SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

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

         For the fiscal year ended December 31, 1999

[  ]     TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934

                        Commission file number 333-86347

                             NEWAGECITIES.COM, INC.
                 (Name of Small Business Issuer in Its Charter)

         FLORIDA                                               91-0927532
         (State or Other Jurisdiction of                     (I.R.S. Employer
         Incorporation or Organization)                      Identification No.)

                        1181 SOUTH ROGERS CIRCLE, SUITE 5
                            BOCA RATON, FLORIDA 33487
                            -------------------------
               (Address of Principal Executive Offices)(Zip Code)

                                 (561) 989-0808
                (Issuer's Telephone Number, Including Area Code)

Securities  registered  under  Section 12(b) of the  Securities  Exchange Act of
1934:

         Title of Each Class          Name of Each Exchange on Which Registered

                  None                                   None

Securities  registered  under  Section 12(g) of the  Securities  Exchange Act of
1934:

                     COMMON STOCK, PAR VALUE $.02 PER SHARE
                                (Title of Class)

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

Check if disclosure  of delinquent  filers in response to Item 405 of Regulation
S-B is not contained in this form, and no disclosure  will 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-KSB or any  amendment to
this Form 10-KSB. [X]

State registrant's revenues for the year ended December  31, 1999:  $2,672.

State the aggregate market value of the voting stock held by  non-affiliates  of
the  registrant on March 31, 2000 computed by reference to the closing bid price
of its Common Stock as reported by the OTC Bulletin  Board on that date ($2.00):
$8,841,316

                      APPLICABLE ONLY TO CORPORATE ISSUERS

The number of shares  outstanding of the  registrant's  Common Stock,  par value
$.02 per share (the "Common Stock") as of March 31, 2000, was 6,100,158.

Transitional Small Business Disclosure Format (check one):Yes       No     X


                       DOCUMENTS INCORPORATED BY REFERENCE

                                     None.


<PAGE>

         This Annual Report Form 10-KSB  contains  "forward-looking  statements"
within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended.  All statements,
other than  statements  of  historical  facts,  included in or  incorporated  by
reference into this Form 10-KSB, are  forward-looking  statements.  In addition,
when  used in this  document  the  words  "anticipate,"  "estimate,"  "intends,"
"project"  and similar  expressions  are  intended  to identify  forward-looking
statements.  These  forward-looking  statements  are  subject to certain  risks,
uncertainties   and   assumptions.   Should  one  or  more  of  these  risks  or
uncertainties  materialize,  or should  underlying  assumptions prove incorrect,
actual  results  may  vary  materially  from  those  anticipated,  estimated  or
projected.  Although the Company  believes that the  expectations  we include in
such forward-looking  statements are reasonable, we cannot assure you that these
expectations will prove to be correct.

         PART 1

ITEM 1.  DESCRIPTION OF BUSINESS

         Newagecities.com,  Inc. is a development stage company whose goal is to
become a leading provider of Internet Community-building and electronic commerce
services for the New Age population and to create a demographically targeted Web
site on the Internet  focused on the New Age  community.  The New Age population
consists of many millions of people  interested in a variety of different areas,
including  aromatherapy  (mood  changing  aromas),  astrology,  crystal  energy,
eastern  philosophy,  natural  health,  psychics,  and a host of  other  topics.
Newagecities.com  is creating a Web site that serves as a doorway, or portal, to
a range of information, products and services specifically designed with the New
Age community in mind.

         Newagecities.com  features a broad set of easy-to-use tools designed to
create an online  community of members.  Members  represent the core audience of
newagecities.com  and its most valuable users. The site also features  extensive
e-commerce capabilities.  We offer a large selection of New Age related products
as well as the chance for other  retailers  and users to sell  products as well.
Newagecities.com  also  offers high  quality  audio and video  psychic  readings
online.

Our background

         Psychicnet.com,  inc.  was formed on January 29,  1999 to provide  "New
Age" services and products on the  Internet.  On April 6, 1999,  Psychicnet  was
acquired by Virginia City Gold Mines, Inc., an Idaho corporation,  for 2,700,000
shares of common stock. The exchange was completed through an Agreement and Plan
of  Reorganization  between  Psychicnet and Virginia City.  Virginia City had no
operations at the time of the  acquisition.  The exchange was accounted for as a
reverse  acquisition  under  the  purchase  method  for  business  combinations.
Subsequent to the exchange,  Virginia City changed its name to newagecities.com,
Inc., its present  corporate name. We expect to reincorporate  into the State of
Florida in the near future.

Industry background and growth of Internet

         The Internet has emerged as one of the fastest  growing  sectors of the
economy.  As computer and Internet access prices decrease,  the number of online
shoppers  increases.  In a recent study of online shoppers,  Ernst & Young found
that 10% of the households they surveyed had purchased goods online in 1998 (The
Second Annual Ernst & Young Internet Shopping Survey; Ernst &

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Young, 1999), with that number expected to increase  substantially in the coming
years. Additionally, more and more retailers are preparing to enter the world of
online shopping, recognizing the additional sales potentials and larger customer
access base.

         The  Internet has opened the door to new worlds for many and offers the
opportunity  to reach  millions  of people with a product,  service or idea.  It
enables  people  to  interact  in  ways  that  were  not  possible  before  with
traditional  communication  media. It also offers new and effective  methods for
online  retailers to connect with their  customers and for  advertisers to reach
highly targeted markets.

The New Age population and market

         The term "New Age" is  typically  used to refer to a set of beliefs and
practices  that  originated  in  centuries  past.  These  include  aromatherapy,
astrology,  crystal energy, eastern philosophy,  natural health,  psychics, UFOs
and a host of other  topics.  Although  each of these areas is distinct from the
others, they are all considered within the umbrella concept of "New Age."

         Although  the term  "New  Age"  has  come in and out of vogue  over the
years,  the  ideas  that it  represents  have  shown a steady  growth  in public
interest.  Often items that fall into the New Age genre are classified  within a
more mainstream category.  The book sensation,  The Celestine Prophecy, by James
Redfield,  is a prime  example.  The book has sold over 7 million copies to date
and is clearly a "New Age" title, although it is commonly classified as fiction.
Other best-  selling  book  examples  include  Conversations  with God, by Neale
Donald Walsch, as well as the myriad of best-sellers by Deepak Chopra. These and
other New Age books are found on the  shelves  (and Web sites) of all major book
retailers  in various  sections of the store,  including  psychology,  religion,
self-help,  philosophy,  UFOs, etc. Overall, it is clear that the market for New
Age  products  can be quite  substantial.  In  fact,  preliminary  results  of a
forthcoming  study (New Editions New Age Consumer Survey,  Sophia Tarla,  Ph.D.,
New Editions  Retailers)  reveal the following  encouraging  facts about New Age
consumers:

  o   The average age is 44, with a majority between the ages of 30 and 59.
  o   Two-thirds have college degrees and 41% have completed post-graduate work.
  o   The average New Age consumer spends over $1,000 annually on New Age items.
  o   The New Age consumer base is estimated at over 38 million.
  o   New Age industry sales average over $44 billion dollars annually.

         These  statistics  represent values for the United States only. We have
no information on the potential international market.

         The average New Age consumer is also very close to the average Internet
consumer.  Ernst & Young  recently  released  a survey of online  shopping  (The
Second Annual Ernst & Young Internet Shopping Survey; Ernst & Young, 1999) which
highlighted the following facts about online shoppers:

  o   68% are over 40 years old

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  o   94% have had some college background
  o   46% generate $50,000 plus in annual income

The need for a New Age online destination

         The New Age  population is a large and under served market segment that
desires interaction, communication, a sense of community and an environment that
caters to their particular  needs. New Age consumers build their own communities
off-line. We believe they are interested in extending these communities onto the
Internet because of the opportunity for interaction on a larger scale.

         For many in the New Age  community  there is also a need for  access to
products and services that are not commonly available. Most New Age products are
purchased at small retail stores that specialize in this industry.  However,  in
many areas where these stores are not present,  New Age  consumers  are somewhat
limited to those products available in more mainstream outlets.  Even those that
have New Age  stores in their  vicinity  are often  disappointed  because  these
stores can only stock a small amount of products.

         We believe that creating an online  destination  specifically  designed
for New Age  consumers  is crucial to marketing  to this  population.  The rapid
growth in the number of New Age consumers has created a marketplace for products
and services that outside advertisers should attempt to reach.  Newagecities.com
offers a means for  these  advertisers  to reach  this  market  in a manner  not
possible in more traditional advertising media.

The Newagecities.com solution

         We believe our  company  can serve as the  conduit  between the New Age
community and the  Internet.  We have created a Web portal where members of this
community can interact,  be entertained  and shop in an environment  that caters
specifically to their needs and desires.  Newagecities.com  integrates community
and  commerce  through a network of  different  Web sites and  features  focused
primarily on the New Age devotee and by offering updated content and a forum for
community interaction.

         Newagecities.com  enables visitors to create their own place within our
Web site. We offer users the ability to join and become involved in what we hope
will be an important site for the New Age community.  They will be provided with
free disk storage space and publishing  tools to quickly and easily create their
own pages within any of the site's topically organized categories.  Members will
be  encouraged to keep their areas  current and  interactive  through the use of
chat and bulletin board services to be provided by us.

         Newagecities.com has designed a broad range of e-commerce  capabilities
to offer  products to New Age  consumers.  There are a variety of company  owned
stores available, each focused on a different New Age area. In addition, we will
offer people the opportunity to open mini-shops, where they can market their own
wares as well as selected  products  from our database of  products.  Mini-shops
will be easy for a user to set up and provide a marketplace for Web users to buy

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and sell online to other users and  visitors in an easy to navigate  environment
with newagecities.com deriving a percentage of all sales.

         We will also allow  people who do not own Web stores to offer  products
that our stores or any of the other mini-stores offers via an affiliate program.
An affiliate  program will allow anyone with a Web page to list an item for sale
on  their   existing   page.   The  product  can  then  be   purchased   through
newagecities.com, with the Web page owner receiving a commission.

         An additional unique feature of  newagecities.com is our "See and Hear"
psychics.  Using the  latest in  "streaming"  technology,  users can  receive an
online  psychic  reading  complete with audio and video.  The users both see and
hear the  psychic  during  the  reading,  creating  a bond and  ensuring  a more
intimate and emotional  experience during a reading.  The sophistication of this
technology sets  newagecities.com  apart from any competition and assures repeat
business and recommendations to other clients.  Because of the unique nature and
high-quality  of this  service,  newagecities.com  expects  to  build  a  strong
word-of-mouth advertising campaign for this product

         Newagecities.com has launched an Internet-only radio station at the Web
site address  "newagesound.com."  The station offers continuous (24 hours a day)
New Age music and  programming.  Newagesound.com  is  available  to anyone  with
Internet  access.  We are using  advanced  streaming  technology to provide high
quality and  accessibility  for all users. We have available a full audio studio
as well as the ability to broadcast  large amounts of data directly  through one
of our direct high-speed connections to the Internet.

