UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-K

(Mark  One)

[X]     ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
        ACT OF  1934

        For  the  fiscal  year  ended  December  31,  1999

        Commission  file  number:  0-26109

                                   NETTAXI.COM
                                   -----------
             (Exact name of registrant as specified in its charter)

                 Nevada                                    82-0486102
                 ------                                    ----------
     (State or other jurisdiction           (I.R.S. Employer Identification No.)
   of incorporation or organization)

                      1696 Dell Avenue, Campbell, CA  95008
                      -------------------------------------
           (Address of Principal Executive Offices Including Zip Code)

       Registrant's telephone number, including area code: (408) 879-9880
                                                           --------------

        Securities registered pursuant to Section 12(b) of the Act:  None
           Securities registered pursuant to Section 12(g) of the Act:

                                                Name of each exchange
Title  of  each  class                          on  which  registered
----------------------                          ---------------------
Common  Stock,  $.001  par  value               O-T-C  Bulletin  Board


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding  12  months  (or  for such shorter period that the registrant was
required  to  file  such  reports),  and  (2)  has  been  subject to such filing
requirements  for  the  past  90  days.  Yes  [X]  No  [  ]


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<PAGE>
Indicate by a check mark if disclosure of delinquent filers pursuant to Item 405
of  Regulation  S-K  is  not contained herein, and will not be contained, to the
best  of  registrant's  knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form  10-K.  [_]

As  of  February 28, 2000 the approximate aggregate market value of voting stock
held by non-affiliates of the registrant was $51,632,835 (based upon the closing
price  for shares of the registrant's common stock as reported by O-T-C Bulletin
Board  on that date). Shares of common stock held by each officer, director, and
holder  of 5% or more of the outstanding common stock have been excluded in that
such  persons  may  be  deemed to be affiliates. This determination of affiliate
status  is  not  necessarily  a  conclusive  determination  for  other purposes.

As  of  February 28, 2000, the registrant had 24,129,390 shares of common stock,
$.001  par  value  per  share,  outstanding.

Certain  exhibits  and  appendices  filed  with  the  Registrant's  Registration
Statement  on  Form S-1  ( File  No. 33-78129),  as  amended,  the  Registrant's
Quarterly  Report  on  Form  10-Q for  the  period  ending  September  30, 1999,
the  Registrant's  Registration  Statement  on  Form S-1  (File No.  333-30074),
as  amended,  and  the  Registrant's  Registration  Statement  on Form S-8 (File
No. 333-32678) are incorporated by reference into  Part  IV  of  this  Form 10-K
where indicated.


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<TABLE>
<CAPTION>
                                    NETTAXI.COM

                                    FORM 10-K

                                TABLE OF CONTENTS


PART  I.
--------

<S>          <C>                                                    <C>
ITEM 1.      Business                                                4
ITEM 1A.     Risk Factors                                           30
ITEM 2.      Properties                                             43
ITEM 3.      Legal Proceedings                                      44
ITEM 4..     Submission Of Matters To A Vote Of Security Holders    45

PART  II.
---------

ITEM  5.     Market  For  The  Registrant's  Common  Stock
             And  Related  Stockholder  Matters                     46
ITEM  6.     Selected  Consolidated  Financial  Data                50
ITEM  7.     Management's  Discussion  And  Analysis  Of
             Financial Condition  And  Results  Of  Operations      50
ITEM  7A.    Quantitative  And  Qualitative  Disclosures
             About Market  Risk                                     61
ITEM  8.     Financial  Statements  And  Supplementary  Data        61
ITEM  9.     Changes  In  And  Disagreements  With  Accountants
             On  Accounting  And  Financial  Disclosure             62

PART  III.
----------

ITEM 10.     Directors And Executive Officers Of The Registrant     63
ITEM 11.     Executive Compensation                                 70
ITEM 12.     Security Ownership Of Certain Beneficial Owners
             And Management                                         76
ITEM 13.     Certain Relationships And Related Transactions         78


PART  IV.
---------

ITEM  14.     Exhibits,  Financial Statement Schedules,
              And Reports On Form 8-K                               82
</TABLE>


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                                     PART I
                                     ------


     This  Form 10-K contains forward-looking statements.  These forward-looking
statements  are subject  to  significant  risks  and  uncertainties,  including
information included  under  Items  1  and 1A of this Form 10-K, which may cause
actual results to differ materially from those discussed in such forward-looking
statements.  The forward-looking statements within this Form 10-K are identified
by  words such as "believes," "anticipates," "expects," "intends," "may," "will"
and  other  similar  expressions  regarding  our  intent,  belief  and  current
expectations.  However,  these  words are not the exclusive means of identifying
such  statements.  In  addition,  any  statements  that  refer  to expectations,
projections  or  other  characterizations  of future events or circumstances and
statements made in the future tense are forward-looking statements.  Readers are
cautioned  that actual results may differ materially from those projected in the
forward-looking  statements  as  a  result of various factors, many of which are
beyond  our control.  We undertake no obligation to publicly release the results
of  any  revisions  to  these  forward-looking  statements  which may be made to
reflect  events or circumstances occurring subsequent to the filing of this Form
10-K  with  the  Securities  and  Exchange  Commission.  Readers  are  urged  to
carefully  review  and  consider the various disclosures made by us in this Form
10-K,  including  those  set  forth  under  "Risk  Factors"  in  Item  1A.


ITEM  1.          DESCRIPTION  OF  BUSINESS

OUR  BUSINESS

     We  were  organized in 1997 to capitalize on a significant opportunity that
still  exists  today,  through  the  convergence  of the media and entertainment
industries  with the vast communications power of the Internet.  We are defining
a  new  type  of  Internet  company  -- an e-commerce-based online community and
portal  to  the  Internet  --  that  is  dedicated  to  providing  content-rich
communities  and  an  entry  point  on  the  Internet  for  both  consumers  and
businesses.   Our  site  is  designed  to  seamlessly  integrate  content  with
e-commerce  services  for  consumers  and  businesses.  Nettaxi.com  provides
comprehensive  information  about news, sports, entertainment, health, politics,
finances,  lifestyle,  and  areas  of interest to the growing number of Internet
users.  Our  mission  is  to establish our site as an entry point or 'portal' to
the  Internet by continuing to develop premium online communities which are both
content-rich  to our subscribers, the "citizens" of our communities, and provide
easy-to-use e-commerce services to businesses of all sizes which reside in these
communities.     By  successfully  achieving  this,  we  expect  to  continue to
generate  substantial  revenues through advertising fees and e-commerce revenues
and  transaction  fees  through  the  sale  of  products  online.


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<PAGE>
INDUSTRY  BACKGROUND

THE  INTERNET

     GROWTH  OF  THE INTERNET AND E-COMMERCE.  The Internet has rapidly become a
significant  global  medium for communications, entertainment, news, information
and  commerce.  Commercialization  of  the Internet began in the mid-1980s, with
e-mail  providing  the  primary  means  of  communication.  However,  it was the
Internet's  World  Wide  Web,  which provided a means to link text and pictures,
that led to the blossoming of e-commerce and sparked the explosive growth of the
Internet in the 1990s.  Today,  millions  of  people around the world  have  the
capability  to send and receive information, and purchase products and services,
through  the Internet.

     GROWTH  OF  ONLINE ADVERTISING AND DIRECT MARKETING.  The Web has become an
attractive  medium  for  advertisers,  offering  a  level  of  targetability,
flexibility, interactivity and measurability not available in traditional media.
The Web enables advertisers to demographically target their messages to specific
groups  of  consumers  as  well  as to change their advertisements frequently in
response  to  market  factors,  current  events and consumer feedback. Moreover,
advertisers  can  track  more  accurately the effectiveness of their advertising
messages by receiving reports of the number of advertising impressions delivered
to  consumers  and  the  resulting  click-through  rate  to  their  Web  sites.

     THE INTERNET AS A MARKETING TOOL.  Over 50 million companies and households
around  the  world  use  the  Internet  as a communications link through e-mail,
interactive  advertisement,  bulletin  boards,  research  and  online discussion
groups.  At  its  most  basic  level, the Internet serves as a seemingly endless
catalog  of  marketing  messages  and  advertising  platforms  presented  in  an


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<PAGE>
interactive  fashion.  Companies  like IBM, Apple, AT&T, Microsoft and Lotus are
investing millions of dollars to develop new state-of-the-art tools and services
aimed  at  helping  companies  expand  electronic business through the Internet.

     Business is rapidly adopting the Internet as the means through which it can
efficiently  and  economically conduct marketing, research and customer support.
With  the  number  of  users growing monthly at an estimated rate of 10%, or one
million  users,  the  Internet  is the fastest growing global telecommunications
network in the world.  Large and small companies are embracing the Internet as a
fundamental  communication  tool  used  to  conduct daily business.

     ADVANTAGES  OF  THE  INTERNET  FOR CONTENT COMPANIES.   The Internet offers
content  providers  significant  and attractive economic mechanisms that combine
cost  advantages  with  practices  that  are  conducive to revenue generation or
premiums.  Significantly,  the  Internet provides information dissemination at a
materially  lower cost than do other forms of media, notably, both printed paper
and  private networks.  The Internet also offers the potential for easier access
to  content,  which  can  expand  market coverage.  We believe that by using the
capabilities  of  the  Internet  to  enrich  the  convenience, utility, time, or
entertainment  value  of  content,  Internet  content  providers  can  garner
significant  and  even  premium  revenues.

     The Internet also enables providers to change and enhance the form and mass
delivery  of content so that information is dynamic, interactive, real-time, and
personalized,  as  opposed  to static, passive and bland as traditional media is
trending.  The  ability to personalize content on a mass scale promises to offer
compelling  utility  to  subscribers  as  well  as  a mechanism for providers to
sustain  those  same  subscribers.  Otherwise  static information can be made to
come  alive by using the multiple forms of media, such as hyper-text, audio, and
graphics,  that  are  all  made  possible  through  the  Internet.

THE  NEED  FOR  ONLINE  COMMUNITIES

     As  the  Internet  continues  to  grow,  users  seek  from the Web the same
opportunity  for  expression, interaction, sharing, support and recognition they
seek  in  the  everyday  world.  To  date,  a typical Internet user's experience
surfing  the  Web  has  been essentially one-way-searching and viewing Web sites
containing  professionally created content on topics of general interest such as
current  events,  sports,  finance,  politics  and  weather. However, the Web in
general  does  not  provide  a context for users to publish, promote, search and
view  personal  Web pages. As a result, users publishing personal Web sites have
had  limited  means of attracting visitors to their sites or interacting with or
receiving  recognition  from  visitors.  Internet  search and navigational sites
serve  a  valuable  function  for  users  seeking  to  navigate the Internet for
aggregated  Web  content;  however,  these  sites  are  not primarily focused on
providing  a  platform  for  publishing  and  aggregating the rapidly increasing
volume  of  personalized  content  created  by  users  or enabling such users to
interact  with  each  other.


                                        6
<PAGE>
     Similarly,  Web  users engaged in passive browsing are increasingly seeking
ways  of  interacting  and  communicating  with  other  individuals with similar
interests  and accessing personalized content. While users are generally able to
obtain  relevant professionally created content through traditional navigational
sites  such as Web directories and search engines, the source of such content is
usually the media and not fellow Web users. Often, the most relevant content for
a  user  is generated by other users who share an interest in what is published;
however,  most  Web  sites  are  not  dedicated  to  providing  a  platform  for
aggregating  and  accessing  user-created  content.

     An  important  response  to  the perceived needs of Internet users, and the
weaknesses  of  traditional  Web  navigational  or  content  sites, has been the
emergence  of  community  Web  sites.  Community  sites  provide a single online
destination  where  like-minded  users  can  interact and quickly find pertinent
information,  products  and  services  related  to their particular interests or
needs.  Community sites generally offer free services including access to e-mail
accounts,  chat  rooms,  message  boards, news and entertainment.  Through these
features,  online  communities seek to establish a close relationship with their
audience  and evolve over time according to the interests of their members. As a
result,  we believe that users tend to be loyal to and spend more time online at
community  sites.

     Online  communities  also  provide  advertisers  an  attractive  means  of
promoting  their products and services and allow businesses to reach the growing
number of users who will be purchasing goods over the Internet in the future. To
date,  advertisers  and  businesses have typically used traditional navigational
sites  and  professionally  created  content sites to promote their products and
services online. However, online communities allow advertisers and businesses to
reach  highly  targeted  audiences  within  a  more  personalized  context, thus
providing  the  opportunity  to  increase advertising efficiency and improve the
likelihood  of  a  successful  sale.

OUR  SOLUTION

     Nettaxi  was  born  of  the vision of co-founders Robert and Dean Rositano,
veterans  of  the  Internet  service  provider  industry.  Even  before founding
Nettaxi,  they  recognized  that there was an enormous market for learning tools
targeted  to beginner-level Internet users, and they were actively involved with
the  development of the Ques Mega Web Directory. In 1994, they co-founded Simply
Interactive,  Inc. to develop and market sophisticated, interactive Web learning
tools  for  this  vast  untapped  marketplace.  In connection with a substantial
early-stage  financing  of  that  company,  which  entailed the merger of Simply
Interactive,  Inc.  with  another  early-stage  enterprise  software development
company,  the  management  control and focus of the combined entity shifted away
from  Web  learning  tools.  As a result of this shift in focus, Robert and Dean
left  Simply  Interactive  to  continue  pursuit  of  their  vision.

     The  founders  believed  that  to  survive  and  thrive in the increasingly
crowded  Internet  industry,  they  needed  to  develop  a website with a strong
persona.  To  accomplish  this,  they  set  out  to  create  a  comprehensive
theme-oriented  website, targeted to the rapidly-growing "family" and home-based
business  markets,  which  would  provide  up-to-date  premium  content,


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<PAGE>
ready-to-use  e-commerce  storefront  services,  and  the ability to purchase an
expanding  variety  of  goods  and  services, all within a single integrated web
community.  Their  goal  was  to position their new website not only as an entry
point to the Internet, but also as an attractive, premium online destination, in
contrast  to  merely  acting  as  a  web  junction  point,  for  content  and
e-commerce  services,  and  to  generate  substantial  revenues  through monthly
subscriptions,  banner  advertising,  and  e-commerce  transaction  fees.

     Nettaxi  launched  its  new  online community in October 1997.  Immediately
recognizing  the  value of developing and acquiring the tools necessary to drive
new users to the website, the founders acquired the assets of Simply Interactive
in  November  1997,  including  the  rights  to  Internet  the  Citytm,  the
sophisticated  interactive  Internet  training  CD-ROM  that  the  Rositanos had
developed  while  at  Simply Interactive.  Upon acquiring these rights, we moved
quickly  to  implement  numerous  modifications  to the training tool, including
principally:

     -     integrating  the  Nettaxi  "taxicab"  in  the  main  user  interface;

     -     developing  and  integrating  promotional  information  regarding the
Nettaxi  Web  site  community,  including  its  free  services,  features  and
benefits;  and

     -     creating  the  mechanism  whereby  users  could  launch  into  the
Nettaxi  community  Web  site  directly  from  within  the  CD-ROM  environment.

Since  launching our web site in October 1997, we have been engaged primarily in
continued  development  and  enhancement  of  our online web site community, and
building  traffic  to  the  web  site.  To  these  ends,  we  have been actively
pursuing  corporate  relationships  in  several  areas  that  are  key  to  the
successful  implementation of our strategy, including co-marketing, content, and
technology.  Thus  far,  we  have  been  successful  in  securing  co-marketing
relationships whereby  Nettaxi bundles its CD-ROM product with products of other
companies,  as  described  in  more  detail below.  In addition, we have entered
into agreements with  eCharge,  InfoSpace.com,  Cybereps,  and  other  companies
for  important  service  enhancements  to  our  community  website.

     While  we  have  incurred  significant  losses since our site was launched,
traffic  to  our  online  community has increased consistently from a membership
base  of  60,000  citizens  in  December  1998, to a membership base of over 1.8
million  citizens  in  December  1999.  This increase in our membership base has
also  resulted  in  corresponding  increases in both the number of web pages and
advertising  banners  viewed  by  visitors.  Our  records  indicate  that  the
Nettaxi.com  web site had over 45.8 million visitors, 125 million page views and
180  million advertising impressions for the month of December 1999.  A visit by
a user to a page on our web site represents one page view and each advertisement
that  appears  on  that  page  to  which  a  visitor  is  exposed  is  called an
advertisement  impression.  Based on unique visitors to our site, PC Data Online
ranked  Nettaxi.com  as  the  289th most visited site in the world at the end of
November 1999. The "100hot", an industry ranking of the top Internet sites based
upon  unique visits, ranked Nettaxi.com as the 12th most popular site on the Web
during this same month.     We believe that the success of our site confirms the
original  vision  of  the founders that we can deliver a powerful new model with
the  capability  to  generate  substantial  economic  returns.  By  integrating
ready-to-use  e-commerce  capabilities with thematic community-based content and
e-commerce  Web  sites,  we are creating a number of powerful business tools and
resources:


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     USER  PROFILE DATABASE.  A substantial database of user profiles, according
to  their  interests,  which  enables  us  to  offer  large,  highly  targeted
audiencesto  our  advertisers,  and  command  the  higher  advertising  rates
that  demographically  segmented  audience  profiles  dictate.

     META-SEARCH  ENGINE.  A search engine that enables users to search multiple
sites  simultaneously  and  return  the  results,  including comparative product
pricing  and  availability,  to  one  page.

     WEB  SITE  TRAFFIC  DRIVER.  The  ability  to  drive  traffic  to  Nettaxi
subscriber  Web  sites,  via  our  search engine, which first searches and lists
Nettaxi's  premium  providers' and subscribers' Web sites, then scours the World
Wide  Web  for  additional  search  matches.  We believe this feature will drive
customers  to Nettaxi community e-commerce sites, thereby propelling transaction
processing  fees  and  drawing  new  e-commerce  business  to  our  community.

     EXPANDED  RELATIONSHIPS.  Opportunities  to  develop  an  expanded range of
relationships,  by  virtue of being able to match premium content providers with
consumer  bases.  We  believe  that  such  a  combination not only increases the
variety  of revenue generating e-commerce services we offer to subscribers,  but
also  helps  keep  us  at  the  forefront  of  new  developments in products and
services  that will attract additional subscribers, retain, current subscribers,
and  encourage  subscription  upgrades.

     POSITIVE  PUBLIC  PERCEPTION.  The  goodwill,  trust,  and  loyalty of both
parents and children by providing a site on the World Wide Web where parents can
feel  comfortable  about  their children's participation, and where children can
enjoy  their  own  privacy.  We  believe  that  providing parents with filtering
technologies  that  make  adult-content sites "invisible" to underage users will
attract  family  subscribers  and  many  of  their  friends  and  relatives.

OUR  STRATEGY

OUR  STRATEGIC  GROWTH  PLAN

     We  are  now  poised to build on our early success by implementing a growth
strategy  that  should  make us a major ready-to-use e-commerce storefront host,
and  allow  us  to  meet  our  goal  of  becoming  one  of  the  most frequented
community-based  portals  on  the Internet.  Our strategic growth plan includes:

     -     execution  of  Nettaxi.com's  Community  Service  Business Model (see
below);

     -     continued  expansion  of  our  co-branded  content  partnerships  and
portal  service  offerings  to  Nettaxi.com  citizens;

     -     continued  development  of  an  expandable  infrastructure;

     -     widespread  distribution  of  our  CD-ROM  product with free Internet
access  to  assist  our  partners  in  their  customer  acquisition  strategies,
educate  computer  users  about the Internet and introduce  them  to  our  site;
and


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     -     an  aggressive  subscriber  acquisition  program.

Nettaxi.com's  Community  Service  Model



             [GRAPHIC OMITTED]



Our  strategy  to create affinity-based communities leverages three key areas of
each  community  by:

     1.     Focusing  on  major  community  opportunities  where  the  ability
for  professionals,  teams,  experts,  celebrities,  and  artists  to  extend
themselves  to  their  base  of  constituents  is  untapped;

     2.     Utilizing  our  proprietary  technologies  and  infrastructure  to
facilitate  private  label  development  of  individual  and  affinity  group
"brands".  We  will  provide  the  medium  and tools to promote and establish an
on-line  presence  for  these  citizens;  and

     3.     Incorporating  content  and  commerce,  with  the  community
infrastructure to create  virtual  communities  and empower these communities to
grow  by using our award- winning CD-ROM, " Nettaxi.com: The Experience" bundled
with  free  Internet  access.

     Content  and  commerce  are  well  established online by many of the target
affinity-based communities.  What they miss is the ability for small businesses,
fans  and consumers, professionals, and sponsors to all leverage their interests
within  a  community.  Most  individual  sites  are  designed  to  maximize  the
interests  of  the  on-line  site  versus  the  interests of the constituents or
"citizens".  For example, NASCAR and the NBA all have very well-trafficked sites
for  content,  but  they fail to provide teams and drivers with a way to promote


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themselves  and  engage  fans.  In  addition,  small  and large sponsors are not
provided  commercial opportunities outside of branding via advertising programs.
Today  many  small  businesses  are  not on-line for a number of reasons.  Small
businesses  do  not have a presence on the web that leverages their interests or
affinity  base,  which  leaves  them  trying to compete in large shopping arenas
where  their ability to extend and enhance their "brand" is expensive and offers
very  little  value-added  to  the  consumer.

     Nettaxi.com  will engage these small businesses by hosting their web sites,
providing  commerce  enabled back end systems to sell merchandise, offer virtual
merchandise  commission  opportunities,  and  locate  businesses  within
affinity-based  communities  where these businesses can differentiate themselves
via  their  local  presence  and  specialized  offerings  to  a  highly targeted
audience.

     The  key  to our success involves focusing on creating value for all of our
citizens.  Critical  among  these  is  successfully  establishing  a model where
sports teams, professionals, experts, celebrities, and artists engage their fans
and  audiences  with  rich  content,  entertainment, and commerce offerings in a
trusted,  simple,  easy, and fun way on the internet.  With a focus on the value
delivered  to  each  citizen,  the  community  will  develop through methods and
promotional  efforts  designed  by  us.

OUR  GOALS

     We  believe  that  the  current  structure  and  future developments of the
Nettaxi  website  offer us a strong variety of sources for garnering significant
revenue.  These  sources  include:

-  E-COMMERCE     Direct Nettaxi sales of products, including products linked to
                  events  in  subscribers'  Remind  Me  files,  and products
                  targeted to users and subscribers  on  the  basis  of  their
                  interests  and patterns of activity when surfing  Nettaxi.com;

                  Transaction  processing  fees  from  credit  card  and
                  eCharge  processing services;

                  Support  service  fees,  where  applicable, for providing
                  specific business services  that  support  the  e-commerce
                  activities  of  Nettaxi  subscribers;

                  Percentage  splits with subscribers of the list price of goods
                  sold through their  e-commerce  storefronts  in  Nettaxi
                  communities;  and

                  Sales  commissions  negotiated  with vendors for products sold
                  directly by Nettaxi  and  through  Nettaxi  subscriber
                  e-commerce  storefronts.


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<PAGE>
-  ADVERTISING    Spot  and banner advertising can be sold at premium prices to
                  advertisers,  by  virtue  of offering them large, highly
                  targeted audiences that are  demographically  segmented,  as
                  well as the opportunity to rotate and keep "fresh"  the  ads
                  presented  to  a  viewer;

-  SUBSCRIPTION   Premium  service  account  monthly  subscription fees;
   FEES

-  CD  ROM        Co-branding  and licensing of our CD-ROM product  to  select
   DISTRIBUTION   third  parties;
   ROYALTIES


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<PAGE>
     In  order  to realize our strategic initiatives, we will seek to accomplish
the  following  principal  goals:

     DEVELOP INFRASTRUCTURE, BUILD PREMIUM CONTENT, LAUNCH E-COMMERCE.  Over the
next  12  months, we are looking to further develop our managerial and technical
infrastructure,  enhance  the quality and depth of our content by developing new
relationships  with  premium content providers, develop and customize e-commerce
systems  to  meet  our  requirements,  establish  relationships with fulfillment
operations  to  support  our  e-commerce  services,  and  launch  our e-commerce
products  and  services.

     REFINE  OFFERING  AND EXPAND DEMAND.  Once our initial strategic goals have
been  accomplished,  we  are  looking  to  refine  our  offering of products and
services  and  expand  demand by enhancing consumer services through call center
automation  and e-mail service and deploying an aggressive marketing campaign to
create  real excitement about our site. We also hope to raise additional capital
for  brand  development  and  expansion  of  our  operations.

     GAIN  SIGNIFICANT MARKET SHARE AND CONSOLIDATE COMPETITORS.   Within two to
three  years,  we  hope  to  gain  significant  market share and consolidate our
competitive  position  by  acquiring  strategic  online  community companies and
continue  an  aggressive  plan  of  infrastructure  expansion.

     As  previously  described,  our  ability  to  achieve the objectives of our
strategic growth plans are subject to the risks set forth in the section of this
Form  called  "Risk  Factors" including the limited resources we have, our
ability  to  obtain  additional resources, our reliance on third parties for the
development  of  software and content as well as the uncertainties involved with
the  rapidly  changing  business  and  technological  environment  for  Internet
companies.

RECENT  ACQUISITION

     In  May  1999,  we  completed  the merger with Plus Net, Inc.  Plus Net was
founded  in  1998  and  has  licensed  a wide range of Internet related tools to
generate  revenue opportunities. Plus Net operates a portal website on the World
Wide Web with a robust search engine that brings back the top ten results of the
web's  most  popular search engines and return results within a specific subject
category,  while  enhancing  electronic  commerce and advertising opportunities.
Plus  Net  also  has  an  e-commerce  processing engine which is compatible with
interfaces  enabling  the  acceptance of online credit card transactions and the


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processing  of  these  transactions  with  banking  institutions.  The  Plus Net
e-commerce capabilities also support one-click buying opportunities and programs
designed  to  prevent  credit  card  fraud.  These  features will accelerate our
research and development efforts, and will enrich the Internet experience of our
subscribers.  We  intend  to  continue  to  implement and integrate the services
offered  by  Plus Net throughout 2000. The Plus Net merger also provides us with
access  to  a  large  pool  of  potential  subscribers  and  provides us with an
opportunity to substantially increase the citizenship base within our community.

OUR  WEB  SITE  AND  SERVICES

OUR  WEBSITE

     The  Nettaxi.com  website,  at  http://www.nettaxi.com,  is structured as a
virtual "urban" environment, populated by subscribers referred to as "citizens",
that  is  divided  into  broad  "zones," which are further divided into thematic
"communities,"  and  from  there  into  "streets"  and  "homes."

     When  users  first  arrive  at  Nettaxi.com,  they are in the broad "urban"
environment, where they find links to the "zones," which include categories such
as:

     -     Member  Services,  Registration,  and  Communities;
     -     community  information  links  such  as  Message  Boards,  and
     -     links  to  premium  content  such  as  Sports  Scores, Weather, Stock
Quotes,  or  Travel.

     Clicking  on one of the links -- for example, Communities -- takes users to
the  next  level, where they can choose from an extensive list of categories, or
"communities."  Choosing  one  community,  such as the Arena District theemed to
sports  events  and  activities,  takes  users  to  a  list of subcategories, or
"streets,"  such  as the basketball-oriented Hoops Avenue. Once on the "street,"
users  can  select to visit any of the various "homes," which are the individual
web  pages  of  our  subscribers.

     Clicking  on  a  premium  content link in the "urban" environment follows a
similar  pattern,  but  may  differ  in  the  number  and  types of category and
subcategory  levels,  depending  on  the content they offer. The premium content
links  lead  to the special web pages of our major content providers, as opposed
to  subscriber  pages.

NETTAXI'S  "TAXI"

     A key feature of our site is that users in a hurry to get somewhere will be
able  to  "step into" a "taxi", a specially configured search engine, which they
will  find waiting in all areas and levels of our environment. Users simply type
in  a  "destination" such as "sports," and they are immediately whisked first to
our  main  sports  areas  which  include the relevant premium content provider's
web  site,  followed  by  the  Top  10 subscriber sports "homes," and then on to
other  sports  sites,  including those on the rest of the web.  As a result, the


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<PAGE>
search  engine  has  the  ability  to  drive  traffic to e-commerce sites in our
community,  including  premium  content  providers'  sites,  thereby  propelling
transaction  processing  fees  and  drawing  new  e-commerce  business  to  the
community.  In addition,  our  search  engine  provides  greater  value  to  our
users  since  it presents  small,  manageable  groups  of  "destination" choices
in response to a search, as opposed to an overwhelming volume of listings turned
up  by  most  other
search  engines.

     We  are  exploring  the  possibility of eventually serving content to users
based  on  their  preferences,  which  will  be  determined  by  tracking  their
activities  as  they  surf  through  our  overall  Web site.  The result will be
content  that  is  automatically and seamlessly customized to a user's interests
and  tastes  so  that, for example, two different users with differing interests
who  take  a  "taxi"  using  the  same  search  term  might  arrive  at separate
destinations  or,  if  at  the  same  destination, are likely to be offered some
differences  in  content,  based  on  their  patterns  of  activity.

CONTENT

     A  key  component  of  our  current  and  future  plans  is  the  continued
development  of  relationships with providers of premium content in a variety of
categories.  The  purpose  of  these  relationships  is not to directly generate
revenue,  but  rather  to  enhance  the  quantity and quality of information and
content  on  our web site.  We believe that enhanced information and content may
lead to increased visitors to our site as well as increased subscriptions to our
services.  To  date,  we have established formal relationships with some premium
content providers.  The companies listed below provider substantially all of the
content  on  our  Web  site  that is currently provided by outside parties.  The
providers  are  listed  in  order  by  the amount of content they provide to us.

     -     INFOSPACE.COM,  INC.  We  have  a  nonexclusive  content distribution
agreement with  Infospace.com,  an  aggregator  of  a  broad  range  of  content
services,  including  sports  scores,  late-breaking  news,  weather,  concerts,
public  record  searches,  phone/address  searches,  classified  ads,  and daily
horoscopes,  for syndication to Internet portals and destination sites. The term
of  the  agreement is  one  year.  Although  this  agreement  is  technically  a
revenue  sharing  agreement,  it  generates  less  than  one  percent  of  our
revenues.  Infospace.com  currently  provides  the  majority  of  our  outside
party  content.

     -     SOLUTIONS  MEDIA,  INC.  ("SPINRECORDS.COM").  We  have  a
nonexclusive  agreement  with  Spin  Records  to  co-brand  its  content, which
includes  digital audio/video  music files in the MP3 format, which Spin Records
has  licensed  from  independent  artists.  This  audio/video  content  is
downloadable  by  our  subscribers  from  Spin Records for banner advertisements
shown  on  these  co-branded  content  pages,  and  e-commerce revenues  for our
  citizens  who  purchase licensed content or merchandise from these  co-branded
web  pages.  Also under the terms  of  this  agreement,  both Spin  Records  and
Nettaxi.com are required to co-market,  advertise and promote the  other party's
website.  This  agreement  has a  term  of  one  year,  and currently  accounts
for  approximately  13%  of  our  revenues.


                                       15
<PAGE>
     -     BIG  NETWORK.COM.  We  have  entered  into  a  co-marketing agreement
with  Big  Network.com  which  will  provide  our  subscribers  with  immediate
access  to  the  BigNetwork.com  suite of classic board and card games including
chess,  checkers,  backgammon,  reversi,  spades,  morph  and  more.  The
nonexclusive agreement will also allow our subscribers to interact in  real time
with  the  200,000  registered  members  of  BigNetwork.com.  This  arrangement
also  allows  our  subscribers to embed  Java-based  games  into  their  own Web
sites.  For  those  subscribers  who  have  developed  and  integrated their own
personal  Web  pages  into  our  community,  they  will  be  able  to  create an
interactive  gaming  environment  suited  to  the  specific  needs  of  their
visitors.  The  term  of the agreement is one year. This agreement is an expense
sharing  agreement  and  generates  less  than  one  percent  of  our  revenues.

     -     PI  GRAPHIX.  We  have  a  nonexclusive  linking  agreement  with  PI
Graphix,  a  provider  of  an  online  community  with  e-commerce  capabilities
and extensive graphics  capabilities  under  which we have linked and co-branded
our  site  with  theirs  in  order  to  increase  traffic.  The  term  of  the
agreement  is one year. Although this agreement is technically a revenue sharing
agreement,  it  generates  less  than  one  percent  of  our  revenues.

     -     NETOPIA,  INC.  We  have  a  nonexclusive  agreement  with Netopia, a
provider  of  next  generation  products  including  web  site  services  and
high-speed connectivity  to  the  Internet, under which Netopia provides us with
technology  that  enhances  our  ability to provide services to our subscribers.
The  term  of the  agreement is two years. This agreement is an expense  sharing
agreement  and  generates  less  than  one  percent  of  our  revenues.

     -     SPIN  MEDIA  NETWORK,  INC.  ("SPINWAY").  We  have  entered  into an
exclusive  agreement,  effective  November  1999,  with  Spinway  to  offer  a
co-branded  free Internet  Service  Provider,  or  "ISP", service to our
subscribers.   Under the terms  of  this  agreement,  we share advertising
revenues with Spinway that are derived  from  the  sales  to advertising clients
of pop-up video advertisements viewed  by subscribers as they log on to this ISP
service.  Also under the terms of  this agreement, we are able to offer a paid
ISP service through Spinway on a non-exclusive  basis.  The  term of this
agreement is two years.  This agreement currently  accounts  for  less  than
one  percent  of  our  revenues.

     Under  our  agreements,  we  provide  co-branding  services  to the content
providers  listed  above.  The  content included on our web site is branded with
the logo and similar brand features of the relevant providers.  We also increase
the  traffic  to  their own web sites by linking our sites so that end users can
easily  move  from  our  web site to theirs. We are also working to identify and
develop  a  selection of relationships with providers of proprietary information
content,  particularly individuals and organizations with archives and databases
that  could be easily rendered into digital format.  We believe that a carefully
developed  selection  of  such databases,  would act as a powerful attraction to
the  type  and  volume  of  subscribers  that  our  advertisers  find desirable.

     Our subscribers also provide personal or entrepreneurial/commercial content
that  is  available  on  our website.  We offer each of our subscribers, free of
charge,  10  megabytes  of  server  space to use for a home page and e-mail.  In
addition,  subscribers  have access to free, easy-to-use website design software
to  build  their  web home page, and they can designate the community and street
where  they  would  like  to  have  their  home  page  located.


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<PAGE>
E-MAIL  SERVICES

     Our  e-mail  services  surpass  those  of  other  portals and full-featured
internet  service providers by being available though both Post Office Protocol,
POP,  and  the Web, IMAP. To the best of our knowledge, ours is the only service
today  to simultaneously offer subscribers both types of e-mail access for free.
Nettaxi's  e-mail service also allows its Citizens and small businesses to offer
a  free  Web-based  email  service  with a unique domain name, e.g., me@you.com,
giving the domain name free promotion with every email sent. There's no software
for  the  user to download and all mail and maintenance are provided by Nettaxi,
with  no  added  inconvenience  to  the  webmaster.  The  look  and  feel can be
customized  to  look  like  the  subscriber's  home  page.

     POP  e-mail  is  the type most commonly used by Internet service providers.
Its  primary  advantage for users is that messages are sent and received quickly
and  with  more  privacy,  because they do not stay resident on a server for any
length  of  time.  Its  greatest  disadvantage  is  that  e-mail  messages, once
delivered  to  a  user, are generally no longer available for download again, so
that a user who downloads e-mail to a home computer, for example, will generally
not  be able to download the same mail at a later time to another computer, such
as  one  at  work.

     IMAP,  or  web-based  e-mail, most commonly used by portal services, allows
users  to  retrieve  e-mail messages from any location that offers access to the
Internet  and  a  specific website.  Sending and receiving messages may be a bit
slower  than POP services, but messages are stored on a server, can be retrieved
multiple  times, and remain available until they are either specifically deleted
by  the  user,  or  a  set  amount  of  time  has  passed.

     Subscribers  to  all  levels  of  our  services will have both POP and IMAP
e-mail  capabilities,  and a distinct @nettaxi.com address or @ their own custom
domain  name.

"REMIND  ME"  SERVICE

     As  a  special  feature, we will offer our subscribers Remind Me, a service
that  functions  like  an  electronic  datebook.  Subscribers  can  enter  their
important  dates  and  appointments,  with  requests  to  be reminded of them at
specified times, which can be as far  ahead as a month or a few hours. Remind Me
is  structured to allow users to specify the type of event being listed, such as
a  birthday  or  anniversary,  by  simply  entering  important  dates  and their
corresponding  event.  Keywords  in  these  fields  trigger Remind Me to suggest
event-appropriate  products and/or services.  Some of these will be available at
no  charge  to subscribers, e.g., electronic greeting cards and virtual flowers.
Others  will  be  available  for purchase or subscription directly through us or
through  our  subscriber  "storefronts" and advertiser sites, driving traffic to
both,  and offering us opportunities for generating revenues through transaction
processing  and  other  fees,  where  appropriate.


