in connection with
         the acquisition of the minority shareholders' interest in INRG on
         January 7, 2000, based on the difference between the fair value of
         FTM's common shares issued and the book value of the minority interest
         on September 22, 1999, which was the approval date of the merger by the
         shareholders. Subsequently, the goodwill was deemed to be impaired and
         written down to its fair value of $3,774,438, which is equal to the sum
         of the value of the INRG common shares issued in a private offering
         during Spring, 1999 plus the fair value of the INRG minority interest
         as of September 22, 1999. The impairment loss of $13,225,410 has been
         charged to operations. The fair value of the goodwill is being
         amortized over five years.

         Goodwill in the amount of $78,513 was recorded during the year ended
         March 31, 1999 upon the acquisition of a subsidiary and is being
         amortized over ten years.
         Goodwill consisted of the following:

<TABLE>
<CAPTION>
         -------------------------------------------------------------------
         March 31,                                      2000            1999
         -------------------------------------------------------------------
<S>                                              <C>                 <C>
         Goodwill                                $17,078,361         $78,513
         Less:  Impairment Loss                   13,225,410              --
         Less:  Accumulated Amortization             450,164           1,963
         -------------------------------------------------------------------
         Net Goodwill                            $ 3,402,787         $76,550
         ===================================================================
</TABLE>


                                                                   - continued -



                                      -F-9-
<PAGE>   50
FTM MEDIA, INC.
(FORMERLY REDWOOD BROADCASTING, INC.)
AND SUBSIDIARY
(A DELAWARE CORPORATION)
SCOTTSDALE, ARIZONA


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------


NOTE E - GOODWILL - CONTINUED

         Amortization expense for the years ended March 31, 2000, 1999, and 1998
         was $448,201, $1,963, and $-0-, respectively.

NOTE F - SHORT TERM NOTES PAYABLE

         The Company has multiple outstanding notes payable to individual
         investors that were issued as bridge loans in anticipation of capital
         raised in a private offering. These notes carry various maturity dates
         ending in May, 2000 and have terms of 180 days or less from the date of
         issue. $1,700,000 of the notes provide for monthly extensions by the
         Company for an indefinite period with interest payments of 1% per
         month, in addition to the regular interest payments. The notes totaled
         $3,350,000 at March 31, 2000 and carried various interest rates ranging
         from 6% to 10%. Some of the investors have the option to convert the
         notes to common stock while other of the investors have the option to
         convert the notes to units, consisting of common stock and warrants, at
         the price of either $8.00 or $7.50 respectively. Interest expense for
         the years ended March 31, 2000, 1999, and 1998 was $91,942, $-0-, and
         $-0-, respectively.

         Subsequent to March 31, 2000, the Company repaid $1,212,500 of the
         notes.

         The Company is currently in dispute with one of the investors over a
         $400,000 note, as to whether the Company is required to repay the note
         or whether the investor is required to convert it to common stock. The
         $400,000 note amount is included in the notes payable as of March 31,
         2000.

NOTE G - MINORITY INTEREST

         The minority interest in INRG, acquired by FTM on January 7, 2000, had
         two components at March 31, 1999:

         1.    PREFERRED STOCK

               40,637 shares of Series A Preferred Stock with par value of
               $.001, recorded at the stock's liquidation value of $10 per
               share. Holders of the stock received one share of FTM's Series A
               Preferred Stock for each one share held of INRG's Preferred Stock
               at the time that FTM acquired the minority interest in INRG.

         2.    COMMON STOCK

               Common Stock and additional paid-in-capital in the amount of
               $2,771,261. Holders of the stock received 1.25 shares of FTM's
               common stock for each one share held of INRG's common stock at
               the time that FTM acquired the minority interest in INRG.

NOTE H - COMMON STOCK EQUIVALENTS

         At March 31, 2000, there were outstanding warrants to purchase 708,666
         shares of the Company's common stock at various purchase prices ranging
         from $1.50 to $8.00. The common stock warrants expire on various dates
         beginning November 11, 2002 to January 10, 2003.

         In connection with the private placement described in Note C, there are
         892,493 class A warrants outstanding to purchase one share of common
         stock for $10.00 (subject of readjustment) and 892,493 class B warrants
         outstanding to purchase one share of common stock for $15.00 (subject
         of readjustment). The class A and class B warrants have a three-year
         term.