         Newagesound.com  generates  revenues  through  product and  advertising
sales.  Advertising  will be sold for both "on-air"  commercials  and on the Web
site.  Web site  advertising  takes the form of banners or other  graphics  with
links back to the advertisers' sites. Product sales consist of New Age CDs.

Strategy

         Our goal is to build newagecities.com into a leading online destination
for members of the New Age community.  We believe that  successful  execution of
this strategy will help newagecities.com realize revenue growth through expanded
e-commerce  offerings as well as  advertising  and marketing  opportunities.  We
believe the key elements to our success are as follows:

  o  Increasing  Membership - One of the most valuable assets of any Web site is
     its  members.  Typically  members  account  for a large  percentage  of all
     product  purchases.  Members  also offer a target  demographic  category of
     users for us as well as other advertisers and marketers. Membership is free
     and simply requires that the user list some basic information, such as name
     and e-mail address.  Membership  benefits  include access to areas reserved
     for  members,  special  members-only  services  and  discounts  on selected
     products.  It is our intention to increase membership by actively marketing
     and promoting the site, as well as constantly  refreshing  and updating the
     content and other features.

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  o  Building  Brand  Recognition - The key to attracting  increased  numbers of
     users to our site is to build brand recognition. Our strategy for enhancing
     brand  recognition  consists  of  maximizing  our  exposure  to the New Age
     population   through  both  on  and  offline   advertising   and  marketing
     opportunities.

  o  Enhancing Online Features - In order to encourage more visits and increased
     lengths of stay, we will constantly be updating our content,  products list
     and service offerings.  We are continually seeking new features to bring in
     user traffic and keep their attention.

  o  Fresh Content - To encourage return visits,  much of the content  available
     on  newagecities.com  is  updated on a regular  basis.  Items such as daily
     horoscopes,  new item reviews and updated articles keep people coming back,
     offering additional opportunities for advertising and product sales.

  o  New Features - New Internet  technologies and interactive Web software will
     be  introduced  all  the  time.  To  the  extent  that  any  of  these  new
     developments complement our existing features and meet our strategic goals,
     they will be implemented on the site.

Strategic alliances

         We  believe  that  one of the  keys  to our  possible  success  will be
building  strategic  alliances with companies that provide products and services
that are  important  for us to reach our  goals.  To that end,  we have  already
entered  into  agreements  with  QSound  Labs,   Inc.,   Virtacon   Corporation,
FinalThoughts.com  , as well as an agreement for the  acquisition of Member Net,
Inc.

         Our alliance  with QSound Labs  provides us with  licenses for Internet
Store and  AffiliateDirect.  Internet Store is the e-commerce software that will
serve as the  backbone  for all of our online  shopping  activities.  Our online
stores are created using this software. In addition, Internet Store allows us to
offer   other   merchants   the  chance  to  open   their  own  online   stores.
AffiliateDirect  is the software  that allows Web page owners to sell any of our
products on their pages and earn a commission.  We believe that  Internet  Store
and  AffiliateDirect  are  already  two of the  most  complete  and  easy-to-use
packages of their kind  available.  In addition,  QSound has agreed to customize
the  software to our  specifications.  QSound  Labs will  receive 3% of Web site
revenues  generated from product sales using their software.  In addition,  they
received  400,000 shares of common stock and options to purchase  125,000 shares
of our common stock  exercisable at $2.25 per share over a five year term, which
has been valued at $671,250.

         Virtacon Corporation,  formerly Virtual Financial Corp., is an Internet
development  and public  relations  firm.  Virtacon's  designers and programmers
created our basic  technology  and design.  In our initial stages of operations,
all of our Web content was housed at Virtacon.  Virtacon received 150,000 shares
of  common  stock  and  options  to  purchase  75,000  shares  of  common  stock

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exercisable at $2.25 per share over a five-year term for their services and work
product, which has been valued at $258,750.

         We have recently formed a content  partnership with  FinalThoughts.com,
Inc,  operators  of the  finalthoughts.com  Web  site.  Under  the terms of this
agreement,  we will be providing content for use in their  spirituality  section
with links back to newagecites.com sites.

         In 1999 we completed our acquisition of Member Net, Inc. of Chatsworth,
California. Member Net brings with it an existing Web site geared toward New Age
consumers,  "www.mindbodysoul.com."  Mindbodysoul.com  contains  a great deal of
content that complements that of newagecities.com and is being incorporated into
our site. Along with the additional  content,  mindbodysoul.com  has an existing
membership  base of over 60,000  people as well as  approximately  500,000  page
views per month.  The  additional  members and page views  should  increase  our
revenues by allowing us to sell product to more people and offer more page views
for  advertiser  and  sponsor  purchases.  In  connection  with the  merger  the
stockholders  of Member  Net  received  2,5000,00  shares  of  common  stock and
warrants to purchase  1,000,000 shares of common stock  exercisable at $1.75 per
share, which were valued at $490,000.

         Mindbodysoul.com  also brings with it licenses for  software  that will
help us to bring in new visitors and keep the ones we have staying  longer.  One
of these  licenses  is for an  Internet  search  engine,  which  we would  cater
specifically to the New Age community. The search engine would contain a catalog
of New Age destinations on the Internet,  allowing users to search by keyword or
category. Because the search engine will focus exclusively on New Age resources,
it will be easier for  members of the New Age  community  to find  relevant  Web
sites and  information.  A second  piece of software we would seek to license is
browser-based  e-mail.  With this  software,  users would be able to sign up for
their    own     newagecities.com     e-mail     address    for    free    (i.e.
johndoe@newagecities.com).  Users will be able to check  their  e-mail  from any
place in the world with Internet  access,  using  standard Web browser  software
such as Microsoft's Internet Explorer(R) or Netscape's  Navigator(R).  Each time
they check their newagecities.com e-mail, they need to return to the site. These
two  pieces  of  software  could  ensure a  constant  flow of site  traffic  and
opportunities to present advertising banners for us and other paid sponsors.

The newagecities.com network

         Newagecities.com consists of a number of individual sections, each with
its own theme,  content and product line.  Each section  includes its own set of
chat  rooms  and  discussion  boards,  as well as the  opportunity  to  purchase
products  directly  related to the section  theme.  These  sections  include the
following.

  o  Crystal Warehouse - devoted to people interested in Crystals.  This section
     includes information about specific crystals,  their geological  properties
     and metaphysical uses as well as the opportunity to purchase Crystals.

  o  New Age Forum - dedicated to the modern devotee of the New Age. Information

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     and  products  from a variety  of areas  including  aromatherapy,  healing,
     meditation, yoga and other metaphysical disciplines.

  o  Present  Alternative - created to supply information and products for those
     interested in  metaphysics  and practices of other  cultures  including Far
     Eastern, Tibetan, Egyptian, South American, Australian and Indonesian.

  o  Books N' Things - a comprehensive Alternative,  Magic and Occult Superstore
     of New Age related books and music.

  o  Shaman's Gate - a haven for those  interested in Native  American and other
     indigenous  peoples'  practices,  beliefs and ceremonial items which may be
     purchased.

  o  Psychic  Internetwork - home of our "See and Hear" Psychics.  People prepay
     for  blocks  of time  with a  psychic  that  they can see and hear over the
     Internet using streaming technology.

         Newagecities expects to generate revenues from a variety of sources. We
expect about 40% of our Year 2000 revenues to be realized  directly  through the
sale of  products  listed on our  stores.  Almost 50% of sales is expected to be
generated by psychics and other services. We also expect no more than 10% of our
revenues to be generated via commissions on sales through the "mini-shops" owned
by others.  Finally, we expect that a nominal percentage of our revenues will be
generated from the sale of advertising and  sponsorships  throughout our content
areas.

Advertisers and sponsors

         Newagecities.com  expects to be able to market to either the entire New
Age niche,  or to specific  sectors  within  that  market.  As a result,  we are
exploring relationships with marketers who wish targeted access to these people.
Advertisers  will have access to this population via standard  online  marketing
vehicles such as banner advertisements on Web pages. In addition, we are seeking
sponsorship  relationships  with advertisers  that wish to increase  advertising
effectiveness and brand recognition.  Sponsorship arrangements are typically for
longer  lengths of time and involve  higher  dollar  values.  They also  usually
involve more than simple  banner  advertising  and  integration  of the sponsors
brand industry into a Web site section. We are currently  assembling a sales and
marketing team, one of whose tasks will be to better understand the needs of our
customers and to help market towards these needs.

Marketing and promotions

         Like most Internet companies,  our marketing plan calls for both on and
off-line  marketing.  Off-line  marketing  will  cover  a full  range  of  media
including  television,  radio, print, and event  sponsorships.  We are currently
seeking  alliances  with  industry  specific  magazines  that  will  provide  us
increased exposure to a wide audience and a cost-effective  means of advertising
to our target market. Similar ventures with other media companies are also being

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explored.  We will also be working  with  mini-shop  owners  who own  (physical)
retail  stores  to  assist  them  in  marketing  their  online  stores  and,  by
association, newagecities.com to their existing customer base.

         Online marketing includes ad placement in major search engines, keyword
based  advertising in search  engines as well as advertising  purchases on other
relevant and popular online destinations such as America On Line, the GO Network
and the  Microsoft  Network.  We are  currently  negotiating  bulk  discounts on
advertising  rates because of the anticipated  volume of our  advertising  needs
along with those of our strategic partners.  Additionally, we hope to be able to
benefit from the marketing of  individual  Web pages and  "mini-shops"  that the
site's  users house with  newagecities.com.  An  affiliate  program will offer a
unique opportunity to market our products and brand our name through other sites
on the Web.

International markets

         We expect that some portion of our traffic and revenue  generation will
result from markets outside of the United States.  Many New Age ideas originated
outside the U.S., and now the Internet makes it easier for cultures and ideas to
spread globally.  Additionally,  many markets outside of the U.S. have no access
to the range of products and services offered at newagecities.com.

Technology

         Our office contains a Windows NT network made up of computers purchased
through Dell. All of our Web content is being housed on IBM  compatible  servers
at our facility.  All of our machines are Year 2000  compliant.  Our Web servers
are connected  directly to an OC-12, one of the fastest possible  connections to
the Internet.  All of our computers and our Internet  connections have redundant
systems in place to ensure reliability.

Product fulfillment

         To  accommodate  our users' demand for products,  newagecities.com  has
negotiated  distribution  arrangements  with  most of our  vendors.  As  product
distributors,  we  will  benefit  from  better  pricing,  allowing  us to  offer
discounted  prices to clients on the site as well as the ability to wholesale to
other  retailers,  both on and  offline.  Products  will  be  shipped  from  our
warehouse  facility in Boca Raton,  Florida.  In the future we expect to arrange
with  our  major  suppliers  to  ship  directly  from  their  facilities  to our
customers.