                                       17
<PAGE>
E-COMMERCE  SERVICES

     One   of  the   key  features   that  we   will  offer   members   is   the
opportunity to become  on-the-spot  entrepreneurs.  We  are currently developing
ready-to-use-commerce capabilities  that  are  aimed  at  providing  members and
corporate clients who wish  to  launch  an  online  e-business  with  a  bundled
ready-to-use variety of services designed to meet their  needs.  These  services
will  include  a  customized  storefront,  customer  order  processing,  account
management,  credit  card processing,  and,  in  certain cases,  back-end  order
fulfillment  needs.  In conjunction  with  these  product offerings,  member  or
corporate clients will be able  to  purchase  advertising packages  within their
communities to help market their  products  or  services, as well as email tools
that will provide them the capability to  direct market  to their customer base.

     Commercial  Web Site Hosting.  Premium account subscribers will be provided
with  commercial  website  hosting  services,  on  top-of-the-line  servers with
redundant  capabilities, to maintain an online presence 24 hours a day, 7 days a
week.  Hosting  services  will include full commerce capability, including major
credit  card  and  eCharge  services,  for  secure  online transactions, driving
traffic  to  the site, and a variety of other commerce-related services, such as
sourcing  and  fulfillment.

     Wholesale  Supply  Of  Products.  As  part  of  our ready-to-use e-commerce
business  services,  we intend to offer subscribers sourcing services to provide
them  with  the  products  they  are  marketing  at  wholesale  prices  and on a
just-in-time  basis,  eliminating the need for warehousing.  Through negotiating
with  vendors,  we  will  be able to provide subscribers with the convenience of
access  to  a group of reputable, quality suppliers identified as appropriate to
their  business,  and the ability to source products at wholesale and discounted
price  levels normally reserved for large commercial enterprises. These services
will be on an optional per transaction, or contract volume basis.  We benefit by
receiving  a pre-negotiated commission/transaction fee from the wholesale vendor
for  each  sale.

     Our  recent  merger with Plus Net will also enhance our e-commerce ability.
Plus  Net  has  recently  launched  e-commerce  processing  operations  which is
compatible  with  interfaces  enabling  the  acceptance  of  online  credit card
transactions and the processing of these transactions with banking institutions.
The  Plus  Net e-commerce capabilities also support programs designed to prevent
credit  card  fraud.

INTERNET  THE  CITY  CONNECTED  CD  ROM

     It  is  a  well-recognized  truism  that technology, and personal computers
particularly, are typically not used to their fullest potential.  Paradoxically,
while  vast  arrays  of  information  and  services  are  already  available  to
proficient  Internet  users, prospective or neophyte users typically postpone or
limit  their  usage  due  to  their  lack  of  understanding  and  experience in
navigating  the  Internet.  While it is true that 42.9% of U.S. households owned
personal  computers  in  1998,  less  than  half  of those households are active
Internet  users.  Furthermore,  trends  indicate  that  the  remaining  57.1% of
households  still  without  computers are steadily joining the ranks of computer
users  and  potential  Internet  users.


                                       18
<PAGE>
     Our  Internet  training  CD-ROM  was  born  from  management's
conviction that an enormous untapped opportunity to capture the novice user lies
in  effectively  initiating  and  tutoring  this  huge  market  in a one-on-one,
interactive,  entertaining  way.  The  CD-ROM,  called  Internet  the  City is a
comprehensive, interactive training tool that enables new and intermediate users
to  learn  about  and begin using the many powerful capabilities and features of
the  Internet.

     The  professionally  produced  CD-ROM features an animated cyber-cabbie  --
URLtm  --  who  takes  users  wherever  they  wish to go. During the tour, URLtm
explains  and  demonstrates  how  features  such  as  e-mail, chat rooms, search
engines, Web sites, etc., work and can actually connect the user to our website.

     The  CD-ROM, with its "front end" connection feature, is a key component of
our  marketing  and  promotions  plan.  The  CD-ROM  serves  as vehicle to drive
users  to  our  website  in a manner that is far more efficient than traditional
means  of  advertising  and promotion. We intend to explore a variety of options
for  establishing  co-branding  and  sponsorship opportunities for promoting and
distributing  the  CD-ROM.

     We  currently  have  an agreement with Media Technology Services to provide
CD-ROM  duplication, delivery and packaging services.  We also have an agreement
with  Fountain Technologies, which bundles the CD-ROM with computer systems from
its  Quantex  Microsystems  and  Pionex  Technologies  subsidiaries.  Under  the
one-year  agreement,  we receive a per copy royalty of $0.45.  With our targeted
approach  to  distribution,  we potentially allow users of specific interests to
connect  to  a community  which addresses their interests.  We have  established
an  agreement with Apple Computer whereby Apple bundles the CD-ROM with its K-12
curriculum  bundle and as an optional upgrade to its iMac computer. We receive a
$1.00  per  copy  royalty under this agreement which is currently in place until
November  2000.  In the future, we plan to offer the CD-ROM to numerous computer
software  and  hardware  manufacturers, as well as other types of manufacturers,
for  bundling  with  their  respective  products.

     We  have  entered into an agreement with eBay, an online trading community,
under  which  we  will  develop a customized version of our instructional CD-ROM
product  designed  to  familiarize  end  users  with  the services of eBay. This
product  is  expected  to  include  basic Internet tutorials, a Nettaxi tour and
step-by-step interactive instructions on how to register on eBay, how to place a
bid  and  how  to  list  an  item for sale on the eBay site. Both companies will
finance development of the product and market and distribute it upon completion.
We  will  receive cash payments based on the number of new customers who use the
CD-ROM  to  join  eBay.

CUSTOMER  ACCOUNT  PLANS

     We  adhere  to  the  principle that providing excellent customer service is
integral  to  attracting  and,  more importantly, retaining subscribers. To that
end,  we  have  focused  on  the  development of a customer service organization
keenly  focused  on  satisfying  demand  and  creating  customer  loyalty.


                                       19
<PAGE>
     To  provide  subscribers,  or  "citizens,"  with  choices  that  suit their
individual  needs,  we  offer  both free and premium accounts, on a tiered basis
similar  to the way that cable systems do.  Premium accounts are configured from
a  large  menu  of  options,  to  attract  subscribers and address the needs and
desires  of  particular  segments  of  online  users.

     BASIC  FREE  CITIZEN  ACCOUNT.  Like  most  portals,  we offer a free basic
service  package,  the  "free  citizen"  account,  to  attract a large number of
subscribers.  We  benefit  through  providing  a  broad  variety  of  subscriber
Web  pages  and  a  substantial  database  of user profiles, which enables us to
offer  large,  highly  targeted  audiences  to  our advertisers, and command the
higher  advertising  rates  that  demographically  segmented  audience  profiles
dictate.

     This  account  offers  the  following  package  of  features  and services:

     -     A  four  page  Virtual  Office;

     -     Free  Internet  access

     -     MyNettaxi,  personal  start  page;

     -     25  Megs  of  disk  space;

     -     Web Statistics - for analyzing  who is coming to their site and when;

     -     E-mail  service  for  one  personal  e-mail  account  with  a
userID@nettaxi.com  address;

     -     Remind  Me  service,  an  electronic  datebook;

     -     Web  hosting  services  for  a  free  website  -  for  personal  or
entrepreneurial  use  -- with a /citizens/userID web address, or URL, located in
the  subscriber's  community  of  choice;

     -     Child  protection  tools;

     -     Special  discounts  on  selected  Nettaxi  merchandise;  and

     -     Access  to  chat  sessions,  message boards, and shopping, as well as
premium  content  such  as  weather,  sports scores, stock quotes, services such
as  travel arrangements  and  packages, introductions to people who share common
interests,  and  more.

     Each  account  is  allotted  25  megabytes  of  storage  space  for  use.
Subscribers  are  provided  with  free,  easy-to-use  software for designing and
building  their  web  page,  tips  and  techniques  for  making  their Web sites
attractive  and  exciting  to  visit,  and our search engine to drive traffic to
their  website.


                                       20
<PAGE>
     PREMIUM  ACCOUNTS.  Our  premium  accounts  are  especially  attractive  to
entrepreneurs  who  would  like  to  establish  an  e-commerce  storefront  on a
ready-to-use basis.  Citizens can build premium accounts from a menu of options,
allowing them the ability to pick and choose which items they are interested in.
Option  can be added for additional fees.  In addition to the services which are
provided  to  free  service  account  subscribers,  premium  account holders are
provided  with  the  following  options:

     -     Nettaxi  Virtual  Office,  which  allows  users to build and maintain
their  own  virtual  office,  including  their  own  message boards, chat rooms,
calendar  and  task  manager,  address  book, etc. Users can build their virtual
office  through  and  easy-to-use  Web-based  interface;

     -     Free  Internet  access

     -     E-mail service for unlimited e-mail accounts,  each  with  a distinct
@nettaxi.com  address  or  your  own  domain  and  customized  look  and  feel;

     -     Commerce  capability,  including  major  credit  card  and  eCharge
services,  for  secure  online  transactions;

     -     Access  to  Nettaxi-sponsored  advertising  and  banner  ads,  and
other  cross-promotion  opportunities;

     -     Unique  domain  name;

     -     Disk  space  for  Web  page  hosting;  and

     -     Web statistics for analyzing who  is  coming  to their site and when.

     Premium subscribers are provided with professional website services for the
initial  Web  site's design and launch, to showcase the products and/or services
in  an  effective manner, as well as free, easy-to-use software for updating the
site  at  any time.  In addition, subscribers are provided with special tips and
techniques  for making their Web sites attractive and exciting to visit, as well
as mechanisms to drive traffic to their website, including our search engine and
strategically  placed, highly visible links to the site from other desirable web
locations.  Subscribers  wishing to have their own domain are charged a one-time
fee  to  register  the  domain  with  InterNIC  for  a  two-year  period.

CUSTOMER  ASSISTANCE

     To  maintain  Nettaxi.com as a portal that truly serves its subscribers and
reflects  their  interests  and  needs,  we invite and encourage subscribers and
visitors  to  send  in  their  comments  and  suggestions.  We track visitor and
subscriber  activities,  and  carefully  monitor the nature and content of their
comments,  as  part  of  our  strategy  for  continuing  product  refinement and
development.


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<PAGE>
     Regardless of the type of account selected, subscribers have access to free
online  help at any time by simply clicking on our Help icon and by visiting the
Message  Boards,  where they can review information posted by other subscribers,
or  post  a query of their own. Subscribers can also find information on billing
matters,  special  promotions,  upcoming events, etc., quickly and easily on the
Nettaxi.com  home  page.

     If they are unable to find what they are looking for, or if the information
they  find  is  confusing,  subscribers  can  submit  queries,  to which we will
actively  and  promptly respond with appropriate information or guidance. We are
also  currently  in  the  process  of  establishing  and  deploying
subscriber-to-subscriber  support  services,  which  are  provided  by  online
volunteers  in  exchange  for  free  account  upgrades  or  other  premiums.

WEB  HOSTING

     We  began  providing  Internet  hosting  and  connectivity  for  corporate
customers  in  1999.  Our  services  are  delivered  through  a state-of-the-art
Internet  data  center  located  in Southern California using a high-performance
Internet  backbone  network.  Customers  pay  monthly  fees for the professional
services utilized, one-time installation fees, and monthly connectivity charges.
These  "hosting"  revenues  are  recognized  in  the  period  the  services were
provided.

     For  the  twelve  months  ended  December  31,  1999,  web hosting revenues
accounted  for  19%  of  total  revenues.

ADVERTISING

ADVERTISING  SALES  AND  DESIGN

     We  seek to distinguish ourselves from our competition through the creation
of  advertising  and  sponsorship opportunities that are designed to build brand
loyalty  for our  corporate sponsors by seamlessly integrating their advertising
messages  into our content. Through our close relationship with our subscribers,
we have the ability to deliver advertising to specific targets within our site's
theme  content areas, allowing advertisers to single out and effectively deliver
their messages to their respective target audiences.  For example, an advertiser
can  target  its  message  solely  to  women  with an interest in recreation and
sports.  We  believe that such sophisticated targeting is a critical element for
capturing  worldwide  advertising  budgets  for  the Internet.  Additionally, we
intend  to  expand  the  amount  and  type  of  demographic information our site
collects  from  our  members, which will allow us to offer more specific data to
our  advertising  clients.

     We  intend  to build a direct sales organization of professionals dedicated
to  maintaining  close  relationships  with advertisers and advertising agencies
nationwide.  We  also  intend  to  enter  into  arrangements  with  a  number of
third-party  advertising sales representatives pursuant to short-term agreements


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<PAGE>
that  in  general  may be terminated by either party, without notice or penalty.
The  sales organization would consult regularly with advertisers and agencies on
design  and  placement  of  their  Web-based advertising, provide customers with
advertising measurement analysis and focus on providing a high level of customer
service  and  satisfaction.

     Currently,  advertisers  and  advertising  agencies  enter  into short-term
agreements,  on  average  one  to  two  months, pursuant to which they receive a
guaranteed  number  of  impressions  for  a  fixed fee.  Advertising on our site
currently consists primarily of banner-style advertisements that are prominently
displayed  at  the  top  of  pages  on  a  rotating  basis throughout our online
community,  including  members'  personal  Web  sites.  From  each  banner
advertisement,  viewers  can hyperlink directly to the advertiser's own website,
thus  providing  the  advertiser  an  opportunity  to  directly interact with an
interested  customer.  Our standard cost per thousand impressions depends upon a
number  of factors including the location of the advertisement, its size and the
extent  to  which  it  is  targeted  for  a particular audience.  Discounts from
standard cost per thousand impressions rates may be  provided for higher volume,
longer-term  advertising  contracts.

     We  intend  to increase our advertising revenues by focusing on a number of
key  strategies,  including  expanding  our  community  content  expanding  our
advertising  customer base, increasing the cost per thousand impressions charged
to  advertisers by continuing to improve our ability to target advertisements to
demographically  distinct groups,  increasing page views, increasing the average
size  and  length  of  our  advertising  contracts, increasing the number of our
direct sales representatives,  and continuing to invest in improving advertising
serving  and  advertising  targeting  technology.

     We  also  offer  special  sponsorship and promotional advertising programs,
including  contests,  sampling  and  couponing  opportunities  to  build  brand
awareness,  generate  leads  and drive traffic to an advertiser's site.  We also
intend  to  sell  sponsorships of special interest pages where topically focused
content  is  aggregated  on  a  permanent  area  within  a  neighborhood.

ADVERTISING  CUSTOMERS

     Recently  we  have  begun to successfully attract both mass market consumer
product  companies  as  well as technology-related businesses advertising on the
Internet.  Due to our advantages as a community Web site, we believe that we are
well  positioned  to capture a portion of the growing number of consumer product
and  service  companies  seeking  to  advertise  online.

BANNER  ADVERTISING  FOR  SUBSCRIBERS

     To  help  support  and  drive  traffic to the e-commerce storefronts of our
Platinum  Service  account subscribers, and expand co-branding opportunities, we
intend  to  offer  special  cross-promotion  opportunities,  including  periodic
Nettaxi-sponsored  advertising  and  banner  ads  at  a  variety  of  locations
throughout  our  web  site.  The  banners  will  be  of the same high quality as
those  sold  at  premium prices to outside advertisers.  Placement of the banner
ads  will


                                       23
<PAGE>
be  determined  by  a variety of factors, including appropriateness of location,
opportunities  for  co-branding,  and  eventually  even the activity patterns of
visitors  and  subscribers  to  our  web  site.

     We  intend  to  implement  special  software  on  our  web  site  in  the
immediate  future.  The  software  allows  us  to  track  a user surfing through
the overall web site,  follow  the user's patterns of activity, present ads that
are  targeted  and  relevant  to  the  user's  interests,  and  recommend
particular  products  or  services,  based  on  the  user's  activity  profile.

     In  addition,  the software will be able to track the particular banner and
other  advertising  to  which the user has been exposed while visiting our site.
This will provide us with a record of the number and type of advertisement views
accessed  by users over a specified period of time, useful for determining rates
for  outside  advertisers  wishing  to  have a presence on our website.  It will
also provide us with the opportunity to rotate the particular ads it presents to
a  user to keep the ads "fresh" and appropriate in context.  Eventually, we hope
to  expand  our  activity tracking functions to include serving content to users
based on their preferences.  The result will be content that is customized for a
user,  automatically  and  seamlessly.

     We  have  also  licensed  advertisement  management software from Accipiter
Technology,  and written some custom code to extend the software's capabilities.
The  software  tracks  how  many  ads are served on the website, which areas and
which  pages  to  which  they were served, and how many people have "clicked" on
them.  The  software  allows  us  to  manage  its  advertisement  selection  and
placement by providing an accurate advertisement count on both a real-time and a
compiled-over-a-specified-time  basis,  information  crucial  to  billing  an
advertiser.  The  software  also  provides advertisers with the ability to audit
their advertisement performance on our website on a real-time basis.  We provide
a user ID and password to the advertiser, who can then come onto the website and
track  their  ads  at  any  time.

     LINKING  AGREEMENTS.  We  are  continuously  looking  for  opportunities to
connect  our  web  site  through  links  with  other  sites  in  a way that will
increase  the  number  of  visitors  to,  and potential new subscribers for, our
community.  We have  entered  into  a  linking  and  promotion agreement with PI
Graphix,  which  provides e-commerce systems and related information services on
its  own web site. Under  the  agreement,  our  Web sites are linked and we work
with  PI  Graphix  to develop  methods  of  increasing cross traffic between the
sites.  Our  agreement with  PI  Graphix  permits  us  to  allow  end  users  to
post three-dimensional descriptions  of  the  products  they  wish  to  sell  on
our  web  site.

     ADVERTISING  PROGRAMS.  We  plan  to  invest in online advertising to drive
traffic  to our site by placing advertisements on selected high volume sites, as
well  as  purchasing targeted keywords on several popular search engines such as
Yahoo!,  Excite,  Lycos,  Infoseek  and  others.  We  also  plan to advertise in
traditional  media  such  as  print, radio and broadcast, on a selective, highly
targeted  basis,  to  increase  the  awareness  of  our  site.

     PUBLIC  RELATIONS  SUPPORT.  By  virtue  of  its  broad  appeal  and


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<PAGE>
"entrepreneurial" focus, we anticipate that a targeted public relations campaign
will  yield  material  results  in building both national and targeted local and
regional  awareness  for Nettaxi.   We do not currently have an agreement with a
national  public relations professional, but intend to enter into an arrangement
with  a  suitable  public  relations  company  in  the  future.

     TRADE  PUBLICATIONS.  An  effective  and  extreme  inexpensive  method  of
bolstering  awareness  of  the  Nettaxi  brand  is  editorial inclusion in trade
publications  that  target the various industry groups with which  we seek to do
business.  We  believe  that  several  factors  make  us  a  prime candidate for
editorial  coverage  in trade publications for the Internet industry, as well as
the  general  media.  They  include:

     -     Our  integration  of  online  community  with  premium  content  and
ready-to-use  e-commerce  services;

     -     Our  "entrepreneurial"  focus;  and

     -     The  growth  of  traffic  to  our  online  community  web  site.

     We  will  seek  out  high-impact editors and reporters at publications that
serve  the  Internet  industry.  We will also seek to place articles and columns
written by our staff and management in various publications.  This will serve to
enhance  our  credibility  and establish and promote our management and staff as
experts.

OPERATIONS  AND  INFRASTRUCTURE

ADMINISTRATIVE  OPERATIONS

     To  provide  our  subscribers  with  the  most  efficient,  flexible,  and
innovative services possible, our administrative operations combine in-house and
outsourced  services  and functions.  Our strategy is to keep our in-house staff
small,  with  a  focus  on  core  competencies  in  technical  and  research and
development  areas,  and  to  outsource  other  functions  and  projects  on  an
as-needed  basis.

     Internal  functions  currently  include  account  management,  traffic
management,  website  service  updates, and other network functions that rely on
UNIX  shell  scripts; the continued development and updating of the Internet the
City  CD-ROM  to add to its capabilities and increase co-branding opportunities;
and  establishing  and  managing  relationships with premium content  providers,
product  vendors,  and other appropriate parties.   We intend to further develop
our  in-house  production  facilities  to  support  the  development of original
content,  including  interactive  content for our site and specialty content for
our  advertisers.

     Outsourced functions include providing and maintaining network hardware and
Internet  connections,  providing  premium  content  for  our site and providing
subscribers  with  selected  e-commerce business services, including credit card
and  eCharge  billing  services,  and managing an extensive product database and
tracking  its  related  customer  activities.


                                       25
<PAGE>
INFRASTRUCTURE  &  SYSTEMS

     The  development of an infrastructure with an Internet-centered network and
database  system  that  allows us to serve information and facilitate e-commerce
transactions  on  behalf  of  our  subscribers'  Web  sites  is  integral to the
implementation  of  our  web  community  and  ready-to-use e-commerce storefront
concept. to accommodate the substantial transaction volume that we anticipate as
we  build  our  online  community  of  subscribers,  or "citizens", vendors, and
information.  At  this  time,  the  basic  components  of  our  technology
infrastructure  are  substantially  in  place  and  operational.

     Our  UNIX-based  electronic  network  for  Nettaxi.com  operates  on  a one
terabyte  Ethernet  backbone,  with  two  Cisco  Systems  Ethernet switches that
prevent  collisions  on  the  network.  Traffic direction for the web servers is
handled by Arrowpoint's CS-100, which tracks server load conditions in real time
and  sends  traffic  to the most appropriate server to spread around and balance
the  load. The network is comprised primarily of Sun  Microsystems high-capacity
servers, and  include a mix of Enterprise 450s, Ultra 1, and Ultra 5 models, all
running  the  newest  version of Sun's Solaris operating environment for network
systems.  These servers collectively provide approximately 1.6 terabytes of hard
drive  space  for  subscriber  capacities.

     In  addition,  the  network  currently  includes  NT  servers  to  handle
registration  and  selected  other  database  functions,  using  Microsoft's SQL
database  software.  However,  we have embarked on an ambitious program to shift
our  database functions over to a 3-tier database connectivity architecture that
relies  heavily  on  Web  Objects  technology  -  database connectivity software
licensed  from  Apple  Computer--to  provide  more  robust  and  easier-to-use
capabilities  for  subscription  registration, browsing through our communities,
and  subscriber  personalization  of  web  pages,  and  to allow us to track and
extract  user  profile  and  activity  data  more  easily  and  in  more detail.

SERVER  MAINTENANCE

     Our  electronic  network  is  located  both  at  Alchemy  Communications in
Southern  California  and  at  the Exodus Communications Internet Data Center in
Santa  Clara, California.  Exodus Communications is a provider of server hosting
and  provides  our  web  site with its connection to the World Wide Web.  Exodus
operates  Internet  Data  Centers in several US locations, as well as in London,
and  includes  several  major  Internet  companies  among  its  clients.

     Through its network co-location agreement with Exodus, we are provided with
a  secure  location  for  its  network  servers,  multiple  high-speed  Internet
connections,  and  access  to  24-hour-a-day,  7-day-a-week  technical  support
personnel  and  services.  Exodus  also  provides  critically important routing,
redundancy,  and  maintenance  services  for  the  network  and  its  Internet
connections,  as  well  as  a back-up power supply capable of continuing network
operations  for  up  to  a  week  in  the  event  of  a  power  failure.


                                       26
<PAGE>
COMPETITION

     The markets in which we are engaged are new, rapidly evolving and intensely
competitive,  and  we  expect  competition  to  intensify further in the future.
Barriers to entry are relatively low, and current and new competitors can launch
new  sites  at  a relatively low cost using commercially-available software.  We
currently  or  potentially  compete  with a number of other companies for users,
advertisers  and  electronic  commerce  marketers,  including  a number of large
online  communities  and  services  that  have  expertise  in  developing online
commerce,  and  a  number  of  other small services, including those that  serve
specialty  markets.

     Other  companies  that  are  primarily  focused on creating Internet online
communities  include  Tripod  and  AngelFire,  subsidiaries  of   Lycos;  Yahoo,
theGlobe.com,  Xoom.com, Alloy  Online,  iVillage,  and  Tripod,  in the future,
 Internet communities may  be  developed  or  acquired  by  companies  currently
operating  Web  directories,  search engines, shareware archives, content sites,
Internet  Service  Providers  and  other entities, which may have more resources
than  ours.

     In  addition,  we  currently  and  in  the  future  face  competition  from
traditional  media companies, a number of which, including Disney, CBS, Fox  and
NBC, have  recently   made  significant  acquisitions or investments in Internet
companies.

     Furthermore,  we  compete  for  users  and  advertisers  with other content
providers  and  with  thousands  of  Web  sites  operated  by  individuals,  the
government  and  educational institutions. Such providers and sites include AOL,
Angelfire,  CNET, CNN/Time Warner, Excite, Hotmail, Infoseek, Lycos,  Microsoft,
Netscape,  Switchboard,  Xoom,  ESPN.com,  ZDNet.com  and  Yahoo!

     We  believe  that  the  following are the principal competitive factors for
companies  seeking  to  create  online  communities  on  the  Internet:

     -     community  cohesion  and  interaction;

     -     customer  service;

     -     brand  recognition;

     -     web  site  convenience  and  accessibility;

     -     price;

     -     quality  of  search  tools;  and

     -     system  reliability.


                                       27
<PAGE>
     Once  our  e-commerce  functions  become fully operational, we will also be
competing  with  companies  in  the online commerce market.  This market is new,
rapidly  evolving  and  intensely  competitive.  Current and new competitors can
launch  new  Web  sites  at relatively low cost.  The products and services that
might  be  offered through our site will compete with other retailers and direct
marketers,  some  of  which may specifically target our potential customers.  We
anticipate that we will compete with various mail-order and Web-based retailers;
various  traditional  retailers,  either  in  their  physical  or online stores;
various  online  service  providers  that  offers  products  of  interest to our
potential  customers,  including  AOL,  Microsoft, and other providers mentioned
above;  and  e-commerce  Web  sites,  such  as  Amazon.com,  Etoys  and  CDnow.

     We  believe that the following are the principal competitive factors in the
online  commerce  market:

     -     brand  recognition;

     -     quality  of  site  content;

     -     merchandise  selection;

     -     convenience;

     -     price;

     -     customer  service;  and

     -     reliability  and  speed  of  fulfillment.

     Many  of  our  current  and  potential  competitors  have  longer operating
histories,  larger  customer  bases, greater brand recognition in other business
and  Internet  markets  and  significantly  greater  financial,  marketing,
technical  and  other  resources  than  us.  In  addition, other online services
may  be  acquired  by,  receive  investments from or enter into other commercial
relationships  with  larger, well-established and well-financed companies as use
of  the Internet and other online services increases. Therefore, our competitors
with  other  revenue  sources  may  be  able  to  devote  greater  resources  to
marketing  and promotional campaigns, adopt more aggressive pricing policies and
devote  substantially more resources to Web site and systems development than us
or  may  try  to  attract  traffic  by  offering  services  for free.  Increased
competition  may  result  in reduced operating margins, loss of market share and
diminished  value  of  our  brand.

     A key factor that will set us apart from other portals in the future is our
ability  to offer subscribers of ready-to-use e-commerce capabilities, including
full  hosting  of  a  subscriber's  domain,  e-commerce storefront building, and
fulfillment  and  billing  services.  However,  our e-commerce functions are not
yet  fully  operational,  and  there can be no assurance that we will be able to
compete  successfully against other e-commerce providers who may develop similar
services.  Further,  as  a  strategic  response  to  changes  in the competitive


                                       28
<PAGE>
environment,  we  may,  from  time  to  time, make pricing, service or marketing
decisions  or  acquisitions  that  could  have  a material adverse effect on our
business,  results  of operations and  financial condition. New technologies and
the expansion of existing technologies may increase the competitive pressures on
us by enabling our competitors to  offer a lower-cost service. Certain Web-based
applications that direct Internet traffic to certain Web sites may channel users
to  services  that  compete  with  us.  Any and all of these events could have a
material  adverse  effect  on  our business, results of operations and financial
condition.

INTELLECTUAL  PROPERTY

     We  currently have pending applications before the United States Patent and
Trademark  Office  for trademark and service mark protection for "Nettaxi", as a
brand  name  for our website, "Internet the City", the Company's CD-ROM training
product,  "URL",  our  animated  guide  character, and the Nettaxi "taxicab". If
these  applications  are  approved, protection will be available for the periods
prescribed  by  law.

     We  regard  the  protection  of  our copyrights, service marks, trademarks,
trade  dress  and  trade secrets as critical to our future success and rely on a
combination  of  copyright,  trademark,  service  mark and trade secret laws and
contractual  restrictions  to  establish  and  protect our proprietary rights in
products  and  services.  We  have  entered  into  confidentiality and invention
assignment  agreements  with  our  employees  and contractors, and nondisclosure
agreements  with our suppliers in order to limit access to and disclosure of our
proprietary  information.  There  can  be  no  assurance  that these contractual
arrangements or the other steps taken by us to protect our intellectual property
will  prove sufficient to prevent misappropriation of our technology or to deter
independent third-party  development  of  similar technologies.  While we intend
to  pursue  registration  of  our  trademarks  and service marks in the U.S. and
internationally,  effective  trademark, service mark, copyright and trade secret
protection  may not be available in every country in which our services are made
available  online.

     We  also  rely  on technologies that we license from third parties, such as
the  suppliers  of  key  database  technology, the operating system and specific
hardware  components  for  our  products and services. These licenses extend for
terms  ranging  from  one  year to perpetuity and are subject to satisfaction of
conditions  laid  out  in  the  specific  licensing agreements.  There can be no
assurance  that  these  third-party  technology  licenses  will  continue  to be
available  to  us  on commercially reasonable terms. The loss of such technology
could require us to obtain substitute technology of lower quality or performance
standards  or  at  greater  cost,  which  could  materially adversely affect our
business,  results  of  operations  and  financial  condition.

     Although we do not believe that we infringe the proprietary rights of third
parties,  there  can  be  no  assurance  that  third  parties  will  not  claim
infringement  by  us  with  respect  to past, current or future technologies. We
expect  that  participants  in  our  markets  will  be  increasingly  subject to
infringement  claims as the  number of services and competitors  in our industry
segment  grows.  Any  such  claim,  whether  meritorious  or  not,  could  be
time-consuming,  result  in  costly  litigation, cause service upgrade delays or
require  us  to  enter  into  royalty  or  licensing agreements. Such royalty or
licensing agreements might not be available on terms acceptable to us or at all.
As  a  result,  any  such  claim  could  have a material adverse effect upon our
business,  results  of  operations  and  financial  condition.


                                       29
<PAGE>
GOVERNMENT  REGULATION

     Our  company,  operations  and  products  and  services  are all subject to
regulations  set  forth by various federal, state and local regulatory agencies.
We  take  measures  to  ensure  our  compliance  with  all  such  regulations as
promulgated  by  these  agencies  from time to time.  The Federal Communications
Commission  sets  standards and regulations regarding communications and related
equipment.

     There  are  currently  few  laws and regulations directly applicable to the
Internet.  It  is  possible that a number of laws and regulations may be adopted
with  respect  to  the  Internet  covering issues such as user privacy, pricing,
content,  copyrights, distribution, antitrust and characteristics and quality of
products  and services.  The growth of the market for online commerce may prompt
calls  for  more  stringent  consumer protection laws that may impose additional
burdens  on  those  companies  conducting business online.  Tax authorities in a
number  of  states  are  currently  reviewing  the  appropriate tax treatment of
companies  engaged in online commerce, and new state tax regulations may subject
us  to  additional  state  sales  and  income  taxes.

     Several  states have also proposed legislation that would limit the uses of
personal  user  information  gathered  online  or  require  online  services  to
establish  privacy  policies.  The  Federal  Trade Commission has also initiated
action  against  at  least  one  online  service  regarding  the manner in which
personal  information  is  collected  from  users and provided to third parties.
Changes  to  existing  laws or the passage of new laws intended to address these
issues,  including  some  recently proposed changes, could create uncertainty in
the  marketplace  that  could  reduce  demand  for  our products and services or
increase the cost of doing business as a result of litigation costs or increased
service  delivery  costs,  or could in some other manner have a material adverse
effect  on  our  business,  results  of  operations  and financial condition. In
addition,  because our services are accessible worldwide and we facilitate sales
of  goods to users worldwide, other jurisdictions may claim that we are required
to  qualify  to  do  business  as a foreign corporation in a particular state or
foreign  country.  Our  failure  to  qualify  as  a  foreign  corporation  in  a
jurisdiction  where  it  is  required  to  do  so  could subject us to taxes and
penalties  for  the  failure  to  qualify  and  could result in our inability to
enforce contracts in such jurisdictions. Any such new legislation or regulation,
or  the  application of laws or regulations from jurisdictions whose laws do not
currently  apply  to  our  business, could have a material adverse effect on our
business,  results  of  operations  and  financial  condition.

EMPLOYEES

     As  of  December  31,  1999,  we  had  29  employees,  including:

     -     3  in  customer  support;

     -     9  in  product  development;


                                       30
<PAGE>
     -     13  in  sales,  marketing  and  business  development;  and

     -     4  in  administration.

     We  believe  that  our  future success will depend in part on our continued
ability  to  attract,  integrate, retain and motivate highly qualified technical
and  managerial  personnel,  and  upon  the  continued  service  of  our  senior
management and key technical personnel.  The competition for qualified personnel
in  our  industry  and  geographical  location  is  intense, and there can be no
assurance  that  we will be successful in attracting, integrating, retaining and
motivating a sufficient number of qualified personnel to conduct our business in
the future. From time to time, we also engage independent contractors to support
our  research  and  development, marketing, sales and support and administrative
organizations.  We  have  never  had  a  work  stoppage,  and  no  employees are
represented  under  collective bargaining agreements.  We consider our relations
with  our  employees  to  be  good.

ITEM  1A.    RISK  FACTORS

     You should consider  carefully the following risks before you decide to buy
our  common  stock.  Our  business, financial condition or results of operations
could  be  materially  and  adversely  affected  by  any of the following risks.

WE  HAVE  A LIMITED OPERATING HISTORY, HAVE INCURRED LOSSES SINCE INCEPTION, AND
EXPECT  LOSSES  FOR  THE  FORESEEABLE  FUTURE

     We  were  incorporated in October 1997. Accordingly, we have only a limited
operating  history upon which you can evaluate our business and prospects. Since
our  inception,  we  have  incurred  net  losses, resulting primarily from costs
related  to  developing  our  Web  site,  attracting  users  to our Web site and
establishing  the Nettaxi.com brand. At December 31, 1999, we had an accumulated


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<PAGE>
deficit  of $13,336,400.  Losses have continued to grow faster than our revenues
during our limited operating history. This trend  is reflective of our continued
investments  in technology and sales and marketing efforts to grow the business.
Because  of  our plans to continue to invest heavily in marketing and promotion,
to  hire  additional  employees,  and  to  enhance  our  Web  site and operating
infrastructure,  we  expect  to incur significant net losses for the foreseeable
future.  We  believe  these  expenditures  are necessary to strengthen our brand
recognition,  attract  more  users  to  our Web site and generate greater online
revenues.  If  our  revenue  growth  is  slower  than  we  anticipate  or  our
operating expenses  exceed  our  expectations,  our losses will be significantly
greater.  We  may  never  achieve  profitability.

WE  REQUIRE  FURTHER  CAPITAL TO PURSUE OUR BUSINESS OBJECTIVES

     We  currently  believe  that we have sufficient cash to fund our operations
through  December  2000.   After  that  time,  we  will  be  required  to  seek
additional  capital  to  sustain  our  operations.  We  expect  to  generate  a


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<PAGE>
portion  of  the  necessary  cash flow through advertising and hosting revenues,
but  will also need to  obtain  capital  through other sources such as equity or
debt  financing.  We  cannot  assure you that we will be  able  to  achieve  and
sustain positive cash flow  or  profitability or that we will have other sources
available  to  provide  the  financial  resources  necessary  to  continue  our
operations.  Given  our  limited resources  and  our  history  of  losses   from
operations,  we will  also  need  to  raise  additional  funds in order to  fund
expansion of our business, to  develop  new  or  enhanced  services or products,
to  respond  to competitive  pressures  or  to acquire  complementary  products,
businesses  or technologies.  No  assurances  can  be  given,  however, that  we
will be able to  obtain  such  additional  resources.  If  we  are  unsuccessful
in  generating anticipated  resources  from  one  or  more  of  the  anticipated
sources,  and unable to  replace  the  shortfall  with  resources  from  another
source,  we may be able to extend  the  period  for  which  available  resources
would  be  adequate  by  deferring  the  creation  or  satisfaction  of  various
commitments, deferring  the introduction  of  various  services  or  entry  into
various  markets, and  otherwise  scaling  back  operations.  If  we are  unable
to  generate  the required resources, our  ability  to meet our obligations  and
to continue  our  operations  would  be adversely  affected.