         Additionally, there are warrants outstanding related to certain bridge
         notes that allow the purchase of 165,000 units at a price of $7.50 per
         unit. These warrants have a three-year term and expire between February
         1, 2003 and March 1, 2003.

         The company also has stock options outstanding for 1,973,033 shares
         of common stock. See Note J for further information.

         In addition, some of the company's short term notes payable are
         convertible into common stock, and some of the Company's short term
         notes payable are convertible into units consisting of common stock and
         warrants. See Note F for additional information.

                                                                   - continued -



                                     -F-10-

<PAGE>   51
FTM MEDIA, INC.
(FORMERLY REDWOOD BROADCASTING, INC.)
AND SUBSIDIARY
(A DELAWARE CORPORATION)
SCOTTSDALE, ARIZONA


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------


NOTE I - PREFERRED STOCK

         Preferred stock consists of the following:

<TABLE>
<CAPTION>
         --------------------------------------------------------------------------------------------------
                                                           Shares       Shares Outstanding
                                                         Authorized      at March 31, 2000        Per Value
         --------------------------------------------------------------------------------------------------
<S>                                                      <C>            <C>                       <C>
         Series A Preferred Stock                           50,000             40,367                .001
         Series B Convertible Preferred Stock              400,000            282,051                .001
         Undesignated Preferred Stock                    4,550,000                 --                .001
         ==================================================================================================
</TABLE>

         The following rights pertain to the Series A Preferred Stock:

         i.    The stock ranks senior to Common Stock and any other class or
               series of capital stock of the Company with respect to
               liquidation, dissolution, or winding up of the business.

         ii.   Holders of the stock are not entitled to receive dividends or
               other distributions except on liquidation, dissolution, or
               winding up of the business.

         iii.  Holders of the stock have the right to vote with the Common
               stockholders as a single class, unless the Delaware General
               Corporation Law requires the Series A Preferred stockholders to
               vote separately as a single class.

         iv.   Holders have the option to convert their stock to Common shares
               with a fair market value equal to the Series A Preferred Stock
               liquidation value anytime after September 9, 2000.

         v.    Holders may redeem their stock for cash equal to the liquidation
               value anytime after March 9, 2001. INRG may elect to redeem any
               or all of the outstanding shares of Series A Preferred Stock
               anytime, at the liquidation value.

         vi.   The liquidation value of each share of Series A Preferred Stock
               is $10, increased with interest compounded annually at 7.5%
               through March 9, 2001. The Series A Preferred Stock liquidation
               value consisted of the following:

<TABLE>
<CAPTION>
         --------------------------------------------------------------
         March 31,                                                 2000
         --------------------------------------------------------------
<S>                                                            <C>
         Liquidation Value at Issuance                         $406,370
         Accrued Interest to Date                                39,996
         --------------------------------------------------------------
         Total Liquidation Value                               $446,366
         ==============================================================
</TABLE>


                                                                   - continued -



                                     -F-11-
<PAGE>   52
FTM MEDIA, INC.
(FORMERLY REDWOOD BROADCASTING, INC.)
AND SUBSIDIARY
(A DELAWARE CORPORATION)
SCOTTSDALE, ARIZONA


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE I - PREFERRED STOCK - CONTINUED

         The following rights pertain to the Series B Convertible Preferred
         Stock:

         i.    The stock ranks senior to common stock and junior to Series A
               Preferred Stock with respect to dissolution, liquidation, or
               winding up of the business.

         ii.   Holders of the stock are entitled to receive dividends at the
               rate of $.702 per share per year, payable on each semi-annual
               anniversary of the Series B issue date. The Company has the
               option to pay any dividend with 50% cash and 50% common stock.

         iii.  Holders of the stock have no voting rights except for the minimum
               voting rights required by Delaware General Corporation Law and
               shall vote together with the common stock as a single class.

         iv.   Holders have the right to convert their stock to common shares
               equal to the conversion rate. The conversion rate shall equal
               $5.85 divided by the conversion price. The conversion price shall
               equal $5.85 minus the aggregate amount of accrued dividends per
               share times .64103. Beginning June 15, 2000, the Company has the
               right to force the Series B holders to convert if the closing
               price of the stock is at least $8.35 per share for each of the
               preceding 20 trading days.

         iv.   The liquidation value of each share of Series B Convertible
               Preferred Stock is $8.35 plus the amount of any accrued and
               unpaid dividends. The liquidation value at March 31, 2000 is
               $2,355,126. (282,051 shares outstanding x 8.35). There were no
               accrued or unpaid dividends.