Competition

         We have  found  no Web  sites  devoted  to the New Age  community  that
contain the breadth and depth of  information,  interaction,  entertainment  and
merchandise   available   at   newagecities.com.   Several   content   areas  of
newagecities.com  are currently  available at other sites,  however,  we believe
they lack the completeness of our site. The ability to offer high quality "See &
Hear" psychics  appears to be unique to  newagecities.com.  Other sites offering
psychic readings either do so via phone, email or video with text chat.

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         The market  for  members,  visitors,  Internet  advertising  and online
product is rapidly evolving and competition is sure to increase.  With the rapid
expansion of the New Age community and the limited  number of barriers to entry,
we expect  additional  competition  to arrive over time.  Some of our  potential
competitors may be larger,  better funded and more technically  capable than us.
Increased  competition  may lead to pricing  pressures  on our  advertising  and
product rates which could have adverse material effects on us.

Employees

         Newagecities.com currently has twelve full-time employees. Four persons
are in  management  and provide  services in the areas of marketing and business
development,  finance  and  technology,  one  person is in  administration,  six
persons  are  employed  in  operations  and  technology,  and one  person  is in
warehousing.  No  employee  of  newagecities.com  is  covered  by  a  collective
bargaining  agreement  nor is  represented  by a labor  union.  Newagecities.com
considers its employee relations to be good.

ITEM 2.  DESCRIPTION OF PROPERTIES

         We currently lease facilities  consisting of approximately 5,145 square
feet of office and warehouse  space in Boca Raton,  Florida.  The lease is for a
five-year period. The first year's rent is $43,732.50, the second is $45,919 and
third, fourth and fifth are $48,215,  $50,626, and $53,157,  respectively,  plus
newagecities'  proportionate share of taxes, insurance and operating expenses on
the building.

ITEM 3.  LEGAL PROCEEDINGS

         We are not a party to any material legal proceeding, nor are any of our
officers, directors or affiliates a party adverse to us in any legal proceeding.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITYHOLDERS

         Not Applicable.




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                                     PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED  SHAREHOLDER MATTERS

         Our  common  stock is  traded  over-the-counter  and  quoted on the OTC
Electronic Bulletin Board under the symbol "NACT". The reported high and low bid
prices for the common  stock are shown below for the period from April 14, 1998,
the date our common stock began trading on the OTC  Electronic  Bulletin  Board,
through   December  31,  1999.  The  prices  do  not  always   represent  actual
transactions.  The  following  information  gives effect to a 1:80 reverse stock
split of our  outstanding  common stock  completed on April 6, 1999. As of March
31, 2000, we had 1,038 stockholders of record.

Period                                               High            Low

Quarter ended June 30, 1998                         $3.20          $   .80
Quarter ended September 30, 1998                    $2.48          $   .80
Quarter ended January 31, 1998                      $4.80          $  1.60

Quarter ended March 31, 1999                        $5.60          $  1.60
Quarter ended June 30, 1999                         $8.00          $  2.50
Quarter ended September 30, 1999                    $3.75          $  1.37
Quarter ended December 31, 1999                     $2.88          $  1.50

         On March 31, 2000, the closing bid price of our common stock was $2.00.

         We have never paid cash  dividends  on our common  stock.  We intend to
keep future  earnings,  if any, to finance the expansion of our business.  We do
not anticipate that any cash dividends will be paid in the foreseeable future.

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS

         The following  discussion  and analysis  should be read in  conjunction
with the financial  statements  of the Company and the notes  thereto  appearing
elsewhere.

         During  the  12-month  period  immediately  following  the date of this
Prospectus,  our goal is to design and begin to operate a Web portal  focused on
providing  services and selling goods  related to the New Age concept.  The term
"New Age" refers to a set of beliefs and practices that  originated in past time
and  includes  aromatherapy,  astrology,  crystal  energy,  eastern  philosophy,
natural  health,  psychics,  UFOs and a host of other  topics.  The Internet has
emerged as one of the fastest  growing  sectors of the economy and is becoming a
major  part of the lives of a greater  number of people  which  includes a large
number of online shoppers.  Newagecities.com  is creating a Web site that serves

                                       11

<PAGE>

as a  doorway  or  portal  to a range  of  information,  products  and  services
specifically designed with the New Age community in mind. In order to accomplish
our goal, we must create, with the assistance of various consultants,  a complex
computer  network and  e-commerce  based  system which will allow our clients to
receive our services and purchase New Age related  products from their  personal
computers.  We are developing our computer  systems and network so that they can
evolve  into a fully  operating  system  which  will allow  newagecities.com  to
provide services and market its products on a larger scale.

         Our goal is to build newagecities.com into a leading online destination
for members of the New Age community.  We believe the execution of this strategy
will help newagecities.com to realize revenue growth through expanded e-commerce
offerings  as  well  as  advertising  and  marketing  opportunities.  The key to
implementing  this strategy requires  increasing our membership,  building brand
recognition,  enhancing the online features of our Web portal, maintaining fresh
content and integrating new technology.

         In order to implement our business plan,  newagecities.com will need to
build strategic alliances with companies that provide products and services that
are important  for us to achieve our goals.  To this end,  newagecities.com  has
completed  licensing  arrangements  for and entered into an agreement  which has
provided us with a Web page incorporating a "New Age Look".

         To  further   advance   our   strategic   plan,   in   December   1999,
newagecities.com  consummated  its  acquisition of Member Net, Inc. which has an
existing Web site geared towards New Age consumers. Along with this content, the
acquisition provides newagecities.com with access to an existing membership base
of over 60,000 people as well as approximately 500,000 individual web page views
per month. The membership base offers us a targeted market to approach for sales
of our products and services. The additional page views gives us the opportunity
to sell advertising to others seeking access to our target market.

         Member Net has a license agreement for the use of its Internet software
which  extends  until January 26, 2005.  Under this  agreement,  the licensor is
entitled  to  50% of all  advertising  revenue  generated  from  the  use of the
software.  We cannot determine the future impact of this licensing  agreement at
this time. Member Net's product sales will not be covered by this licensing fee.
Member Net has also entered into three one-year consulting  agreements involving
total payments of $30,000.

         Newagecities.com  commenced  active  operations in April 1999. We began
receiving  limited  revenues  beginning in August 1999,  apart from any revenues
derived from the  acquisition  of Member Net,  which has limited  revenues,  and
which is expected to be completed in the near future. For the period January 29,
1999  (inception)  through December 31, 1999,  newagecities.com  had revenues of
$2,672  from  sales of music CDs and  operating  expenses  totaling  $1,293,859,
representing  essentially all of our net loss which totaled  $1,939,134 for that
period.  Operating  expenses  consisted of research and  development  charges of
$258,750,  general and administrative  expenses of $675,859 and non-cash charges
associated  with  compensation  of  $359,250.   We  funded  these  research  and
development  expenses through issuance of 150,000 shares of our common stock and

                                       12

<PAGE>

warrants to purchase  75,000  shares.  Our general and  administrative  expenses
consisted primarily of payroll and professional fees.

         For the year  ended  December  31,  1998,  Member Net had  revenues  of
$26,768,  and income of $-0-.  For the nine months  ended  September  30,  1999,
Member Net had  revenues of $13,807,  and a net loss of $135.  The loss for this
period  reflects a  substantial  increase in the cost of sales of $28,641 due to
increased  business  activities  and sales  efforts.  Member Net's revenues were
generated  from  the  sale  of  e-mail  psychic  readings,  dream  profiles  and
astrological charts as well as commissions earned via banner ads.

         At December 31, 1999,  newagecities.com  had current assets of $922,117
and a working  capital deficit of $(201,293).  Substantially  all of the working
capital was obtained as a result of a private offering  conducted  between March
and April 1999 which  resulted in the receipt of net  proceeds of  approximately
$600,000 and the  issuance by  newagecities.com  of 300,000  shares at $2.00 per
share.  At December  31, 1999,  the Company had a cash balance of $812,569.  Our
current  financial  resources  will not be sufficient  for us to accomplish  our
goal.  Over the next 12 months,  our  management  estimates that we will need to
raise  approximately  $1.5 million and  hopefully up to $3 million  primarily to
further develop our computer network infrastructure ($170,000), acquire products
for sale to our New Age customers ($480,000),  advertising ($500,000), marketing
($200,000) and for expanding our staff  ($150,000).  These funds will need to be
raised through a private placement of our securities,  strategic  investments or
public financing.  Revenues from operations are expected to provide only limited
resources during this 12-month period.

         Newagecities.com had an accumulated deficit of approximately $1,900,000
at December 31, 1999, and has incurred  significant  recurring operating losses.
These factors raise  substantial  doubt about our ability to continue as a going
concern without the raising of additional  debt and/or equity  financing to fund
operations.  As we describe  below,  we are  actively  pursuing  new debt and/or
equity  financing  and  continually   evaluating  our  financial   position  and
profitability.   However,   while  we  have  raised  additional   funds,   these
arrangements  may not be sufficient to satisfy our needs, and we may not be able
to successfully implement our business strategy.

         In November 1999,  newagecities.com  received a loan of $50,000 from an
existing  stockholder  and issued a secured  promissory note  collateralized  by
equipment  and  inventory  to the  noteholder.  Newagecities.com  also  issued a
warrant to purchase up to 50,000  shares of its common stock to this  noteholder
exercisable at $1.50 per share on or prior to June 30, 2005.

         On  December  21,  1999,  newagecities.com  received  net  proceeds  of
$952,498 and issued its promissory  notes in the aggregate  principal  amount of
$1,041,300 to certain  non-U.S.  investors under  Regulation S of the Securities
Act of 1933.  The notes are due on April 30, 2000 and bear  interest at the rate
of 8% per year  payable  at the time  that  principal  is paid.  The  notes  are
convertible into a total of 822,700 shares of common stock of newagecities.com.

         With this  funding,  we will  have the  opportunity  now to launch  our

                                       13

<PAGE>

advertising program on both the Internet and in trade magazines as well increase
our inventory of products.  This should produce current  revenues prior to April
30, 2000.  In addition,  it also allows us to increase our customer base and our
industry status, which should also help us to attract further capital as well as
to further increase our potential for advertising revenue. We cannot assure you,
however,  that all this  will take  place or that we will be able to extend  the
maturity dates of the notes if necessary. If we are not able to raise sufficient
additional  capital or extend the maturity dates for the above loans,  we may be
required to suspend or terminate our operations.