WE  ARE  SUBJECT  TO THE RISKS AND UNCERTAINTIES FREQUENTLY ENCOUNTERED BY EARLY
STAGE  COMPANIES  IN  NEW  AND  RAPIDLY  EVOLVING  MARKETS

     Due  to  our limited operating history, we are subject to many of the risks
and  uncertainties  frequently  encountered  by early stage companies in new and
rapidly  evolving markets, such as e-commerce.  Among other things, we are faced
with  the need to establish our credibility with customers, advertising, content
providers,  and  companies  offering  e-commerce products and services, and such
parties  are  often  understandably reluctant to do business with companies that
have  not  had  an  opportunity  to  establish a track record of performance and
accountability.  For  example, our ability to enter into exclusive relationships
to  provide  content  over  the  Internet  will  be  dependent on our ability to
demonstrate  that  we  can  handle  high  volumes  of  traffic through our site.
Similarly,  early  stage companies must devote substantial time and resources to
recruiting  qualified  senior  management  and employees at all levels, and must
also  make  significant  investments  to establish brand recognition.  If we are
unable  to  overcome  some  of  these obstacles, we may be unable to achieve our
business  goals  and  raise  sufficient  capital  to  expand  our  business.


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<PAGE>
OUR  REVENUE  GROWTH  IN PRIOR PERIODS IS NOT INDICATIVE OF FUTURE GROWTH AND WE
CANNOT  ACCURATELY  PREDICT  OUR  FUTURE  REVENUES

     We  had  revenues  of  approximately  $5,032,800 and $258,000 for the years
ended  December  31,  1999  and  1998,  respectively.  While  our  growth  rate
has  been  strong,  it  is unlikely that revenue  will  continue to grow at this
rate  in  the  future  and  our performance during  these  periods should not be
taken  as  being  indicative  of  future  trends.  In  addition,  approximately
$1,285,000  of  the  revenues  for the year ended December 31, 1999 were derived
from  credit  card  transaction  processing fees,  a  revenue  stream  that  has
declined  significantly  and  will  not  be  significant  in  future  periods.
Accurate  predictions regarding our revenues in the  future  are  difficult  and
should  be  considered  in  light  of  our limited operating  history  and rapid
changes  in  the  ever  evolving  Internet  market.  For example, our ability to
generate  revenues  in  the  future  is  dependent in part on the success of our
capital-raising  efforts  and  the investments that we intend to make  in  sales
and  marketing,  infrastructure,  and  content  development.  Our  revenues  for
the  foreseeable  future  will  remain  primarily  dependent  on  the  number of
customers  that  we  are  able  to  attract  to our Web site, and secondarily on
sponsorship  and  advertising  revenues.  We  cannot forecast with any degree of
certainty  the  number  of  visitors to our Web site, the number of visitors who
will become customers, or the  amount  of  sponsorship and advertising revenues.
Similarly,  we cannot provide any guarantees regarding the revenues that will be
generated from e-commerce products and services that we intend to make available
on  our  site.

OUR  QUARTERLY OPERATING RESULTS MAY FLUCTUATE SIGNIFICANTLY, THEREBY INCREASING
THE  VOLATILITY  OF  OUR  STOCK  PRICE

     In addition to the uncertainties regarding the rate of growth of our future
revenues,  we anticipate that our operating results will fluctuate significantly
from quarter to quarter.  These fluctuations may be due to seasonal and cyclical
patterns  that  may emerge in Internet e-commerce and advertising spending.  For
example,  we  believe that the use of our Web site will be somewhat lower during
periods  of  the  year  if the patterns that currently effect traditional media,
such  as television and radio where advertising sales are lower during the first
and  third  calendar  quarters  because  of  the summer vacation period and post
winter  holiday season slowdown, develop in the Internet industry.  It is likely
that  similar  seasonal  patterns will develop in the Internet industry and thus
result  in  decreasing  revenues  for  us  during periods of the year. Quarterly
results  may  also vary for some of the same reasons and because it is difficult
to  predict  the  long-term  revenue  growth of our business.  If investments in
marketing  and  content development are delayed, we may experience corresponding
delays  in anticipated revenues from such investments, thereby leading to uneven
quarterly results.  Because of these factors, we believe that quarter-to-quarter
comparisons  of  our results of operations are not good indicators of our future
performance.  If  our operating results fall below the expectations of investors
in  future  periods,  then  our  stock  price  may  decline.


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<PAGE>
OUR  NEED  TO  RAISE ADDITIONAL CAPITAL MAY CAUSE OUR STOCKHOLDERS TO EXPERIENCE
SIGNIFICANT  DILUTION  IN  THE  FUTURE

     It  is  likely that we will need to raise additional funds in the future in
order to pursue our business objectives.  If additional funds are raised through
the  issuance of equity or convertible debt securities, the percentage ownership
of  our  stockholders  will  be  reduced, stockholders may experience additional
dilution  and such securities may have rights, preferences and privileges senior
to  those  of our common stock.  This may make an investment in our common stock
less attractive to other investors, thereby weakening the trading market for our
common  stock.

FUTURE  CONVERSION OF THE DEBENTURES AND EXERCISE OF THE WARRANTS AND INVESTMENT
OPTIONS MAY SIGNIFICANTLY  DILUTE YOUR  HOLDINGS; WE NEED TO REGISTER ADDITIONAL
COMMON  STOCK  FOR  SUCH  CONVERSIONS

     As of February 23, 2000,  an aggregate of  $2,400,000  principal  amount of
debentures were  outstanding,  which  debentures were convertible into shares of
our common  stock.  Such  debentures  entitle the holder to exercise  investment
options to purchase additional shares of our common stock upon conversion of the
debentures.  If  fully  converted  and  exercised  on  February  23,  2000,  the
debentures  and  investment  option  would be  convertible  into an aggregate of
4,396,170  shares of our common stock,  but this number of shares could prove to
be significantly  greater in the event of a decrease in the trading price of the
common stock due to required adjustments in the conversion price.  Purchasers of
our common  stock  could  therefore  experience  substantial  dilution  of their
investment  upon  conversion of the  debentures  and exercise of the  investment
options.  In addition,  as of February 23,  2000,  warrants to purchase  150,000
shares of common stock issued to the  purchasers of debentures  and  exercisable
over the next  five  years at a price of $7.857  (subject  to  adjustment)  were
outstanding.  We  do  not  currently  have  enough  shares  registered under the
Securities Act of 1933 to provide freely tradable stock upon  conversion  of the
remaining debentures  and exercise of the  conversion  option and warrants.  Our
agreement  with  the  holder  of  the debentures, conversion option and warrants
requires us to maintain this registration and our failure to do so  could  cause
us  to  incur  certain  penalties.  The  shares  of  common stock into which the
debentures may be converted  and the  investment options and the warrants may be
exercised  are  in  the process of being  registered;  however,  there can be no
assurance that such registration  will be declared  effective.  For a discussion
of  the  conversion  formula,  please  refer  to  the  section   below  entitled
"Description  of Capital Stock--Warrants and Debentures".

OUR  PLANNED  ONLINE  AND  TRADITIONAL  MARKETING  CAMPAIGNS  MAY  NOT  ATTRACT
SUFFICIENT  ADDITIONAL  VISITORS  TO  OUR  WEB  SITE

     We  plan to pursue aggressive marketing campaigns online and in traditional
media  to  promote  the  Nettaxi.com  brand  and attract an increasing number of
visitors  to  our  Web  site.  We believe that maintaining and strengthening the
Nettaxi.com  brand  will  be  critical  to  the  success  of our business.  This
investment  in  increased marketing carries with it significant risks, including
the  following:

     -     Our  advertisements  may  not  properly  convey the Nettaxi.com brand
image,  or  may  even  detract  from  our  image.  Advertising  in  print  and


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<PAGE>
broadcast  media  is  expensive  and  is  often  typically  difficult  to modify
quickly  in order to take into  account  feedback  that  may  indicate  that  we
have  failed  to  convey  the  optimal  message.  If  our advertisements fail to
positively  promote  our brand and image,  the  damage  to  our  business may be
long-lasting  and  costly  to  repair.

-     Even  if  we  succeed  in  creating the right messages for our promotional
campaigns, these advertisements may fail to attract new visitors to our Web site
at  levels  commensurate with their costs. We may fail to choose the optimal mix
of  television,  radio,  print  and  other media to cost effectively deliver our
message. Moreover, if these efforts are unsuccessful, we will face difficult and
costly  choices  in  deciding whether and how to redirect our marketing dollars.

WE  MAY  FAIL  TO  ESTABLISH AN EFFECTIVE INTERNAL SALES ORGANIZATION TO ATTRACT
SPONSORSHIP  AND  ADVERTISING  REVENUES

     To  date,  we  have  relied  principally on outside advertising agencies to
develop sponsorship and advertising opportunities. We believe that the growth of
sponsorship  and advertising revenues will depend on our ability to establish an
aggressive  and  effective  internal sales organization. Our internal sales team
currently  has  nine  members. We will need to substantially increase this sales
force  in  the coming year in order to execute our business plan. Our ability to
increase our sales force involves a number of risks and uncertainties, including
competition and the length of time for new sales employees to become productive.
If  we  do  not  develop an effective internal sales force, our business will be
materially  and  adversely  affected by our inability to attract sponsorship and
advertising  revenues.

WE RELY HEAVILY ON THIRD PARTIES FOR DEVELOPMENT OF SOFTWARE AND CONTENT AND FOR
ESSENTIAL  BUSINESS  OPERATIONS  AND MAY BE ADVERSELY AFFECTED BY OUR FAILURE TO
MAINTAIN  SATISFACTORY  RELATIONSHIPS  WITH  SUCH  PARTIES

     We  depend  on  third  parties  for  important  aspects  of  our  business,
including:

     -     Internet  access;

     -     development  of  software  for  new  Web  site  features;

     -     content;  and

     -     telecommunications.

     We have limited control over these third parties, and we are not their only
client.  We  may  not be able to maintain satisfactory relationships with any of
them  on  acceptable commercial terms, and there is no guarantee that we will be
able  to  renew  these  agreements  at  all. Further, we cannot be sure that the
quality  of  products  and  services  that they provide may remain at the levels
needed  to  enable  us  to  conduct  our  business  effectively.


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<PAGE>
WE  ARE  HEAVILY  RELIANT ON THIRD PARTIES TO HOUSE AND SERVICE OUR WEB SITE AND
ARE  VULNERABLE  TO  POSSIBLE  DAMAGE  TO  OUR  OPERATING  SYSTEMS

     We  maintain  substantially  all  of  our computer systems at our Campbell,
California  site  and the Santa Clara, California site of Exodus Communications.
We  are  heavily  reliant  on the ability of Exodus to house and service our Web
site.  This system's continuing and uninterrupted performance is critical to our
success.  Growth  in  the  number of users accessing our Web site may strain its
capacity,  and we rely on Exodus to upgrade our system's capacity in the face of
this  growth. Exodus also provides our connection to the Internet.  Sustained or
repeated  system  failures  or interruptions of our Web site connection services
would  reduce  the  attractiveness of our Web site to customers and advertisers,
and  could  therefore  have a material and adverse effect on our business due to
loss  of  membership  and  advertising  revenues.

     In  1999 and 1998, we experienced several interruptions and degradations of
service  as  a result of our third party service provider's inability to deliver
the  contractual  bandwidth  required  to  handle  our  traffic  volume.  These
interruptions  result  in  decreased  Web  usage volume and therefore impact our
ability to serve advertising impressions for our customers.  These interruptions
can  materially  impact  our  revenues.  We  estimate  that  during 1998 we lost
approximately  $35,000  in  revenue  because of this, and during 1999 we lost an
additional  $35,000  in  revenues.

     In addition, our operations are dependent in part on our ability to protect
our  operating  systems  against physical damage from fire, floods, earthquakes,
power  loss,  telecommunications  failures,  break-ins  or other similar events.
Furthermore,  our  servers  are  vulnerable  to  computer viruses, break-ins and
similar  disruptive problems. The occurrence of any of these events could result
in  interruptions,  delays or cessations in service to our users and result in a
decrease  in  the  number  of  visitors  to  our  site.

WE  PLAN  TO  GROW RAPIDLY, AND EFFECTIVELY MANAGING OUR GROWTH MAY BE DIFFICULT

     Our  business plan contemplates a period of significant expansion. In order
to  execute  our  business  plan,  we  must continue to grow significantly. This
growth  will  strain  our personnel, management systems and resources. To manage
our growth, we must implement operational and financial systems and controls and
recruit, train and manage new employees. Some key members of our management have
only  recently been hired, including our chief financial officer and controller.
These  individuals  have had little experience working with our management team.
We  cannot  be  sure  that we will be able to integrate new executives and other
employees  into  our  organization  effectively.  In  addition,  there  will  be
significant  administrative burdens placed on our management team as a result of
our  status as a public company. If we do not manage growth effectively, we will
not  be  able  to  achieve  our  financial  and  business  goals.


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<PAGE>
WE  DEPEND  ON OUR KEY PERSONNEL TO OPERATE OUR BUSINESS, AND WE MAY NOT BE ABLE
TO  HIRE  ENOUGH ADDITIONAL MANAGEMENT AND OTHER PERSONNEL AS OUR BUSINESS GROWS

     Our performance is substantially dependent on the continued services and on
the  performance of our executive officers and other key employees, particularly
Robert  A.  Rositano,  Jr.,  our Chief Executive Officer, and Dean Rositano, our
Chief  Operating  Officer.  The  loss  of  the  services of any of our executive
officers  could  materially  and  adversely  affect  our  business  due to their
experience  with  our  business  plan  and  the disruption in the conduct of our
day-to-day  operations. Additionally, we believe we will need to attract, retain
and  motivate  talented  management  and  other  highly  skilled employees to be
successful.  Competition  for  employees  that  possess  knowledge  of  both the
Internet  industry  and our target market is intense. We may be unable to retain
our  key  employees  or  attract,  assimilate  and retain other highly qualified
employees  in  the  future.

INTENSE  COMPETITION FROM OTHER INTERNET-BASED BUSINESSES MAY REDUCE OUR MARGINS
AND  MARKET  SHARE  AND  CAUSE  OUR  STOCK  PRICE  TO  DECLINE

     The markets in which we are engaged are new, rapidly evolving and intensely
competitive,  and  we  expect  competition  to  intensify further in the future.
Barriers to entry are relatively low, and current and new competitors can launch
new  sites  at  a  relatively  low  cost  using commercially available software.
Competition  could  result  in  price  reductions for our products and services,
reduced  margins  or  loss  of  market  share.  Consolidation  within the online
commerce  industry  may  also  increase  competition.

     We  currently  or  potentially  compete  with  a  number of other companies
including  a number of large online communities and services that have expertise
in  developing  online commerce, and a number of other small services, including
those  that  serve  specialty  markets.  Many  of our potential competitors have
longer  operating histories, larger customer bases, greater brand recognition in
other  business  and  Internet  markets  and  significantly  greater  financial,
marketing,  technical  and  other  resources  than  us.

WE  MAY  FAIL  TO  ESTABLISH AND MAINTAIN STRATEGIC RELATIONSHIPS WITH OTHER WEB
SITES  TO  INCREASE  NUMBERS  OF  WEB  SITE  USERS  AND  INCREASE  OUR  REVENUES

     We  intend  to  establish numerous strategic relationships with popular Web
sites  to  increase  the  number  of  visitors to our Web site. There is intense
competition  for placements on these sites, and we may not be able to enter into
these relationships on commercially reasonable terms or at all. Even if we enter
into  relationships  with  other  Web  sites,  they  themselves  may not attract
significant  numbers  of  users.  Therefore, our site may not receive additional
users from these relationships. Moreover, we may have to pay significant fees to
establish  these  relationships.  Our  inability  to enter into new distribution
relationships  and  expand  our  existing ones could have a material and adverse
effect  on  our business due to our inability to increase the number of users of
our  site.


                                       38
<PAGE>
WE  MAY  NOT  BE  ABLE  TO  ADAPT  AS INTERNET TECHNOLOGIES AND CUSTOMER DEMANDS
CONTINUE  TO  EVOLVE

     To  be  successful, we must adapt to rapidly changing Internet technologies
and  continually  enhance the features and services provided on our Web site. We
could  incur substantial, unanticipated costs if we need to modify our Web site,
software  and  infrastructure  to  incorporate  new technologies demanded by our
audience.  We may use new technologies ineffectively or we may fail to adapt our
Web  site,  transaction-processing  systems  and  network infrastructure to user
requirements  or  emerging  industry standards. If we fail to keep pace with the
technological  demands  of our Web-savvy audience for new services, products and
enhancements,  our  users  may not use our Web site and instead use those of our
competitors.

WE  MAY  NOT  BE  ABLE  TO PROTECT AND ENFORCE OUR TRADEMARKS, WEB ADDRESSES AND
PROPRIETARY  RIGHTS

     Our Nettaxi.com brand and our Web address, www.nettaxi.com, are critical to
our  success.  We  have filed a trademark application for "Nettaxi", among other
trademark  applications.  We  cannot  guarantee  that  any  of  these  trademark
applications  will  be granted. In addition, we may not be able to prevent third
parties  from  acquiring  Web  addresses  that  are  confusingly  similar to our
addresses,  which  could  harm  our  business.  Also, while we have entered into
confidentiality  agreements  with  our  employees,  contractors and suppliers in
order  to  safeguard  our trade secrets and other proprietary information, there
can  be  no assurance that technology will not be misappropriated or that others
may  lawfully  develop  similar  technologies.

WE  WOULD  LOSE  REVENUES AND INCUR SIGNIFICANT COSTS IF OUR SYSTEMS OR MATERIAL
THIRD  PARTY  SYSTEMS  ARE  NOT  YEAR  2000-COMPLIANT

     We  have  not  devised  a  Year  2000 contingency plan. Although we did not
experience  any  Year  2000-related  problems  on  January 1, 2000, and have not
experienced  any  such problems to date, the failure of our internal systems, or
any  material  third  party  systems,  to  be  Year  2000-compliant could have a
material and adverse effect on our business, results of operations and financial
condition  if  the compliance problems significantly impair access to and use of
our  Web  site.

     To  date,  we  have  not  incurred  any  material  costs  in identifying or
evaluating  Year  2000 compliance issues. Most of our costs have related to, and
are  expected  to  continue  to  relate  to,  the upgrades or replacements, when
necessary,  of software or hardware, as well as costs associated with time spent
by  employees  in  the  evaluation  process  and  Year  2000  compliance matters
generally.  These  expenses  are  included  in  our  operating  and  capital
expenditures  budget and are not expected to exceed $100,000.  However, if these
costs  are  significantly  higher  than expected, they could have a material and
adverse  effect  on  our business, results of operations and financial condition
due  to  the  need  to  spend  substantial  amounts  on  compliance.


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<PAGE>
     We  may  fail to discover Year 2000 compliance problems in our systems that
will  require  substantial  revisions  or  replacements.  In  the event that the
operational facilities that support our business, or our Web-hosting facilities,
are not Year 2000 compliant, portions of our Web site may become unavailable and
we  would  be unable to deliver services to our users. In addition, there can be
no  assurance  that third party software, hardware or services incorporated into
our  material  systems  will  not need to be revised or replaced, which could be
time-consuming  and  expensive.  Our  inability  to  fix  or replace third party
software,  hardware or services on a timely basis could result in lost revenues,
increased  operating  costs  and  other  business  interruptions.  Moreover, the
failure  to  adequately  address  Year  2000  compliance issues in our software,
hardware  or  systems could result in claims of mismanagement, misrepresentation
or  breach  of  contract  and  related  litigation,  which  could  be costly and
time-consuming  to  defend.

     In  addition, there can be no assurance that governmental agencies, utility
companies,  Internet  access companies, third party service providers and others
outside  our  control will be Year 2000 compliant. The failure by these entities
to be Year 2000 compliant could result in a systemic failure beyond our control,
including,  for  example, a prolonged Internet, telecommunications or electrical
failure,  which could also prevent us from delivering our services to our users,
decrease  the  use of the Internet or prevent users from accessing our services.

ACQUISITIONS  MAY  DISRUPT  OR  OTHERWISE HAVE A NEGATIVE IMPACT ON OUR BUSINESS

     We  may  acquire or make investments in complementary businesses, products,
services  or  technologies  on  an opportunistic basis when we believe they will
assist us in carrying out our business strategy. Growth through acquisitions has
been  a successful strategy used by other Internet companies. We do not have any
present understanding relating to any such acquisition or investment. If we were
to buy a content, service or technology company, the amount of time and level of
resources  required  to successfully integrate their business operation could be
substantial.  The  challenges  in  assimilating  their people and organizational
structure,  and  in  encountering  potential  unforeseen  technical  issues  in
integrating  their  content,  service  or  technology  into  ours,  could  cause
significant  delays  in  executing  other  key areas of our business plan.  This
could  include  delays in integrating other content, services or technology into
our  communities, or moving forward on other business development relationships,
as  management  and  employees,  both  of  which  are  time  constrained, may be
distracted.  In  addition,  the key personnel of the acquired company may decide
not  to work for us, which could result in the loss of key technical or business
knowledge  to  us.  Furthermore,  in making an acquisition, we may have to incur
debt  or  issue  equity  securities  to finance the acquisition, the issuance of
which  could  be  dilutive  to  our  existing  shareholders.

WE  ARE VULNERABLE TO ADDITIONAL TAX OBLIGATIONS THAT COULD BE IMPOSED ON ONLINE
COMMERCE  TRANSACTIONS

     We  do  not  expect  to  collect sales or other similar taxes in respect of
transactions  engaged  in by customers on our Web site.  However, various states
or  foreign  countries  may seek to impose sales tax obligations on us and other
e-commerce  and direct marketing companies. A number of proposals have been made
at  the state and local levels that would impose additional taxes on the sale of


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<PAGE>
goods  and  services  through  the  Internet. These proposals, if adopted, could
substantially  impair  the growth of e-commerce and cause purchasing through our
Web  site  to  be less attractive to customers as compared to traditional retail
purchasing. The United States Congress has passed legislation limiting for three
years  the ability of the states to impose taxes on Internet-based transactions.
Failure  to  renew  this  legislation  could result in the imposition by various
states  of  taxes  on e-commerce. Further, states have attempted to impose sales
taxes  on  catalog sales from businesses such as ours. A successful assertion by
one or more states that we should have collected or be collecting sales taxes on
the  sale  of  products could have a material and adverse effect on our business
due  to  the imposition of fines or penalties or the requirement that we pay for
the  uncollected  taxes.

WE MAY NOT BE ABLE TO TAKE FULL ADVANTAGE OF POTENTIAL TAX BENEFITS FROM OUR NET
OPERATING  LOSS  CARRYFORWARDS

     At  December  31, 1999 we had net operating loss carryforwards available to
reduce  future  taxable  income  that  aggregated  approximately  $11,200,000
for  Federal income tax purposes.  These benefits expire through 2019.  Pursuant
to  a  "change  in  ownership"  as  defined  by the provisions of the Tax Reform
Act  of  1986,  utilization  of  our  net  operating  loss  carryforwards may be
limited,  if  a  cumulative change of ownership of more than 50% occurs within a
three-year period. We  have  not determined if an ownership change has occurred.
If  it  has,  we  may not  be  able  to  take  full  advantage  of potential tax
benefits  from  our  net  operating  loss  carry  forwards.

WE  ARE  DEPENDENT  ON  THE CONTINUED DEVELOPMENT OF THE INTERNET INFRASTRUCTURE

     Our  industry is new and rapidly evolving. Our business is highly dependant
on  the  growth  of the internet industry and would be adversely affected if Web
usage and e-commerce does not continue to grow. Web usage may be inhibited for a
number  of  reasons,  including:

     -     inadequate  Internet  infrastructure;

     -     security  concerns;

     -     inconsistent  quality  of  service;

     -     unavailability  of  cost-effective,  high-speed  service;

     -     imposition  of  transactional  taxes;  or

     -     limitation  of  third  party  service  provider's  ability  and
willingness  to  invest  in  new  or  updated  equipment  to  handle  traffic
volume.

     If  Web usage grows, the Internet infrastructure may not be able to support
the  demands placed on it by this growth, or its performance and reliability may
decline.  We  are  highly  dependant  on  third  party  service  providers.  Any
interruption  experienced  by these service providers may have a material impact
on  our  business due to our inability to serve our advertising customers or end


                                       41
<PAGE>
users.  In  addition,  Web  sites, including ours, have experienced a variety of
interruptions in their service as a result of outages and other delays occurring
throughout  the  Internet  network  infrastructure.  If  these outages or delays
frequently  occur  in  the  future,  Web usage, including usage of our Web site,
could  grow  slowly  or  decline.  This  may  have  a  material impact on future
revenues.


OUR LONG-TERM SUCCESS DEPENDS ON THE DEVELOPMENT OF THE E-COMMERCE MARKET, WHICH
IS  UNCERTAIN

     Our  future  revenues  and profits substantially depend upon the widespread
acceptance  and  use of the Web as an effective medium of commerce by consumers.
Rapid  growth  in  the use of the Web and commercial online services is a recent
phenomenon.  Demand  for  recently introduced services and products over the Web
and  online  services is subject to a high level of uncertainty. The development
of  the Web and online services as a viable commercial marketplace is subject to
a  number  of  factors,  including  the  following:

     -     e-commerce  is at an early stage and buyers may be unwilling to shift
their  purchasing  from  traditional  vendors  to  online  vendors;

     -     insufficient  availability  of  telecommunication  services  or
changes  in  telecommunication  services  could  result  in  slower  response
times;  and

     -     adverse  publicity  and  consumer  concerns  about  the  security  of
commerce  transactions  on  the  Internet  could  discourage  its  acceptance
and  growth.

ADOPTION  OF  THE  INTERNET  AS  AN  ADVERTISING  MEDIUM  IS  UNCERTAIN

     The  growth of Internet sponsorships and advertising requires validation of
the  Internet  as  an  effective  advertising medium. This validation has yet to
fully  occur.  In order for us to generate sponsorship and advertising revenues,
marketers  must  direct  a  significant portion of their budgets to the Internet
and,  specifically, to our Web site. To date, sales of Internet sponsorships and
advertising  represent only a small percentage of total advertising sales. Also,
technological developments could slow the growth of sponsorships and advertising
on  the  Internet.  For example, widespread use of filter software programs that
limit  access  to  advertising  on our Web site from the Internet user's browser
could  reduce advertising on the Internet. Our business, financial condition and
operating  results  would  be  adversely  affected  if  the  market for Internet
advertising  fails  to  further develop due to the loss of anticipated revenues.

BREACHES  OF  SECURITY ON THE INTERNET MAY SLOW THE GROWTH OF E-COMMERCE AND WEB
ADVERTISING  AND  SUBJECT  US  TO  LIABILITY

     The need to securely transmit confidential information, such as credit card
and other personal information, over the Internet has been a significant barrier
to e-commerce and communications over the Web. Any well-publicized compromise of
security  could deter more people from using the Web or from using it to conduct
transactions  that  involve  transmitting  confidential  information,  such  as


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<PAGE>
purchases  of  goods  or services. Furthermore, decreased traffic and e-commerce
sales as a result of general security concerns could cause advertisers to reduce
their  amount  of  online  spending.  To  the  extent that our activities or the
activities  of  third  party contractors involve the storage and transmission of
proprietary  information,  such  as credit card numbers, security breaches could
disrupt  our  business, damage our reputation and expose us to a risk of loss or
litigation  and  possible  liability.  We  could  be  liable for claims based on
unauthorized  purchases  with  credit  card  information, impersonation or other
similar  fraud  claims.  Claims could also be based on other misuses of personal
information, such as for unauthorized marketing purposes. We may need to spend a
great  deal  of  money  and use other resources to protect against the threat of
security  breaches  or  to  alleviate  problems  caused  by  security  breaches.

WE  COULD FACE LIABILITY FOR INFORMATION DISPLAYED ON AND COMMUNICATIONS THROUGH
OUR  WEB  SITE

     We  may  be  subjected  to  claims for defamation, negligence, copyright or
trademark infringement or based on other theories relating to the information we
publish  on  our  Web  site.  These types of claims have been brought, sometimes
successfully,  against  Internet  companies as well as print publications in the
past.  Based  on links we provide to other Web sites, we could also be subjected
to  claims  based  upon online content we do not control that is accessible from
our Web site. Claims may also be based on statements made and actions taken as a
result  of participation in our chat rooms or as a result of materials posted by
members on bulletin boards at our Web site. We also offer e-mail services, which
may  subject  us  to  potential  risks,  such  as:

     -     liabilities  or  claims  resulting  from  unsolicited  e-mail;

     -     lost  or  misdirected  messages;

     -     illegal  or  fraudulent  use  of  e-mail;  or

     -     interruptions  or  delays  in  e-mail  service.

     -     These  claims  could  result  in  substantial  costs  and a diversion
of  our  management's  attention  and  resources.

     Efforts  to regulate or eliminate the use of mechanisms which automatically
collect  information  on users of our Web site may interfere with our ability to
target  our marketing efforts and tailor our Web site offerings to the tastes of
our  users.

     Web sites typically place a tracking program on a user's hard drive without
the  user's  knowledge  or consent. These programs automatically collect data on
anyone  visiting  a  Web  site.  Web  site  operators use these mechanisms for a
variety  of  purposes,  including  the  collection  of  data derived from users'
Internet activity. Most currently available Web browsers allow users to elect to
remove  these  mechanisms  at any time or to prevent such information from being


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<PAGE>
stored  on  their  hard drive. In addition, some commentators, privacy advocates
and  governmental bodies have suggested limiting or eliminating the use of these
tracking  mechanisms.  Any  reduction  or limitation in the use of this software
could  limit  the  effectiveness  of  our  sales  and  marketing  efforts.

WE  COULD  FACE  ADDITIONAL BURDENS ASSOCIATED WITH GOVERNMENT REGULATION OF AND
LEGAL  UNCERTAINTIES  SURROUNDING  THE  INTERNET

     Any new law or regulation pertaining to the Internet, or the application or
interpretation of existing laws, could have a material and adverse effect on our
business,  results  of operations and financial condition due to increased costs
of  doing  business.  Laws  and  regulations  directly  applicable  to  Internet
communications,  commerce  and advertising are becoming more prevalent.  The law
governing  the Internet, however, remains largely unsettled, even in areas where
there  has been some legislative action.  It may take years to determine whether
and  how  existing  laws  governing  intellectual  property, copyright, privacy,
obscenity, libel and taxation apply to the Internet. In addition, the growth and
development  of  e-commerce  may  prompt  calls  for  more  stringent  consumer
protection  laws,  both in the United States and abroad.  We also may be subject
to  future  regulation  not specifically related to the Internet, including laws
affecting  direct  marketers.

WE  COULD  INCUR  MONETARY  DAMAGES  FROM LITIGATION ARISING OUT OF OUR BUSINESS
ACTIVITIES

     On  July  9,  1999, we were named as one of several defendants in a lawsuit
filed  by four disaffected shareholders in Simply Interactive, Inc.  The lawsuit
arises  out  of  a  series  of  events  relating to certain assets our operating
company,  Nettaxi  Online  Communities, purchased from SSN Properties in October
1997.  The  complaint  alleges  that  we  owed,  and  either  intentionally  or
negligently  breached, fiduciary duties to the plaintiffs.  The suit also claims
that  we  either  intentionally  or  negligently interfered with the plaintiffs'
contract  or  prospective  advantage.  While  our officers and directors believe
that  the  suit is without merit, we cannot provide you with any assurances that
we  will  prevail in this dispute.  If the plaintiffs successfully prosecute any
of  their claims against us, the resulting monetary damages and reduction in our
working  capital  could  significantly  harm our business.  See Part II, Item 1,
"Legal  Proceedings".

SHARES ELIGIBLE FOR FUTURE SALE BY OUR CURRENT STOCKHOLDERS MAY ADVERSELY AFFECT
OUR  STOCK  PRICE

     As of  February 28,  2000,  5,698,219  shares  of  our  common  stock  were
immediately eligible  for  sale  in  the  public market without  restriction  or
further restriction  under  the Securities Act of 1933, unless purchased  by  or
issued to any  "affiliate"  of ours,  as  that  term  is  defined  in  Rule  144
promulgated  under  that  act.   Additionally,  we  have  filed  a  registration
statement on Form s-8 ( Registration  No. 333-32678 ) to  register all shares of
common stock under our 1998 and 1999 stock  option  plans.  Shares  issued  upon
exercise  of  stock  options, including options  for 1,194,144 shares that  were
exercisable  as  of  February  15,  2000,  are  eligible  for  resale  in  the
public  market  without  restriction.  If  our  stockholders  sell  substantial


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<PAGE>
amounts  of  our common stock under Rule 144 or pursuant  to  the aforementioned
registration  statement,  the  market  price  of  our  common  stock  could  be
adversely  affected  and our ability to raise additional capital  at  that  time
through  the  sale  of  our  securities  could  be  impaired.

WE  NEED  TO  INCREASE  THE  NUMBER  OF SHARES OF COMMON STOCK AUTHORIZED IN OUR
ARTICLES  OF  INCORPORATION

     We  have  issued  a  significant  number  of shares of our common stock and
options,  warrants,  debentures and other rights to acquire shares of our common
stock.  Currently,  if  all of the outstanding options, warrants, debentures and
other rights to acquire shares of our common stock were converted into shares of
common  stock by the holders thereof, the total number of shares then issued and
outstanding  would  exceed  the  50,000,000 shares authorized in our Articles of
Incorporation.  In  order  to  insure  that  we have enough shares authorized to
permit all of the holders of outstanding options, warrants, debentures and other
rights  to  acquire shares of our common stock to convert such rights, we intend
to  seek  necessary  board  and  shareholder  approval to increase the number of
shares  authorized  in  our Articles of Incorporation. There can be no assurance
that  such an increase will be approved or that such an increase will provide an
adequate  remedy  for  the  holders  of  such  rights.

ANTI-TAKEOVER  PROVISIONS  AND  OUR  RIGHT TO ISSUE PREFERRED STOCK COULD MAKE A
THIRD  PARTY  ACQUISITION  OF  US  DIFFICULT

     We  are  a Nevada corporation. Anti-takeover provisions of Nevada law could
make  it more difficult for a third party to acquire control of us, even if such
change  in  control  would  be  beneficial  to  stockholders.  Our  articles  of
incorporation  provide  that  our  board  of directors may issue preferred stock
without  stockholder  approval.  The  issuance  of preferred stock could make it
more  difficult  for  a  third  party to acquire us.  All of the foregoing could
adversely  affect  prevailing  market  prices  for  our  common  stock.

OUR COMMON STOCK PRICE IS LIKELY TO BE HIGHLY VOLATILE AS IS TYPICAL OF INTERNET
COMPANIES

     The market price of our common stock has been, and is likely to continue to
be,  highly  volatile  as  the  stock  market  in  general,  and  the market for
Internet-related  and  technology  companies  in  particular,  has  been  highly
volatile.  Investors  may not be able to resell their shares of our common stock
following  periods  of  volatility  because  of the market's adverse reaction to
volatility.  The  trading  prices  of  many  technology  and  Internet-related
companies'  stocks  have  reached  historical highs within the last 52 weeks and
have  reflected  valuations  substantially  above historical levels.  During the
same  period,  these  companies'  stocks have also been highly volatile and have
recorded  lows  well below historical highs. We cannot assure you that our stock
will  trade  at the same levels of other Internet stocks or that Internet stocks
in  general  will  sustain  their  current  market  prices.

     Factors  that  could cause such volatility may include, among other things:

     -     actual  or  anticipated  fluctuations  in  our  quarterly  operating
results;

     -     announcements  of  technological  innovations;

     -     conditions  or  trends  in  the  Internet  industry;  and

     -     changes  in  the  market  valuations  of  other  Internet  companies.


ITEM  2.          PROPERTIES

     Our  headquarters  are  currently located in a leased facility in Campbell,
California,  consisting  of  approximately  8,600 square feet of office space to
accommodate  management,  operations,  and  research  and development functions,
which  is  under  a  lease that expires in April 2002.  We also lease 580 square
feet  of  office  space  in  Las  Vegas,  Nevada  which  we  use  for  general


                                       45
<PAGE>
administrative  purposes.  This lease was entered into on May 27, 1999 and has a
one-year  term and we have an option to renew it for an additional two years. We
believe  that  our  current  facilities  are  adequate  for  our  present needs.