NOTE J - EMPLOYEE STOCK OPTION PLAN

         Options covering an aggregate of 1,973,033 shares of FTM common stock
         have been granted as of March 31, 2000, which consisted of 973,033
         shares of FTM common stock that were granted under the FTM Stock Option
         Plan and 1,000,000 shares of FTM common stock, which were converted
         from 800,000 shares of INRG common stock, under the INRG Stock Option
         Plan after the merger of INRG into FTM on January 7, 2000. 1,750,000
         shares of common stock have been reserved for issuance under the FTM
         Stock Option Plan. The exercise price for the 1,973,033 outstanding
         options to common stock are as follows: 1,216,000 shares at $3 per
         share; 671,833 shares at $6 per share; and 85,200 shares at $7.50 per
         share.

NOTE K - INCOME TAXES

         The Company has $11,442,272 of consolidated net operating loss
         carryforwards for federal tax purposes as of March 31, 2000, which are
         available to offset future taxable income and expire during the years
         2011 through 2020. The Company has fully reserved for any future tax
         benefits from the net operating loss carryforwards since it has not
         generated sufficient revenues to date.



                                     -F-12-
<PAGE>   53
FTM MEDIA, INC.
(FORMERLY REDWOOD BROADCASTING, INC.)
AND SUBSIDIARY
(A DELAWARE CORPORATION)
SCOTTSDALE, ARIZONA


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------


NOTE L - RELATED PARTY TRANSACTIONS

         The Company entered into a management agreement to pay consulting fees
         on a monthly basis to Ingenious Enterprises, Inc., a Nevada
         corporation, in the amount of $120,000 annually, beginning October 1,
         1998, for the services provided by Ron Conquest, Chief Executive
         Officer of the Company. Such payments increased to $180,000 annually
         commencing on January 1, 2000. Consulting fees paid in accordance with
         this management agreement during the years ended March 31, 2000, 1999,
         and 1998 were $135,000, $60,000, and $-0-, respectively.

         The Company paid consulting fees totaling $270,000 during the year
         ended March 31, 2000 to various companies for services provided by
         members or former members of the Board of Directors, who are either
         owners or employees of the payee companies.

         The Company entered into a consulting agreement with the Chairman of
         the Board of Directors to provide him with 150,000 options to purchase
         common stock of the Company in exchange for his services.

         The Company borrowed $100,000 each from the Chairman and a member of
         the Board of Directors as part of the bridge loan financing included in
         Short Term Notes Payable, in exchange for notes convertible into common
         stock and 20,000 warrants at an exercise price of $8 per share. The
         Company repaid both of the notes by May, 2000.

NOTE M - CONTINGENCIES

         The Company's ability to continue as a going concern is dependent upon
         achieving profitable operations and raising additional equity capital.
         In addition to raising equity capital, achievement of the Company's
         business objectives is dependent upon, amongst other factors: attaining
         new customers, i.e., radio stations, the sale of radio advertising and
         e-commerce services, and the continued success of raising equity
         capital. The Company currently has seven Web sites up and running and
         six in development. The ability of the Company to recover its
         investment in Web site development technology is dependent upon the
         future profitability of the Web site services it provides to its
         customers. The outcome of these matters cannot be predicted at this
         time.

NOTE N - SUBSEQUENT EVENTS

         The following events occurred subsequent to March 31, 2000:

         1.    The Company received funds during April through June, 2000 in the
               amount of $5,183,225 that had been held in escrow in connection
               with the private placement described in Note C.

         2.    22,223 shares of Series B Preferred Stock with a total face value
               of $130,005 were converted to an additional 17,332 units in
               a private placement.

         3.    The Company issued an additional $60,000 in units in connection
               with a private placement.

         4.    The Company repaid $1,212,500 of notes payable.



                                     -F-13-