Impact of Year 2000

         The year 2000 issue relates to whether  computer  systems will properly
recognize and process information  relating to dates in and after the Year 2000.
These systems could fail or produce  erroneous results if they cannot adequately
process dates beyond the Year 1999 and are not  corrected.  We have only limited
hardware  and software in use, we have  reviewed all software and hardware  used
internally by us in all support systems to determine  whether they are Year 2000
compliant. All of our existing software has been upgraded by the manufacturer or
was recently purchased and is Year 2000 compliant.

         As of March 31, 2000, we have experienced no disruptions or failures to
our normal operations as a result of the transition into calendar year 2000, and
we have received no  information to the effect that any third party with whom we
have any material relationship has experienced any such disruption or failure.

ITEM 7.  FINANCIAL STATEMENTS

         See  "Index  to  Financial  Statements"  for the  financial  statements
included in this Form 10-KSB.

                                       14

<PAGE>


                     NEWAGECITIES.COM, INC. AND SUBSIDIARIES
                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS





newagecities.com, Inc.:

  Independent Auditors' Report                                               F-2

  Consolidated Balance Sheet                                                 F-3

  Consolidated Statement of Operations                                       F-4

  Consolidated Statement of Stockholders' Equity                             F-5

  Consolidated Statement of Cash Flows                                       F-6

  Notes to Consolidated Financial Statements                         F-7 - F- 14


<PAGE>

                          INDEPENDENT AUDITORS' REPORT

To the Board of Directors
newagecities.com, Inc.
Boca Raton, Florida

         We  have  audited  the  accompanying   consolidated  balance  sheet  of
newagecities.com,  Inc. and Subsidiaries (A Development  Stage Enterprise) as of
December  31,  1999,  and the related  consolidated  statements  of  operations,
stockholders' equity, and cash flows for the period January 29, 1999 (Inception)
through December 31, 1999. 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 audit.

         We conducted our audit 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 amount and disclosures in the financial  statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audit provides 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
newagecities.com,  Inc. and Subsidiaries (A Development  Stage Enterprise) as of
December 31, 1999,  and the results of its operations and its cash flows for the
period  January 29, 1999  (Inception)  through  December 31, 1999, in conformity
with generally accepted accounting principles.

         The accompanying  consolidated  financial statements have been prepared
assuming the Company will continue as a going concern. As discussed in Note 3 to
the consolidated  financial statements the Company has an accumulated deficit of
approximately  $1,939,000  at December  31, 1999,  and has incurred  significant
operating losses which raise  substantial doubt about its ability to continue as
a going concern without the raising of additional  debt and/or equity  financing
to fund operations.  Management's plans in regard to these matters are described
in Note 3. The consolidated  financial statements do not include any adjustments
that might result from the outcome of this uncertainty.



                                              Feldman Sherb Horowitz & Co., P.C.
                                              Certified Public Accountants

New York, New York
March 1, 2000

                                       F-2


<PAGE>


                     NEWAGECITIES.COM, INC. AND SUBSIDIARIES

                        (A DEVELOPMENT STAGE ENTERPRISE)

                           CONSOLIDATED BALANCE SHEET

                                DECEMBER 31, 1999

                                     ASSETS

CURRENT ASSETS:

  Cash                                                       $   812,569
  Inventories                                                     97,073
  Prepaid expenses and other current assets                       12,475
                                                              -----------
TOTAL CURRENT ASSETS                                             922,117

FURNITURE AND EQUIPMENT, net                                      77,118

LICENSING AGREEMENT, net                                         540,728

DEFERRED FINANCING COSTS                                         116,802

GOODWILL                                                       5,490,000

DEPOSITS AND OTHER ASSETS                                         36,222
                                                              -----------
                                                             $ 7,182,987
                                                              ===========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:

  Accrued expenses                                           $    82,110
  Convertible notes payable                                    1,041,300
                                                              -----------
TOTAL CURRENT LIABILITIES                                      1,123,410
                                                              -----------

STOCKHOLDERS' EQUITY:

  Common stock, $.02 par value, 45,000,000 shares
    authorized; 6,100,158 shares issued and outstanding          122,003
  Additional paid-in capital                                   7,876,708
  Accumulated deficit                                         (1,939,134)
                                                              -----------
TOTAL STOCKHOLDERS' EQUITY                                     6,059,577
                                                              -----------
                                                             $ 7,182,987
                                                              ===========








                 See notes to consolidated financial statements.

                                       F-3
<PAGE>
                     NEWAGECITIES.COM, INC. AND SUBSIDIARIES

                        (A DEVELOPMENT STAGE ENTERPRISE)

                      CONSOLIDATED STATEMENT OF OPERATIONS

         FOR THE PERIOD JANUARY 29,1999 (INCEPTION) TO DECEMBER 31, 1999



SALES                                        $     2,672

COST OF SALES                                      1,763
                                             -----------
                                                     909
                                             -----------

OPERATING EXPENSES:

  Research and development                       258,750
  General and administrative                     675,859
  Noncash compensation expense                   359,250
                                             -----------
                                               1,293,859
                                             -----------

OPERATING LOSS                                (1,292,950)

INTEREST EXPENSE, NET                            646,184
                                             -----------

NET LOSS                                     $(1,939,134)
                                             ===========

BASIC LOSS PER SHARE OF COMMON STOCK         $     (0.54)
                                             ===========

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING     3,599,757
                                             ===========





















                 See notes to consolidated financial statements.

                                       F-4
<PAGE>
                     NEWAGECITIES.COM, INC. AND SUBSIDIARIES

                        (A DEVELOPMENT STAGE ENTERPRISE)

                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>


                                                    Common Stock                                                        Total
                                             ----------------------   Additional
                                                Number of               Paid-in  Accumulated       Stockholders'
                                                 Shares   Amount        Capital    Deficit            Equity
                                             ----------- ---------   ----------- -------------       ----------

<S>                                             <C>      <C>        <C>           <C>           <C>
Balance, January 29, 1999 (Inception)           400,158  $  8,003   $    (8,003)  $        --   $           --

Issuance of common stock pursuant

to share exchange agreement                   2,200,000    44,000       (44,000)           --               --

Issuance of shares and warrants for

licensing agreement                             400,000     8,000       663,250            --          671,250

Sale of common stock                            300,000     6,000       530,841            --          536,841

Common stock and warrants issued for
 services and financings                        300,000     6,000       640,000            --          646,000

Beneficial conversion feature of
 convertible notes payable                           --        --       605,000            --          605,000

Issuance of common stock and warrants
 for acquisition                              2,500,000    50,000     5,440,000            --        5,490,000

Warrants issued for debt                             --        --        49,620            --           49,620

Net loss                                             --        --            --    (1,939,134)      (1,939,134)
                                             ----------- ---------    ----------    ----------      -----------
Balance, December 31, 1999                    6,100,158  $122,003   $ 7,876,708   $(1,939,134)  $    6,059,577
                                             =========== =========    ==========    ==========      ===========
</TABLE>









                 See notes to consolidated financial statements.

                                       F-5
<PAGE>
                     NEWAGECITIES.COM, INC. AND SUBSIDIARIES

                        (A DEVELOPMENT STAGE ENTERPRISE)

                      CONSOLIDATED STATEMENT OF CASH FLOWS

         FOR THE PERIOD JANUARY 29,1999 (INCEPTION) TO DECEMBER 31, 1999



CASH FLOWS FROM OPERATING ACTIVITIES:

  Net loss                                                          $(1,939,134)
                                                                     -----------
  Adjustments to reconcile net loss to
    net cash used in operations:

    Depreciation and amortization                                       139,928
    Common stock issued for services                                    618,000
    Beneficial conversion feature recorded
      as interest expense                                               605,000
    Warrants issued for debt                                             49,620

    Changes in assets and liabilities:

      Increase in inventories                                           (97,073)
      Increase in other current assets                                  (12,475)
      Increase in deferred financing costs                              (88,802)
      Increase in other assets                                          (36,222)
      Increase in accrued expenses                                       82,110
                                                                     -----------
Total adjustments                                                     1,260,086
                                                                     -----------
NET CASH USED IN OPERATING ACTIVITIES                                  (679,048)
                                                                     -----------
CASH FLOWS FROM INVESTING ACTIVITIES:

  Capital expenditures                                                  (86,524)
                                                                     -----------
NET CASH USED IN INVESTING ACTIVITIES                                   (86,524)
                                                                     -----------

CASH FLOWS FROM FINANCING ACTIVITIES:

  Proceeds from issuance of convertible notes payable                 1,041,300
  Proceeds from sale of capital stock                                   536,841
                                                                     -----------
NET CASH PROVIDED BY FINANCING ACTIVITIES                             1,578,141
                                                                     -----------

NET INCREASE IN CASH                                                    812,569

CASH - beginning of period                                                   --
                                                                     -----------
CASH - end of period                                                $   812,569
                                                                     ===========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW
  INFORMATION:

   Noncash investing and financing activities:

   Common stock and warrants issued for licensing agreement         $   671,250
                                                                     ===========

   Common stock and warrants issued for services and financing      $   646,000
                                                                     ===========

   Common stock and warrants issued for acquisition                 $ 5,490,000
                                                                     ===========

   Beneficial conversion feature recorded as additional
    paid in capital                                                 $   605,000
                                                                     ===========

   Warrants issued for debt                                         $    49,620
                                                                     ===========
                 See notes to consolidated financial statements.

                                       F-6

<PAGE>

                     NEWAGECITIES.COM, INC. AND SUBSIDIARIES

                        (A DEVELOPMENT STAGE ENTERPRISE)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

      FOR THE PERIOD JANUARY 29, 1999 (INCEPTION) THROUGH DECEMBER 31, 1999




Pyschicnet.Com, Inc. ("Psychic") was formed on  January 29, 1999 to provide "New
Age" services and products on the internet.

On April 6, 1999,  Psychic  was  acquired  by  Virginia  City Gold  Mines,  Inc.
("VCGM"),  an  Idaho  corporation,  for  2,200,000  shares  of VCGM  stock  (the
"Exchange").  The Exchange was  completed  pursuant to the Agreement and Plan of
Reorganization  between Psychic and VCGM. The Exchange has been accounted for as
a reverse  acquisition  under the  purchase  method for  business  combinations.
Accordingly,   the   combination   of  the  two   companies  is  recorded  as  a
recapitalization  of  Psychic,  pursuant  to which  Psychic  is  treated  as the
continuing entity. Subsequent to the Exchange, with the approval of the Board of
Directors, VCGM changed its name to newagecities.com, Inc. (the "Company").

The Company has adopted a December 31 year end.

On December 15, 1999 the Company  completed the  acquisition of MemberNet,  Inc.
("MemberNet"), a California company formed in 1999.

1.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         A.       PRINCIPLES OF CONSOLIDATION - The financial statements include
                  the accounts of the Company and its wholly-owned subsidiaries.
                  All material intercompany transactions have been eliminated.