ITEM  3.          LEGAL  PROCEEDINGS

     On  July  9,  1999, after our public  announcement  of  the filing  of  our
registration  statement  on  form  S-1,  (Registration No.  333-78129)  four
disaffected shareholders in Simply Interactive, Inc., led by Ronald  Ventre,
filed  an  action  in  the  Santa Clara County Superior Court against Warren  J.
Kaplan, Frank McGrath, Bruno Henry, Alan K. Fetzer, Robert Divenere, Robert  A.
Rositano,  Sr., Robert A. Rositano, Jr., Dean Rositano, Glenn Goelz,
Nettaxi.com,  Nettaxi  Online Communities, Inc., SSN Properties, LLC and others.
The  case  number  is  CV  783127.  Other than the brief settlement negotiations
referred  to  below,  there has been no activity on this matter since the action
was  filed.

     Mr.  Kaplan  was  formerly  the  chief  executive officer and a director of
Simply  Interactive.  He also became a member of SSN Properties and is currently
the  chief operating officer of AboveNet Communications, Inc.  Mr. McGrath was a
director  of  Simply Interactive.  He also became a member of SSN Properties and
is  currently  a  vice  president  of  MCI WorldCom.  Messrs. Henry, Fetzer, and
DiVenere  were  all  former  officers  of Simply Interactive, and Mr. Henry also
served  as  a  director  of  Simply  Interactive.  Robert A. Rositano, Sr. was a
director of Simply Interactive and became the managing member of SSN Properties.
He  currently  owns  more  than 5% of the outstanding shares of our common stock
following a distribution by SSN Properties to its members in March 1999.  Robert
A.  Rositano, Jr. was formerly an executive vice president of Simply Interactive
and  served  as  a  director  until  May  1996.  He is currently chief executive
officer,  secretary  and  a  director of Nettaxi.  Dean Rositano was formerly an
executive  vice  president  of Simply Interactive and served as a director until
May  1996.  He is currently president, chief operating officer and a director of
Nettaxi.  Mr.  Goelz  was the chief financial officer of Simply Interactive from
August 1996 to July 1997 and joined us as chief financial officer in April 1999.
All  individual defendants held shares, or options to purchase shares, of Simply
Interactive.

     Distinctions  can  be  made  between  the  claims  that the Ventre group is
pursuing against us and the other defendants.  As to us, the suit claims that we
owed,  and either intentionally or negligently breached, fiduciary duties to the
Ventre  group.  The suit also claims that we either intentionally or negligently
interfered with the Ventre group's contract or prospective advantage. The Ventre
group  is  seeking  the  following  relief  against  us:

     -     an  unstated amount of compensatory and special damages in the sum of
their  investments  in  Simply  Interactive,  plus  prejudgment  interest;

     -     an  accounting  of  profits;

     -     punitive  damages;  and

     -     costs  of  suit,  including  attorney  fees  as  permitted  by  law.


                                       46
<PAGE>
     The  Ventre  group's  claims against the other defendants, while not clear,
include  all  of  the claims described above with respect to us as well as other
claims  of  ineffective  management,  waste  of  assets  and similar claims.  In
addition  to  the  relief  described  above with respect to us, the Ventre group
seeks  the  following  from  the  other  defendants:

     -     declaratory  relief  concerning  the  validity of the election of the
board  of  directors  of  Simply  Interactive;  and

     -     orders  for  the  inspection  of  corporate  records  in,  and  the
holding  of  shareholder  meetings  for,  Simply  Interactive.

     The factual basis for the proceedings as alleged by the Ventre group can be
summarized as follows.  The Ventre group alleges that between February and April
1996, they made a series of investments in Simply Interactive and thereby became
minority  shareholders.  Thereafter,  according  to  the complaint, the board of
directors  of  Simply  Interactive,  without due diligence and disclosure to the
minority  shareholders,  increased the debts and expenses of Simply Interactive.
The  Ventre  group  then  alleges that the defendants raised capital through the
sale  of  $5.5 million principal amount of convertible notes, secured by all the
assets  and  properties  of Simply Interactive, to three of the defendants, that
the minority shareholders were not given notice of the proposed financing and an
opportunity  to participate, and that the entire transaction is void or voidable
because  the board of directors of Simply Interactive was improperly constituted
at  the  time.  The  Ventre  group  goes on to allege that SSN Properties, which
acquired  the  notes  from  the  original purchaser, foreclosed on the assets of
Simply  Interactive  without  reason  in  August  1997.  Finally,  the complaint
alleges  that the assets formerly used by Simply Interactive were transferred to
us  through  a series of transactions in violation of fiduciary obligations owed
by  the  defendants  to  the  minority  shareholders  of  Simply  Interactive.

     Our  officers  and  directors  believe  that  the Ventre group's claims are
without  merit  and  that  significant  issues of proof exist with regard to the
relevant  facts  as  alleged  in  the  complaint.  For  example,  the individual
defendants  have  advised  that  the  issuance  of  the  notes followed numerous
failed  attempts  to  raise  additional  funds  from  outside  sources, and that
foreclosure occurred only after  Simply Interactive's default in its obligations
to  make  required  interest  payments.   Moreover,  while  the  complaint  does
include  us  as  defendants with respect  to  the  allegations  arising  out  of
the  events  described  above,  our current  operating  company,  Nettaxi Online
Communities,  was  not  launched  until  September  1997.

     In fact, Nettaxi Online Communities did purchase certain  assets  from  SSN
Properties  in  October 1997,  including  the  original Internet the City CD-ROM
product; a domain name; furniture, fixtures, and equipment;  plus other  assets
which have since been abandoned.  However, the assets acquired by Nettaxi Online
Communities  from  SSN  Properties at that time represented less than 50% of the
value  of  the foreclosed assets.  As  described  in  the notes to our financial
statements,  the  aggregate  value  of  the  assets  acquired  by Nettaxi Online
Communities  from  SSN Properties was  $2,000,000,  which  amount  was  verified
by  an  independent  appraiser.

     In 1998,  we  experienced  several  significant  functional  problems  with
portions of a purchased technology program, namely the web to database  software
application, due  to  those  components incompatability with subsequent releases
of upgraded versions of  its operating system.  Following attempts to make these
components of  the  acquired  technology  compatible,  we  decided, in  December
1998, not to spend  additional  monies on these components but to replace  them.
We wrote off the  unamortized  portion  of this impaired technology that reduced
the value of the  assets  by  approximately $700,000. Currently, the unamortized
cost of the remaining  assets  purchased  from  SSN  Properties as a  percentage
of our total assets  is  approximately  10%. Moreover, the role of these assets,
which were intended to be  revenue-generating  products  in Simply Interactive's
business  model,  is  substantially  different  for us  in  that  we  view  them
primarily as a tool  to drive traffic to our site  and  not  necessarily  as  an
independent revenue source.  It should also be noted that our business model for
an  online  community is  substantially  different  than  Simply I  nteractive's
objective of  licensing, distribution,  and  sale  of  the  CD-ROM  product  and
marketing and sales  of  the  impaired  software  application  described  above.

     Since  the  action  was  filed, discussions regarding a possible settlement
have taken place.  However, Ventre's group has demanded that Robert A. Rositano,
Sr.,  Dean  Rositano  and Robert A. Rositano, Jr. give them shares of our common
stock  having  an  approximate  value  of  $2.08 million.  Given that the Ventre
group's  original  investment  in Simply Interactive was approximately $675,000,
and  that  the officers and directors of Nettaxi believe that the Ventre group's
claims  are  without merit, the demand was rejected and the defendants intend to
vigorously  defend  the  litigation.  In  its agreement with us for the original
sale  and  purchase of the assets, SSN Properties agreed to indemnify us against
claims  that  might be brought by Simply Interactive with respect to rights that
Simply  Interactive  might  have  in  the  transferred assets.  We are currently
seeking  confirmation  of  the  indemnity  obligation  from  SSN  Properties.

ITEM  4.          SUBMISSION  OF  MATTERS  TO  A  VOTE  OF  SECURITY  HOLDERS
None.


                                       47
<PAGE>
                                     PART II
                                     -------


ITEM  5.     MARKET  FOR  THE  REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER
             MATTERS

     Our  common  stock  has been traded on the NASD O-T-C Market Bulletin Board
under  the trading symbol "NTXY" since October 1, 1998.  Prior to that date, our
common  stock  was not actively traded in the public market. The following table
sets  forth,  for the periods indicated, the high and low closing prices for our
common  stock  as  reported  by  various  Bulletin  Board  market  makers.  The
quotations  do  not  reflect  adjustments  for  retail  mark-ups, mark-downs, or
commissions  and  may  not  necessarily  represent  actual  transactions.


PERIOD                                     LOW  CLOSE     HIGH  CLOSE
------                                     ----------     -----------
FISCAL  YEAR  ENDED  DECEMBER  31,  1998:
Fourth  Quarter                             $  4.500         $  8.750
(October  1  -  December  31,  1998)

FISCAL  YEAR  ENDED  DECEMBER  31,  1999:
First  Quarter                              $  6.625         $ 17.625
(January  1  -  March  31, 1999)

Second  Quarter                             $ 11.500         $ 29.500
(April  1  - June 30, 1999)

Third  Quarter                              $  7.437         $ 16.500
(July  1  -  September 30, 1999)

Fourth  Quarter                             $  2.218         $  7.500
(October  1  -  December  31,  1999)

FISCAL  YEAR  ENDING  DECEMBER  31,  2000:
First  Quarter                              $  1.437         $  8.093
(January  1  -  March  13, 2000)


     On  March  13, 2000, the closing price for our common stock on the Bulletin
Board  was  $8.093 per  share.  As of March 9, 2000, there were 363 stockholders
of  record  who held shares of our common stock, which figure does not take into
account  those  stockholders  whose  certificates  are  held  in  the  name  of
broker-dealers  or  other  nominees.

DIVIDEND  POLICY

     To  date,  no  dividends  have  been declared or paid on any of our capital
stock.  We  currently intend to retain earnings, if any, to fund the development
and  growth  of  our business and do not anticipate paying cash dividends in the
foreseeable  future.  Payment  of  future  dividends,  if  any,  will  be at the
discretion  of our board of directors after taking into account various factors,
including  our  financial  condition, operating results, current and anticipated
cash  needs  and  plans  for  expansion.

RECENT  SALES  OF  UNREGISTERED  SECURITIES

     Set  forth in chronological order is information regarding shares of common
stock  issued  and options and warrants and other convertible securities granted
by  the  Company  during the year ended December 31, 1999.  Also included is the
consideration,  if  any,  received  by  the  Company for such shares and options
and  information relating  to  the  section  of  the  Securities  Act  of  1933,
or  rule  of  the  Securities  and  Exchange  Commission  under  which exemption
from  registration  was  claimed.


                                       48
<PAGE>
     (1)     From  January,  1999 to December, 1999, the Company pursuant to its
1998  Stock  Option  Plan, issued options to purchase 2,614,000 shares of common
stock  to  its key employees, with exercise prices ranging from $7.437 to $44.00
per  share.  These  issuances  were  made  in  reliance  on  Section 4(2) of the
Securities  Act  of 1933 and/or Rule 701 promulgated under the Securities Act of
1933  and  were made without general solicitation or advertising. The purchasers
were  sophisticated  investors with access to all relevant information necessary
to  evaluate  these  investments,  and  who  represented to the Company that the
shares  were  being  acquired  for  investment.

     (2)     In  March,  1999  the  Company  issued  an  option  to  purchase an
aggregate  of  125,000  shares  of  Common  Stock  to  Wall Street Trading Group
pursuant  to  the  Common  Stock  Purchase  Option  to Purchase Common Shares of
Nettaxi.  The  exercise  price  for  the Option is $8.00 per share. The issuance
was  made  in  reliance  on  Section  4(2) of the  Securities Act of 1933 and/or
Regulation D promulgated under the Securities Act of 1933 and  were made without
general  solicitation or advertising. The purchaser was a sophisticated investor
with access to all relevant information necessary to evaluate these investments,
and  who  represented  to  the  Company  that the shares were being acquired for
investment.

     (3)     On  March  31,  1999,  the Company issued convertible debentures in
the amount of $5,000,000 and warrants to purchase 150,000 shares of common stock
of  the  Company.  The  issuance  was  made  in  reliance on Section 4(2) of the
Securities  Act of 1933 and/or Regulation D promulgated under the Securities Act
of  1933  and  were  made  without  general  solicitation  or  advertising.  The
purchasers  were sophisticated investors with access to all relevant information
necessary to evaluate these investments, and who represented to the Company that
the  shares  were  being  acquired  for  investment.

     (4)     In  May,  1999  the Company issued an aggregate amount of 7,000,000
shares  of common stock to the former shareholders of Plus Net, Inc. pursuant to
the  Merger  Agreement  and  Plan of Reorganization between the Company and Plus
Net. The issuance was made in reliance on Section 4(2) of the  Securities Act of
1933  and/or Regulation D promulgated under the Securities Act of 1933 and  were
made  without  general  solicitation  or  advertising.  The  purchasers  were
sophisticated  investors  with  access  to all relevant information necessary to
evaluate  these  investments, and who represented to the Company that the shares
were  being  acquired  for  investment.

     (5)     In  May,  1999 the Company issued options to purchase up to 150,000
shares  of common stock to Fontenelle LLC.  The options vest upon the completion
of  financial  consulting  services  to be provided to the Company by Fontenelle
LLC.  The exercise price for the options is $14.875 per share. This issuance was
made  in reliance on Section 4(2) of the  Securities Act of 1933 and/or Rule 701
promulgated  under  the  Securities  Act  of  1933  and was made without general
solicitation  or  advertising.  The purchaser  was a sophisticated investor with
access  to all relevant information necessary to evaluate these investments, and
who  represented  to  the  Company  that  the  shares  were  being  acquired for
investment.


                                       49
<PAGE>
     (6)     In  December,  1999  the  Company  issued  350,000 shares of Common
Stock  to  Sinclair  Davis  Trading  Corp.  in exchange for consulting services.
The  issuance  was  made  in  reliance on Section 4(2) of the  Securities Act of
1933 and/or  Regulation D promulgated under the Securities Act of 1933 and  were
made  without  general  solicitation  or  advertising.  The  purchasers  were
sophisticated  investors  with  access  to all relevant information necessary to
evaluate  these  investments,  and  who  represented  to  the  Company  that the
shares  were  being  acquired  for  investment.

     (7)     From January to  March 2000,  we  issued  options  to  purchase  up
to  1,508,800 shares  of  common stock under our 1999 stock option plan to three
current and one former member of  our  board of directors who were not employees
of the Company, 3 officers and 33 key employees  with  exercise  prices  ranging
from  $1.44  to $2.44 per share, which was  not  less than the fair market value
of the shares on the date  of  grant.  The  issuances were made in  reliance  on
Section 4(2) of the Securities Act of 1933 and/or  Rule  701  promulgated  under
the  Securities  Act  of  1933  and  was  made  without general  solicitation
or  advertising.  The  purchasers  were  sophisticated investors  with  access
to  all relevant  information  necessary  to  evaluate the investments, and  who
represented to the Company that the shares were being  acquired  for investment.

     (8)     In February 2000 we  issued  175,000  shares  of  Common  Stock  to
Sinclair  Davis Trading Corp. in exchange for consulting services.  The issuance
was  made  in  reliance  on  Section  4(2) of the  Securities Act of 1933 and/or
Regulation  D  promulgated under the Securities Act of 1933 and was made without
general solicitation or advertising. The purchaser  was a sophisticated investor
with  access  to  all  relevant  information  necessary  to  evaluate  these
investments,  and  who  represented  to  the  Company that the shares were being
acquired  for  investment.

     (9)     In February 2000 we  issued  approximately 15.8  million shares  of
Common  Stock and warrants to purchase up to an equal number of shares of common
stock in exchange for  approximately  $23.6 million.  The issuances were made in
reliance  on Section  4(2) of the  Securities  Act of 1933 and/or  Regulation  D
promulgated  under  the  Securities  Act of 1933 and were made  without  general
solicitation or advertising.  The purchasers were  sophisticated  investors with
access to all relevant information necessary to evaluate these investments,  and
who  represented  to the  Company  that  the  shares  were  being  acquired  for
investment.


                                       50
<PAGE>
ITEM  6.     SELECTED  CONSOLIDATED  FINANCIAL  DATA

SUMMARY  FINANCIAL  DATA

     Set  forth  below  are summary statements of operations data for the period
from  October  23,  1997,  date  of  incorporation, to December 31, 1997 and for
the  years  ended  December 31, 1998 and 1999, and summary balance sheet data as
of  December  31,  1997,  1998  and  1999.  This  information  should be read in
conjunction with the Consolidated Financial Statements  and  Notes  thereto  and
"Management's  Discussion  and  Analysis  of Financial  Condition and Results of
Operations",  appearing  elsewhere  in  this  Form.

<TABLE>
<CAPTION>
For the Period from October 23, 1997, date of incorporation, to December 31,1997
               and for the years ended December 31, 1998, and 1999

                                                1997         1998          1999
                                            -----------  ------------  ------------
<S>                                         <C>          <C>           <C>
STATEMENT OF OPERATIONS DATA:
Net revenues . . . . . . . . . . . . . . .  $  144,900   $   258,000   $ 5,032,800
------------------------------------------  -----------  ------------  ------------
  Gross profit . . . . . . . . . . . . . .  $   57,500   $    18,200   $ 1,029,000
------------------------------------------  -----------  ------------  ------------
  Loss from operations . . . . . . . . . .  $ (142,100)  $(3,082,300)  $(9,402,500)
------------------------------------------  -----------  ------------  ------------
  Net loss . . . . . . . . . . . . . . . .  $ (159,700)  $(3,113,600)  $(9,880,400)
------------------------------------------  -----------  ------------  ------------
  Net loss available to common shareholders $ (327,200)  $(3,127,900)  $(9,880,400)
------------------------------------------  -----------  ------------  ------------
  Basic loss per share . . . . . . . . . .  $    (0.06)  $     (0.32)  $     (0.46)
------------------------------------------  -----------  ------------  ------------
  Diluted loss per share . . . . . . . . .  $    (0.06)  $     (0.32)  $     (0.46)
------------------------------------------  -----------  ------------  ------------
WEIGHTED-AVERAGE COMMON SHARES:
------------------------------------------
     Basic outstanding shares. . . . . . .   5,483,500     9,724,781    21,274,203
------------------------------------------  -----------  ------------  ------------
  Diluted outstanding shares . . . . . . .   5,483,500     9,724,781    21,274,203
------------------------------------------  -----------  ------------  ------------
BALANCE SHEET DATA:
------------------------------------------
     Working capital (Deficiency). . . . .  $ (222,900)  $   300,400   $(2,053,000)
------------------------------------------  -----------  ------------  ------------
  Total assets . . . . . . . . . . . . . .  $2,082,300   $ 1,652,700   $ 6,031,200
------------------------------------------  -----------  ------------  ------------
  Long-term liabilities. . . . . . . . . .  $  773,500   $     5,400   $ 3,200,000
------------------------------------------  -----------  ------------  ------------
  Total stockholders' equity (Deficiency).  $  973,400   $ 1,332,100   $(2,000,300)
------------------------------------------  -----------  ------------  ------------
</TABLE>

ITEM  7.     MANAGEMENT'S  DISCUSSION  AND  ANALYSIS OF FINANCIAL  CONDITION AND
             RESULTS  OF  OPERATIONS

     The  following  discussion  of  the  financial  condition  and  results  of
operations  of  Nettaxi  should  be  read  in  conjunction with the Consolidated
Financial  Statements  and  the  Related  Notes  included  elsewhere  in  this
Form.  This  discussion  contains  forward-looking  statements  that  involve
risks  and  uncertainties.  Our actual results may differ mat erially from those
anticipated  in these forward-looking statements as a result of various factors,
including, but not limited to, those  set forth  under "Risk Factors" in Item 1A
and elsewhere  in  this  Form.


                                       51
<PAGE>
OVERVIEW

     We  were  incorporated  in  October  1997 and launched our Web site in July
1998.  Located  in  Campbell, California, we are a developer of commerce-enabled
and  content-rich  communities that offer subscribers, or "citizens", a place to
build  their  home  pages  or  businesses  on  the  Internet.

     The  Nettaxi.com  website,  at  http://www.nettaxi.com,  is structured as a
virtual "urban" environment, populated by subscribers referred to as "citizens",
that  is  divided into thematic "communities," and from there into "streets" and
"homes."  Nettaxi.com provides access to news, entertainment, sports, financial,
and  travel  information  and services such as free e-mail, personal home pages,
chat  and  messages.

     To  date,  our  revenues  have  been  derived  principally from the sale of
advertisements.  We sell a variety of advertising packages to clients, including
banner  advertisements,  event  sponsorships,  and  targeted and direct response
advertisements. Currently, our advertising revenues are derived principally from
short-term  advertising  arrangements,  averaging one to six months, in which we
guarantee a minimum number of impressions for a fixed fee.  Advertising revenues
are  recognized  ratably  in the period in which the advertisement is displayed,
provided  that  we have no significant remaining obligations and that collection
of  the  resulting  receivable  is probable.  Payments received from advertisers
prior  to  displaying  their advertisements on the site are recorded as deferred
revenues  and  are  recognized  as  revenue  ratably  when  the advertisement is
displayed.  To  the  extent minimum guaranteed impression levels are not met, we
defer  recognition  of  the  corresponding  revenues until guaranteed levels are
achieved.  We  expect  to continue to derive the majority of our revenue for the
foreseeable  future  from  the  sale  of  advertising  space  on  our  Web site.

     In  the  third quarter of 1999, the Company began providing website hosting
and  internet  connectivity  services for corporate customers.  Our services are
delivered  through  a  state-of-the-art Internet data center located in Southern
California  using  a  high-performance Internet backbone network.  Customers pay
monthly fees for the professional services utilized, one-time installation fees,
and connectivity charges.  These "hosting" revenues are recognized in the period
the  services  are  provided.

     In  addition  to  advertising  revenues,  we  derive  other  revenues  from
royalties  from  the  distribution  of  our  CD-ROM  tutorial  product  and  our
premium  account  membership  subscriptions.  Royalty  revenues  result  from
relationships  with  computer  manufacturers  that  bundle  and  distribute  our
CD-ROM  product  with their products.  Our  membership  programs  offer  premium
services  for a monthly fee, providing  additional  services  such  as unlimited
personal  e-mail  accounts  for  family  or  friends,  unlimited  Nettaxi  Site
Builder  Web  pages,  themed  Web page templates,  a  personal  event  calendar,
discussion  groups,  and  options  to customize  personal  homepages  with
 pictures,  colors  and  content.

     In  May  1999,  we  completed  the merger with Plus Net, Inc., a California
corporation,  which  has allowed us to provide our users with a web based e-mail
program  and  a  robust  meta  search  engine.  Plus  Net also has an e-commerce
processing  engine  which enables the acceptance and processing of online credit
card transactions.  We believe this merger also enhances our electronic commerce
and  advertising  opportunities.


                                       52
<PAGE>
     As  a  result  of  our  merger with Plus Net, Inc. in May 1999, we received
revenues  from  credit  card processing fees during the first half of 1999, with
minimal revenues being earned in the third quarter of 1999. The contract through
which  these  fees  have  been  derived  terminated  in  December  1999  and  we
anticipate that revenues of this type will be minimal in the foreseeable future.

     We  also  receive  revenues  from  e-commerce  transactions.  Our  recent
e-commerce arrangements generally provide us with a share of any sales resulting
from direct links from our site. Revenues from these programs will be recognized
in  the  month  that  the service is provided. To date, revenues from e-commerce
arrangements  have  not  been  material.  However,  we expect e-commerce derived
revenues  to  become  a  more  significant  portion of our total revenues in the
foreseeable  future, as we increase the number of contractual relationships with
parties  offering  e-commerce  related  products  and services which can be made
available  to  our  subscribers  and parties seeking to make online sales to our
subscribers  and  other  visitors  to  our  site.

     To  date, we have entered into business and technology license arrangements
in  order  to  build  our website community, provide community-specific content,
generate  additional  traffic,  and  provide  our  subscribers  with  additional
products  and  services,  including  e-commerce  tools.

     We  intend  to  continue  to investigate potential acquisitions and to seek
additional  relationships  with  content providers that fall within the scope of
our  business  strategy,  and  will  serve  to  increase our subscriber base and
overall site traffic. Acquisitions carry numerous risks and uncertainties and we
cannot  guarantee that we will be able to successfully integrate any businesses,
products,  technologies  or  personnel  that  might  be  acquired in the future.

RESULTS  OF OPERATIONS - COMPARISON OF THE TWELVE MONTHS ENDED DECEMBER 31, 1999
AND  1998

     NET  REVENUES.  Net revenues for the year ended December 31, 1999 increased
1,851%  to  approximately $5.03 million from $258,000 in the year ended December
31,  1998.  The  absolute  dollar  increase is the result of the increase in the
number of advertisers and the average contract duration and value (the result of
higher  web site traffic to nettaxi.com web pages), an increase in revenues from
the  corporate  web hosting, transaction processing fee revenue, and to a lesser
extent,  increases in our  royalties  and customization fees associated with the
distribution of our CD ROM product.  Barter revenues accounted for approximately
7%  of  total  revenues  for  the twelve months ended  December  31,  1999.  One
customer  accounted  for  approximately  17% of the total revenues in the twelve
months  ended  December,  13,  1999.  For the year ended December 31, 1998, four
customers  accounted  for  approximately  28%,  21%,  13%,  and 12% of revenues.


                                       53
<PAGE>
     ADVERTISING REVENUES.  Advertising revenues for the year ended December 31,
1999  and  1998  were  approximately  $2.67  million and approximately $177,000,
respectively,  which  represented  53%  and  69%,  respectively,  of  total  net
revenues.  The  year  over  year  increase  in absolute dollars resulted from an
increase  in  the  number  of  advertisers  as  well  as the increase in average
contract  commitments  of these advertisers as a result of increased web traffic
to  our  web  site.

     TRANSACTION PROCESSING FEES. Transaction processing fees were approximately
$1.29  million  for  the year ended December 31, 1999, which represented 19%, of
total  net  revenues.  There  were  no  transaction  processing  fees  in  1998.
Transactions  fees  consist  of revenue derived from credit card evaluations and
from  the  processing  of on-line credit card transactions.  The 1999 revenue is
attributable  to  the  merger  with  Plus  Net,  Inc. in May 1999.  The contract
through  which  these fees have been derived terminated in December, 1999 and we
do  not  expect  revenues  of  this  type  to  be  significant  in  future
periods.

     HOSTING REVENUES.  Our hosting revenues were approximately $945,000 for the
year  ended  December  31,  1999,  which represented 19%, of total net revenues.
There  were  no  hosting  revenues  in  1998.  In the third quarter of 1999, the
Company began providing internet hosting and connectivity services for corporate
customers.  Our  services are delivered through a state-of-the-art Internet data
center located in Southern California using a high-performance Internet backbone
network.  Customers  pay  monthly  fees  for the professional services utilized,
one-time  installation  fees, and monthly connectivity charges.  These "hosting"
revenues  were  recognized  in  the  period  the  services  were  provided.

     COST  OF  OPERATIONS.  Cost  of  operations were approximately $400 million
and  $240,000  for  the  years  ended  December 31, 1999 and 1998, respectively.
The  substantial  absolute  dollar increases for the twelve month period in 1999
over  1998  is  the  result  of  increased  costs  for  co-location  expenses
(Internet  connection  charges),  equipment  costs  and  depreciation  of
equipment,  amortization  of  intangible  assets,  and  expenses  for  third
party content and development.  In the third quarter of 1999, we began providing
Internet  connectivity services to corporate  customers  and  required purchases
of additional bandwidth to service these  customers.  These  costs  are expected
to  continue  to  increase  as  our  web  traffic  increases  and  our corporate
customer  require  additional  bandwidth  for  our  "citizens".

     SALES  AND  MARKETING  EXPENSES.  Sales  and  marketing  expenses consisted
primarily  of  salaries  of  our  sales  and  marketing  personnel,  marketing,
promotion,  advertising  and  related  costs.  Sales and marketing expenses were
approximately  $4.79  million  and  $746,000  for the twelve month periods ended
December  31,  1999  and  1998, respectively.  The  absolute dollar increases in
the  twelve  month  period  in  1999  over  the  comparable  period  in  1998 in
sales  and  marketing  expenses  was  primarily  attributable  to  expansion  of
our  online  and  print advertising,  public  relations  and  other  promotional
expenditures  as  well  as  increased  sales  and  marketing  personnel  and
related  expenses  required to implement our marketing strategy.  In  the  third
quarter  of  1999,  the  Company  began  to  implement  aggressive  marketing
campaigns  online and in traditional media to promote the Nettaxi.com  brand and
attract  an  increasing  number  of  visitors  to  our  Web  site.


                                       54
<PAGE>
     We  expect sales and marketing expenses to increase significantly in future
periods.  These increases will be principally related to hiring additional sales
and  marketing  personnel  and increased spending on advertising in a variety of
media  to  increase  brand  awareness and attract additional visitors to our Web
site. There can be no assurance that these increased expenditures will result in
increased  visitors  to  our  Web  site  or  additional  revenues.

     RESEARCH  AND DEVELOPMENT EXPENSES.  Research and development expenses were
approximately  $2.19  million  and  $635,000  for the twelve month periods ended
December 31, 1999 and 1998, respectively. The absolute dollar increases for both
the  twelve  month period in 1999 over 1998 primarily  attributable  to  ongoing
updating  of the  infrastructure and technological  development of our web site.
The  increase also includes  increased salaries and associated hiring costs that
are  a  result  of  the  highly  competitive  nature  of  hiring in the internet
software marketplace.  We experienced substantial costs for engineer consultants
during  the  twelve  month  period  ended  December  31,  1999 and expects these
increased  costs  to  continue as we continue to recruit and retain personnel to
meet  the  research  and  development  requirements.

     GENERAL  AND  ADMINISTRATIVE EXPENSES.  General and administrative expenses
consisted  primarily  of  salaries  and  related  costs  for  our  executive,
administrative,  and  finance  personnel, as well as legal, accounting and other
professional  service  fees.  General  and  administrative  expenses  were
approximately  $3.46  million  and $1.05 million for the respective twelve month
periods  ended  December  31,  1999  and  1998  respectively.  The  increase  in
absolute  dollars for the twelve month  period  in 1999 over 1998 was  primarily
due  to  increases  in  the  number  of  general  and  administrative personnel,
increase  in  fees  for  professional  services  and  amortization  of  deferred
compensation  expenses,  related  to the issuance of common stock and option sot
consultants.  We  expect  general  and  administrative  expenses  to  grow  as
we  hire  additional  personnel  and  incur  additional  expenses related to the
growth  of  our  business  and  our  operation  as  a  public  company.

     ASSET  IMPAIRMENT  For  the year ended December 31, 1998 operating expenses
includes  a  one  time  adjustment  of  $667,000  for  asset  impairment.  Asset
impairment  write  down  was  to  adjust  the carrying amount of portions of the
purchased technology, namely the web to database software application to its net
realizable  value.  For  the period ended December 31, 1999, no asset impairment
write-down  was  recorded.

     INTEREST  EXPENSE.  Net  interest  expense  was  approximately $351,100 and
$59,000  for  the  respective  twelve  month  period ended December 31, 1999 and
1998.  The  net interest expense for the twelve month periods ended December 31,
1999  and  1998 related to the  convertible  promissory  note  that  was  issued
on  March  31, 1999 and to amortization of deferred interest related to warrants
issued  in  conjunction  with  the  convertible  promissory  note.

     OTHER  INCOME.  In  the  twelve  months ended December 31, 1998 we realized
a  gain  of  $28,500,  from  the  disposal  of  capital  equipment.  No gain was
realized  in  1999.


                                       55
<PAGE>
     INCOME  TAXES.  At  December  31,  1999,  we  had  net operating loss carry
forwards  available  to  reduce  future  taxable  income  that  aggregate
approximately  $11,200,000  for  Federal  income  tax  purposes.  These benefits
expire  through 2019. Pursuant  to  a  "change  in  ownership" as defined by the
provisions  of  the  Tax  Reform  Act  of 1986, utilization of our net operating
loss  carry forwards may be limited  if  a  cumulative  change  of  ownership of
more  than  50%  occurs over a three-year  period.  We have not determined if an
ownership  change  has  occurred.

     In  the  twelve  months  ended  December  31,  1999  we  recorded  a  tax
provision  which  relates  to  earnings made by Plus Net, Inc. during its fiscal
period  before  our  merger.

RESULTS  OF  OPERATIONS  -  COMPARISON  OF  THE PERIOD OCTOBER 23, 1997, DATE OF
INCORPORATION,  TO  DECEMBER  31, 1997 AND THE TWELVE MONTHS  ENDED DECEMBER 31,
1998

     NET  REVENUES.  Net  revenues  for  the  twelve  months  ended December 31,
1998  were  approximately  $258,000  and  for the period ended December 31, 1997
approximately  $144,900.   The  revenues  for  the  1997 period were principally
derived from royalties from  the  distribution  of  our CD-ROM tutorial product.
Revenues  for  the  twelve months ended December 31, 1998 reflect the shift from
the  initial  start-up  phase  of the Company to the current business model that
derives  a  majority  of  its  revenue  from  the sale of banner advertisements.

     ADVERTISING  REVENUES.  Advertising  revenues  for  the twelve months ended
December 31, 1998   were  approximately   $177,000 or approximately 69% of total
revenues.  There  were no advertising revenues for the period ended December 31,
1997.   The  Company began the sale of banner advertising on the internet in the
third  quarter  of  1998.

     ROYALTY REVENUES.  Our royalty revenues were approximately  $61,700 for the
twelve  months  ended  December 31, 1998, which represented approximately 24% of
total  revenues,  and  approximately  $132,300 for the period ended December 31,
1997,  which  represented  approximately  91%  of  total  revenues.  The Company
initially  derived  its  revenues  from  the distribution of the CD-ROM tutorial
product.

     COST  OF  OPERATIONS.  Cost  of  operations were approximately $239,800 for
the  twelve  months  ended  December  31,  1998 and $87,400 for the period ended
December  31,  1997.  The substantial absolute dollar is the result of increased
costs  for  co-location  expenses  (Internet  connection  charges), software and
equipment  costs,  and depreciation of equipment as a result of build-out of our
web  site.

     SALES  AND  MARKETING  EXPENSES.  Sales  and  marketing  expenses consisted
primarily  of  salaries  of  our  sales  and  marketing  personnel.  Sales  and
marketing  expenses  were  approximately  $745,600  and  $3,100  for  the twelve
month  period  ended December  31,  1998 and the period ended December 31, 1997,
respectively.  The  absolute dollar increase represents the shift from the early
research  and development stages of the Company to the current business model as
an  online  community  generating  revenues  from  the sales of advertising that
required  the  shift in resources to focus on the sales and marketing efforts to
promote  the  brand  awareness  of  the Company and increased traffic on our web
site.


                                       56
<PAGE>
     We  expect sales and marketing expenses to increase significantly in future
periods.  These increases will be principally related to hiring additional sales
and  marketing  personnel  and increased spending on advertising in a variety of
media  to  increase  brand  awareness and attract additional visitors to our Web
site. There can be no assurance that these increased expenditures will result in
increased  visitors  to  our  Web  site  or  additional  revenues.

     RESEARCH  AND DEVELOPMENT EXPENSES.  Research and development expenses were
approximately  $634,700  and $36,500 for the  twelve month period ended December
31,  1998  and  the period ended December 31, 1997, respectively.  The  absolute
dollar  increases  in  research  and  development  expenses  were  primarily
attributable  to  ongoing  updating  of  the  infrastructure  and  technological
development  of  our  web  site,  increased  salaries that are a result  of  the
highly  competitive  nature  of  hiring in the internet software marketplace. We
expect  these  increased  costs to continue as we continue to recruit and retain
personnel  to  meet the research and development requirements  of  the  Company.

     GENERAL  AND  ADMINISTRATIVE EXPENSES.  General and administrative expenses
consisted  primarily  of  salaries  and  related  costs  for  our  executive,
administrative,  and  finance  personnel, as well as legal, accounting and other
professional  service  fees.  General  and  administrative  expenses  were
approximately  $1.05  million  and  $160,000  for  the twelve month period ended
December  31,  1998  and  the  period ended December 31, 1997, respectively. The
increase  in  absolute  dollars   in  general  and  administrative  expenses was
primarily due to increases in the number of general and administrative personnel
and  the  increase  in  fees  for professional services. We expect  general  and
administrative  expenses  to  grow  as  we hire additional personnel  and  incur
additional  expenses  related  to the growth of our business and  our  operation
as  a  public  company.