         B.       FURNITURE  AND EQUIPMENT - Furniture and equipment are carried
                  at cost.  Depreciation  is  computed  using the  straight-line
                  method over the estimated useful lives of the various assets.

         C.       INVENTORIES  -  Inventories  consisting  of "New Age"  related
                  products are stated at the lower of average cost or market.

         D.       INCOME TAXES - Income taxes are accounted for under  Statement
                  of Financial  Accounting  Standards No. 109,  "Accounting  for
                  Income  Taxes," which is an asset and liability  approach that
                  requires   the   recognition   of  deferred   tax  assets  and
                  liabilities for the expected future tax consequences of events
                  that  have  been   recognized  in  the   Company's   financial
                  statements or tax returns.

         E.       FAIR VALUE OF FINANCIAL  INSTRUMENTS  - The  carrying  amounts
                  reported  in the balance  sheet for cash and accrued  expenses
                  approximate  their fair market  value based on the  short-term
                  maturity of these instruments.

                                       F-7


<PAGE>




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

         G.       IMPAIRMENT  OF  LONG-LIVED   ASSETS  -  The  Company   reviews
                  long-lived  assets for impairment  whenever  circumstances and
                  situations  change such that there is an  indication  that the
                  carrying  amounts may not be recovered.  At December 31, 1999,
                  the Company  believes that there has been no impairment of its
                  long-lived assets.

         H.       COMPREHENSIVE  INCOME/LOSS - The Company has adopted Statement
                  of  Financial   Accounting   Standards  No.  130  ("SFAS  130)
                  "Reporting  Comprehensive  Income".  Comprehensive  income  is
                  comprised  of net loss and all  changes to the  statements  of
                  stockholders'  equity,  except  those  due to  investments  by
                  stockholders,  changes in paid-in capital and  distribution to
                  stockholders.  Comprehensive  income/loss and net loss for the
                  period ended December 31, 1999 were the same.

         I.       RESEARCH AND DEVELOPMENT - Research and development  costs are
                  expensed as incurred.  These costs primarily  consists of fees
                  paid for the development of the Company's  software.  Research
                  and  development  costs for the period ended December 31, 1999
                  were $258,750.

         J.       STOCK  BASED  COMPENSATION  - The Company  accounts  for stock
                  transactions  in accordance  with APB No. 25,  "Accounting for
                  Stock Issued to  Employees."  In accordance  with Statement of
                  Financial   Accounting   Standards   No.  123  ("SFAS   123"),
                  "Accounting for Stock-Based Compensation," the Company adopted
                  the pro forma disclosure requirements of SFAS 123.

         K.       NEW ACCOUNTING  PRONOUNCEMENTS  - In June 1998, the  Financial
                  Accounting  Standards  Board issued SFAS No. 133 - "Accounting
                  for Derivative  Instruments  and  Hedging Activities" which is
                  effective for fiscal quarters  beginning  after June 15, 1999.
                  This statement establishes accounting  and reporting standards
                  for derivative  instruments,  including   certain   derivative
                  instruments embedded  in  other  contracts  and  for   hedging
                  activities. It  requires  that   an   entity   recognize   all
                  derivatives  as  either  assets  or liabilities in the balance
                  sheet  and  measure  those  instruments  at fair  value.  This
                  statement   amends   SFAS   No.   52  -   "Foreign    Currency
                  Translation",  and  supersedes  SFAS  No. 80 - "Accounting for
                  Future   Contracts",   No. 105 -  "Disclosure  of  Information
                  about  Financial  Instruments with  Off-Balance-Sheet Risk and
                  Financial  Instruments  with  Concentration  of  Credit Risk",
                  No.   107  -  "Disclosure    about  Fair  Value  of  Financial
                  Instruments".  The   Company   adopted  SFAS No. 133 in fiscal
                  2000.  Management   believes   that the impact of SFAS No. 133
                  will not be significant to the Company.

                                       F-8


<PAGE>



                  In December 1999, the SEC issued Staff Accounting Bulletin No.
                  101,  Revenue  Recognition  in  Financial  Statements,   ("SAB
                  101"").  SAB 101 requires that four basic criteria must be met
                  before revenue can be recognized:  (1) persuasive  evidence of
                  an arrangement  exists,  (2) delivery has occurred or services
                  have been rendered, (3) the fee is fixed and determinable, and
                  (4)  collectibility  is  reasonably  assured.  The  Company is
                  required to comply with SAB 101  transactions  entered into on
                  or after  February  1, 2000,  but does not expect it to have a
                  material  impact  on  the  Company's   consolidated  financial
                  position or results of operation.

         K.       LICENSING  AGREEMENTS  -  Licensing  agreements  are stated at
                  cost, less accumulated amortization.  Amortization is computed
                  using the straight-line method over an estimated life of three
                  years  based upon  management's  expectations  relating to the
                  life  of  the  technology  and  current   competitive   market
                  conditions.  The estimated life is reevaluated each year based
                  upon  changes  in  these  factors.  Amortization  for the year
                  ending December 31, 1999 was $130,522.

         M.       EARNINGS PER SHARE - The Company has adopted the provisions of
                  Financial  Accounting Standards No. 128, "Earnings Per Share".
                  Basic  net loss per  share  is based on the  weighted  average
                  number of shares outstanding. Potential common shares included
                  in  the   computation  are  not  presented  in  the  financial
                  statements as their effect would be anti-dilutive.

         N.       GOODWILL - Goodwill resulting from acquisition of MemberNet is
                  being amortized on a straight line basis over 3 years.

         O.       REVENUE    RECOGNITION   -   The   Company's   revenues   from
                  advertisements  placed on the  website are  recognized  at the
                  time  advertisements  are  displayed on the website.  Revenues
                  from the sale of  products  are  recorded  when the  goods are
                  shipped or transmitted via E-mail.

2.       FURNITURE AND EQUIPMENT

         Furniture and equipment are as follows:

                                             Estimated Life

                                           -------------------
Office furniture                                 7 Years        $ 12,110
Computer equipment                               5 Years          64,904
Retail equipment                                 5 Years           9,510
                                                                 -------
                                                                  86,524
Less: Accumulated depreciation                                     9,406
                                                                 -------
                                                                $ 77,118
                                                                 =======


                                       F-9


<PAGE>





3.       BASIS OF PRESENTATION

         The Company has an accumulated  deficit of approximately  $1,890,000 at
         December 31, 1999, and has incurred significant  operating losses which
         raise  substantial  doubt  about its  ability  to  continue  as a going
         concern without the raising of additional debt and/or equity  financing
         to fund  operations.  Management  is actively  pursuing new debt and/or
         equity    financing   and   continually    evaluating   the   Company's
         profitability, however any results of their plans and actions cannot be
         assured.  The  consolidated  financial  statements  do not  include any
         adjustments that might result from the outcome of this uncertainty.

4.       LICENSING AGREEMENT

         The Company acquired a licensing agreement from a software  development
         company  for  the  use of its  e-commerce  software.  The  license  was
         acquired for 400,000 shares of the Company's common stock.  Such shares
         of common stock were valued at the fair market value of $1.60 (based on
         the Reg D 504 offering  during April 1999 of $2.00 per share less a 20%
         discount for  restrictions  on the resale of such shares).  The Company
         also issued warrants to purchase 125,000 shares of the Company's common
         stock  exercisable  at $2.25 per share  over a five  year  period.  The
         warrants  have been  valued at $31,250  which has been  included in the
         value of licenses.  In addition the software  development  company will
         receive 3% of Web site  revenues  generated  from  product  sales using
         their software.

          MemberNet  has  entered  into a license  agreement  for the use of its
         internet  software.  Under the terms of the  Agreement  the licensor is
         entitled to 50% of all  advertising  revenue  generated from the use of
         the software.

5.       COMMITMENTS

         The Company leases certain office and warehouse  space under  operating
         leases commencing January 2000. The leases expires January 2005.

                  Minimum rental commitments are as follows:

         2000                          $ 43,000
         2001                          $ 46,000
         2002                          $ 48,000
         2003                          $ 51,000
         2004                          $ 53,000

         The Company  has  entered  into three  employment  agreements  with its
         officers in April 1999.  All three of the  agreements are for two years
         and  expire in March  2001.  The  agreement  with its  Chief  Executive
         Officer, provides for an annual salary of $85,000 and $106,000 in years
         ended 2000 and 2001, respectively.  The agreement with the President of
         the Company,

                                      F-10


<PAGE>



         provides for an annual salary of $60,000 and $75,000, respectively. The
         agreement  with the Company's  Chief  Financial  Officer,  calls for an
         annual  salary of $50,000 and $62,500,  respectively.  All of the above
         contracts  provide for a bonus of up to 25% of the prior  years  annual
         salary.  Prior  to the  establishment  of an  independent  compensation
         committee the bonuses are based on certain performance criteria.  After
         the  committee is formed the bonuses will be at the  discretion  of the
         committee. Additionally, the above officers will receive 20,000 options
         to purchase shares of the Company's  common stock at $2.00 per share at
         the end of each contract year.

         MemberNet  has  entered  into  three  one  year  consulting  agreements
         commencing December 1999 for a total of $30,000.

6.       INCOME TAXES

         The Company  accounts  for income  taxes under  Statement  of Financial
         Accounting  Standards  No. 109,  "Accounting  for Income  Taxes" ("SFAS
         109").  SFAS 109  requires the  recognition  of deferred tax assets and
         liabilities  for both the expected  impact of  differences  between the
         financial  statements and tax basis of assets and liabilities,  and for
         the  expected  future tax  benefit to be derived  from tax loss and tax
         credit carryforwards.  SFAS 109 additionally requires the establishment
         of a valuation  allowance to reflect the  likelihood of  realization of
         deferred tax assets.

         The  provision  (benefit)  for income  taxes  differs  from the amounts
         computed by applying the  statutory  federal  income tax rate to income
         (loss)  before  provision for income taxes,  the  reconciliation  is as
         follows:

Taxes (benefit) computed at statutory rate                $  (776,000)
Effect of permanent differences                               509,000
Income tax benefit not utilized                               267,000
                                                             --------
Net income tax benefit                                    $      -
                                                             ========

         The Company has a net  operating  loss  carryforward  for tax  purposes
         totaling  approximately  $665,000 at December 31, 1999  expiring in the
         year 2014.

         Listed below are the tax effects of the items  related to the Company's
net tax liability:

Tax benefit of net operating loss carryforward            $   267,000
Valuation Allowance                                          (267,000)
                                                              --------
Net deferred tax asset recorded                          $       -
                                                              ========






                                      F-11


<PAGE>



7.       STOCKHOLDERS' EQUITY

         On April 6, 1999 the Company  declared a 1 for 80 reverse  stock split.
         The  financial   statements   for  all  periods   presented  have  been
         retroactively adjusted for the stock split.