     ASSET  IMPAIRMENT  For  the twelve months ended December 31, 1998 operating
expenses includes a one time adjustment of $667,000 for asset impairment.  Asset
impairment  write  down  was  to adjust  the  carrying amount of portions of the
purchased technology, namely the web to database software application to its net
realizable  value.  For  the period ended December 31, 1997, no asset impairment
write-down  was  recorded.

     INTEREST  INCOME/EXPENSE.  Net interest expense for the twelve months ended
December  31, 1998  was  approximately $59,000 and  $17,000 for the period ended
December  31, 1997. The net interest expense for both periods was related to the
convertible  promissory  note  that  was  issued  on  November 1, 1997 which was
converted  into  shares  of  common  stock  in  September  1998.

     INCOME  TAXES.  The provision for income taxes for the year ended  December
31,  1998  and  the  period  ended  December 31, 1997 consisted of minimum state
taxes.  At  December 31, 1998, we had net operating loss carryforwards available
to  reduce  future  taxable  income  that  aggregate  approximately  $ 1,227,000
for  Federal  income  tax  purposes.


                                       57
<PAGE>
LIQUIDITY  AND  CAPITAL  RESOURCES

     As  of  December  31,  1999,  the  Company had cash and cash equivalents of
approximately $988,000, compared to approximately $466,000 at December 31, 1998.

     Net  cash  used in operating activities equaled approximately $5.36 million
and  $665,800  for  the  twelve-month  periods ended December 31, 1999 and 1998,
respectively.  We  had significant negative cash flows from operating activities
for  both  of  the twelve month periods primarily from our net operating losses,
adjusted  for  non-cash items, and increases in accounts receivable balances due
to  the  time  lag  between revenue recognition and the receipt of payments from
advertisers.  These  factors  were  offset  by significant increases in accounts
payable  and  accrued  expenses.

     Net  cash  used in investing activities was approximately $2.16 million and
$124,600  for  the  twelve  month  periods  ended  December  31,  1999 and 1998,
respectively.  Substantially  all  of  the cash used in investing activities for
both periods was primarily  related  to  the purchase  of  capital  equipment in
connection  with  the  build  out  of  our  Web  site  and  infrastructure.

     Net  cash  provided by financing activities was approximately $8.04 million
and $1.21 million for the twelve month periods ended December 31, 1999 and 1998,
respectively.  Net  cash  provided  by  financing  activities  in 1998 consisted
primarily  of  net  proceeds  from  the  issuance of our common stock.  Net cash
provided  by  financing  activities  in 1999 consisted of both net proceeds from
issuance  of  common  stock  and  issuance  of  a  convertible  promissory note.

     We incurred net losses of approximately $9.88 million and $3.13 million for
the year ended December 31, 1999, and 1998, respectively.  At December 31, 1999,
we  had  an accumulated deficit of approximately $13.34 million.  The net losses
and  accumulated  deficit  resulted  from  the  significant  operational,
infrastructure  and other costs incurred in the development and marketing of our
services  and  the fact that revenues failed  to  keep  pace  with  such  costs.
As  a  result  of  our  expansion  plans  and our expectation that our operating
expenses,  especially  in  the  areas  of  sales  and  marketing,  will continue
to  increase  significantly,  we  expect  to  incur  additional  losses  from
operations for the foreseeable  future.  To  the  extent  that  increases in our
operating expenses precede  or are not  subsequently  followed  by  commensurate
increases in revenues, or  that  we  are  unable  to  adjust  operating  expense
levels accordingly, our business,  results of operations and financial condition
would be materially and adversely  affected.  There  can  be  no  assurance that
we will ever achieve or sustain  profitability  or  that  our  operating  losses
will  not  increase  in  the  future.

     We  currently  believe  that we have sufficient cash to fund our operations
through  December  2000.   After  that  time,  we  will  be  required  to  seek
additional  capital  to  sustain  our  operations.  We  expect  to  generate  a
portion  of  the  necessary  cash flow through advertising and hosting revenues,
but  will also need to  obtain  capital  through other sources such as equity or
debt  financing.


                                       58
<PAGE>
     We  recently  completed  a  private  placement  of  our common stock.  As a
result,  we  raised approximately  $ 23.6 million in exchange for  approximately
15.8 million shares  of  common  stock issued to  investors.  The investors also
 received warrants to purchase up to an equal number of  shares  of  our  common
stock  exercisable  at  an  exercise price  of  $4.00  per  share.  All  of  the
investors  completed   subscription agreements  and  represented to the  Company
that they were accredited investors, purchasing the shares for their own
account.

     We  are currently negotiating with other prospective investors; however  to
date, no  agreements for additional financing have been consummated.  We  cannot
assure you that we will be able to achieve  and  sustain  positive  cash flow or
profitability  or  that  we  will  have  other  sources available to provide the
financial  resources  necessary  to  continue  our  operations.  If  we  are
unsuccessful in generating resources from one or more of the anticipated sources
and  are  unable to replace any shortfall with resources from another source, we
may be able to extend the period for which available resources would be adequate
by  deferring the creation or satisfaction of various commitments, deferring the
expansion  or  introduction  of  various  services,  and  otherwise scaling back
operations.  If  we were unable to generate the required resources, our  ability
to  meet  our  obligations  and  to  continue  our operations would be adversely
affected.

     Given  our  limited resources and our history of losses from operations, we
will need to  raise additional funds in order to fund expansion of our business,
to  develop  new  or  enhanced  services  or products, to respond to competitive
pressures or to acquire complementary products,  businesses or technologies.  No
assurances can be given, however, that we will be able to obtain such additional
resources.  If  we are unsuccessful in generating anticipated resources from one
or  more  of  the  anticipated sources, and unable to replace the shortfall with
resources  from  another  source,  we may be able to extend the period for which
available  resources would be adequate by deferring the creation or satisfaction
of  various commitments, deferring the introduction of various services or entry
into  various  markets, and otherwise scaling back operations.  If we are unable
to  generate  the required resources, our ability to meet our obligations and to
continue  our  operations  would  be  adversely  affected.

IMPACT  OF  THE  YEAR  2000

     Many  currently  installed computer systems and software products are coded
to  accept  or  recognize  only two digit entries in the date code field.  These
systems  may  therefore recognize a date using "00" as the year 1900 rather than
the  year  2000.  As  a  result,  computer  systems and/or software used by many
companies  and governmental agencies may need to be upgraded to comply with Year
2000  requirements or risk system failure or miscalculations causing disruptions
of  normal  business  activities.

     STATE  OF READINESS.  The third party vendors upon which we materially rely
are  Exodus  Communications  and  Alchemy  Communications, Inc., which house and
service  our  Web  equipment  and  provide our connection to the Internet.  Both
Exodus  and  Alchemy have informed us that they believe their systems to be Year
2000  compliant.


                                       59
<PAGE>
     Although  as  of  February  28,  2000  we  have  experienced  no  material
technical  problems  related  to  the  Year  2000,  we  will  continue  to  seek
verification  from  other  key vendors, distributors and suppliers that they are
Year  2000  compliant  or,  if  they  are  not presently compliant, to provide a
description of their plans to  become so.  To the  extent that vendors failed to
provide  certification  that  they  are  Year  2000  compliant,  we  have
terminated  and  replaced  these  relationships.

     We  have  conducted  an  internal  assessment  of  all material information
technology  and  non-information technology systems at our headquarters for Year
2000  compliance.  We  experienced  no problems with these systems on January 1,
2000  or  since that time, and believe that these material systems are currently
Year  2000  compliant.

     COSTS.   To  date,  we  have  not  yet  incurred  any  material  costs  in
identifying  or  evaluating Year 2000 compliance issues.  Most of our costs have
related  to,  and  are  expected  to  continue  to  relate  to,  the upgrades or
replacements,  when  necessary,  of  software  or  hardware,  as  well  as costs
associated  with time spent by employees in the evaluation process and Year 2000
compliance  matters generally.  These expenses are included in our operating and
capital  expenditures  budget and are not expected to exceed $100,000.  However,
if  these  costs  are  significantly  higher  than  expected,  they could have a
material and adverse effect on our business, results of operations and financial
condition.

     RISKS.  Although  as  of  February 28, 2000 we have experienced no material
technical problems related to the Year 2000, there  can  be no assurance that we
will  not  discover  Year  2000  compliance  problems  in  our systems that will
require substantial revisions or replacements. In the event that the operational
facilities  that  support  our  business, or our Web-hosting facilities, are not
Year  2000  compliant,  we  may  be  unable  to deliver goods or services to our
customers  and  portions  of  our  Web site may become unavailable. In addition,
there  can  be  no  assurance  that  third  party software, hardware or services
incorporated  into  our  material  systems  will  not  need  to  be  revised  or
replaced,  which  could be time-consuming and expensive.  Our inability  to  fix
or  replace  third party software, hardware or services on a timely  basis could
result  in  lost  revenues,  increased  operating  costs  and  other  business
interruptions,  any  of  which  could  have a material and adverse effect on our
business,  results  of  operations  and  financial  condition.  Moreover,  the
failure  to  adequately  address  Year  2000  compliance issues in our software,
hardware  or  systems could result in claims of mismanagement, misrepresentation
or  breach  of  contract  and related litigation, which  could   be  costly  and
time-consuming  to  defend.

     In  addition, there can be no assurance that governmental agencies, utility
companies, Internet access companies and others outside our control will be Year
2000-compliant.  The  failure  by these entities to be Year 2000-compliant could
result  in  a  systemic  failure  beyond  our control, including, for example, a
prolonged  Internet,  telecommunications or electrical failure, which could also
prevent  us  from  delivering our services to our users, decrease the use of the
Internet or prevent users from accessing our services, any of which would have a
material and adverse effect on our business, results of operations and financial
condition.


                                       60
<PAGE>
     CONTINGENCY  PLAN.  We  do  not  currently  have a contingency plan to deal
with the worst case scenario that might occur if technologies on which we depend
are not Year 2000-compliant and fail to operate effectively after the Year 2000.
We  have  taken  into  consideration  the  results  of  our Year 2000 compliance
evaluation  and  the  responses  received from distributors, suppliers and other
third  parties  with  which we conduct business  in determining the need for and
nature  and  extent  of  any  contingency  plans.

     If our present efforts to address the Year 2000 compliance issues discussed
above  are not successful, or if distributors, suppliers and other third parties
with  which  we  conduct  business  do not successfully address such issues, our
users  could seek alternate suppliers of our products and services. Any material
Year  2000  problem could require us to incur significant unanticipated expenses
to  remedy and could divert our management's time and attention, either of which
could  have a material and adverse effect on our business, operating results and
financial  condition.

     This  is  a  Year 2000 readiness disclosure statement within the meaning of
the  Year  2000  Information and Readiness Disclosure Act P.L. 105-271; however,
the  disclosures  made  herein  do  not affect our liabilities under the federal
securities  laws.

RECENT  ACCOUNTING  PRONOUNCEMENTS

     In  June  1997,  the Financial Accounting Standards Board  issued Statement
of  Financial  Accounting  Standards  No. 131,  "Disclosure About Segments of an
Enterprise  and  Related  Information,"  which  is  effective  for  fiscal years
beginning  after  December 15, 1997. Statement of Financial Accounting Standards
No.131  requires  that  public  companies  report  information  about  operating
segments  in  their  annual  financial  statements  and  in subsequent condensed
financial  statements  of interim periods issued to shareholders. This statement
also  requires that public companies report information about their products and
services,  the geographic areas in which they operate and their major customers.
Reportable  operating segments are determined based on the management  approach,
as  defined  by  Statement  of  Financial  Accounting  Standards  No.  131.  The
management  approach is based on the way that the chief operating decision-maker
organizes  the segments within an  enterprise for making operating decisions and
assessing  performance.  We  have  determined that we do not have any separately
reportable  business  segments.

     In February 1998, the Financial Accounting Standards Board issued Statement
of  Financial  Accounting Standards No. 132, Employer's Disclosure about Pension
and  Other  Post  retirement  Benefits,  which  standardized  the  disclosure
requirements  for  pension  and other post retirement benefits.  The adoption of
Statement  of  Financial  Accounting  Standards  No.  132  had  no impact on the
Company's  current  disclosures.

     In  June 1998, the Financial Accounting Standards Board issued Statement of
Financial  Accounting  Standards No. 133, "Accounting for Derivative Instruments
and  Hedging  Activities."  Statement  of  Financial Accounting Standards No.133
establishes  accounting  and reporting standards requiring that every derivative
instrument  be  recorded in the  balance  sheet  as either an asset or liability
measured at its fair value. Statement of Financial Accounting Standards  No. 133


                                       61
<PAGE>
requires  that changes in the derivative's fair value be recognized currently in
earnings  unless  specific  hedge  accounting criteria are met.  In  June  1999,
The  FASB  Issued  SFAS  No. 137, "Accounting  for  Derivative  Instruments  and
Hedging  Activities - Deferral of the effective date of FASB Statement  No. 133"
which  amends  SFAS No. 133 to be effective  for  all  fiscal  quarters  or  all
fiscal  years  beginning  after  June  15,  2000.

     Historically,  we  have  not  entered  into derivatives contracts either to
hedge existing risks or for speculative purposes.  Accordingly, we do not expect
adoption  of  the new standard to have a material  impact  on  our  results from
operations,  financial  position  or  cash  flows.

     In  March  1998,  the  American  Institute  of Certified Public Accountants
issued  Statement  of  Position  No.  98-1,  Software  for  Internal  Use, which
provides guidance  on accounting for the cost  of computer software developed or
obtained  for  internal  use.  Statement  of  Position  98-1  is  effective  for
financial  statements  for fiscal years beginning after December 13, 1998. We do
not  expect  that  the  adoption  of  Statement  of  Position  98-1  will have a
material  impact  on  its  consolidated  financial  statements.


ITEM  7A.     QUANTITATIVE  AND  QUALITATIVE  DISCLOSURES  ABOUT  MARKET  RISK

MARKET  RISK

     We  could  be  exposed  to  market  risk related to any and all of our debt
obligations  for financing working capital and capital equipment requirements in
the  future.  Historically, we have financed such requirements from the issuance
of  both  preferred and common stock.  In addition, we have augmented our equity
financing  activities  via  the  issuance  of  convertible  debt.  We  continue
to  consider  financing  alternatives,  which may include the incurrence of long
term  indebtedness.  Actual  capital  requirements  may  vary  based  upon  the
timing and success of the expansion of our operations.  We believe that based on
the  terms  and  maturities  of any future debt obligations that the market risk
would  be  minimal.  We  currently  do  not have any material market rate risks.

EFFECTS  OF  INFLATION

     Due to relatively low levels of inflation in 1997, 1998 and 1999, inflation
has  not  had  a  significant  effect  on  our  results  of  operations.

ITEM  8.     FINANCIAL  STATEMENTS  AND  SUPPLEMENTARY  DATA

     Our financial statements, schedules and supplementary data, as listed under
Item  14,  appear  in  a  separate section of this report beginning on page F-1.


                                       62
<PAGE>
ITEM  9.     CHANGES  IN  AND  DISAGREEMENTS  WITH ACCOUNTANTS ON ACCOUNTING AND
             FINANCIAL  DISCLOSURE

None.


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<PAGE>
                                    PART III
                                    --------

ITEM  10.     DIRECTORS  AND  EXECUTIVE  OFFICERS  OF  THE  REGISTRANT

DIRECTORS,  EXECUTIVE  OFFICERS  AND  KEY  EMPLOYEES

     Our  directors, executive officers and other key employees, and their ages,
as  of  February  28,  2000  are  as  follows:

<TABLE>
<CAPTION>
NAME . . . . . . . . . . .  AGE  POSITION
--------------------------  ---  -----------------------------------------------------
<S>                         <C>  <C>
Robert A. Rositano, Jr.(1)   30  Chief Executive Officer, Secretary and Director
Dean Rositano(1) . . . . .   27  President and Director
Glenn Goelz. . . . . . . .   42  Vice President, Chief Financial Officer and Treasurer
Robert Speicher. . . . . .   44  Vice President of Sales and Marketing
Brian Stroh. . . . . . . .   29  Vice President of Information Services
Andrew Garroni (2) (3) . .   44  Director
Ron R. Goldie. . . . . . .   48  Director
<FN>
(1)     Robert  A.  Rositano,  Jr.  and  Dean  Rositano  are  brothers.
(2)     Member  of  Compensation  Committee
(3)     Member  of  Audit  Committee
</TABLE>

     Each  director  holds  his  office  until  the  next  annual meeting on the
stockholders  and  until  his  successor  is  elected  and  qualified. Executive
officers  are  appointed by and serve at the pleasure of our board of directors.

     Set  forth  below  is certain information regarding the business experience
during  the  last  five  years  of  each  of  the  above  named  persons.

     ROBERT  A.  ROSITANO,  JR.  Mr.  Rositano  Jr.  co-founded  Nettaxi  Online
Communities,  Inc., a Delaware corporation , in October, 1997.  He has served as
Chief  Executive  Officer and Secretary of Nettaxi since the reorganization with
Swan  Valley and prior to that served in the same capacities with Nettaxi Online
Communities  from  its inception.   He has over seven years of experience in the
internet  service  provider  and  Internet  industry.  In  February  1995,  he
co-founded  Simply  Interactive,  Inc. , an Internet/intranet  software company,
and  served  as Executive Vice  President in the areas of Inside Sales, Customer
Service  and  Product  Development  until  he  co-founded  Nettaxi  Online
Communities.  In  January  1994,  he  co-founded Digital Data Express, a company
focused on beginner level Internet users, and served as Chief  Executive Officer
until  February  1995  when  Digital  Data  Express  was  acquired  by  Simply
Interactive.  From 1992 to 1994, Mr. Rositano was hired on as the third employee
at  Netcom  On-line  Communications  in  1992  and  served as a senior sales and
account  manager  until  1993.


                                       64
<PAGE>
     DEAN  ROSITANO.  Mr.  Rositano  co-founded  Nettaxi  Online  Communities in
October,  1997.  He  has served as President of Nettaxi since the reorganization
with  Swan  Valley  and prior to that served in the same capacities with Nettaxi
Online  Communities.  He  has  over  seven  years  of  experience in the ISP and
Internet industry.  In February 1995, he co-founded Simply Interactive, Inc., an
Internet/intranet  software  company, and served as Vice President of Technology
until he co-founded Nettaxi Online Communities.  While at Simply Interactive, he
assembled  a digital production studio and produced the Internet the City CD-ROM
in  a  three  month  time frame on three platforms, Windows 3.1, Windows 95, and
Macintosh.  In  January  1994,  he co-founded Digital Data Express and served as
President  and  Chief  Executive  Officer  until February 1995 when Digital Data
Express  was  acquired  by  Simply  Interactive.  At  Digital  Data Express, Mr.
Rositano  co-produced  and  directed  the  world's first Internet training video
"Introduction  to  the  Internet."

     GLENN  GOELZ.  Mr.  Goelz  was  appointed  Vice  President, Chief Financial
Officer  and  Treasurer  in  April,  1999.  He  has  19 years of broad financial
experience  across several high technology fields.  Prior to joining Nettaxi, he
was  a  principal  of his own consulting firm specializing in strategic business
and financial consulting to multinational firms and Internet start-up companies.
From  August  1997  to  January,  1999 Mr. Goelz served as the Vice President of
Finance  and  Operations  for Pictra, Inc., a photo e-commerce start-up company.
From  April  1996  to  July  1997,  he  served in various capacities with Simply
Interactive,  including  Vice-President-Controller  and Chief Financial Officer.
From  April  of 1995 to April 1996, Mr. Goelz served as the Worldwide Controller
at Logitech, Inc., a worldwide provider of computer mice and senseware. Prior to
this,  Mr.  Goelz  served  as the Corporate Controller at Auspex Systems, Inc. a
provider of  high  performance data servers from 1993 to 1995.  Mr. Goelz earned
his  Bachelor's  degree  in  Business  and  Economics,  with  a concentration in
accounting,  from  Lehigh  University.

     ROBERT SPEICHER.  Robert  Speicher joined Nettaxi in October, 1999 to serve
as our Vice President of  Sales  and  Marketing.  From  November,  1994  through
October, 1999; Speicher was Executive Vice President and General Manager at Wood
Associates, a marketing and  promotions  company.  Prior to  that,  he served as
President  of  Plastech Marketing, Inc., a company that introduced biodegradable
polymer  technologies  to  the  promotional  merchandise industry.  He  has also
served  as  Vice  President  of  Sales  at  Multidate  Corporation,  a  company
dedicated   to   providing  automation  solutions  for  the  financial  services
industry.  He earned his  Bachelor's  degree from  San  Diego State  University
and  his  MBA  from Pepperdine  University.

     BRIAN  STROH.  Mr.  Stroh  was  appointed  Vice  President  of  Information
Services  in  October,  1997.  He  has  close to four years of experience in the
Internet  service  provider  and  Internet industry.  From December 1995 to June
1996  he  was  head  of  Customer  Service  of  a customer service, inside sales
department  which  grew to eight employees.  He assisted in the development of a
robust  call center and customer database.  He also served in a managerial role,
assisting  in  the development of the second edition to Ques Mega Web Directory.
Mr.  Stroh  earned  his  Bachelor's  degree  from  the University of Colorado at
Boulder.


                                       65
<PAGE>
     ANDREW  GARRONI.  Mr.  Garroni has served as a director since completion of
our  merger  with Plus Net in May 1999.  Under the terms of our merger agreement
with  Plus Net, Mr. Garroni was appointed as a member of the board of directors.
Mr.  Garroni  has  over 20 years experience in the development and management of
start-up entertainment  companies.  He currently serves as Executive Producer of
Showtime's  movie  series  "Naked  City," a position he has held since  January,
1998.  From  1990  to  September,  1998  he  served  as  President of Axis Films
International,  Inc.  supplying  films to cable television networks such as Home
Box  Office,  Showtime Networks and DBS  providers  like Direct TV. He began his
career  in  New  York  as  a principal partner in the motion picture  Production
Company  Cinerex  Associates,  Inc. whose clients included Twentieth Century Fox
and Orion  Pictures.  While in New York, he helped create Magnum Motion Pictures
and Magnum Entertainment.  Mr. Garroni has a Bachelor's degree in Marketing from
Fairleigh  Dickinson  University.

     RON  R.  GOLDIE.  Mr.  Goldie  has served as a director since completion of
our  merger  with Plus Net in May 1999.  Under the terms of our merger agreement
with  Plus  Net, Mr. Goldie was appointed as a member of the board of directors.
From  March  1990  to  December  1995 he was a senior partner at the law firm of
Jeffer,  Mangels, Butler and Marmaro.  From March 1996 to February 1997 he was a
senior  partner  at Coudert Brothers.  From February 1997 to March 1998 he was a
senior  partner  at Stroock and Lavan.  In March, 1999 he became a senior member
of the corporate department of Mitchell Silberberg and Knupp,  a ninety year old
Los  Angeles  based  law  firm.  Mr. Goldie specializes in business planning and
transactions  ranging from local to international matters. The practice includes
a  range from mergers and acquisitions, securities practice,  secured and  asset
based  lending  transactions,  advising  regarding structure and development and
general  and  corporate  business  matters.  Mr.  Goldie received his Bachelor's
degree  and  Law  degree  from  the  University  of Southern California, and was
admitted  to  the  California  Bar  in  1975.

EMPLOYMENT  AGREEMENTS  AND  TERMINATION  OF  EMPLOYMENT  AND  CHANGE OF CONTROL
ARRANGEMENTS

     EXECUTIVE  EMPLOYMENT  AGREEMENTS.  On  August  1,  1998  Nettaxi  Online
Communities,  Inc.  entered  into executive employment agreements with Robert A.
Rositano,  Jr. and Dean Rositano, and these agreements continued in effect after
the  reorganization with Swan Valley Snowmobiles, Inc.  Pursuant to the terms of
their individual executive employment agreements, Robert A. Rositano,  Jr. is to
perform the duties Chief Executive Officer and serve as a member of the board of
directors,  and Dean Rositano is to perform the duties of President and serve as
a member of the board of directors. Each executive employment agreement provides
for  an  annual  base  salary of $125,000 which may be increased by the board of
directors,  in  its  discretion.  The  base  salary  also  is to increase by ten
percent  per annum, which increase shall be cumulative for each year.  Under the
executive  employment  agreements,  each  executive  is also eligible for annual
bonus compensation in the minimum amount of $50,000 up to a maximum amount equal
to  the  base  salary  then  payable. The board of directors is to determine the
amount  of  the  annual  bonus based upon performance targets established by the
board  of  directors.  Under  the  executive  employment  agreements,  Robert A.
Rositano, Jr. and Dean Rositano each received warrants to purchase up to 883,952
shares  of  the common stock of Nettaxi Online Communities. The warrants were to
vest  over  three years and vesting was accelerated upon the reorganization with
Swan  Valley.  Robert  A. Rositano, Jr. and Dean Rositano each  exercised  their


                                       66
<PAGE>
warrants  in  September,  1998.  They have each been granted registration rights
with  respect to shares of common stock issued upon exercise  of  the  warrants.
Each  executive is eligible to receive three weeks paid vacation for the  first
year  of  employment  and  four  weeks  per  year  thereafter.  They  are  also
eligible  to  participate in the health, life insurance, medical, retirement and
other  benefit  programs  which  we may offer from time to time.  Each executive
receives  a  car  allowance  in  an  amount  not  to  exceed $600 per month plus
insurance  and  costs  of  repair  and  may  be  reimbursed for other reasonable
expenses  incurred  during  the  course  of  performing  their  duties.

     The  term of the executive employment agreements is four years and they are
automatically renewed for successive periods of one year unless terminated prior
to  such renewal.  We may terminate either executive at any time with or without
cause.  The  term  "cause" is defined in the executive employment agreements as:

     -     conviction  or  plea  of  no  contest  to  a  felony;
     -     willful  gross  misconduct  materially  injurious  to  Nettaxi;
     -     willful  and  material  failure to substantially perform duties other
than  a  failure  resulting  from  disability;
     -     violation  of  the  agreement's  covenant  not  to  compete;  or
     -     disclosure  of  material confidential  information  without prior
written consent.

If  any  executive  is  terminated without cause, he is to receive severance pay
equal  to:

     -     the  base  salary  for  the  remainder  of  the  term;
     -     minimum  bonus  plus  any pro rata bonus in  excess  of  the  minimum
bonus;
     -     pre payment of all automobile allowance  for  the remaining period of
the term;  and
     -     continued  coverage  for  life,  health  and  disability insurance
for the remainder  of  the  term.

The  above amounts shall be due in one lump sum payment three days following the
termination  of  his  employment  without  cause.  If  there  is  a  "change  in
control"  with  respect to Nettaxi, the executives may terminate their executive
employment  agreements and be entitled to severance in the amount of three years
of  annual benefits to be realized in accordance with the terms of the executive
employment  agreements,  payable in one lump sum. "Change in control" is defined
in  the  executive  employment  agreements  as:

     -     any  change  of  equity  such that more than 50% of  the  outstanding
shares  of  our  outstanding  shares  are  transferred  to  a  third  party;
     -     debt  ownership  such  that  more than 50% of our outstanding  shares
are  transferred  to  a  third  party;  or
     -     a  sale  of  70%  or  more  of  our  assets.


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<PAGE>
The  executive  employment  agreements  also  contain  covenants restricting the
disclosure of our confidential information, the solicitation of our employees or
agents  and the ability of the executives to engage in competing activities with
us.

     In  the  course  of  the  previous  year,  as a result of our limited human
resources  both  Robert  A.  Rositano  and  Dean  Rositano  have performed other
responsibilities  not  necessarily  within  the scope of the definition of their
positions  under  the  executive  employment  agreements.

     OTHER  EXECUTIVE  EMPLOYMENT  AGREEMENTS.  We  have  also  entered  into
employment agreements with each of Messrs. Glenn Goelz and Robert Speicher. Each
agreement  has  a  term  of  three years and automatically renews for successive
periods  of  one year unless terminated prior to such renewal.  We may terminate
him  at  any  time  with  or  without cause.  The term "cause" is defined in the
executive  employment  agreements  as:

     -     conviction  or  plea  of  no  contest  to  a  felony;
     -     willful  gross  misconduct  materially  injurious  to  Nettaxi;
     -     willful  and  material  failure to substantially perform duties other
than  a  failure  resulting  from  disability;  or
     -     disclosure  of  material  confidential  information without prior
written consent.

Messrs.  Goelz  and  Speicher  are  eligible  to  receive  severance  pay  if
terminated  without  cause  or  if  Nettaxi  experiences a change in control and
either  of  them elects to terminate the agreement.  The severance payment would
be:

     -     the  base  salary  for  the  remainder  of  the  term;
     -     minimum bonus plus any pro rata bonus in excess of the minimum bonus;
and
     -     continued coverage for  health and other benefits for the remainder
of the term.

Additionally, the vesting of all options to purchase common stock of the Company
would  be  accelerated  immediately.  The  severance payment would be due in one
lump sum three days following the termination of employment. "Change in control"
is  defined  in  the  employment  agreements  as:

     -     any  change  of  equity  such that more than 50% of  the  outstanding
shares  of  our  outstanding  shares  are  transferred  to  a  third  party;
     -     debt  ownership  such  that  more  than  50%  of  our  outstanding
shares  are  transferred  to  a  third  party;  or
     -     a  sale  of  substantially  all  of  our  assets.

The  employment  agreements  also  contain covenants regarding the assignment of
inventions,  restricting  the  disclosure  of  our confidential information, the
solicitation  of  our employees or agents and the ability of Mr. Goelz to engage
in  competing  activities.

     Our  agreement  with Mr. Goelz was entered into as of April 1, 1999.  Under
the  agreement,  Mr. Goelz is employed as Chief Financial Officer of the Company
and is expected to perform the duties consistent with the position including the
management  of  the  financial  operations  of  the  Company  and  the hiring of


                                       68
<PAGE>
personnel.  Mr. Goelz receives a base salary of $125,000 until August 1, 1999 at
which  time  the base salary will increase to $150,000.  He is also eligible for
annual  bonus  compensation  in  the  minimum amount  of $50,000 up to a maximum
amount  equal  to  the  base  salary  then payable. The board of directors is to
determine  the  amount  of  the  annual  bonus  based  upon  performance targets
established by the board of directors. He also is to receive options to purchase
up to 250,000 shares of our common stock, which vest over three years, under our
1998 Stock Option Plan. He receives three weeks paid vacation for the first year
of  employment  and  four  weeks  per  year  thereafter.  He is also eligible to
participate  in  the  health  and other benefit programs which we may offer from
time  to  time.

     Our  agreement  with  Mr.  Speicher  was entered into as of September 1999.
Under  the  agreement,  he  is employed as Vice President of Sales and Marketing
and  is  expected  to  perform  the  duties  consistent  with  the  position
including the management  and  supervision of the sales and marketing operations
and  duties of the  Company  and the hiring of personnel.  Mr. Speicher receives
an  annual  base  salary  of  $175,000.  He  is  also  eligible for annual bonus
compensation  in the minimum  amount  of $50,000 up to a maximum amount equal to
the  base  salary  then  payable.  The  board  of  directors is to determine the
amount  of  the  annual  bonus based upon performance targets established by the
board  of  directors.  He also is to  receive  options to purchase up to 250,000
shares  of  our  common stock, which vest over three years, under our 1998 Stock
Option  Plan.  He receives three weeks paid  vacation  for  the  first  year  of
employment  and  four  weeks  per  year  thereafter.  He  is  also  eligible  to
participate in the health and other benefit program  which  we  may  offer  from
time  to  time.

BOARD  COMMITTEES

     The  Compensation  Committee  of  the  board  of  directors  determines the
salaries and incentive compensation of our officers and provides recommendations
for  the  salaries  and  incentive  compensation  of  our  other  employees. The
compensation  committee  also  administers  our 1998 Stock Option Plan. There is
currently  only one member of the Compensation Committee, Mr. Garroni.  Prior to
May  3, 1999, we did not have a Compensation Committee or any other committee of
the  board  of  directors  that  performed  any  similar  functions.

     The  Audit Committee of the board of directors reviews, acts on and reports
to  the  board  of  directors  with  respect  to various auditing and accounting
matters,  including  the selection of our independent auditors, the scope of the
annual  audits,  fees  to  be  paid  to  the  auditors,  the  performance of our
independent auditors and our accounting practices.  Mr. Garroni is currently the
only  member  of  the  audit  committee.

     The  board  of  directors  does  not  have  a  nominating  committee.


                                       69
<PAGE>
DIRECTORS'  COMPENSATION

     Directors  who  are  also  employees of Nettaxi receive no compensation for
serving  on  the  board  of  directors.  With  respect  to directors who are not
employees,  we  intend  to  reimburse  such  directors  for all travel and other
expenses  incurred  in  connection  with  attending  meetings  of  the  board of
directors  and any committees of the board of directors.  Non-employee directors
are  also  eligible  to  receive grants of non-qualified stock options under our
1998  stock  option plan and our 1999 stock option plan.  We intend to grant our
non-employee directors, subject to shareholder ratification, options to purchase
common stock under our stock option plans to provide us with an effective way to
recruit  and  retain  qualified  individuals to serve as members of the board of
directors.

COMPENSATION  COMMITTEE  INTERLOCKS  AND  INSIDER  PARTICIPATION

     We did not have a Compensation Committee or other committee of the board of
directors  performing  similar functions during the fiscal years ending December
31,  1997  and  1998.  Messrs.  Robert A. and Dean Rositano are each officers of
Nettaxi and, as members of the board of directors, participated in deliberations
of  the  board  of  directors  relating  to  the  compensation  of our executive
officers.  As indicated above, the board of directors established a Compensation
Committee  as  of  May  3,  1999.

COMPLIANCE  WITH  SECTION  16(A)  OF  THE  SECURITIES  EXCHANGE  ACT  OF  1934

     Section  16(a) of the Securities Exchange Act of 1934, as amended, requires
our officers and directors, and persons who own more than ten percent of a class
of  our  capital  stock,  to  file  reports  of  ownership  and changes in their
ownership  with the Securities and Exchange Commission.  Officers, directors and
greater  than ten-percent shareholders are required to furnish us with copies of
all  Section  16(a)  forms  they  file.

Based  solely on a review of the copies of such forms received by us, or written
representations from certain reporting persons that no Forms 5 were required for
such  persons,  we  believe  that,  during  the  last  fiscal  year,  all filing
requirements  applicable to our officers, directors and greater than ten percent
beneficial  owners  were  complied  with except that initial reports  on  Form 3
were filed late by Messrs.  Robert A. Rositano, Jr., Dean Rositano, Glenn Goelz,
Ron Goldie, Andrew Garroni,  Steven  Antebi  and  Roger  Thornton.


                                       70
<PAGE>
ITEM  11.     EXECUTIVE  COMPENSATION


     The  following  table  sets  forth  information concerning compensation for
services  in all capacities awarded to, earned by or paid to our Chief Executive
Officer  and  President,  collectively,  the "named executives" during the years
ended  December  31,  1998  and  1999:


<TABLE>
<CAPTION>
                          SUMMARY COMPENSATION TABLE(1)

                             ANNUAL COMPENSATION            LONG-TERM COMPENSATION
NAME AND                     YEAR   SALARY ($)   BONUS ($)  NUMBER OF SECURITIES
PRINCIPAL                                                   UNDERLYING WARRANTS/
POSITION                                                    OPTIONS (#)
--------------------------  -------  ----------  ---------  ----------------------
<S>                         <C>      <C>         <C>        <C>
Robert A. Rositano, Jr. . . 1998(2)  $95,917(3)     -       1,012,347
Chief Executive Officer
                            1999     156,550     132,500    600,000

Dean Rositano . . . . . . . 1998(2)  $95,917(3)     -       1,012,347
President
                            1999     156,550     132,500    600,000
</TABLE>


(1)     The  columns  for  "Other  Annual  Compensation"  "Restricted  Stock
Awards"  "LTP  Payouts"  and  "All Other Compensation" have been omitted because
there  is  no  compensation  required  to  be  reported.

(2)     Information  set  forth  herein  includes  services  rendered  by  the
Named  Executives while employed  by  Nettaxi  Online  Communities,  Inc.  prior
to  the  reorganization  with  Swan  Valley  Snowmobiles,  Inc.  and  by Nettaxi
following  the  reorganization with Swan Valley.  No other executive officer  or
employee  received  compensation  in  excess  of  $100,000  during  this
period.

(3)     For  each  Named  Executive,  includes  $93,000  in  cash  compensation
and  16,574  shares of common  stock  issued  to each of the Named Executives in
February, 1998 in lieu of salary earned in 1998  having  an  ascribed  value  of
$2,198  as  determined  by  the  board  of  directors.

WARRANT  AND  OPTION  GRANTS  IN  LAST  YEAR

     The  following table sets forth information concerning warrants and options
granted  to  the  named  executives  during  1999.

<TABLE>
<CAPTION>
                                   WARRANT AND OPTION GRANTS DURING YEAR ENDED DECEMBER 31, 1999

NAME       Number of       % of Total       Exercise      Expiration       Potential Realizable Value at
           Securities   Warrants/ Options    Price Per       Date          Assumed Annual Rates of Stock
           Underlying       Granted to         Share                       Price Appreciation for Option
           Warrants/   Employees in 1999     ($/Sh)                        Term
           Options
           Granted (#)
                                                                         -------------  -----------------
                                                                          5%             10%
---------  -----------  ------------------  -----------  --------------  -------------  -----------------
<S>        <C>          <C>                 <C>          <C>             <C>            <C>
Robert A.     600,000          21.1%           $ 9.075       8/07           $1,869,000   $5,166,000
Rositano,
Jr.

Dean. . .     600,000          21.1%           $ 9.075       8/07           $1,869,000   $5,166,000
Rositano

</TABLE>
     No SARs were  granted to  either  of  the  Named  Executives  during  1999.
Each warrant and option represents the right to purchase one share of our common
stock.  In  1999,  we  granted  officers, employees and consultants warrants and
options  to  purchase  an aggregate  of 2,614,000 shares  of  our common  stock.
The  options shown may terminate before their expiration dates if the optionee's
status  as  an employee or consultant is terminated or upon the optionee's death
or  disability

     The  options  for each of the named executives were granted pursuant to our
1998  stock  option  plan  and  vest  in  the  following  manner:

     -     options  to  purchase 100,000 shares vest in 12 monthly installments;
           and

     -     options  to  purchase  500,000  shares  vest  upon our achievement of
specific  business  objectives  which  have  been  established  by  the board of
directors.

     The  amounts  indicated  in  the  columns  under  the  heading  "Potential
Realizable  Value at Assumed Annual Rates of Stock Price Appreciation for Option
Term"  Amounts  represent  hypothetical  gains  that  could  be achieved for the
respective  warrants  and options  if exercised at their end of their respective
terms.  The  5%  and  10%  assumed  annual  rates  of  compounded  stock  price
appreciation are mandated by rules of the Securities and Exchange Commission and
do  not  represent our estimate or projection of the future prices of the common
stock.  Actual  gains,  if  any,  on  any  exercises of warrants and options are
dependent  upon  the  future  performance  of our common stock and overall stock
market  conditions.  The  amounts  reflected in the table may not necessarily be
achieved.

WARRANT  AND  OPTION  EXERCISES  AND  YEAR-END  OPTION  VALUES

     The  following  table  sets  forth  information  with  respect to the named
executives concerning their exercise of warrants during 1999 and exercisable and
unexercisable  stock  options  held  by  them  as  of  December  31,  1999.


                                       71
<PAGE>
<TABLE>
<CAPTION>
              AGGREGATE WARRANT AND OPTION EXERCISES IN 1999 AND YEAR END OPTION VALUES

NAME                         Value          Number  of  Unexercised       Value of Unexercised In-the-
                Shares       REALIZED($)    Options  at  Year  End(#)     Money Options at Year End($)
               Acquired On                -----------------------------  -------------------------------
               EXERCISE (#)                Exercisable   Unexercisable    Exercisable   Unexercisable
-------------  -----------  ------------  ------------  ---------------  ------------  -----------------
<S>            <C>          <C>           <C>           <C>              <C>           <C>
Robert A. . .  0            $0.00         43,333        596,667          $21,370       $64,110
Rositano, Jr.

Dean Rositano  0            $0.00         43,333        596,667          $21,370       $64,110

</TABLE>

     No SARs were owned or exercised by any of the named executives  during  the
year ended December 31, 1999.

     The  amounts  shown  in the columns under the heading "Value of Unexercised
In-the-Money  Options at Year End" are based on a per share fair market value of
our common stock equal to $2.937 at December 31, 1999, the closing price for our
common  stock  on  that date as reported by various market makers for our common
stock  on  the  Over-The-Counter  Market  Bulletin  Board.  Each  of  the  named
executives  has options to purchase 40,000 shares of common stock which were "in
the  money"  at  year  end.  Options  to  purchase  10,000  of these shares were
exercisable  and  the  remaining  options  to  purchase 30,000 had yet to become
exercisable.

EMPLOYEE  BENEFIT  PLANS

     1999  STOCK  OPTION  PLAN.  Our  1999  Stock Option Plan was adopted by the
board  of  directors  in January 2000.  It will be presented to our stockholders
for ratification at our annual meeting of stockholders to be held in late spring
of  2000.  The  following description of our 1999 Stock Option Plan is a summary
and  qualified  in  its  entirety  by the text of the plan, which is filed as an
exhibit  to this Form.

     The  purpose  of the 1999 Stock Option Plan is to enhance our profitability
and  stockholder  value  by  enabling  us  to  offer  stock  based incentives to
employees, directors and consultants.  The 1999 Stock Option Plan authorizes the
grant  of options to purchase shares of common stock to employees, directors and
consultants of Nettaxi and its affiliates.  Under the 1999 Stock Option Plan, we
may  grant  incentive  stock  options  within  the meaning of Section 422 of the
Internal Revenue Code of 1986 and non-qualified stock  options.  Incentive stock
options  may  only  be  granted  our  employees.

     The number of shares available for options under the 1999 Stock Option Plan
is  3,300,000.  The  1999  Stock Option Plan is administered by the Compensation
Committee of the board. Subject to the provisions of the 1999 Stock Option Plan,
the  Compensation  Committee has authority to determine the employees, directors
and  consultants  of  Nettaxi  who  are  to be awarded options  and the terms of
such  awards,  including the number of shares subject to such  option,  the fair
market  value  of  the  common  stock subject to options, the exercise price per
share  and  other  terms.


                                       72
<PAGE>
     Incentive  stock options must have an exercise price equal to at least 100%
of  the  fair  market  value of  a  share on the date of the award and generally
cannot  have  a duration of more than 10 years. If the grant is to a stockholder
holding  more  than 10% of our voting stock, the exercise price must be at least
110%  of  the  fair  market  value on the date of grant. Terms and conditions of
awards  are  set  forth in written agreements between Nettaxi and the respective
option  holders.  Awards  under the 1999 Stock Option Plan may not be made after
the tenth anniversary of the date of its adoption but awards granted before that
date  may  extend  beyond  that  date.

     If  the  employment with Nettaxi of the holder of an incentive stock option
is  terminated  for  any  reason other than as a result of the holder's death or
disability  or  for "cause" as defined in the 1999 Stock Option Plan, the holder
may exercise the option, to the extent exercisable on the date of termination of
employment,  until  the earlier of the option's specified expiration date and 90
days  after  the  date  of  termination.  If  an  option  holder dies or becomes
disabled,  both  incentive  and  non-qualified  stock  options  may generally be
exercised,  to the extent exercisable on the date of death or disability, by the
option  holder  or  the  option  holder's  survivors  until  the  earlier of the
option's  specified  termination  date  and  one year after the date of death or
disability.

     As  of  February 15,  2000,  options  to purchase up to 1,508,800 shares of
common  stock had been granted under the 1999 Stock Option  Plan, and options to
purchase  1,791,200  shares  were  available  for  future  grants.  We  have
registered  the  shares  subject  to  issuance  under  the  plan pursuant to our
registration  statement  on  Form  S-8  (Registration  No.  333-32678.)

     Optionees  have no rights as stockholders with respect to shares subject to
option prior to the issuance of shares pursuant to the exercise thereof. Options
issued  to employees under the 1999 Stock Option Plan shall expire no later than
ten  years  after the date of grant.  An option becomes exercisable at such time
and  for  such amounts as determined at the discretion of the board of directors
or  the  Compensation  Committee  at  the  time  of the grant of the option.  An
optionee may exercise a part of the option from the date that part first becomes
exercisable  until  the  option  expires.  The  purchase  price for shares to be
issued  to an employee upon his exercise of an option is determined by the board
of  directors  or  the Compensation Committee on the date the option is granted.
The  purchase  price  is  payable  in  full  in cash, by promissory note, by net
exercise  or  by  delivery  of  shares  of our common stock  when the option  is
exercised.  The  1999 Stock Option Plan provides for adjustment as to the number
and  kinds  of  shares  covered  by the outstanding options and the option price
therefor to give effect to any stock dividend, stock split, stock combination or
other  reorganization  of  or  by  Nettaxi.

     1998  STOCK  OPTION  PLAN.  Our  1998  Stock Option Plan was adopted by the
board  of  directors,  and  ratified  and  approved  by  our stockholders, as of
September 29, 1998. The following description of our 1998 Stock Option Plan is a
summary and qualified in its entirety by the text of the plan, which is filed as
an  exhibit  to  this Form.


                                       73
<PAGE>
     The  purpose  of the 1998 Stock Option Plan is to enhance our profitability
and  stockholder  value  by  enabling  us  to  offer  stock  based incentives to
employees, directors and consultants.  The 1998 Stock Option Plan authorizes the
grant  of options to purchase shares of common stock to employees, directors and
consultants of Nettaxi and its affiliates.  Under the 1998 Stock Option Plan, we
may  grant  incentive  stock  options  within  the meaning of Section 422 of the
Internal Revenue Code of 1986 and non-qualified stock  options.  Incentive stock
options  may  only  be  granted  our  employees.

     The number of shares available for options under the 1998 Stock Option Plan
is  3,000,000.  The  1998  Stock Option Plan is administered by the Compensation
Committee  of  the  board. Subject to the provisions  of  the  1998 Stock Option
Plan,  the  Compensation  Committee  has  authority  to determine the employees,
directors  and  consultants  of  Nettaxi  who are to be awarded options  and the
terms  of  such  awards, including the number of shares subject to such  option,
the fair market value of the common stock subject to options, the exercise price
per  share  and  other  terms.

     Incentive  stock options must have an exercise price equal to at least 100%
of  the  fair  market  value of  a  share on the date of the award and generally
cannot  have  a duration of more than 10 years. If the grant is to a stockholder
holding  more  than 10% of our voting stock, the exercise price must be at least
110%  of  the  fair  market  value on the date of grant. Terms and conditions of
awards  are  set  forth in written agreements between Nettaxi and the respective
option  holders.  Awards  under the 1998 Stock Option Plan may not be made after
the tenth anniversary of the date of its adoption but awards granted before that
date  may  extend  beyond  that  date.

     If  the  employment with Nettaxi of the holder of an incentive stock option
is  terminated  for  any  reason other than as a result of the holder's death or
disability  or  for "cause" as defined in the 1998 Stock Option Plan, the holder
may exercise the option, to the extent exercisable on the date of termination of
employment,  until  the earlier of the option's specified expiration date and 90
days  after  the  date  of  termination.  If  an  option  holder dies or becomes
disabled,  both  incentive  and  non-qualified  stock  options  may generally be
exercised,  to the extent exercisable on the date of death or disability, by the
option holder or the option holder's survivors until the earlier of the option's
specified  termination  date and one year after the date of death or disability.

     As  of  February  15,  2000, no shares had been issued as the result of the
exercise  of  options  previously  granted  under  the  1998  Stock Option Plan,
2,580,166  shares  were  subject  to  outstanding  options  and  419,834  shares
were  available  for  future  grants.  The  exercise  prices  of the outstanding
options  ranged  from  $0.80  to  approximately  $44.00.  The  options under the
1998  Stock  Option  Plan  vest  over  varying  lengths  of  time  pursuant  to
various  option  agreements  that  we  have  entered  into  with  the  grantees
of  such  options.

     We have registered the the  shares  subject  to  issuance  under  the  plan
pursuant  to our registration  statement  on  form  S-8  (file  No. 333-32678).,
pursuant  to  the  Securities  Act  of  1933.


                                       74
<PAGE>
     Optionees  have no rights as stockholders with respect to shares subject to
option prior to the issuance of shares pursuant to the exercise thereof. Options
issued  to employees under the 1998 Stock Option Plan shall expire no later than
ten  years  after the date of grant.  An option becomes exercisable at such time
and  for  such amounts as determined at the discretion of the board of directors
or  the  Compensation  Committee  at  the  time  of the grant of the option.  An
optionee may exercise a part of the option from the date that part first becomes
exercisable  until  the  option  expires.  The  purchase  price for shares to be
issued  to an employee upon his exercise of an option is determined by the board
of  directors  or  the Compensation Committee on the date the option is granted.
The  purchase  price  is  payable  in  full  in cash, by promissory note, by net
exercise  or  by  delivery  of  shares  of our common stock  when the option  is
exercised.  The  1998 Stock Option Plan provides for adjustment as to the number
and  kinds  of  shares  covered  by the outstanding options and the option price
therefor to give effect to any stock dividend, stock split, stock combination or
other  reorganization  of  or  by  Nettaxi.

     401(K)  SAVINGS  PLAN.  Effective  June  1,  1999 we instituted the Nettaxi
401(k)  Savings  Plan . Eligible employees may begin making deferrals under  the
401(k)  Savings Plan. The 401(k) Savings Plan is intended to be a qualified plan
under  Internal  Revenue  Code  Section  401(a),  with a cash or deferred option
governed  by Section  401(k) Savings of the Internal Revenue Code. Employees may
elect  to  defer their eligible  current  compensation up to the statutorily and
401(k)  Savings  Plan  prescribed  limits and  have  the amount of such deferral
contributed to the 401(k) Savings Plan. Contributions to the 401(k) Savings Plan
are  invested  in  the  investment  funds  described in the 401(k) Savings Plan.

INDEMNIFICATION  AGREEMENTS

     We  intend  to enter into indemnification agreements with our directors and
officers. These agreements will provide, in general, that we shall indemnify and
hold harmless such directors and officers to the fullest extent permitted by law
against any judgments, fines, amounts paid in  settlement, and expenses incurred
in  connection  with,  or  in  any  way  arising  out of,  any  claim, action or
proceeding  against,  or affecting,  such directors and officers resulting from,
relating  to  or  in  any way arising out of, the service of such persons as our
directors  and  officers.  Currently, directors and officers are entitled to the
benefits of the limitation of liability provided under our charter documents and
the  laws  of  the  State  of  Nevada.


                                       75
<PAGE>
ITEM  12.     SECURITY  OWNERSHIP  OF  CERTAIN  BENEFICIAL OWNERS AND MANAGEMENT

     The  following  table sets forth information with respect to the beneficial
ownership  of  our  common  stock  as  of  February  15, 2000 by:

     -     each person, or group of affiliated persons, who we know beneficially
owns  5%  or  more  of  our  common  stock;

     -     each  of  our  directors  and  executive  officers;  and

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

     The percentages of total shares of common stock set forth below assume that
only  the indicated person or group has exercised options and warrants which are
exercisable  within  60  days  of  February 15,  2000  and  do  not  reflect the
percentage  of  common  stock  which would be calculated if all other holders of
currently  exercisable  options  or  warrants  had  exercised  their securities.

     Unless otherwise indicated in the footnotes to the table, (1) the following
individuals  have  sole  vesting and sole investment control with respect to the
shares  they beneficially own and (2) unless otherwise indicated, the address of
each  beneficial  owner  listed  below  is  c/o  Nettaxi.com,  1696 Dell Avenue,
Campbell,  California.

<TABLE>
<CAPTION>

NAME OF BENEFICIAL OWNER                                     NUMBER OF SHARES        PERCENT OF
EXECUTIVE OFFICERS AND DIRECTORS:                            BENEFICIALLY OWNED (1)     CLASS
-----------------------------------------------------------  ----------------------  -----------
<S>                                                          <C>                     <C>

Robert A. Rositano, Jr. . . . . . . . . . . . . . . . . . .               1,999,911         8.3%
-----------------------------------------------------------  ----------------------  -----------
Dean Rositano . . . . . . . . . . . . . . . . . . . . . . .               2,081,901         8.6%
                                                             ----------------------  -----------
Glenn Goelz . . . . . . . . . . . . . . . . . . . . . . . .                 104,433           *
-----------------------------------------------------------  ----------------------  -----------
Robert Speicher . . . . . . . . . . . . . . . . . . . . . .                  55,886           *
-----------------------------------------------------------  ----------------------  -----------
Brian Stroh . . . . . . . . . . . . . . . . . . . . . . . .                 122,284           *
-----------------------------------------------------------  ----------------------  -----------
Andrew Garroni. . . . . . . . . . . . . . . . . . . . . . .                 225,000         1.0%
-----------------------------------------------------------  ----------------------  -----------
Ron R. Goldie . . . . . . . . . . . . . . . . . . . . . . .                 200,000           *
-----------------------------------------------------------  ----------------------  -----------
All directors and executive officers as a group (7 Persons)               4,789,415        17.9%
-----------------------------------------------------------  ----------------------  -----------
OTHER 5% STOCKHOLDERS:
-----------------------------------------------------------
      Robert A. Rositano, Sr. . . . . . . . . . . . . . . .               2,705,830        11.7%
-----------------------------------------------------------  ----------------------  -----------
      Janice Rose Rositano-Battistella, . . . . . . . . . .               1,738,018         7.5%
      Trustee of the Janice Rose Rositano-
      Battistella Trust
-----------------------------------------------------------  ----------------------  -----------
<FN>
*     Less  than  one  percent.
</TABLE>


                                       76
<PAGE>
     Beneficial  ownership  is  determined  in  accordance  with  rules  of  the
Securities  and  Exchange  Commission.  In  computing  the  number  of  shares
beneficially  owned  by  a  person  and the percentage ownership of that person,
shares  of  common  stock  options  or  warrants  held  by  that person that are
currently  exercisable  or  exercisable  within  60  days  of  February 15, 2000
are deemed  outstanding.  Such  shares,  however, are not deemed outstanding for
the  purposes  of  computing  the  percentage  ownership  of  each  other
person.

     Robert  A.  and  Dean  Rositano  are  brothers.

     The  number  of  shares  shown  for Robert A. Rositano, Jr. includes 98,000
shares  of  common  stock  subject  to  options  that will be exercisable within
60  days  of  February  15,  2000.  Excludes  798,000  shares  of  common  stock
subject  to options that will not be exercisable  within  60  days  of  February
15,  2000.

     The  number  of  shares  shown for Dean Rositano includes 98,000 shares  of
common  stock  subject  to  options  that  will  be exercisable within  60  days
of  February  15,  2000.  Excludes  798,000  shares  of  common stock subject to
options  that  will not be exercisable within  60  days  of  February 15,  2000.

     The  number  of  shares  shown  for  Glen  Goelz  includes  104,433  shares
of  common stock  subject  to  options  that  will be exercisable within 60 days
of February 15, 2000. Excludes 269,567 shares of common stock subject to options
that  will  not  be  exercisable  within  60  days  of  February  15,  2000.

     The  number  of  shares shown for Robert Speicher 55,786 includes shares of
common  stock  subject  to  options  that  will be exercisable within 60 days of
February 15, 2000.  Excludes 294,214  shares of  common stock subject to options
that  will  not  be  exercisable  within  60  days  of  February  15,  2000.

     The number of shares shown for Brian Stroh includes 16,000 shares of common
stock  subject  to  options  that will be exercisable within 60 days of February
15,  2000.  Excludes  30,000 shares of common stock subject to options that will
not  be  exercisable  within  60  days  of  February  15,  2000.

     The  number  of  shares shown for Andrew Garroni includes 150,000 shares of
common  stock  subject  to  options  that  are  currently  exercisable.

     The number of shares shown for Ron Goldie includes 150,000 shares of common
stock  subject  to  options  that  are  currently  exercisable.

     The  shares  shown  for  Robert  Rositano,  Sr.  were received as part of a
pro-rata distribution to the members of SSN Properties,  LLC in April 1999.  Mr.
Rositano  is  a  managing  member  of SSN Properties and the father of Robert A.
Rositano,  Jr.  and  Dean  Rositano.  Mr. Rositano's address is 14836 Three Oaks
Court,  Saratoga,  California  95070.


                                       77
<PAGE>
     The  shares  shown  for  Janice  Rose  Rositano-Battistella, Trustee of the
distribution  to  the  members  of  SSN  Properties,  LLC  in  April  1999.  Ms.
Rositano-Battistella  is  the  mother  of  Robert  A.  Rositano,  Jr.  and  Dean
Rositano. Ms. Rositano-Battistella's address is 143 El Altillo Court, Los Gatos,
California  95030.

ITEM  13.          CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS

     The following describes transactions to which we were or are a party and in
which any of our directors, officers, or significant stockholders, or members of
the  immediate  family  of  any of the foregoing persons, had or has a direct or
indirect  material  interest.

STOCK  TRANSACTIONS  BY  NETTAXI  ONLINE  COMMUNITIES,  INC.

     Issuances  To  Founders.  Nettaxi  Online  Communities,  Inc. was formed in
October  1997  by  Robert  A.  Rositano, Jr. and  Dean Rositano.  At the time of
formation,  each of them was issued 1,288,044  shares of common stock of Nettaxi
Online  Communities  in  consideration  of  their  efforts  in establishing that
company  and  developing  its  initial  business  strategy.

     On  February  12,  1998,  Robert  A.  and Dean Rositano each were issued an
additional  66,297  shares of Nettaxi Online Communities common stock in lieu of
salary  compensation earned by them between October 1997 and January 1998 in the
amount  of  $11,667.

     In  March  1998,  Robert  A. and Dean Rositano each were issued warrants to
purchase 88,395 shares of Nettaxi Online Communities common stock.  On August 1,
1998,  they  were  each  issued  warrants  to purchase 883,952 shares of Nettaxi
Online Communities common stock pursuant to the executive employment agreements.
All  the  warrants  issued to Robert A. and Dean Rositano each were exercised in
September  1998.

     During  1998,  Robert  A. and Dean Rositano transferred 129,435 and 137,012
shares,  respectively,  of  Nettaxi  Online  Communities common stock by gift to
individuals.

     All the shares of Nettaxi Online Communities common stock held by Robert A.
and  Dean  Rositano  and  their donees  were converted into shares of our common
stock  in the reorganization with Swan Valley Snowmobiles, Inc. described below.

     SSN  Properties,  LLC.  In  October  1997,  Nettaxi  Online  Communities
purchased  the  assets  of  Simply  Interactive,  Inc. from SSN  Properties  LLC
pursuant to an asset purchase agreement.  The purchase  price for the assets was
$2,000,000.  $1,020,000  was  paid  pursuant  to  a convertible interest bearing
promissory note and the remainder of the purchase price was paid by the issuance
of  2,475,066  shares  of Nettaxi Online Communities common stock.  In September
1998,  SSN  Properties  converted  its  promissory note with accrued interest in
exchange  for  2,792,763  shares  of Nettaxi Online Communities common stock. In
September,  1998  Nettaxi  Online  Communities also issued 176,790 shares of its
Nettaxi  Online  Communities  common stock to SSN Properties in exchange for the
cancellation  of  a $70,000 accounts payable to SSN Properties.  All  the shares


                                       78
<PAGE>
of Nettaxi Online Communities common stock held by SSN Properties were converted
into  shares  of  our  common  stock  in  the  reorganization  with  Swan Valley
Snowmobiles,  Inc.  described  below. In April, 1999  a pro rata distribution of
the  shares  of  common  stock  held  by  SSN  Properties was made to all of its
members.

     Robert  Rositano, Sr., father of Robert A, and Dean Rositano, is a managing
member  of  SSN  Properties.

REORGANIZATION  WITH  SWAN  VALLEY  SNOWMOBILES,  INC.

     In  September  1998,  Nettaxi  Online  Communities  entered  into  the
reorganization with Swan Valley with a non-operating public company, Swan Valley
Snowmobiles,  Inc., a Nevada corporation incorporated in October 1995.  From its
incorporation, Swan Valley engaged in the business of snowmobile repair.  During
the first half of 1997, Swan Valley determined that this line of business was no
longer  feasible  and  discontinued  its  operations.  Under  the  terms  of the
reorganization,  the  Nettaxi  Online  Communities  stockholders  received
approximately 2.53 shares of common stock of Swan Valley in exchange for each of
their  shares  of  Nettaxi  Online  Communities common stock, and Nettaxi Online
Communities  became  a  wholly-owned  subsidiary of Swan Valley. An aggregate of
12,000,000  shares  were  issued  to  the  former  Nettaxi  Online  Communities
stockholders  in  the  reorganization  with  Swan  Valley and the Nettaxi Online
Communities  stockholders  owned  approximately  85% of  Swan Valley immediately
after  the  reorganization.  As part of the reorganization, all of the executive
officers  and  directors  of Swan Valley resigned and the executive officers and
directors  of  Nettaxi  Online  Communities  became the  executive  officers and
directors  of  Swan  Valley  which  changed its name to Nettaxi, Inc. (and later
changed  its  name to Nettaxi.com) Immediately prior to the reorganization, Swan
Valley  completed  a  limited  public offering of its common stock which yielded
gross  proceeds  of  $1,000,000  that  was  available  to  Nettaxi  once  the
reorganization  was  completed.


                                       79
<PAGE>
OTHER  AGREEMENTS

     We  have  entered  into  a  consulting  agreement  with  Fontenelle  LLC, a
financial  services provider of which one of our  former  directors,  Steven  S.
Antebi, is a  manager. Under the agreement, Fontenelle is to provide services we
request in connection with the financial planning, capital  structure, continued
development of  our  business  plan and the evaluation of financing alternatives
for us.  In exchange  for  its  services,  Fontenelle is to  receive  option  to
purchase  up  to 150,000  shares  of  our  common  stock  under  our  1998 Stock
Option Plan. The underlying shares of common  stock  are  to  have  registration
rights.  The  agreement  provides that Fontenelle is an  independent  contractor
and includes provisions regarding the  assignment  of  inventions,  prohibiting
the  disclosure  of  confidential  information  and  the  solicitation  of  our
employees.  The  term  of  the  agreement  is  two  years.  Our  agreement  with
Fontenelle did not  provide  for  Mr. Antebi's directorship.

     In  October 1998, each of Robert A. Rositano and Dean Rositano were granted
options to purchase up to 40,000 shares of our common stock under the 1998 Stock
Option Plan and Glenn Goelz was granted options to purchase up to 250,000 shares
of  common  stock under the 1998 Stock Option Plan. As described above, we  have
entered  into employment agreements and other compensation arrangements with our
officers.

     As  described above, in September 1999, we granted Mr. Robert Speicher, our
Vice  President  of Sales and Marketing options to purchase up to 250,000 shares
of  common  stock  in  accordance  with our 1998 stock option plan. The exercise
price  for the options is equal to their fair market value on the date of grant.
Options  to  purchase  up to 6,944 shares were immediately vested on the date of
grant  and  the  remaining  options  vest  in  12  equal quarterly installments.


                                       80
<PAGE>
     As described above, in August 1999 each of Robert A. Rositano, Jr. and Dean
Rositano  were  granted  options  to purchase up to 600,000 shares of our common
stock  under  the  1998 stock option plan. The exercise price for the options is
equal  to 110% of their fair market value on the date of grant. The options vest
in  the  following  manner:

     -     options  to  purchase 100,000 shares vest in 12 monthly installments;
           and

     -     options  to  purchase  500,000  shares  vest  upon our achievement of
           specific  business  objectives  which  have  been  established  by
           the board of directors.

     In  January 2000, each of Robert A. Rositano and Dean Rositano were granted
options  to  purchase  up  to  256,000 shares of our common stock under our 1999
stock  option plan.  The exercise price for these options was not less than 110%
of  the fair market value on the date of grant.  The right to purchase 56,000 of
these shares vests in 12 equal quarterly installments. The right to purchase the
remaining  shares  vests  upon  our  achievement of certain business objectives.

     In January 2000, we granted each of Glenn Goelz and Robert Speicher options
to  purchase  up  to  100,000 shares of common stock under our 1999 stock option
plan.  The  exercise  price  for these options was not less than the fair market
value  on  the  date  of  grant.  The right to purchase these shares vests in 12
equal  quarterly  installments.

     In  January  2000,  we  granted  each of our non employee directors at that
time,  Andy Garonni, Ron  R.  Goldie  and  Steven Antebi, options to purchase up
to 150,000 shares of common  stock  under  our  1999  stock option plan. We also
granted  options  to  purchase  150,000  shares  of  our  common  stock to Roger
Thornton,  a  former director. The exercise price for these options was not less
than  the fair market value on the date of grant.  The right to  purchase  these
shares  was  immediately  vested.

     We  believe that all of the transactions set forth above were made on terms
no  less  favorable  to us than could have been obtained from unaffiliated third
parties. We intend that all future transactions, including loans, between us and
our  officers,  directors,  principal  stockholders and their affiliates will be
approved  by  a  majority of the board of directors, including a majority of the
independent  and  disinterested outside directors on the board of directors, and
be  on  terms  no  less favorable to us than could be obtained from unaffiliated
third  parties.


                                       81
<PAGE>
                                     PART IV
                                     -------

ITEM  14.     EXHIBITS,  FINANCIAL  STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(A)     DOCUMENTS  FILED  AS  PART  OF  THIS  REPORT:

     1.     Financial  Statements.   The  following  financial  statements  of
Nettaxi.com  are  included  in  a separate section of this Annual Report on Form
10-K  commencing  on  the  pages  referenced  below:

      REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS                     F-3
      CONSOLIDATED  FINANCIAL  STATEMENTS
        Consolidated balance sheets                                    F-4 - F-5
        Consolidated statements of operations                                F-6
        Consolidated statements of shareholders' (deficiency) equity         F-7
        Consolidated statements of cash flows                                F-8
        Notes to consolidated financial statements                    F-9 - F-30

     2.     Financial  Statement Schedules. The financial statement schedules of
Nettaxi.com  have been omitted because they are not applicable, not required, or
the  information  is  included in the consolidated financial statements or notes
thereto.

     3.     Exhibits.  The  following  Exhibits  are  attached  hereto  and
incorporated  herein  by  reference:

Exhibit
Number   Description  of  Exhibit
-------  ------------------------
*2.1     Agreement  and  Plan  of Reorganization dated September 24, 1998 by and
         among Nettaxi Online Communities, Inc., the owners of all the
         outstanding shares of  common  stock  of  Nettaxi  Online  Communities,
         Inc.  and  the  Company.

*2.2     Merger  Agreement and Plan of Reorganization dated April 1, 1999 by and
         between  Plus  Net,  Inc.  and  the  Company

*3.1     Articles  of  Incorporation  of  the  Company

*3.2     Certificate  of Amendment to the Articles of Incorporation of
         the  Company

*3.3     By-Laws  of  the  Company

**3.4    Certificate  of  Amendment  of  Articles  of  Incorporation

*4.1     Specimen  Common  Stock  Certificate  of  the  Company


                                       82
<PAGE>
*4.2     See  Exhibits  3.1,  3.2  and  3.3  for  provisions  of the Articles of
         Incorporation  and  By-Laws  of  the  Company  defining the rights of
         holders of Common  Stock  of  the  Company.

*4.3     Convertible  Debenture  dated  March  31,  1999  in  favor  of  RGC
         International  Investors,  LDC

****4.4  1999  Stock  Option  Plan  of  the  Company

****4.5  Form  of  Stock Option Agreement for options issued pursuant to 1999
         Stock  Option  Plan  of  the  Company

*10.1    Asset Purchase and Sale Agreement dated October 1, 1997 by and between
         SSN  Properties,  LLC  and  the  Company

*10.2    Sub  Lease  dated  September 3, 1997 by and between Execustaff and the
         Company

*10.3    [Intentionally  Blank/Updated  form of agreement filed as Exhibit
         10.42]

*10.4    [Intentionally Blank/Updated form of agreement filed as Exhibit 10.43]

*10.5    Stock  Option  Agreement dated March 20, 1998 by and between Robert A.
         Rositano,  Jr.  and  the  Company

*10.6    Stock  Option  Agreement  dated  March  20,  1998  by and between Dean
         Rositano  and  the  Company

*10.7    [Intentionally Blank/Updated form of agreement filed as Exhibit 10.44]

*10.8    [Intentionally Blank/Updated form of agreement filed as Exhibit 10.45]

*10.9    Employment  Agreement  dated  August 1, 1998 between Dean Rositano and
         the  Company

*10.10   Employment Agreement dated August 1, 1998 between Robert A. Rositano,
         Jr.  and  the  Company

*10.11   Stock  Option Agreement dated August 1, 1998 by and between Robert A.
         Rositano,  Jr.  and  the  Company

*10.12   Stock  Option  Agreement  dated  August  1,  1998 by and between Dean
         Rositano  and  the  Company

*10.13   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.46]


                                       83
<PAGE>
*10.14   Letter  Agreement  dated  September  3, 1998 between Bay Tree Capital
         Associates,  LLC  and  the  Company

*10.15   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.47]

*10.16   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.48]

*10.17   1998  Stock  Option  Plan  of  the  Company

*10.18   Form  of  Stock  Option Agreement for options issued pursuant to 1998
         Stock  Option  Plan  of  the  Company

*10.19   Stock  Option  Agreement  under  the  1998  Stock  Option Plan by and
         between  Dean  Rositano  and  the  Company

*10.20   Stock  Option  Agreement  under  the  1998  Stock  Option Plan by and
         between  Robert  A.  Rositano,  Jr.  and  the  Company

*10.21   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.49]

*10.22   Technology  Licensing Agreement dated February 3, 1999 by and between
         Go  Hip,  Inc.  and  the  Company

*10.23   First  Amendment  to Technology Licensing Agreement dated as of April
         1,  1999  by  and  between  Go  Hip,  Inc.  and  the  Company

*10.24   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.50]

*10.25   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.40]

*10.26   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.51]

*10.27   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.52]

*10.28   Settlement  Agreement  dated  March  2,  1999  by  and  among Michael
         Gardner,  Bay  Tree Capital Associates, LLP, Wall Street Trading Group,
         Bruce K. Dorfman,  Robert  A.  Rositano,  Jr.,  Dean  Rositano  and
         the  Company

*10.29   Common  Stock  Purchase  Option to Purchase Common Shares of Nettaxi,
         Inc.  dated  March  4,  1999  between  Wall Street Trading Group and
         the Company

*10.30   Securities  Purchase  Agreement dated March 31, 1999 by and among RGC
         International  Investors,  LDC  and  the  Company


                                       84
<PAGE>
*10.31   Stock  Purchase  Warrant  dated  March  31,  1999  by  and  among RGC
         International  Investors,  LDC  and  the  Company

*10.32   Registration  Rights  Agreement dated March 31, 1999 by and among RGC
         International  Investors,  LDC  and  the  Company

*10.33   Oppenheimer  Funds  401K  Plan

*10.34   Standard  Office  Lease-  Gross dated March 1999 by and between South
         Bay  Construction  and  Development  Co.  III  &  South  Bay
         Construction  and Development  Co.  VII  and  the  Company

*10.35   Form of Indemnification Agreement between the Company and each of its
         Directors  and  Executive  Officers

*10.36   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.53]

*10.37   Employment  Agreement  dated  April  1, 1999 by and between Mr. Glenn
         Goelz  and  the  Company

*10.38   Consulting Agreement dated May 10, 1999 by and between Fontenelle LLC
         and  the  Company

*10.39   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.54]

*10.40   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.55]

*10.41   Lease  Agreement  dated  as of May 27, 1999 by and between H&L Realty
         and  Management  Company, Agent for owners Flamingo Fountains and the
         Registrant

*10.42   Master  Software  License  Bundling  and Distribution Agreement dated
         November  13,  1997  between  Apple  Computer,  Inc.  and  the  Company

*10.43   Master  Software  License,  Bundling and Distribution Agreement dated
         March  14,  1997  between  Fountain  Technologies,  Inc.  and  the
         Company

*10.44   Web  Advertising  Services  Agreement  dated June 3, 1998 between Fly
         Cast  Communications  Corporation  and  the  Company

*10.45   Sales  and Representation Contract dated July 7, 1998 between Michael
         Weiner  dba  Unique  Media  Services  and  the  Company

*10.46   Merchant  Services  Agreement  dated  August  3,  1998 by and between
         eCharge  Corporation  and  the  Company


                                       85
<PAGE>
*10.47   Conversion  Agreement  dated  September  4,  1998  by and between SSN
         Properties,  LLC  and  the  Company

*10.48   Internet  Infospace  Content  (World  Wide  Web  Site)  Distribution
         Agreement  dated  October 8, 1998 by and between InfoSpace.com, Inc.,
         a Delaware corporation  and  the  Company

*10.49   Agreement  for  Terminal Facility Co-Location Space dated January 18,
         1999  between  Alchemy  Communications,  Inc.  and  the  Company

*10.50   Letter Agreement dated January 15, 1999 between Babenet, Ltd. and the
         Company

*10.51   License  and  Distribution  Agreement  dated  March  30,  1999 by and
         between  Netopia,  Inc.  and  the  Company

*10.52   Website  Linking  and Promotion Agreement dated March 5, 1999 between
         PI  Graphix,  Inc.  and  the  Company

*10.53   Development  Agreement  dated as of December 16, 1998 between the Big
         Network  Inc.  and  the  Company

*10.54   Development  and  License  Agreement  dated  May, 1999 by and between
         eBay,  Inc.  and  the  Company

*10.55   Internet  Services  Suite  Agreement dated May 5, 1999 by and between
         Wired  Digital,  Inc.,  Lycos,  Inc.  and  the  Company

*10.56   Financial Consulting Agreement dated June 29, 1999 by and between The
         Phoenix  Group  International,  LLC  and  the  Company

**10.57  Master  Services  Agreement  dated September 15, 1997 by and between
         Exodus  Communications,  Inc.  and  the  Company.