         The Company has completed a private  placement of 500,000 shares of its
         common stock at $2.00 per share.  The Company  issued  300,000 of these
         shares for gross  proceeds of $600,000  (net  proceeds of $536,841) and
         issued 200,000 shares (see below) for services rendered to the Company.

         In April 1999,  the Company  issued 150,000 shares of common stock to a
         consultant who provides both website  development and public  relations
         services.  These  shares were valued at the fair market  value of $1.60
         (based on Reg D 504 offering  during April 1999 of $2.00 per share less
         a 20%  discount for  restrictions  on the resale of such  shares).  The
         Company  also issued to the  consultant  warrants  to  purchase  75,000
         shares of common stock  exercisable  at $2.25 per share.  Such warrants
         have been valued at $18,750.  The Company has expensed the total amount
         of $258,750 as research and development.

         In April 1999,  the Company  issued  50,000 shares of common stock to a
         broker  dealer  for  consulting  services  rendered  on  behalf  of the
         Company.  These  shares were also  valued at the fair  market  value of
         $1.60 (based on Reg D 504 offering during April 1999 of $2.00 per share
         less a 20% discount for restrictions on the resale of such shares). The
         Company has charged the total amount of $80,000 to  Additional  Paid in
         Capital.

         Additionally,  in April 1999,  the Company  issued  100,000 shares to a
         consultant for services rendered.  These shares were valued at the fair
         market value of $1.60 (based on Reg D 504 offering during April 1999 of
         $2.00 per share less a 20% discount for  restrictions  on the resale of
         such  shares).  Such  issuance  was  recorded as non-cash  compensation
         expense.

         In March  through  May 1999,  the Company  granted  warrants to various
         consultants and employees to purchase an aggregate of 563,000 shares of
         common stock at a price of $2.25 per share.  Such  warrants were valued
         at $140,000 and recorded as non-cash compensation expense.

         In June 1999, the Company  granted  warrants to various  consultants to
         purchase an aggregate  of 237,000  shares of common stock at a price of
         $2.25 per share.  Such  warrants were valued at $59,250 and recorded as
         non-cash compensation expense.

         In  November  1999  the  Company granted 50,000 warrants exercisable at
         $1.50  per  share  on  or  prior  to  June 30, 2005 to a stockholder in
         connection with a $50,000 loan which was repaid prior to year end.

                                      F-12


<PAGE>



8.       STOCK WARRANTS

         A summary of outstanding warrants at December 31, 1999 are as follows:
<TABLE>
<CAPTION>

                                               Shares               Range of        Remaining        Average
                                             Underlying             Exercise       Contractual       Exercise
                                              Warrants                Price            Life           Price
                                           ---------------       --------------- ----------------    ----------
<S>                                               <C>          <C>                   <C>            <C>
Outstanding at beginning of period                -            $        -                           $   -
Granted                                          2,250,000          1.50-2.50        2 - 4.5 yrs.      2.00
Exercised                                         -                     -                               -
                                           ---------------       --------------- ----------------    ----------
Outstanding at December 31, 1999                 2,250,000     $    1.50-2.50                       $  2.00
                                           ===============       ===============                     ==========
</TABLE>

         In  November  1999,  120,000  options  were  granted.   In   1999,  had
         compensation  cost for the Plan been determined based on the fair value
         at  the grant dates for awards under the Plan,  the  Company's net loss
         and net  loss per share would have  increased to the pro forma  amounts
         indicated below:

                                                   As          Pro
                                                 Reported     Forma

                                                ----------  ------------

         Net loss                              ($1,939,134) ($1,992,642)
         Basic and diluted net loss per share       ($0.54)      ($0.55)

         The  fair value of each option  grant is estimated on the date of grant
         using  the  Black  Scholes  option-pricing  method  with the  following
         weighted  average  assumptions used for grants in 1999;  dividend yield
         0%, expected  volatility 20%, risk-free  interest rate 6.00%,  expected
         lives in years 3.

         The  weighted  average fair value of stock options  granted  during the
         year ended December 31, 1999 was $2.00.

9.       CONVERTIBLE NOTES PAYABLE

         On December 21, 1999,  newagecities.com  and Subsidiaries  received net
         proceeds of $952,498 and issued its  promissory  notes in the aggregate
         principal  amount of $1,041,300 to certain non - U.S.  investors  under
         Regulation S of the  Securities Act of 1933. The notes are due on April
         30, 1999 and bear  interest  at the rate of 8% per year  payable at the
         time that principal is paid. The notes are convertible  into a total of
         822,700 shares of common stock of newagecities.com.  Additionally,  the
         Company issued 200,000  warrants to purchase the Company's common stock
         to the  holders'  of these notes  exercisable  at $2.50 per share on or
         before June 30, 2005.  Such warrants  were valued at $28,000.  Units of
         the notes  representing a principal amount of $801,000 are secured by a
         pledge  of  650,000  shares  by two of the  principal  officers  of the
         Company.

         In connection  with the financing the Company has recorded a beneficial
         conversion  feature of $605,000,  which is included in interest expense
         in the statement of operations.

                                      F-13


<PAGE>




10.      ACQUISITION

         In  December 1999, the Company  acquired all of the outstanding  shares
         of  common stock of MemberNet  for  2,500,000  shares of the  Company's
         common  stock,  exercisable at $1.75 per share, and 1,000,000  warrants
         to  purchase shares of the Company's common stock, with the acquisition
         being  accounted for as a purchase business  combination.  These shares
         were  valued  at  the fair  market  value of $2.00  (based on Reg D 504
         offering  during  April  1999  of  $2.00).  A final  allocation  of the
         purchase  price is dependent upon valuations and other studies that are
         not  yet  complete.  Accordingly  the  purchase  price  allocation   is
         preliminary and has been recorded as goodwill.

         The computation is as follows:

         Net book value of assets acquired              $      -
         Purchase price:
         Common stock                                     5,000,000
         Warrants                                           490,000
                                                         -----------
         Total purchase price                             5,490,000
                                                         -----------
         Goodwill                                       $ 5,490,000
                                                         ===========

         No pro-forma results of the operations of the Company and MemberNet, as
         if the acquisition had occurred on January 29, 1999, has been presented
         since the activity of MemberNet was immaterial.

                                      F-14


<PAGE>

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

         None.


                                    PART III

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

Directors and Executive Officers

         The following table includes the names,  positions held and ages of our
executive officers and directors.

NAME                     AGE                           POSITION
----                     ---                           --------

Joseph Ardito, Jr.        42                Chairman and Chief Executive Officer
Dr. Kenneth Shenkman      34                President and Director
Stanley Siegel            67                Chief Financial Officer, Secretary,
                                            Treasurer and Director
Cory W. Smith             29                Chief Technology Officer


         Mr. Ardito has served as a director, Chairman of the Board of Directors
and Chief  Executive  Officer of  newagecities.com  since March 1999. Mr. Ardito
previously worked in the following positions:

<TABLE>
<CAPTION>


DATES AND POSITION                                          BUSINESS OR ACTIVITY

<S>                                                         <C>
Between 1990 and 1998-Owner                                 Present Alternative, Boca Raton, Florida.
                                                            This retail store sold New Age products and
                                                            psychic readings
         .
1986 to 1991 - Vice President and Partner                   Professional Accounting Services Corp. New York,
                                                            New York.  This is an accounting firm where Mr.
                                                            Ardito headed  the marketing and client relations
                                                            departments, oversaw bookkeeping and  income tax
                                                            departments and led the computer integration
                                                            division

Dr. Shenkman  has  served  as a director and President of newagecities.com since
March 1999.
Dr. Shenkman previously worked in the following positions:

                                       15

<PAGE>

September 1997 - April 1999-Consultant                      As independent consultant, Dr. Shenkman
                                                            has been an independent computer and
                                                            Internet consultant and trainer.

January 1999 - March 1999-Director of                       Arc Communications, Inc., Tinton Falls,
Internet Marketing                                          New Jersey.  This company is engaged in
                                                            designing Web sites.

July 1995 - September 1998-Vice President Operations        Computer Coach, Inc., Boca Raton, Florida.
                                                            This company engages in computer training
                                                            and Internet web design

Stanley  Siegel is the father-in law of Mr.  Ardito.  Mr. Siegel has served as a
director,  Chief Financial Officer,  Secretary and Treasurer of newagecities.com
since March 1999. Mr. Siegel previously worked in the following positions:

1955 - 1996                                                 Director of Human Resources, Head of
                                                            Special Accountings Department and
                                                            Accountant. United Merchants and
                                                            Manufacturers, Inc.

Mr. Smith was appointed  Chief  Technology  Officer in October,  1999. Mr. Smith
previously worked in the following positions:

Between May 1999 to September, 1999 -                       Bidnow.com, inc., Boca Raton, Florida
Interim Director of Technology                              This is a start-up Internet auction company

August 19, 1998 to May 1999 - Web Enabled Technologies      Equifax Corporation, St. Petersburg, Florida
Manager

January 1996 to August 1998 - Senior Online Designed and    Miami Herald Online, Miami, Florida
Project Manager

May 1996 to January 1999 - Director of Technology           Alton Entertainment Corp. (Internet Division Miami
                                 Beach, Florida

September 1995 to May 1996 - Creative Director              Internet Communication of America, Inc. Miami, Florida
</TABLE>

                                       16

<PAGE>

         Our  directors  are elected at each annual meeting of stockholders. Our
directors hold office until the next annual meeting of  stockholders.  Executive
officers are elected by and serve at the  discretion  of the Board of Directors.
Member  Net has the  right  to  designate  for  nomination  the  names  of three
prospective directors. We have not received the name of designees at this time.

Board Committees

         We plan to establish an audit committee,  which will be responsible for
making   recommendations   concerning  the  engagement  of  independent   public
accountants,  reviewing the plans and results of the audit  engagement  with the
independent public accountants,  approving professional services provided by the
independent  public  accountants  and  reviewing  the  adequacy of our  internal
accounting  controls.  The Audit  Committee  will be  comprised  of designees of
Member  Net,  who will not be  management  employees,  and Mr.  Siegel.  We will
organize an independent  compensation committee which will evaluate compensation
programs  for  management  and  other  employees  as well as  individual  salary
arrangement with our executive officers. This committee will also be composed of
designees  of Member Net or other  independent  directors  added to our Board of
Directors.