**10.58  Gigabit  Data  Center  Services  Agreement dated July 1, 1999 by and
         between  Alchemy  Communications,  Inc.  and  the  Company.

**10.59  Advertising  Impression  Network  Contract dated July 1, 1999 by and
         between  White  Sand  Communications,  Inc.  and  the  Company.

**10.60  Advertising  Impression  Network  Contract dated July 1, 1999 by and
         between  Multinet  Communications  Worldwide  Limited  and  the
         Company.

**10.61  Data  Center  Service  Agreement  dated July 15, 1999 by and between
         Babenet,  LTD  and  the  Company.


                                       86
<PAGE>
**10.62  Data  Center  Service  Agreement  dated July 15, 1999 by and between
         Whitehorn  Ventures  Limited  and  the  Company

**10.63  Data  Center  Service Agreement dated August 15, 1999 by and between
         White  Sand  Communications,  Inc.  and  the  Company.

***10.64 Co-Branded  Free  ISP  Agreement  dated  November  30,  1999 by and
         between  Spin  Media  Network,  Inc.  and  the  Company

***10.65 Internet  Content Distribution Agreement dated December 30, 1999 by
         and  between  InfoSpace.com  and  the  Company

10.66    Sinclair Davis Trading Group Agreement dated as of December 8, 1999 by
         and  between  Sinclair  Davis  Trading  Corp.  and  the  Company

10.67    Form  of  Subscription  Agreement  of  the  Company

21.1     Subsidiaries  of  the  Company

*23.1    [Intentionally  Blank/  Updated  as  Exhibit  23.3]

*23.2    Consent  of  Silicon  Valley  Law  Group  (included  in  Exhibit  5.1)

*23.3    [Intentionally  Blank/  Updated  as  Exhibit  23.4]

*23.4    [Intentionally  Blank/  Updated  as  Exhibit  23.5]

23.5     Consent  of  BDO  Seidman,  LLP

24.1     Powers  of  Attorney  (included on signature pages to this Registration
         Statement)

27.1     Financial  Data  Schedule

*     Incorporated  by  reference  to  the  exhibits filed with the Registrant's
      Registration  Statement  on  Form  S-1  (File  No. 333-78129)  which  was
      declared effective  on  August  13,  1999.

**    Incorporated  by  reference  to  the exhibits filed with the Registrant's
      Quarterly Report on Form 10-Q for the period  ending  September 30, 1999.

***   Incorporated  by  reference  to the exhibits filed with the Registrant's
      Registration  Statement  on  Form  S-1  (File  No. 333-30074) which was
      filed on February  10,  2000.

****  Incorporated  by  reference to the exhibits filed with the Registrant's
      Registration Statement on Form S-8 (File No. 333-32678) which was filed on
      March 17,  2000.


                                       87
<PAGE>
(B)     REPORTS  ON  FORM  8-K.

No  reports  on Form 8-K were filed during the year ended December 31, 1999.


                                       88
<PAGE>
                                   SIGNATURES

         Pursuant  to  the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its  behalf  by  the  undersigned,  thereunto  duly  authorized.

                                        NETTAXI.COM

Date:  March  30, 2000                  By:  /s/  Glenn  Goelz
                                             -----------------
                                        Glenn  Goelz,  Chief  Financial  Officer
                                        (Principal  Accounting
                                        and  Financial  Officer)

                                POWER OF ATTORNEY

     We  the  undersigned  officers  and  directors  of  Nettaxi.com,  hereby
severally  constitute  and  appoint  Glenn  Goelz,  our  true  and  lawful
attorney-in-fact  and  agent, with full power of substitution and resubstitution
for him and in his name, place and stead, and in any and all capacities, to sign
any  and  all  amendments  to  this  Report, and to file the same, with exhibits
thereto,  and  other  documents in connection therewith, with the Securities and
Exchange  Commission,  granting unto said attorney-in-fact and agent, full power
and  authority  to  do  and  perform  each  and every act and thing requisite or
necessary  to  be  done  in  connection  therewith,  as fully to all intents and
purposes  as he might or could do in person, hereby ratifying and confirming all
that  said  attorney-in-fact  and  agent,  or his substitute or substitutes, may
lawfully  do  or  cause  to  be  done  by  virtue  hereof.

     Pursuant  to  the requirements of the Securities Exchange Act of 1934, this
Report  has  been  signed  by the following persons in the capacities and on the
dates  indicated:

SIGNATURE                          TITLE                         DATE
---------                          -----                         ----

/s/ Robert A. Rositano, Jr.        Chief Executive Officer,      March 30, 2000
---------------------------
    Robert A. Rositano, Jr.        Secretary  and  Director
                                   (principal  executive  officer)

/s/  Dean  Rositano                President and Director        March 30, 2000
---------------------------
     Dean  Rositano.

/s/  Glenn Goelz                   Vice President Chief          March 30, 2000
---------------------------        Financial  Officer (principal
     Glenn  Goelz                  accounting  officer)


/s/  Andrew  Garroni               Director                      March 30, 2000
---------------------------
    Andrew  Garroni

/s/  Ron  Goldie                   Director                      March 30, 2000
---------------------------
     Ron  Goldie


                                       89
<PAGE>
                                                                     NETTAXI.COM





REPORT  OF  INDEPENDENT  CERTIFIED  PUBLIC  ACCOUNTANTS


To  The  Board  of  Directors  and  Shareholders  of
Nettaxi.com

We  have  audited the accompanying consolidated balance sheets of Nettaxi.com as
of  December  31,  1999  and  1998,  and  the related consolidated statements of
operations, shareholders' (deficiency) equity and cash flows for each of the two
years  in the period ended December 31, 1999 and for the period from October 23,
1997  (Date  of  Inception) to December 31, 1997. 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 audit 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  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 financial position of Nettaxi.com as of
December 31, 1999 and 1998, and the results of its operations and its cash flows
for  each  of  the  two  years in the period ended December 31, 1999 and for the
period  from  October  23,  1997  (Date  of  Inception) to December 31, 1997  in
conformity  with  generally  accepted  accounting  principles.


San  Jose,  California
February  15,  2000, except for matters discussed in Note 13 for which the date
is March 9, 2000.


                                                                             F-3
<PAGE>
<TABLE>
<CAPTION>
                                                                     NETTAXI.COM


                                                     CONSOLIDATED BALANCE SHEETS
================================================================================



December 31,                                                       1999        1998
--------------------------------------------------------------  ----------  ----------
<S>                                                             <C>         <C>

ASSETS
CURRENT ASSETS:
  Cash and cash equivalents (Note 9) . . . . . . . . . . . . .  $  987,700  $  465,800
  Accounts receivable, net of allowance for doubtful accounts
    of $83,600 and $31,200, respectively (Note 9). . . . . . .   1,181,600     133,700
  Prepaid expenses and other assets (Note 7) . . . . . . . . .     609,200      16,100
--------------------------------------------------------------  ----------  ----------
TOTAL CURRENT ASSETS . . . . . . . . . . . . . . . . . . . . .   2,778,500     615,600
--------------------------------------------------------------  ----------  ----------
PROPERTY AND EQUIPMENT, net (Note 2) . . . . . . . . . . . . .   1,968,600     255,100
PURCHASED TECHNOLOGY, net (Note 3) . . . . . . . . . . . . . .     493,000     667,000
OTHER INTANGIBLES, net (Note 3). . . . . . . . . . . . . . . .      85,000     115,000
DEFERRED EXPENSES (Note 7) . . . . . . . . . . . . . . . . . .     655,200           -
DEPOSITS . . . . . . . . . . . . . . . . . . . . . . . . . . .      50,900           -
--------------------------------------------------------------  ----------  ----------
                                                                $6,031,200  $1,652,700
==============================================================  ==========  ==========
</TABLE>

                     See accompanying notes to consolidated financial statements


                                                                             F-4
<PAGE>
                                                                     NETTAXI.COM


                                                     CONSOLIDATED BALANCE SHEETS
================================================================================


<TABLE>
<CAPTION>
December 31,                                                            1999           1998
------------------------------------------------------------------  -------------  ------------
<S>                                                                 <C>            <C>
LIABILITIES AND SHAREHOLDERS' (DEFICIENCY) EQUITY
CURRENT LIABILITIES:
  Accounts payable . . . . . . . . . . . . . . . . . . . . . . . .  $  4,041,400   $   186,900
  Accrued expenses (Note 4). . . . . . . . . . . . . . . . . . . .       659,100        74,000
  Deferred revenue . . . . . . . . . . . . . . . . . . . . . . . .             -        47,000
  Income taxes payable (Note 8). . . . . . . . . . . . . . . . . .       125,600             -
  Current portion of capital lease obligations (Note 5). . . . . .         5,400         7,300
------------------------------------------------------------------  -------------  ------------

TOTAL CURRENT LIABILITIES. . . . . . . . . . . . . . . . . . . . .     4,831,500       315,200
------------------------------------------------------------------  -------------  ------------

LONG-TERM LIABILITIES:
  Capital lease obligations, less current portion. . . . . . . . .             -         5,400
  Convertible notes payable, related party (Note 6). . . . . . . .     3,200,000             -
------------------------------------------------------------------  -------------  ------------

TOTAL LONG-TERM LIABILITIES. . . . . . . . . . . . . . . . . . . .     3,200,000         5,400
------------------------------------------------------------------  -------------  ------------

TOTAL LIABILITIES. . . . . . . . . . . . . . . . . . . . . . . . .     8,031,500       320,600

COMMITMENTS AND CONTINGENCIES (Notes 5, 9 and 12)
SHAREHOLDERS' (DEFICIENCY) EQUITY (Notes 6, 7 and 13)
  Preferred stock, $0.001 par value; 1,000,000 shares authorized;
    no shares issued and outstanding.. . . . . . . . . . . . . . .             -             -
  Common stock subscribed. . . . . . . . . . . . . . . . . . . . .       (95,000)      (95,000)
  Common stock, $0.001 par value; 50,000,000 shares
    authorized; 23,214,446 and 21,110,000 shares issued
    and outstanding, respectively. . . . . . . . . . . . . . . . .        20,000        10,800
  Additional paid-in capital . . . . . . . . . . . . . . . . . . .    11,902,500     4,872,100
  Deferred Compensation. . . . . . . . . . . . . . . . . . . . . .      (491,400)            -
  Accumulated deficit. . . . . . . . . . . . . . . . . . . . . . .   (13,336,400)   (3,455,800)
------------------------------------------------------------------  -------------  ------------

TOTAL SHAREHOLDERS' (DEFICIENCY) EQUITY. . . . . . . . . . . . . .    (2,000,300)    1,332,100
------------------------------------------------------------------  -------------  ------------

                                                                    $  6,031,200   $ 1,652,700
==================================================================  =============  ============
</TABLE>

                     See accompanying notes to consolidated financial statements


                                                                             F-5
<PAGE>
<TABLE>
<CAPTION>
                                                                     NETTAXI.COM


                                           CONSOLIDATED STATEMENTS OF OPERATIONS
================================================================================


                                                                          For the
                                                                          period
                                                                        October 23,
                                                                         (Date of
                                                                       Inception) to
                                              Year Ended December 31,   December 31,
                                             ------------  ------------  -----------
                                                 1999          1998         1997
                                             ------------  ------------  -----------
<S>                                          <C>           <C>           <C>
NET REVENUES (Notes 9 and 10) . . . . . . .  $ 5,032,800   $   258,000   $  144,900
COST OF REVENUES. . . . . . . . . . . . . .    4,003,800       239,800       87,400
-------------------------------------------  ------------  ------------  -----------
GROSS PROFIT. . . . . . . . . . . . . . . .    1,029,000        18,200       57,500

OPERATING EXPENSES:
  Sales and marketing . . . . . . . . . . .    4,788,800       745,600        3,100
  Research and development. . . . . . . . .    2,186,700       634,700       36,500
  General and administrative. . . . . . . .    3,456,000     1,053,200      160,000
  Asset impairment (Note 3) . . . . . . . .            -       667,000            -
-------------------------------------------  ------------  ------------  -----------
TOTAL OPERATING EXPENSES. . . . . . . . . .   10,431,500     3,100,500      199,600
-------------------------------------------  ------------  ------------  -----------

LOSS FROM OPERATIONS. . . . . . . . . . . .   (9,402,500)   (3,082,300)    (142,100)

OTHER INCOME (EXPENSE):
  Interest income . . . . . . . . . . . . .       75,100         9,800            -
  Interest expense (Notes 6 and 7). . . . .     (426,200)      (68,800)     (17,000)
  Other income. . . . . . . . . . . . . . .            -        28,500            -
-------------------------------------------  ------------  ------------  -----------
LOSS BEFORE INCOME TAXES. . . . . . . . . .   (9,753,600)   (3,112,800)    (159,100)

INCOME TAXES (Note 8) . . . . . . . . . . .     (126,800)         (800)        (600)
-------------------------------------------  ------------  ------------  -----------
NET LOSS. . . . . . . . . . . . . . . . . .  $(9,880,400)  $(3,113,600)  $ (159,700)
-------------------------------------------  ------------  ------------  -----------
PREFERRED STOCK DIVIDEND. . . . . . . . . .            -       (14,300)    (167,500)
-------------------------------------------  ------------  ------------  -----------
NET LOSS AVAILABLE TO COMMON SHAREHOLDERS .  $(9,880,400)  $(3,127,900)  $ (327,200)
===========================================  ============  ============  ===========
BASIC AND DILUTED LOSS PER COMMON SHARE . .  $     (0.46)  $     (0.32)  $    (0.06)
===========================================  ============  ============  ===========
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING.   21,274,203     9,724,781    5,483,500
===========================================  ============  ============  ===========
</TABLE>


                     See accompanying notes to consolidated financial statements


                                                                             F-6
<PAGE>
<TABLE>
<CAPTION>

                                                                     NETTAXI.COM




                                           CONSOLIDATED STATEMENTS OF SHAREHOLDERS' (DEFICIENCY) EQUITY
                       ================================================================================




                        Preferred Stock        Common Stock       Common     Additional
                      -------------------  -------------------    Stock       Paid-in      Deferred     Accumulated
                       Shares     Amount     Shares    Amount   Subscribed    Capital    Compensation     Deficit        Total
--------------------  ---------  --------  ----------  -------  ----------  -----------  ------------  -------------  ------------
<S>                   <C>        <C>       <C>         <C>      <C>         <C>          <C>           <C>            <C>

BALANCES,
  October 23, 1997 .         -   $     -    2,576,088  $   100  $       -   $         -  $         -   $          -   $       100

Issuance of
   common
  stock for
  services
  and salaries . . .         -         -      187,837        -          -        52,500            -              -        52,500
Issuance of common
  stock for
  property,
  equipment and
  technology
  (Note 3) . . . . .         -         -    2,475,066    2,500          -       977,500            -              -       980,000
Proceeds from
  sale of
  preferred stock. .   134,000       100            -        -          -       267,900            -              -       268,000
Net loss available
  to common
  shareholders . . .         -         -            -        -          -             -            -       (327,200)     (327,200)
--------------------  ---------  --------  ----------  -------  ----------  -----------  ------------  -------------  ------------

BALANCES,
  December 31, 1997.   134,000       100    5,238,991    2,600          -     1,297,900            -       (327,200)      973,400

Net proceeds
  from sale of
  preferred stock. .    11,400         -            -        -          -        22,900            -              -        22,900
Net proceeds from
  sale of common
  stock. . . . . . .         -         -    1,756,378    1,800          -     1,198,300            -              -     1,200,100
Issuance of common
  stock for
   services
  and salaries . . .         -         -      328,132      300          -       142,500            -              -       142,800
Exchange of
  convertible notes
  payable and
  accrued interest
  (Note 6) . . . . .         -         -    2,792,763    2,800          -     1,103,000            -              -     1,105,800
Exchange of
  preferred stock
  for common
  stock. . . . . . .  (145,400)     (100)     734,438        -          -           100            -              -             -
Compensation
  expense related
  to warrants
  granted (Note 7) .         -         -            -        -          -       855,000            -              -       855,000
Warrants exchanged
  for common stock .         -         -    2,399,298    2,400    (95,000)       92,600            -              -             -
Issuance of
  common stock
  to Placement
  Agent. . . . . . .         -         -      200,000      200          -       159,800            -              -       160,000
Common stock
  issued in
  connection with
  Reorganization . .         -         -      660,000      700          -             -            -           (700)            -
Net loss available
  to common
  shareholders . . .         -         -            -        -          -             -            -     (3,127,900)   (3,127,900)
--------------------  ---------  --------  ----------  -------  ----------  -----------  ------------  -------------  ------------

BALANCES,
  December 31, 1998.         -         -   14,110,000   10,800    (95,000)  $ 4,872,100            -     (3,455,800)    1,332,100

Issuance of
  common
  stock in
  connection
  with pooling
  (Note 1) . . . . .         -         -    7,000,000    7,000          -             -            -           (200)        6,800
Deferred
  compensation
  related to stock
  options (Note 7) .         -         -            -        -          -       702,700     (702,700)             -             -
Amortization of
  deferred
  compensation
  (Note 7) . . . . .         -         -            -        -          -             -      211,300              -       211,300
Interest related
  to issuance
  of warrants. . . .         -         -            -        -          -       361,200            -              -       361,200
Warrants exercised
  for common
  stock. . . . . . .         -         -      150,000      200          -     1,181,100            -              -     1,181,300
Exchange of
  convertible notes
  payable and
  accrued interest
  (Note 6) . . . . .         -         -      802,223      800          -     1,862,500            -              -     1,863,300
Proceeds from the
  issuance of
  common stock . . .         -         -      802,223      800          -     1,862,500            -              -     1,863,300
Issuance of
  common stock
  for services . . .         -         -      350,000      400          -     1,060,400            -              -     1,060,800
Net loss available
  to common
  shareholders . . .         -         -            -        -          -             -            -     (9,880,400)   (9,880,400)
--------------------  ---------  --------  ----------  -------  ----------  -----------  ------------  -------------  ------------

BALANCES,
  December 31, 1999.         -   $     -   23,214,446  $20,000  $ (95,000)  $11,902,500  $  (491,400)  $(13,336,400)  $(2,000,300)
====================  =========  ========  ==========  =======  ==========  ===========  ============  =============  ============
</TABLE>

                     See accompanying notes to consolidated financial statements




                                                                             F-7
<PAGE>
                                                                     NETTAXI.COM



                                           CONSOLIDATED STATEMENTS OF CASH FLOWS
================================================================================
                                                                       (NOTE 11)
                                                                       ---------

<TABLE>
<CAPTION>
                                                                                            For the period
                                                                                            October 23, to
                                                                    Year Ended December 31,   December 31,
                                                                       1999          1998         1997
-----------------------------------------------------------------  ------------  ------------  ----------
<S>                                                                <C>           <C>           <C>

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net loss. . . . . . . . . . . . . . . . . . . . . . . . . . . .  $(9,880,400)  $(3,113,600)  $(159,700)
  Adjustments to reconcile net loss to net cash used
    in operating activities:
      Gain on disposal of equipment . . . . . . . . . . . . . . .            -       (28,500)          -
      Depreciation and amortization . . . . . . . . . . . . . . .      595,900       433,500      70,200
      Allowance for doubtful accounts . . . . . . . . . . . . . .       52,400        31,200           -
      Issuance of common stock for interest on convertible notes.       63,300        68,800           -
      Issuance of common stock for services (Note 7). . . . . . .       34,200       302,800      52,500
      Asset impairment (Note 3) . . . . . . . . . . . . . . . . .            -       667,000           -
      Compensation expense related to options granted . . . . . .      211,300       855,000           -
      Interest expense related to issuance of warrants. . . . . .      202,200             -           -
      Changes in operating assets and liabilities:
        Accounts receivable . . . . . . . . . . . . . . . . . . .   (1,100,300)     (104,800)    (60,000)
        Prepaid expenses and other assets . . . . . . . . . . . .      (62,700)      (13,200)     (2,900)
        Accounts payable. . . . . . . . . . . . . . . . . . . . .    3,854,500       175,900      11,000
        Accrued expenses. . . . . . . . . . . . . . . . . . . . .      585,100        13,700      37,300
        Deferred revenue. . . . . . . . . . . . . . . . . . . . .      (47,000)       47,000           -
        Income taxes payable. . . . . . . . . . . . . . . . . . .      125,600          (600)        600
-----------------------------------------------------------------  ------------  ------------  ----------

NET CASH USED IN OPERATING ACTIVITIES . . . . . . . . . . . . . .   (5,365,900)     (665,800)    (51,000)
-----------------------------------------------------------------  ------------  ------------  ----------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Proceeds from disposal of equipment . . . . . . . . . . . . . .            -        34,600           -
  Deposits. . . . . . . . . . . . . . . . . . . . . . . . . . . .      (50,900)            -           -
  Capital expenditures. . . . . . . . . . . . . . . . . . . . . .   (2,105,400)     (159,200)          -
-----------------------------------------------------------------  ------------  ------------  ----------

NET CASH USED IN INVESTING ACTIVITIES . . . . . . . . . . . . . .   (2,156,300)     (124,600)          -
-----------------------------------------------------------------  ------------  ------------  ----------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Payment on obligations under capital lease. . . . . . . . . . .       (7,300)       (2,000)          -
  Proceeds from convertible notes payable . . . . . . . . . . . .    5,000,000             -           -
  Net proceeds from issuance of preferred stock . . . . . . . . .            -         8,600     100,500
  Net proceeds from issuance of common stock. . . . . . . . . . .    3,051,400     1,200,100           -
-----------------------------------------------------------------  ------------  ------------  ----------

NET CASH PROVIDED BY FINANCING ACTIVITIES . . . . . . . . . . . .    8,044,100     1,206,700     100,500
-----------------------------------------------------------------  ------------  ------------  ----------

NET INCREASE IN CASH AND CASH EQUIVALENTS . . . . . . . . . . . .      521,900       416,300      49,500

CASH AND CASH EQUIVALENTS, beginning of period. . . . . . . . . .      465,800        49,500           -
-----------------------------------------------------------------  ------------  ------------  ----------

CASH AND CASH EQUIVALENTS, end of period. . . . . . . . . . . . .  $   987,700   $   465,800   $  49,500
=================================================================  ============  ============  ==========
</TABLE>

                     See accompanying notes to consolidated financial statements


                                                                             F-8
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

1.   SUMMARY OF ACCOUNTING POLICIES

          The Company

          Nettaxi.com   (formerly   Nettaxi,   Inc  and  formerly   Swan  Valley
          Snowmobiles,  Inc.), the Company, is a Nevada  Corporation,  which was
          incorporated on October 26, 1995.

          On September 29, 1998 the Company completed the acquisition of 100% of
          the outstanding  common stock of Nettaxi OnLine  Communities,  Inc., a
          Delaware  corporation,  and  changed its name to  Nettaxi,  Inc.  (now
          Nettaxi.com).  For  accounting  purposes,  the  acquisition  has  been
          treated  as  the   acquisition   of  the  Company  by  Nettaxi  OnLine
          Communities,  Inc.  with  Nettaxi  OnLine  Communities,  Inc.  as  the
          acquiror.  All shares and per share data prior to the acquisition have
          been  restated to reflect the stock  issuance and related  stock split
          (Note 7).

          As  the  former  shareholders  of  Nettaxi  OnLine  Communities,  Inc.
          received  85% of the  shares  in the  Company  immediately  after  the
          acquisition,  the  financial  statements  for  periods  prior  to  the
          reorganization are those of Nettaxi OnLine Communities, Inc.

          Effective  May 7, 1999,  the  Company  completed  a merger in a single
          transaction  with Plus Net, Inc. by exchanging 7 million shares of its
          common stock for all of the common stock of Plus Net,  Inc. Each share
          of Plus Net was exchanged for 1,000 shares of Nettaxi common stock.

          The  merger  constituted  a  tax-free   reorganization  and  has  been
          accounted  for as a pooling of interest  under  Accounting  Principles
          Board Opinion No. 16.

          For  periods  proceeding  the  merger,   there  were  no  intercompany
          transactions that require  elimination from the combined  consolidated
          results of  operations  and there  were no  adjustments  necessary  to
          conform the accounting  practices of the two companies.

          The merger with Plus Net, Inc.  allowed the  Company  to  provide  its
          customers with a web based e-mail program and  a  robust  meta  search
          engine.  Plus Net, Inc. also had an e-commerce  processing engine that
          enabled  the  acceptance  and  processing  of  online  credit  card
          transactions.

          Plus Net, Inc. reported no revenues and a net  loss  of  $200 for  the
          period ended December 31, 1998.  For  the period from January 1 to May
          7, 1999 Plus Net, Inc. had revenues  of approximately $700,000 and net
          income of approximately $413,600. Subsequent to the merger the Company
          ceased   its   evaluation   and  processing  of  online  credit   card
          transactions  business.  In 1999, this line of business accounted  for
          approximately $1,285,000 of the Company's revenues.

                                                                             F-9
<PAGE>

          Nettaxi OnLine Communities, Inc., was incorporated on October 23, 1997
          to capitalize on a significant  opportunity  that exists today through
          the  convergence of the media and  entertainment  industries  with the
          vast  communications  power of the  Internet.  The Company's Web site,
          http://www.nettaxi.com,  is an online community designed to seamlessly
          integrate   content  with   e-commerce   services  for  the  Company's
          subscribers,  providing comprehensive  information about news, sports,
          entertainment,  health,  politics,  finances,  lifestyle, and areas of
          interest  to the  growing  number of  Internet  users.  The  Company's
          mission is to establish  nettaxi.com as an entry point, or portal,  to
          the Internet by  continuing  to develop  premium  online  communities,
          which are both content-rich to its subscribers and provide easy-to-use
          e-commerce  services  to  businesses  which  reside  in  these  online
          communities.

          The  Company's  principal  executive  offices are located in Campbell,
          California.

          Consolidation

          The  accompanying   consolidated   financial  statements  include  the
          accounts of  Nettaxi.com  (formerly  Nettaxi,  Inc. and formerly  Swan
          Valley  Snowmobile,  Inc.) and its  wholly-owned  subsidiary,  Nettaxi
          OnLine  Communities,  Inc. All intercompany  accounts and transactions
          have been eliminated in the consolidated financial statements.


                                                                            F-10
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

          Use of Estimates

          The  preparation of  consolidated  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 consolidated  financial  statements and
          the reported  amounts of revenues and  expenses  during the  reporting
          period. Actual results could differ from those estimates.


                                                                            F-11
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

          Cash and Cash Equivalents

          The Company  considers all highly liquid  investments  having original
          maturities of 90 days or less to be cash equivalents.

          Accounts Receivable and Allowances For Doubtful Accounts

          The  Company  grants  credit to its  customers  after  undertaking  an
          investigation of credit risk for all significant amounts. An allowance
          for doubtful  accounts is provided for  estimated  credit  losses at a
          level deemed  appropriate to adequately provide for known and inherent
          risks  related to such  amounts.  The allowance is based on reviews of
          losses,  adjustment  history,  current  economic  conditions and other
          factors that deserve recognition in estimating potential losses. While
          management  uses  the  best   information   available  in  making  its
          determination,  the ultimate recovery of recorded accounts  receivable
          is also dependent upon future  economic and other  conditions that may
          be beyond management's control.

          Property and Equipment

          Property and  equipment are stated at cost.  Depreciation  is provided
          using the  straight-line  method over the  estimated  economic  useful
          lives of the assets, as follows:

<TABLE>
<CAPTION>
                           Estimated useful lives
                           ----------------------
<S>                        <C>
  Furniture and fixtures.                 5 years
  Office equipment. . . .                 5 years
  Computers and equipment                 3 years
</TABLE>

          Assets held under  capital  leases are  amortized  on a  straight-line
          basis over the shorter of the lease term or the estimated useful lives
          of the related assets.


                                                                            F-12
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

          Purchased Technology and Other Intangibles

          The Company amortizes, on a straight-line basis, the cost of purchased
          technology and other intangibles over the shorter of five (5) years or
          the useful life of the related technology or underlying asset.

          Software Development Costs

          In accordance with Statement of Financial Accounting Standards No. 86,
          Accounting for the Costs of Computer  Software to be Sold,  Leased, or
          otherwise  Marketed,   software  development  costs  are  expensed  as
          incurred until  technological  feasibility  has been  established,  at
          which time such costs are  capitalized  until the product is available
          for general  release to  customers.  To date,  the  establishments  of
          technological  feasibility  of  the  Company's  products  and  general
          release of such software have  substantially  coincided.  As a result,
          software  development  costs qualifying for  capitalization  have been
          insignificant,  and  therefore,  the Company has not  capitalized  any
          software development costs.

          Revenue Recognition and Deferred Revenue

          The  Company's  revenues  are  derived  principally  from  the sale of
          banner  advertisements,  web  hosting  services and from products from
          its online malls. Advertising revenues are recognized in the period in
          which the  advertisement  is  delivered,  provided that  collection of
          the resulting  receivable is probable.  Advertisers are charged  on  a
          per impression or delivery basis up to a maximum as  specified  in the
          contract.   To   date,  the  duration  of  the  Company's  advertising
          commitments has not exceeded one year.  When the  Company guarantees a
          minimum  number  of  impressions  or deliveries, revenue is recognized
          ratably in proportion to  the  number  of  impressions  or  deliveries
          recorded  to  the  minimum  number  of  impressions   and   deliveries
          guaranteed.  Deferred  revenue  resulting from advertising  agreements
          aggregated $0 and $47,000 as  of  December  31,  1999  and  1998,  and
          is  amortized on a straight-line basis over the advertising agreement.
          Web  hosting  revenues  are  recognized  in  the  period  in which the
          Services  are  provided.  Product revenue is recognized upon shipment,
          provided  no  significant  obligations  remain  and  collectability is
          probable.

                                                                            F-13
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

          Advertising revenue include barter revenues, which are the exchange by
          Nettaxi.com  of  advertising  space on  Nettaxi.com's  web  sites  for
          reciprocal  advertising space on other web sites.  Revenues from these
          barter transactions are recorded as advertising  revenues at the lower
          of  the  estimated  fair  value  of  the  advertisements  received  or
          delivered  and  are  recognized  when  the  advertisements  are run on
          Nettaxi.com's   web  sites.   Barter   expenses  are   recorded   when
          Nettaxi.com's  advertisements  are run on the  reciprocal  web  sites,
          which is typically in the same period as when  advertisements  are run
          on Nettaxi.com's web sites. In 1999, barter revenues represented 7% of
          net revenues.  There was no barter  revenue in the year ended December
          31, 1998 and in the period ended December 31, 1997.

          In November  1999,  the Financial  Accounting  Standards  Board (FASB)
          issued Emerging  Issues Task Force (EITF) Issue 99-17  "Accounting for
          Advertising  Barter  Transactions".  Under EITF  99-17,  revenues  and
          expenses should be recognized from advertising barter  transactions at
          the fair value of the  advertising  surrendered  or received only when
          the company has a historical  practice of receiving or paying cash for
          such  transactions.  As of  December  31,  1999,  the  Company  was in
          compliance with EITF 99-17.

          Income Taxes

          The Company  accounts for income taxes in accordance with Statement of
          Financial  Accounting  Standards (SFAS) No. 109, Accounting for Income
          Taxes, which requires an asset and liability  approach.  This approach
          results  in  the  recognition  of  deferred  tax  assets  (future  tax
          benefits) and liabilities for the expected future tax  consequences of
          temporary  differences  between the book carrying  amounts and the tax
          basis  of  assets  and  liabilities.   The  deferred  tax  assets  and
          liabilities  represent  the future tax  return  consequences  of those
          differences,  which will  either be  deductible  or  taxable  when the
          assets and liabilities  are recovered or settled.  Future tax benefits
          are subject to a valuation  allowance when  management  believes it is
          more  likely  than  not  that  the  deferred  tax  assets  will not be
          realized.


                                                                            F-14
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================


          Advertising Costs

          The cost of advertising is expensed as incurred. Advertising costs for
          the year ended  December  31,  1999,  1998,  and for the period  ended
          December 31, 1997,  were  approximately  $2,831,300,  $3,100 and $300,
          respectively.

          Long-Lived Assets

          The Company periodically reviews its long-lived assets for impairment.
          When events or changes in  circumstances  indicate  that the  carrying
          amount of an asset may not be  recoverable,  the  Company  writes  the
          asset down to its net realizable value.

          Fair Values of Financial Instruments

          The  following  methods  and  assumptions  were used by the Company in
          estimating its fair value disclosures for financial instruments:

          Cash and cash equivalents:

          The carrying  amount reported in the  consolidated  balance sheets for
          cash and cash equivalents approximates fair value.

          Short-term debt:

          The fair value of  short-term  debt  approximates  cost because of the
          short period of time to maturity.

          Long-term debt:

          The fair  value  of  long-term  debt is  estimated  based  on  current
          interest  rates  available  to the Company for debt  instruments  with
          similar terms and remaining maturities.

          Related party notes receivable and payable:

          The  fair  value  of  the  notes   receivable  and  notes  payable  to
          shareholders is based on arms-length transactions and bear interest at
          rates comparable to similar debt obligations.


                                                                            F-15
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

          At December 31, 1999 and 1998,  the fair values of the Company's  debt
          instruments approximate their historical carrying amounts.

          Stock-Based Incentive Program

          SFAS No. 123,  Accounting  for  Stock-Based  Compensation,  encourages
          entities to  recognize  compensation  costs for  stock-based  employee
          compensation  plans  using the fair value based  method of  accounting
          defined  in SFAS No.  123,  but allows  for the  continued  use of the
          intrinsic  value based method of  accounting  prescribed by Accounting
          Principles Board (APB) Opinion No. 25,  Accounting for Stock Issued to
          Employees.  The Company continues to use the accounting  prescribed by
          APB Opinion  No. 25 and as such is required to disclose  pro forma net
          income (loss) and earnings (loss) per share as if the fair value based
          method of accounting had been applied (Note 7).

          Basic and Diluted Loss Per Common Share

          In February  1997,  the FASB issued SFAS No. 128,  Earnings Per Share,
          which was effective December 28, 1997. Conforming to SFAS No. 128, the
          Company  changed  its  method  of  computing  earnings  per  share and
          restated  all prior  periods  included in the  consolidated  financial
          statements. Basic loss per common share is determined by dividing loss
          available to common  shareholders  by the weighted  average  number of
          common shares outstanding. Diluted per-common-share amounts assume the
          issuance  of common  stock  for all  potentially  dilutive  equivalent
          shares  outstanding.  Anti-dilution  provisions  of SFAS  128  require
          consistency  between  diluted   per-common-share   amounts  and  basic
          per-common-share  amounts in loss periods.  For the periods  reported,
          there were no  differences  between  basic and  diluted  earnings  per
          share.  The number of potential  common shares not included in diluted
          earnigns per share, due to their being  anti-dilutive,  are 3,838,679,
          280,000 and 0, for the years ended December 31, 1999 and 1998, and for
          the period ended  December 31, 1997,  respectively.  All share and per
          share  information has been adjusted for the shares  exchanged for the
          common stock of Plus Net, Inc.


                                                                            F-16
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

          Adoption of New Accounting Pronouncements

          In February  1998,  the Financial  Accounting  Standards  Board (FASB)
          issued SFAS No. 132,  Employer's  Disclosure  about Pensions and Other
          Postretirement    Benefits,    which   standardizes   the   disclosure
          requirements  for  pension  and  other  postretirement  benefits.  The
          adoption  of SFAS  No.  132 had no  impact  on the  Company's  current
          disclosures.