Employment Agreements

         We  entered  into  two-year  employment agreements with Messrs. Ardito,
Shenkman and Siegel. No employment  agreement has been prepared for Mr. Smith at
this time. The terms of the agreements are as follows:

         JOSEPH  ARDITO:  Mr.  Ardito is to receive an annual  salary of $85,000
beginning April 1, 1999 and ending March 31, 2000 and $106,000 annual salary for
the period April 1, 2000 and ending March 31, 2001.  Mr. Ardito is entitled to a
bonus of up to 25% of his annual salary each year. On April 1, 1999,  Mr. Ardito
was granted  options to purchase a total of 40,000  shares of common stock at an
exercise  price of $2.00 per share.  These options expire on March 31, 2003, and
may be exercised for up to 20,000 shares  beginning March 31, 2000 and as to the
remaining 20,000 shares beginning March 31, 2001.

         KENNETH  SHENKMAN:  Dr.  Shenkman  is to  receive  an annual  salary of
$60,000  beginning  April 1, 1999 and ending  March 31, 2000 and $75,000  annual
salary for the period April 1, 2000 and ending March 31, 2001. On April 1, 1999,
Dr.  Shenkman was granted options to purchase a total of 40,000 shares of common
stock at an exercise price of $2.00 per share. These options expire on March 31,
2003, and may be exercised for up to 20,000 shares  beginning March 31, 2000 and
as to the remaining 20,000 shares beginning March 31, 2001.

         STANLEY  SIEGEL:  Mr.  Siegel is to receive an annual salary of $50,000
beginning  April 1, 1999 and ending March 31, 2000 and $62,500 annual salary for
the period April 1, 2000 and ending March 31, 2001. On April 1, 1999, Mr. Siegel
was granted  options to purchase a total of 40,000  shares of common stock at an
exercise  price of $2.00 per share.  These options expire on March 31, 2003, and
may be exercised for up to 20,000 shares  beginning March 31, 2000 and as to the

                                       17

<PAGE>

remaining 20,000 shares beginning March 31, 2001.

         Each  of the  employment  agreements  terminates  on  April  2001.  The
officers are to devote full time and efforts to our business.  Their  agreements
also have  non-disclosure  covenants  during  the term of  employment  and for a
period of two years after the term of their  employment.  We may terminate  each
employment agreement for cause.

         Until an independent  compensation committee is formally established to
administer  the above bonus program,  no bonus will be paid to these  executives
for the  initial  year under  their  contracts  unless the  following  objective
criteria are met. The bonus will be based as follows:

  o      At least 10,000 new member sign-ups by March 31, 2000;

  o      At least six communities (these are unique content areas or subjects of
         interest) are available at our website;

  o      e-commerce  capabilities  are  introduced  with at least 5,000 products
         available for sale;

  o      Availability of live see and hear psychics at our website;

  o      At least ten merchant-owned "mini-shops" opened;

  o      At least three other company-owned websites are up and running.

         In the event that any of these six  criteria are not met, the amount of
the bonus will be reduced by 16.7% from the maximum allowed.  If for some reason
an independent compensation committee is not organized by the second year of the
employment contract, then the criteria for earning the bonus will be doubled.

Key-man life insurance

         We do not have key-man life insurance on our officers or directors.

Limitation on liability and indemnification matters

         The Idaho Business  Corporation Act allows us to indemnify our officers
and  directors  from  liability  incurred in  furtherance  of their duties under
certain  circumstances.  In criminal  proceedings,  Idaho law states that we may
indemnify an officer or director if he or she acted in good faith and reasonably
believed that his or her conduct was in the best interests of the corporation if
he or she had no reasonable cause to believe his or her conduct was unlawful. In
addition,  Idaho law  requires  us to  indemnify  directors,  who succeed on the
merits of any defense proceeding or in any defense proceeding to which he or she
was party  because he or she was a director of the  corporation  for  reasonable
expenses  incurred in connection with the  proceeding.  If we chose to indemnify

                                       18

<PAGE>

our  officers and  directors  in  accordance  with the  provisions  of the Idaho
Business Corporation Act, our financial resources may be significantly affected.

         Insofar as indemnification for liabilities arising under the Securities
Act of 1933, may be permitted to our directors, officers and controlling persons
pursuant to the above,  we are aware that in the opinion of the  Securities  and
Exchange Commission,  this indemnification is against public policy as expressed
in the securities laws, and is, therefore unenforceable.

Compliance with Section 16(a) of the Securities Exchange Act of 1934

         The Company is not subject to Section 16(a) of the Securities  Exchange
Act of 1934, which requires the Company's directors and executive officers,  and
persons who own more than ten percent of the Company's  outstanding Common Stock
to file with the Securities and Exchange Commission initial reports of ownership
and reports of changes in ownership of Common Stock.


ITEM 10. EXECUTIVE COMPENSATION

Summary Compensation Table

         The following table sets forth information relating to all compensation
awarded to,  earned by or paid by us during the past three  fiscal years to: (a)
our Chief Executive  Officer;  and (b) each of our executive officers who earned
more than $100,000 during the fiscal year ended December 31, 1999:

<TABLE>
<CAPTION>

                               Fiscal                                Other Annual                LTIP          All Other
Name and Principal Position    Year         Salary        Bonus      Compensation   Options/ (#) Payouts    Compensation
---------------------------    -----------------------------------------------------------------------------------------

<S>                             <C>         <C>                                       <C>
Joseph Ardito, CEO              1999        $78,465         -             -           40,000        -            -

</TABLE>


Option Grants in Last Fiscal Year

         The  following  table sets forth  information  concerning  our grant of
options to  purchase  shares of our common  stock  during the fiscal  year ended
December  31,  1999 to (a) our  Chief  Executive  Officer;  and (b)  each of our
executive  officers who earned more than  $100,000  during the fiscal year ended
December 31, 1999.

<TABLE>
<CAPTION>

                                                Percent of
                                Number of     Total Options/
                               Securities      SARs Granted
                               Underlying      To Employees          Exercise Or
                              Options/SARs       In Fiscal           Base Price
      Name                     Granted (#)          Year               ($/Sh)           Expiration Date

<S>                            <C>      <C>         <C>                <C>                  <C> <C>
Joseph Ardito, CEO             400,000/-0-          33%                $2.00               -0-/-0-
</TABLE>

                                       19

<PAGE>

Option Exercises and Holdings

         The following table contains  information  with respect to the exercise
of options  to  purchase  shares of common  stock  during the fiscal  year ended
December  31,  1999 to (a) our  Chief  Executive  Officer;  and (b)  each of our
executive  officers who earned more than  $100,000  during the fiscal year ended
December 31, 1999.

<TABLE>
<CAPTION>

Aggregated Option/SAR Exercises in Last Fiscal Year and Fiscal Year-End Option/SAR Values

                                                                            Number of
                                                                           Securities            Value of
                                                                           Underlying           Unexercised
                             Shares                                        Unexercised         In-The-Money
                            Acquired                                      Options/SARs         Options/SARs
                               On                         Value           At FY-End (#)        At FY-End ($)
                            Exercise                    Realized          Exercisable/         Exercisable/
      Name                     (#)                         ($)            Unexercisable        Unexercisable
------------------------------------------------------------------------------------------------------------

<S>                             <C>                         <C>           <C>    <C>               <C> <C>
Joseph Ardito, CEO             -0-                         -0-            20,000/20,000           -0-/-0-
</TABLE>


Long-Term Incentive Plans Awards in Last Fiscal Year

<TABLE>
<CAPTION>

                                     Number          Performance
                                    of Shares         or Other            Estimated Future Payouts Under
                                    Units or        Period Until             Non-Stock Price-Based Plans
                                                                          ------------------------------
                                  Other Rights       Maturation             Threshold   Target   Maximum
      Name                            (#)             or Payout                ($or #)  ($or #)    ($ or #)
      -----------------------------------------------------------------------------------------------------

<S>                                     <C>               <C>                    <C>        <C>    <C>
Joseph Ardito, CEO                      -                 -                      -          -      -
</TABLE>


ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The following table sets forth, as of March 31, 2000, information known
to us relating to the  beneficial  ownership  of shares of common stock by: each
person who is the beneficial  owner of more than five percent of the outstanding
shares of common stock; each director; each executive officer; and all executive
officers and directors as a group.

         Unless otherwise indicated, the address of each beneficial owner in the
table set forth  below is care of  Newagecities.com,  Inc.,  1181  South  Rogers
Circle,  Suite 5, Boca Raton,  Florida  33487.  The  address  for Messrs.  Quan,
Gallagher,  Muhlfeld  and Gould is c/o Member Net,  Inc.,  9610  DeSoto  Avenue,
Chatsworth, CA 91311.

         We believe  that all  persons  named in the table have sole  voting and

                                       20

<PAGE>

investment power with respect to all shares of common stock  beneficially  owned
by them.

         Under the securities  laws, a person is considered to be the beneficial
owner of securities  that can be acquired by him within 60 days from the date of
this  prospectus   upon  the  exercise  of  options,   warrants  or  convertible
securities.  We determine  beneficial owner's  percentage  ownership by assuming
that options,  warrants or convertible  securities that are held by him, but not
those held by any other person and which are  exercisable  within 60 days of the
date of this prospectus,  have been exercise or converted. As of March 31, 2000,
there were  6,100,158  shares of our common  stock issued and  outstanding.  The
issued and outstanding  shares do not include 850,000 shares of our common stock
issuable  upon the exercise of warrants  issued in  connection  with our private
placement,  or warrants to purchase  1,000,000 shares issued to the stockholders
of Member Net in connection with that acquisition.


<TABLE>
<CAPTION>

Names and Address of                      Number of shares                       Percentage of shares
Beneficial Owner                          Beneficially Owned                     Beneficially Owned

<S>                                            <C>                                        <C>
Joseph Ardito                                  1,220,000(1)                               18.5%
Kenneth Shenkman                                 369,500(2)                                5.8%
Stanley Siegel                                    90,000(3)                                1.5%
Q-Sound Labs                                     525,000(4)                                8.6%
James Warner                                     225,000(5)                                3.7%
CALP II Limited Partnership                      632,700(6)                               10.8%
New Amsterdam Investment Trust                   240,000(7)                                3.9%
Nolan Quan                                     1,006,250(8)                               15.8%
John Gallagher                                   853,125(9)                               13.4%
Robert Gould                                     743,750(10)                              11.8%
Bruce Muhlfeld                                   437,500(11)                               7.0%

All executive officers and
directors as a group (3 persons)               1,679,500                                  24.3%
-----------------
</TABLE>

(1)      The number of shares owned by Joseph Ardito also includes 20,000 shares
         held by his wife directly,  22,000 shares held by his wife as custodian
         for two minor  children and 470,000  shares  issuable to Mr.  Ardito to
         replace  shares  delivered  by Mr.  Ardito to  satisfy a portion of the
         Company's  outstanding  indebtedness.  Mr. Ardito disclaims  beneficial
         ownership  of the shares held by his wife.  The table  includes  20,000
         under  options  that are  currently  exercisable,  but does not include
         20,000 shares under options that may be exercised  beginning  March 31,
         2001.