          In June 1998, the FASB issued SFAS No. 133,  Accounting for Derivative
          Instruments and Hedging Activities. SFAS No. 133 requires companies to
          recognize all derivatives contracts as either assets or liabilities in
          the  balance  sheet and to  measure  them at fair  value.  If  certain
          conditions are met, a derivative may be  specifically  designated as a
          hedge,  the  objective of which is to match the timing of gain or loss
          recognition on the hedging  derivative with the recognition of (i) the
          changes in the fair value of the hedged  asset or  liability  that are
          attributable  to the hedged  risk or (ii) the  earnings  effect of the
          hedged  forecasted  transaction.  For a derivative not designated as a
          hedging  instrument,  the gain or loss is  recognized in income in the
          period  of  change.  In June  1999,  the FASB  issued  SFAS  No.  137,
          Accounting  for  Derivative   Instruments  and  Hedging  Activities  -
          Deferral of the Effective Date of FASB Statement No. 133, which amends
          SFAS No. 133 to be  effective  for all fiscal  quarters  of all fiscal
          years beginning after June 15, 2000.

          Historically,  the Company has not entered into  derivative  contracts
          either  to  hedge   existing  risks  or  for   speculative   purposes.
          Accordingly,  the Company does not expect adoption of the new standard
          to have a material  impact on the Company's  results from  operations,
          financial position or cash flows.


                                                                            F-17
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

2.  PROPERTY  AND  EQUIPMENT

     Property  and  equipment  consisted  of  the  following:


<TABLE>
<CAPTION>
  December 31,                      1999       1998
                                 ----------  --------
<S>                              <C>         <C>

  Furniture and fixtures. . . .  $  196,200  $  5,000
  Office equipment. . . . . . .      59,700    59,700
  Computers and equipment . . .   2,134,400   250,200
                                 ----------  --------
                                  2,390,300   314,900
  Less accumulated depreciation     421,700    59,800
                                 ----------  --------
                                 $1,968,600  $255,100
                                 ==========  ========
</TABLE>

          Equipment  under capital lease  obligations  aggregated  $14,700 as of
          December 31, 1999 and 1998, with related  accumulated  amortization of
          $1,500 and $500, respectively.

3.   PURCHASED TECHNOLOGY AND OTHER INTANGIBLES

          In November 1997, the Company issued a convertible  secured promissory
          note in the  amount of  $1,020,000  (Note 6) and  2,475,066  shares of
          common stock,  valued at $980,000,  to a related party in exchange for
          certain  fixed  assets,  liabilities  and  technology.   Core  to  the
          technology acquired was a web to database software application and the
          underlying  technology  to the Company's  Internet The City  products.
          Based on the fair  market  value of the  consideration  exchanged,  as
          determined by an independent appraisal service, the aggregate purchase
          price was  $2,000,000,  and was allocated to the following  respective
          assets and liabilities based on their fair market value at the time of
          the transaction:

<TABLE>
<CAPTION>
<S>                                       <C>
  Purchased technology . . . . . . . . .  $1,740,000
  Other intangibles. . . . . . . . . . .     150,000
  Computers and equipment. . . . . . . .     100,000
  Office equipment . . . . . . . . . . .      45,000
  Furniture and fixtures . . . . . . . .       5,000
  Contracts payable and accrued expenses     (40,000)
----------------------------------------  -----------
                                          $2,000,000
========================================  ===========
</TABLE>

                                                                            F-18
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

          In 1998,  the Company  experienced  several  functional  problems with
          portions  of the  purchased  technology,  namely  the web to  database
          software  application,  due to those components  incompatibility  with
          subsequent  releases of upgraded  versions  of its  operating  system.
          Following  attempts to make these components  compatible,  the Company
          decided,  in December  1998, not to spend  additional  monies on these
          components but to replace them. As approximately 50% of the components
          of the acquired  technology were no longer technically viable with the
          upgraded  versions of the Company's  operating  system and provided no
          alternative future use, the Company wrote off the unamortized  portion
          of the  impaired  technology,  resulting  in a charge  to  expense  of
          $667,000.

          Purchased technology and other intangibles consisted of the following:

<TABLE>
<CAPTION>
  December 31,                     1999      1998
-------------------------------  --------  --------
<S>                              <C>       <C>

  Purchased technology. . . . .  $870,000  $870,000
  Less accumulated amortization   377,000   203,000
-------------------------------  --------  --------
                                 $493,000  $667,000
===============================  ========  ========

  December 31,. . . . . . . . .      1999      1998
-------------------------------  --------  --------
  Other intangibles . . . . . .  $150,000  $150,000
  Less accumulated amortization    65,000    35,000
-------------------------------  --------  --------
                                 $ 85,000  $115,000
===============================  ========  ========
</TABLE>


                                                                            F-19
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================


4.   ACCRUED EXPENSES

          Accrued expenses consisted of the following:

<TABLE>
<CAPTION>
  December 31,                       1999     1998
---------------------------------  --------  -------
<S>                                <C>       <C>
  Payroll and related expenses. .  $216,200  $10,000
  Professional fees . . . . . . .   135,000   52,700
  Marketing . . . . . . . . . . .    93,000   52,700
  Accrued interest, related party   125,500        -
  Other . . . . . . . . . . . . .    89,400   11,300
---------------------------------  --------  -------
                                   $659,100  $74,000
=================================  ========  =======
</TABLE>

5.   LEASE COMMITMENTS

          The  Company  leases its  facility  under an  operating  lease,  which
          expires on May 31, 2003.  The facility  lease  requires the Company to
          pay  certain  maintenance  and  operating  expenses,  such  as  taxes,
          insurance,  and  utilities.  Rent expense for the years ended December
          31, 1999 and 1998,  and for the period ended  December  31, 1997,  was
          $178,000, $35,500 and $6,800, respectively.

          In  1999,  the  Company  entered  into  operating  leases  on  certain
          vehicles.  For the year ended December 31, 1999,  rent expense related
          to the vehicle leases aggregated $2,600.

          A summary of the  future  minimum  lease  payments  under  capitalized
          leases  together with the present value of such minimum lease payments
          and future minimum payments  required under  non-cancelable  operating
          leases with terms in excess of one year follows:


                                                                            F-20
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

<TABLE>
<CAPTION>
Years Ending December 31,                   Operating Lease   Capital Leases
------------------------------------------  ----------------  ---------------
<S>                                         <C>               <C>
2000 . . . . . . . . . . . . . . . . . . .  $        276,080  $         5,400
2001 . . . . . . . . . . . . . . . . . . .           284,421                -
2002 . . . . . . . . . . . . . . . . . . .            98,373                -
------------------------------------------  ----------------  ---------------
                                            $        658,874            5,400
                                            ================
Less amounts representing interest (8.00%)                                  -
                                                              ---------------
Present value of minimum lease payments                                 5,400
Less current maturities                                                 5,400
                                                              ---------------
                                                              $             -
                                                              ===============
</TABLE>

6.   CONVERTIBLE NOTES PAYABLE, RELATED PARTY

          On November 1, 1997,  the Company  issued a 10% five-year  convertible
          secured  promissory  note in the amount of  $1,020,000.  In  September
          1998, this note, with accrued interest of $85,800,  was converted into
          2,792,763  shares  of  common  stock.  Interest  expense  on the  note
          aggregated  $68,800 in 1998 and $17,000 in the period  ended  December
          31, 1997.

          On March 31, 1999 the Company  entered into a  $5,000,000  Convertible
          Debt  Financing  Agreement  (the  Agreement)  with  RGC  International
          Investors,  LDC (RGC). The convertible  debenture bears interest at 5%
          and matures on March 31, 2004. The  debentures are  convertible at the
          option of the holder into that number of shares of common  stock equal
          to the principal  amount of the  debentures to be converted  including
          all accrued interest, divided by the conversion price specified in the
          debentures.  The conversion price is the lesser of a variable or fixed
          conversion  price.  The  variable  conversion  price  is  based on the
          trading  price of the  Company's  common  stock over a fixed period to
          conversion  of the  debentures,  and the  fixed  conversion  price  is
          $11.88.  The fixed  conversion price represents 120% of the average of
          the three lowest  trades ten days prior to the  effective  date of the
          Agreement.

          In  November  and  December  1999,  RGC  converted  $1,800,000  of the
          debentures,  with accrued interest of $63,300,  into 802,223 shares of
          common  stock.  As of  December  31,  1999,  accrued  interest  on the
          remaining debentures aggregated $125,500.


                                                                            F-21
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

7.   SHAREHOLDERS' EQUITY

          PREFERRED STOCK

          In October 1997,  the Company  offered  shares of its preferred  stock
          through a private  placement  offering.  This  offering  established a
          maximum of  150,000  shares of Series A  preferred  stock at $0.75 per
          share, each share convertible into 5.05 shares of the Company's common
          stock at any time.

          During the year ended  December 31, 1998 and the period ended December
          31, 1997,  the Company  issued  11,400 and 134,000  shares of Series A
          preferred  stock in this  offering for net cash proceeds of $8,600 and
          $100,500, respectively. As these shares were issued at a discount from
          the then fair market  value of the stock the Company  recorded  deemed
          preferred  stock  dividends  of $14,300 and $167,500 in the year ended
          December  31,  1998  and for  the  period  ended  December  31,  1997,
          respectively.

          In September  1998, all of the shares of Series A preferred stock were
          converted into 734,438 shares of the Company's common stock.

          COMMON STOCK

          In October  1997,  the  Company  offered  shares of its  common  stock
          through a private  placement  offering.  This  offering  established a
          maximum of 1,262,650 shares of common stock at $0.40 per share. During
          1998,  the  Company  issued  506,378  shares of  common  stock in this
          offering for net proceeds of $200,500.

          During the year ended  December 31, 1998 and the period ended December
          31, 1997, the Company issued 252,045 and 88,395 shares of common stock
          with ascribed values of $120,000 and $35,000 as payments for services,
          respectively.  The  shares  issued in  connection  with  payments  for
          services  performed  were valued at the then fair market  value of the
          share issued on the October 1997 private placement offering.


                                                                            F-22
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

          During the year ended  December 31, 1998 and the period ended December
          31, 1997,  the Company issued 76,087 and 99,442 shares of common stock
          with ascribed  values of $22,800 and $17,500 to officers and employees
          of the Company in lieu of salaries, respectively.

          In September 1998, the Company's Board of Directors declared a 2.53 to
          1 stock split, in connection with the Acquisition as discussed in Note
          1. All  references  to number of shares of common  stock and per share
          data in the  consolidated  financial  statements have been adjusted to
          reflect the stock split on a retroactive basis.

          In September  1998, in connection  with the  Acquisition,  the Company
          offered  shares  of its  common  stock  through  a  private  placement
          offering  (the  Offering).  The  Offering  established  a  maximum  of
          1,250,000  shares of common  stock at $0.80 per share.  The  Placement
          Agent received 200,000 shares of common stock with a fair market value
          of $160,000.  The Company issued  1,250,000  shares of common stock in
          the Offering for net proceeds of $999,600.

          In May 1999,  the Company  completed a merger in a single  transaction
          with Plus Net, Inc. by exchanging 7,000,000 shares of its common stock
          for all of the common stock of Plus Net,  Inc.  Each share of Plus Net
          was exchanged for 1,000 shares of Nettaxi common stock.

          In accordance with the Convertible Debt Financing  Agreement,  entered
          into between the Company and RGC International Investors, LDC on March
          31,  1999,  RGC has the option to  purchase  one  additional  share of
          common stock for every share of common stock issuable as a result of a
          conversion  of the  debenture,  at a  price  equal  to the  applicable
          conversion  price.  In November and December  1999, RGC exercised this
          investment  option right and purchased 802,223 shares of the Company's
          common stock for proceeds of $1,863,300.

          In December  1999,  the Company issued 350,000 shares of common stock,
          to a consulting group in exchange for a two-year  agreement to provide
          the Company with  consulting  services.  Based on the then fair market
          value of the shares issued the price of these  services was determined
          to be $1,060,800.


                                                                            F-23
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

          Included in prepaid expenses and deferred  expenses is, as of December
          31, 1999,  $1,026,600  representing  the unamortized  portion of these
          consulting services.

          WARRANTS

          In 1998,  prior to the  adoption of the Stock Option Plan as discussed
          below,  the  Company  granted  warrants  to  officers,  employees  and
          consultants  of the Company,  to purchase  2,399,298  shares of common
          stock at $0.04.

          In September 1998,  these warrants were exchanged for 2,399,298 shares
          of common  stock via the  issuance of  promissory  notes for  $95,000,
          concurrent  with the  reorganization  of the Company.  The  promissory
          notes have been  accounted for as common stock  subscribed  and are an
          offset to shareholders' equity until such notes are collected.

          In accordance with APB Opinion No. 25,  Accounting for Stock Issued to
          Employees,   the  Company  recorded  $855,000  of  compensation  costs
          associated with the above warrants.

          In conjunction  with the  Agreement,  entered into between the Company
          and RGC on March 31, 1999, the Company issued  warrants,  which vested
          immediately,  to purchase  150,000  shares of common stock at $12.375.
          The Company  recognized  an  additional  $115,500 of interest  expense
          associated  with these  warrants.  In August 1999, the Company entered
          into an  agreement  with RGC  pursuant  to which  it  exercised  these
          warrants.

          In consideration for the early exercise of the warrants,  the exercise
          price for the  warrants was  decreased  from $12.375 to $7.875 and the
          Company  issued RGC warrants to purchase an additional  150,000 shares
          of common stock at $7.875.  The Company will  recognize an  additional
          $245,700 of interest expense associated with these warrants.  In 1999,
          the Company recognized $86,700 of this amount as interest expense.


                                                                            F-24
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

          STOCK OPTION PROGRAM

          On September  29, 1998,  the Company  adopted a Stock Option Plan (the
          Plan). The Plan is restricted to employees,  officers, and consultants
          of the Company.  Options  granted under the Plan  generally  vest over
          three years and are exercisable over ten years.  Non-stautory  options
          are granted at prices not less than 85% of the estimated fair value of
          the  stock  on the  date  of  grant  as  determined  by the  Board  of
          Directors.  Incentive options are granted at prices not less than 100%
          of the  estimated  fair  value  of the  stock  on the  date of  grant.
          However,  options granted to shareholders  who own greater than 10% of
          the  outstanding  stock  are  established  at no less than 110% of the
          estimated fair value of the stock on the date of grant.

          The Company has  reserved  three  million  shares of common  stock for
          issuance under The Plan.


                                                                            F-25
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

          A summary  of the  status of the  Company's  stock  option  plan as of
          December 31, 1999 and December 31, 1998,  and changes during the years
          then ended is presented in the following table:
<TABLE>
<CAPTION>
                         --------------------------------------------
                                    Options Outstanding
                         --------------------------------------------
                          December 31, 1999     December 31, 1998

                                    Wtd. Avg.              Wtd. Avg.
                          Shares    Ex. Price    Shares    Ex. Price
                         ---------  ----------  ---------  ----------
<S>                      <C>        <C>         <C>        <C>
Beginning . . . . . . .    280,000  $     0.80          -  $        -
Granted . . . . . . . .  2,614,000  $    10.40    280,000  $     0.80
Exercised . . . . . . .          -  $        -          -  $        -
Forfeited . . . . . . .    313,834  $     9.45          -  $        -
-----------------------  ---------              ---------
Ending. . . . . . . . .  2,580,166  $     9.47    280,000  $     0.80
=======================  =========  ==========  =========  ==========
Exercisable at year-end    640,499                 23,333
=======================  =========              =========

Weighted-average fair value of options granted during the period:

                                    $     5.71             $     0.71
                                    ==========             ==========
</TABLE>
          The  following  table  summarizes   information  about  stock  options
          outstanding as of December 31, 1999:

<TABLE>
<CAPTION>
                        Options Outstanding     Options Exercisable
                        -------------------     -------------------
               Wtd. Avg.
Range of        Number      Remaining   Wtd. Avg.     Number      Wtd. Avg.
Exercise      Outstanding  Contractual   Exercise   Exercisable    Exercise
Prices        at 12/31/99     Life        Price     at 12/31/99     Price
------------  -----------  -----------  ----------  -----------  -----------
<S>           <C>          <C>          <C>         <C>          <C>
0.80-5.00 .       280,000   8.00 Years  $     0.80      116,667   $     0.80
5.01-10.00.     1,687,250   9.75 Years  $     8.67      177,583   $     8.42
10.01-15.00       522,916   9.50 Years  $    12.68      256,249   $    13.90
15.01-30.00        45,000   9.50 Years  $    25.60       45,000   $    25.60
30.01-45.00        45,000   9.50 Years  $    40.22       45,000   $    40.22
              -----------                           -----------
                2,580,166               $     9.47      640,499   $    12.67
              ===========               ==========  ===========   ==========
</TABLE>


                                                                            F-26
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

          In connection  with the grant of certain  stock  options in 1999,  the
          Company recorded deferred  compensation of $702,700,  representing the
          difference between the deemed fair market value and the exercise price
          of the options as  determined by the Board of Directors on the date of
          grant.  The deferred  compensation is being amortized over the vesting
          period  of  the   underlying   options.   The  amount   recognized  as
          compensation expense in 1999 amounted to $211,300.

          SFAS No. 123,  Accounting for Stock-Based  Compensation,  requires the
          Company to provide pro forma  information  regarding net (loss) income
          and  (loss)  earnings  per  share  as if  compensation  cost  for  the
          Company's stock option plan had been determined in accordance with the
          fair  value  based  method  prescribed  in SFAS  No.123.  The  Company
          estimates  the fair value of stock  options at the grant date by using
          the Black-Scholes  option  pricing-model  with the following  weighted
          average  assumptions used for grants in 1999 and 1998:  dividend yield
          of 0; expected volatility of 112% and 180%; risk-free interest rate of
          6.2% and 5.7%; and expected lives of three years for all plan options.
          The  Company  adopted  its Stock  Option  Plan in  September  1998 and
          consequently had no stock options granted in 1997.

          Under the  accounting  provisions  of SFAS No. 123, the  Company's net
          loss and the basic and  diluted  net loss per common  share would have
          been adjusted to the pro forma amounts below:

<TABLE>
<CAPTION>
                                1999           1998
                            -------------  ------------
<S>                         <C>            <C>
Net income (loss):
As reported. . . . . . . .  $ (9,880,400)  $(3,127,900)
Pro forma. . . . . . . . .  $(11,516,600)  $(3,144,500)
Basic and diluted earnings
 (loss) per share:
As reported. . . . . . . .  $      (0.46)  $     (0.32)
Pro forma. . . . . . . . .  $      (0.54)  $     (0.32)
</TABLE>


                                                                            F-27
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

8.   INCOME TAXES

          The  provision  for income taxes for the year ended  December 31, 1999
          relates to the  earnings of Plus Net,  Inc.  prior to the merger.  The
          provision  for income  taxes for the year ended  December 31, 1998 and
          the period ended December 31, 1997 consisted of minimum state taxes.

          The following  summarizes the  differences  between income tax expense
          and the amount  computed  applying the Federal  income tax rate of 34%
          for the years ended  December  31,  1999 and 1998,  and for the period
          ended December 31, 1997:

<TABLE>
<CAPTION>
                                                  1999          1998        1997
--------------------------------------------  ------------  ------------  ---------
<S>                                           <C>           <C>           <C>

Federal income tax benefit at statutory rate  $(3,316,200)  $(1,058,400)  $(54,100)
State income taxes, net of federal benefit .     (566,500)     (180,800)    (9,800)
Tax benefit not currently recognizable . . .    3,884,100       835,400     64,500
Other. . . . . . . . . . . . . . . . . . . .      125,400       404,600          -
--------------------------------------------  ------------  ------------  ---------
Provision for income taxes . . . . . . . . .  $   126,800   $       800   $    600
============================================  ============  ============  =========
</TABLE>

          Deferred  income  taxes and  benefits  result  from  temporary  timing
          differences in the  recognition  of certain  expenses and income items
          for tax and financial reporting purposes, as follows:

<TABLE>
<CAPTION>
December 31,                           1999         1998       1997
---------------------------------  ------------  ----------  ---------
<S>                                <C>           <C>         <C>

Net operating loss carryforward .  $ 4,558,900   $ 473,900   $ 67,400
Depreciation and amortization . .     (216,800)    (90,300)   (10,100)
Accrued compensation and benefits      562,700       4,000          -
Reserves not currently deductible       33,300     316,200        200
---------------------------------  ------------  ----------  ---------
Total deferred tax asset. . . . .    4,938,100     703,800     57,500
Valuation allowance . . . . . . .   (4,938,100)   (783,800)   (57,500)
---------------------------------  ------------  ----------  ---------
Net deferred tax asset. . . . . .  $         -   $       -   $      -
=================================  ============  ==========  =========
</TABLE>

          The Company has net operating loss  carryforwards  available to reduce
          future  taxable  income,  if any,  of  approximately  $11,200,000  for
          Federal  income tax purposes.  The benefits  from these  carryforwards
          expire  through  2019.  As of December  31,  1999,  management  cannot
          determine that it is more likely than not that these carryforwards and
          other  deferred tax assets will be realized,  and  accordingly,  fully
          reserved for these deferred tax assets.


                                                                            F-28
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

          Pursuant to the "change in ownership" provisions of the Tax Reform Act
          of 1986,  utilization of the Company's net operating loss and research
          and  development  tax  credit  carryforwards  may  be  limited,  if  a
          cumulative  change of  ownership  of more than 50%  occurs  within any
          three-year  period.  The Company has not  determined  if an  ownership
          change has occurred.

9.   CONCENTRATION OF CREDIT RISK

          Financial  instruments,  which  potentially  subject  the  Company  to
          concentration  of credit risk,  consist  principally  of cash and cash
          equivalents  and trade  receivables.  The Company  places its cash and
          cash  equivalents  with high quality  financial  institutions  and, by
          policy,  limits the amounts of credit  exposure  to any one  financial
          institution.

          The Company's  accounts  receivable are derived from many customers in
          various  industries.  The Company believes any risk of accounting loss
          is significantly reduced due to the diversity of its end-customers and
          geographic sales areas. The Company performs credit  evaluation of its
          customers' financial condition whenever necessary,  and generally does
          not require  cash  collateral  or other  security to support  customer
          receivables.

10.  MAJOR CUSTOMERS

          For the year ended  December 31,  1999,  one  customer  accounted  for
          approximately 17% of revenues,  with related account  receivable as of
          December 31, 1999 of $250,000.

          For the year ended  December 31, 1998,  four  customers  accounted for
          approximately  28%,  21%, 13% and 12% of revenues,  respectively  with
          related  accounts  receivable  as of  December  31,  1998 of  $52,100,
          $38,100, $0 and $23,800, respectively.

          For the period ended  December 31, 1997,  one customer  accounted  for
          approximately  84% of revenues,  with related  account  receivable  at
          December 31, 1997 of $59,100.


                                                                            F-29
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

11.  SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

          The following is  supplemental  disclosure  for the statements of cash
          flows.


<TABLE>
<CAPTION>
                                                                                For the
                                                                                 Period
                                                                               October 23,
                                                                                   to
                                                      Year Ended December 31,  December 31,
                                                      -----------------------
                                                          1999        1998        1997
-----------------------------------------------------  ----------  ----------  ----------
<S>                                                    <C>         <C>         <C>

Cash Paid:
-----------------------------------------------------
Income taxes. . . . . . . . . . . . . . . . . . . . .  $    1,600  $    1,400  $        -
Interest. . . . . . . . . . . . . . . . . . . . . . .  $    3,000  $      100  $        -

Noncash Investing and Financing Activities
-----------------------------------------------------
Note payable and common stock issued for
  purchased technology and other assets . . . . . . .  $        -  $        -  $2,000,000
Purchase of equipment under capital lease . . . . . .  $        -  $   14,700  $        -
Issuance of common stock for convertible
  notes payable plus accrued interest . . . . . . . .  $1,863,300  $1,020,000  $        -
Issuance of common stock for consulting services. . .  $1,060,800  $        -  $        -
Warrants issued in conjunction with debt financing. .  $  361,200  $        -  $        -
Conversion of preferred stock to common stock . . . .  $        -  $  109,100  $        -
Promissory notes received for common stock subscribed  $        -  $   95,000  $        -
=====================================================  ==========  ==========  ==========
</TABLE>

12.  CONTINGENCIES

          The Company is involved in litigation  arising in the ordinary  course
          of business. In the opinion of management, after consulting with legal
          counsel,  these matters are without merit and will be resolved without
          material adverse effect on the Company's financial  position,  results
          of operations or cash flows.

13.  SUBSEQUENT EVENTS

          In  January  and  February  2000,   RGC  converted   $800,000  of  the
          debentures,  with accrued interest of $35,000,  into 631,932 shares of
          common stock. In conjunction with the conversions,  RGC also exercised
          its  investment  option  right  and  purchased 631,932  shares  of the
          Company's common stock for proceeds of $835,000.

          In January  2000,  the Company  adopted a new Stock  Option  Plan,  in
          addition  to the  Plan  adopted  in 1998.  The  Company  has  reserved
          3,300,000 shares of common stock for issuance under the new plan.

                                                                            F-30
<PAGE>
                                                                     NETTAXI.COM



                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
================================================================================

          In January  2000,  the  Company  granted  options  under the new Stock
          Option Plan to purchase up to 1,508,800  shares of common stock, at an
          exercise price of $2.44 per share,  to certain members of its board of
          directors and employees of the Company.

          In November 1999, the Company retained the services of an investment
          banking firm to assist in securing a private placement for additional
          capital.  As of March 9, 2000, the Company had issued 300,000 shares
          for proceeds of $450,000.  An additional $6,700,000 was being held by
          the escrow agent for release to the company upon the issuance of
          common stock, sold at $ 1.50 per share, to other subscribers of the
          private placement.  For their services, the investment bank is to
          receive 350,000 shares of the company's common stock valued at
          $525,000.

14,  VALUATION  AND
     QUALIFYING
     ACCOUNTS
                                        ADDITIONS
                          BALANCE  AT   CHARGED  TO                 BALANCE  AT
                          BEGINNING     COSTS  AND                    END  OF
          DESCRIPTION     OF  PERIOD     EXPENSES     DEDUCTIONS      PERIOD
          -----------     ----------     --------     ----------    -----------
          1999:
          ALLOWANCE  FOR  DOUBTFUL
            ACCOUNTS     $31,200         $52,400      $     -         $83,600
          1998:
          ALLOWANCE  FOR  DOUBTFUL
            ACCOUNTS     $     -         $31,200      $     -         $31,200
          1997:
          ALLOWANCE  FOR  DOUBTFUL
            ACCOUNTS     $     -         $     -      $     -         $     -

                                                                            F-31


<PAGE>
                                INDEX TO EXHIBITS

Exhibit
Number    Description of Exhibit
-------  ------------------------
*2.1     Agreement and Plan  of Reorganization dated September 24, 1998 by and
         among Nettaxi Online Communities, Inc., the owners of all the
         outstanding shares of  common  stock  of  Nettaxi  Online  Communities,
         Inc.  and  the Company.

*2.2     Merger  Agreement and Plan of Reorganization dated April 1, 1999 by and
         between  Plus  Net,  Inc.  and  the  Company

*3.1     Articles  of  Incorporation  of  the  Company

*3.2     Certificate  of Amendment to the Articles of Incorporation of the
         Company

*3.3     By-Laws  of  the  Company

**3.4     Certificate  of  Amendment  of  Articles  of  Incorporation

*4.1     Specimen  Common  Stock  Certificate  of  the  Company

*4.2     See  Exhibits  3.1,  3.2  and  3.3  for  provisions  of the Articles of
         Incorporation  and  By-Laws  of  the  Company  defining the rights of
         holders of Common  Stock  of  the  Company.

*4.3     Convertible  Debenture  dated  March  31,  1999  in  favor  of  RGC
         International  Investors,  LDC

****4.4  1999  Stock  Option  Plan  of  the  Company

****4.5  Form  of  Stock Option Agreement for options issued pursuant to 1999
         Stock  Option  Plan  of  the  Company

*10.1    Asset Purchase and Sale Agreement dated October 1, 1997 by and between
         SSN  Properties,  LLC  and  the  Company

*10.2    Sub  Lease  dated  September 3, 1997 by and between Execustaff and the
         Company

*10.3    [Intentionally  Blank/Updated  form of agreement filed as Exhibit
         10.42]

*10.4    [Intentionally Blank/Updated form of agreement filed as Exhibit 10.43]


<PAGE>
*10.5    Stock  Option  Agreement dated March 20, 1998 by and between Robert A.
         Rositano,  Jr.  and  the  Company

*10.6    Stock  Option  Agreement  dated  March  20,  1998  by and between Dean
         Rositano  and  the  Company

*10.7    [Intentionally Blank/Updated form of agreement filed as Exhibit 10.44]

*10.8    [Intentionally Blank/Updated form of agreement filed as Exhibit 10.45]

*10.9    Employment  Agreement  dated  August 1, 1998 between Dean Rositano and
         the  Company

*10.10   Employment Agreement dated August 1, 1998 between Robert A. Rositano,
         Jr.  and  the  Company

*10.11   Stock  Option Agreement dated August 1, 1998 by and between Robert A.
         Rositano,  Jr.  and  the  Company

*10.12   Stock  Option  Agreement  dated  August  1,  1998 by and between Dean
         Rositano  and  the  Company

*10.13   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.46]

*10.14   Letter  Agreement  dated  September  3, 1998 between Bay Tree Capital
         Associates,  LLC  and  the  Company

*10.15   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.47]

*10.16   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.48]

*10.17   1998  Stock  Option  Plan  of  the  Company

*10.18   Form  of  Stock  Option Agreement for options issued pursuant to 1998
         Stock  Option  Plan  of  the  Company

*10.19   Stock  Option  Agreement  under  the  1998  Stock  Option Plan by and
         between  Dean  Rositano  and  the  Company

*10.20   Stock  Option  Agreement  under  the  1998  Stock  Option Plan by and
         between  Robert  A.  Rositano,  Jr.  and  the  Company

*10.21   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.49]

*10.22   Technology  Licensing Agreement dated February 3, 1999 by and between
         Go  Hip,  Inc.  and  the  Company


<PAGE>
*10.23   First  Amendment  to Technology Licensing Agreement dated as of April
         1,  1999  by  and  between  Go  Hip,  Inc.  and  the  Company

*10.24   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.50]

*10.25   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.40]

*10.26   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.51]

*10.27   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.52]

*10.28   Settlement  Agreement  dated  March  2,  1999  by  and  among Michael
         Gardner,  Bay  Tree Capital Associates, LLP, Wall Street Trading Group,
         Bruce K. Dorfman,  Robert  A.  Rositano,  Jr.,  Dean  Rositano  and
         the  Company

*10.29   Common  Stock  Purchase  Option to Purchase Common Shares of Nettaxi,
         Inc.  dated  March  4,  1999  between  Wall Street Trading Group and
         the Company

*10.30   Securities  Purchase  Agreement dated March 31, 1999 by and among RGC
         International  Investors,  LDC  and  the  Company

*10.31   Stock  Purchase  Warrant  dated  March  31,  1999  by  and  among RGC
         International  Investors,  LDC  and  the  Company

*10.32   Registration  Rights  Agreement dated March 31, 1999 by and among RGC
         International  Investors,  LDC  and  the  Company

*10.33   Oppenheimer  Funds  401K  Plan

*10.34   Standard  Office  Lease-  Gross dated March 1999 by and between South
         Bay  Construction  and  Development  Co.  III  &  South  Bay
         Construction  and Development  Co.  VII  and  the  Company

*10.35   Form of Indemnification Agreement between the Company and each of its
         Directors  and  Executive  Officers

*10.36   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.53]

*10.37   Employment  Agreement  dated  April  1, 1999 by and between Mr. Glenn
         Goelz  and  the  Company

*10.38   Consulting Agreement dated May 10, 1999 by and between Fontenelle LLC
         and  the  Company


<PAGE>
*10.39   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.54]

*10.40   [Intentionally  Blank/Updated  form  of  agreement  filed  as Exhibit
         10.55]

*10.41   Lease  Agreement  dated  as of May 27, 1999 by and between H&L Realty
         and  Management  Company, Agent for owners Flamingo Fountains and the
         Registrant

*10.42   Master  Software  License  Bundling  and Distribution Agreement dated
         November  13,  1997  between  Apple  Computer,  Inc.  and  the  Company

*10.43   Master  Software  License,  Bundling and Distribution Agreement dated
         March  14,  1997  between  Fountain  Technologies,  Inc.  and  the
         Company

*10.44   Web  Advertising  Services  Agreement  dated June 3, 1998 between Fly
         Cast  Communications  Corporation  and  the  Company

*10.45   Sales  and Representation Contract dated July 7, 1998 between Michael
         Weiner  dba  Unique  Media  Services  and  the  Company

*10.46   Merchant  Services  Agreement  dated  August  3,  1998 by and between
         eCharge  Corporation  and  the  Company

*10.47   Conversion  Agreement  dated  September  4,  1998  by and between SSN
         Properties,  LLC  and  the  Company

*10.48   Internet  Infospace  Content  (World  Wide  Web  Site)  Distribution
         Agreement  dated  October 8, 1998 by and between InfoSpace.com, Inc.,
         a Delaware corporation  and  the  Company

*10.49   Agreement  for  Terminal Facility Co-Location Space dated January 18,
         1999  between  Alchemy  Communications,  Inc.  and  the  Company

*10.50   Letter Agreement dated January 15, 1999 between Babenet, Ltd. and the
         Company

*10.51   License  and  Distribution  Agreement  dated  March  30,  1999 by and
         between  Netopia,  Inc.  and  the  Company

*10.52   Website  Linking  and Promotion Agreement dated March 5, 1999 between
         PI  Graphix,  Inc.  and  the  Company

*10.53   Development  Agreement  dated as of December 16, 1998 between the Big
         Network  Inc.  and  the  Company


<PAGE>
*10.54   Development  and  License  Agreement  dated  May, 1999 by and between
         eBay,  Inc.  and  the  Company

*10.55   Internet  Services  Suite  Agreement dated May 5, 1999 by and between
         Wired  Digital,  Inc.,  Lycos,  Inc.  and  the  Company

*10.56   Financial Consulting Agreement dated June 29, 1999 by and between The
         Phoenix  Group  International,  LLC  and  the  Company

**10.57  Master  Services  Agreement  dated September 15, 1997 by and between
         Exodus  Communications,  Inc.  and  the  Company.

**10.58  Gigabit  Data  Center  Services  Agreement dated July 1, 1999 by and
         between  Alchemy  Communications,  Inc.  and  the  Company.

**10.59  Advertising  Impression  Network  Contract dated July 1, 1999 by and
         between  White  Sand  Communications,  Inc.  and  the  Company.

**10.60  Advertising  Impression  Network  Contract dated July 1, 1999 by and
         between  Multinet  Communications  Worldwide Limited and the  Company.

**10.61  Data  Center  Service  Agreement  dated July 15, 1999 by and between
         Babenet,  LTD  and  the  Company.

**10.62  Data  Center  Service  Agreement  dated July 15, 1999 by and between
         Whitehorn  Ventures  Limited  and  the  Company

**10.63  Data  Center  Service Agreement dated August 15, 1999 by and between
         White  Sand  Communications,  Inc.  and  the  Company.

***10.64 Co-Branded  Free  ISP  Agreement  dated  November  30,  1999 by and
         between  Spin  Media  Network,  Inc.  and  the  Company

***10.65 Internet  Content Distribution Agreement dated December 30, 1999 by
         and  between  InfoSpace.com  and  the  Company

10.66    Sinclair Davis Trading Group Agreement dated as of December 8, 1999 by
         and  between  Sinclair  Davis  Trading  Corp.  and  the  Company

10.67    Form  of  Subscription  Agreement  of  the  Company

21.1     Subsidiaries  of  the  Company

*23.1    [Intentionally  Blank/  Updated  as  Exhibit  23.3]

*23.2    Consent  of  Silicon  Valley  Law  Group  (included  in  Exhibit  5.1)


<PAGE>
*23.3    [Intentionally  Blank/  Updated  as  Exhibit  23.4]

*23.4    [Intentionally  Blank/  Updated  as  Exhibit  23.5]

23.5     Consent  of  BDO  Seidman,  LLP

24.1     Powers  of  Attorney  (included on signature pages to this Registration
         Statement)

27.1     Financial  Data  Schedule

*     Incorporated  by  reference  to  the  exhibits filed with the Registrant's
      Registration  Statement  on  Form  S-1  (File  No. 333-78129) which was
      declared effective  on  August  13,  1999.

**    Incorporated  by  reference  to  the exhibits filed with the Registrant's
      Quarterly Report on Form 10-Q  for the  period ending September 30, 1999.

***   Incorporated  by  reference  to the exhibits filed with the Registrant's
      Registration  Statement  on  Form  S-1  (File  No. 333-30074) which was
      filed on February  10,  2000.

****  Incorporated  by  reference to the exhibits filed with the Registrant's
      Registration Statement on Form S-8 (File No. 333-32678) which was filed
      on March 17,  2000.


<PAGE>