(2)      The table includes 20,000 under options that are currently  exercisable
         and 219,500 shares issuable to Dr. Shenkman to replace shares delivered
         by Dr.  Shenkman  to  satisfy a portion  of the  Company's  outstanding
         indebtedness.  The table  does not  include  (a)  26,000  shares of our
         common stock  beneficially owned by Mr. Shenkman's  parents,  (b) 6,750
         shares of our common stock issuable upon the exercise of warrants owned
         by Mr. Shenkman's parents, and (c) 20,000 shares under options that may
         be exercised beginning March 31, 2001.

(3)      The number of shares  beneficially owned by Stanley Siegel includes (a)
         20,000  shares owned by his wife,  (b) 20,000 shares under options that
         are currently  exercisable and (c) 70,000 shares issuable to Mr. Seigel
         to replace  shares  delivered by Mr. Siegel to satisfy a portion of the
         Company's outstanding  indebtedness.  The table does not include 20,000
         shares under options that may be exercised beginning March 31, 2001.

                                       21
<PAGE>

(4)      Does not include warrants to purchase 15,000 shares of our common stock
         issued to David Gallagher, President of Q-Sound Labs.

(5)      Mr. Warner's address is 4910 Blue Lake Drive, Boca Raton, Florida 33431
         These include 200,000 shares of Virtacon Corporation  for  which he has
         sole voting and dispositive authority.

(6)      CALP II Limited  Partnership's address is Box HM 1737, Hamilton, HM 6X,
         Bermuda.  These  include  632,700  shares that may be issued  following
         conversion of convertible promissory notes. CALP II Limited Partnership
         is owned  80% by  Canadian  Advantage  Limited  Partnership  and 20% by
         Advantage Bermuda Fund. Canadian Advantage Limited Partnership is owned
         in turn by Messrs. Marc Valentine and Ian McKinnon, all of whom have an
         address at Box HM 1737 Hamilton, HM 6X, Bermuda.

(7)      New  Amsterdam Investment Trust's address is Box N-65, Nassau, Bahamas.
         These  include 190,000 shares that may be issued  following  conversion
         of  convertible  promissory  notes and 50,000 shares that may be issued
         on  exercise of warrants.  New Amsterdam  Investment  Trust is owned by
         Mr. Adrian C. Jones, Charlotte House, Box N-65, Nassau, Bahamas.

(8)      Includes  287,500  shares  issuable upon exercise of warrants issued in
         connection with our acquisition of Member Net, Inc.

(9)      Includes  243,750  shares  issuable upon exercise of warrants issued in
         connection with our acquisition of Member Net, Inc.

(10)     Includes  212,500  shares  issuable upon exercise of warrants issued in
         connection with our acquisition of Member Net, Inc.

(11)     Includes  125,000  shares  issuable upon exercise of warrants issued in
         connection with our acquisition of Member Net, Inc.




ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         In connection with the organization of  Psychicnet.com,  Inc.,  Messrs.
Ardito,  Shenkman and Siegel  received shares of common stock in connection with
the formation of Psychicnet.com.  On March 8, 1999, we acquired  Psychicnet.com,
Inc., and as result of this transaction,  1,900,000  shares,  400,000 shares and
100,000 shares of our common stock were  exchanged  with Joseph Ardito,  Kenneth
Shenkman and Stanley Siegel, respectively.  Thereafter, Messrs. Ardito, Shenkman
and Siegel  transferred  an  aggregate of 180,000,  35,000 and 30,000  shares of
common  stock  respectively  to  various  family  members  and  friends  without
consideration  and  solely  in  appreciation  of their  relationships.  Since at
organization,  Psychicnet had no value and  newagecities.com  had highly limited
value at the time  newagecities.com  acquired the stock of  Psychicnet  from our
current  management,  we believe that the share issuance was fair and reasonable
to us.

         Mr. Ardito also  transferred  400,000 shares of common stock to Q-Sound
Labs valued at $1.60 per share in exchange  for Q-Sound  software  licenses.  In

                                       22

<PAGE>

addition to the 400,000  shares of our common stock  Q-Sound  received  from Mr.
Ardito,  Q-Sound also received warrants to purchase 125,000 shares of our common
stock at $2.25 per share. Mr. David Gallagher,  president of Q-Sound, separately
received  warrants to purchase  15,000  shares of our common  stock at $2.25 per
shares for  agreeing  to serve on our Board of  Advisors  if it is  constituted.
Since this  transaction  was the result of arms-length  bargaining and the price
per share of $1.60 for restricted stock corresponded to our stock offering under
Rule 504 of $2.00, we believe this transaction was fair and reasonable.

         In February 1999, the individuals  serving as officers and directors of
newagecities.com at that time purchased an aggregate of 700,000 shares of common
stock from  newagecities.com  at $.01 per share.  The proceeds  were used to pay
expenses  associated with the acquisition of  Psychicnet.com.  Since our current
management was not involved with the original company (which changed its name to
newagecities.com,  Inc. following the acquisition),  it is difficult to evaluate
whether this transaction was fair to shareholders.  However,  since newagecities
had only nominal  value at this time, we believe that the  transaction  was fair
and reasonable.

         During March and June 1999,  we issued 6,000 shares of our common stock
to the  parents of Dr.  Shenkman  for  $12,000 or $2.00 per share as part of our
Rule 504 offering.

         In April  1999,  we made a $40,000  interest  free  loan to Mr.  Joseph
Ardito, an officer and director. The loan was repaid by Mr. Ardito in June 1999.

         Inasmuch  as the  transactions  involving  officers  and  directors  of
newagecities.com and its predecessor, Psychicnet.com, occurred during a start-up
phase or prior to active  operations,  it is difficult to evaluate whether these
transactions  represented  arm's  length  transactions.  We are  unable to judge
whether these transactions were as favorable to  newagecities.com  as those that
could have been secured in arm's length  transactions,  but no operations  would
have begun if these  transactions  had not  occurred.  However,  given the above
circumstances,  and the  difficulties in developing a start-up  operation facing
large  hurdles,  we  believe  these  transactions  were fair and  reasonable  to
newagecities.com.

         On July 30, 1999, the Company entered into a Merger  Agreement and Plan
of Reorganization dated as of June 21, 1999 with Member Net, Inc. which provides
for the merger of Member Net into a wholly-owned subsidiary of newagecities.com.
The merger was consummated in December 1999. The five stockholders of Member Net
received  from  newagecities,  a total of  2,500,000  shares of common stock and
warrants to purchase 1,000,000 shares of common stock exercisable at an exercise
price of $1.75 per share on or prior to June 30, 2001.

         On December  21,  1999,  we issued  promissory  notes in the  principal
amount of $1,041,300 under  Regulation S to non-U.S.  investors and received net
proceeds of $952,498. The notes mature April 30, 2000. The notes are convertible
into a  total  of  822,700  shares  of our  common  stock.  Units  of the  notes
representing  a principal  amount of $801,000 are secured by a pledge of 650,000
shares by two of the principal officers of newagecities.com. Thomson Kernaghan &

                                       23

<PAGE>

Co.  Limited,  which acquired  $801,000  principal  amount of promissory note as
agent for a  non-U.S.  investor,  received  a  commission  of  $80,100  and also
received a warrant to purchase 150,000 shares of our common stock exercisable at
$2.50 per share on or prior to January 21,  2002.  In  addition,  if during this
exercise period,  our common stock trades for less than $1.26 for 20 consecutive
trading days, then we must also issue an additional  warrant to purchase 150,000
shares during the same exercise period at the same exercise price.  The investor
for units of  promissory  notes in the  principal  amount of  $240,300  received
warrants to purchase  50,000 shares of our common stock for the same term and at
the same exercise price, but without the additional warrant. We are obligated to
register all of the  underlying  shares by April 30, 2000. If we do not, then we
are to pay a penalty  equal to 2% of the  invested  amount for each month  after
April 30.


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

A.       EXHIBITS:

<TABLE>
<CAPTION>

Exhibit
Number                     Description

<S>         <C>
2        Agreement and Plan of Reorganization between Virginia City Gold Mines, Inc.
         and Psychicnet.com, Inc. dated March 8, 1999(1)
3.1      Articles of Incorporation(1)
3.2      Articles of Amendment to the Articles of Incorporation(1)
3.3      Articles of Amendment to the Articles of Incorporation(1)
3.4      Bylaws(1)
10.1     Employment Agreement between newagecities.com, Inc. and Joseph Ardito(1)
10.2     Employment Agreement between newagecities.com, Inc. and Kenneth Shenkman(1)
10.3     Employment Agreement between newagecities.com, Inc. and Stanley Siegel(1)
10.4     Lease Agreement between newagecities.com, Inc. and R. A. La Pointe(1)
10.5     Internet Consulting/Marketing Agreement between Psychicnet.com, Inc. and
         Virtual Financial Corp.(1)
10.6     License Agreement between newagecities, Inc. and Q Sound Labs, Inc.(1)
10.7     Merger Agreement and Plan of Reorganization(1)
10.8     Lease Agreement between newagecities.com, Inc. and R.A. La Pointe(1)
10.9     Note, Security Agreement and Warrant between newagecities.com, Inc. and Marc Siegel.(1)
27       Financial Data Schedule(2)
-------------------------
</TABLE>

(1)      Incorporated  by  reference  to  exhibits with the corresponding number
         filed with our registration statement on form SB-2 (File No. 333-86347)
(2)      Filed herewith.

                                       24

<PAGE>

B.       REPORTS ON FORM 8-K:

         No reports on Form 8-K were filed during the last quarter of the period
covered by this Report.


                                       25
<PAGE>



                                   SIGNATURES


         In accordance  with Section 13 or 15(d) of the Securities  Exchange Act
of 1934, the registrant has caused this report to be signed on its behalf by the
undersigned,  thereunto  duly  authorized,  in Boca Raton,  Florida on April 13,
2000.

                                                     NEWAGECITIES.COM, INC.


                                    By: /s/ Joseph Ardito, Jr.
                                            Joseph Ardito, Jr.
                                            Chairman and Chief Executive Officer


         In accordance with the Securities Exchange Act of 1934, this report has
been  signed  by the  following  persons  on  behalf  of the  registrant  in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>


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



<S>                                                                                             <C> <C>
/s/ Joseph Ardito, Jr.                      Chairman of the Board, Chief                  April 13, 2000
------------------------------------
Joseph Ardito, Jr.                          Executive Officer and Director
                                            (Principal Executive Officer)

/s/ Kenneth Shenkman                        President and Director                        April 13, 2000
------------------------------------
Kenneth Shenkman


/s/ Stanley Siegel                          Chief Financial Officer,                      April 13, 2000
------------------------------------
Stanley Siegel                              Secretary and Treasurer
                                            (Principal Accounting and
                                            Financial Officer)
</TABLE>