BTOO 10-QSB 9-04 body

10QSB 1 btoo10q92004body.htm BTOO 10-QSB 9-04 BODY BTOO 10-QSB 9-04 body

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-QSB

[ x ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES ACT OF 1934

For the quarterly period ended September 30, 2004

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES ACT OF 1934

For the transition period from ___________to ____________

Commission File Number: 0-28058

BIOMETRICS 2000 CORPORATION

(Exact name of registrant as specified in its charter)

New York		11-3137508
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

120 Carando Drive

Springfield, MA 01104

(Address, including zip code, of principal executive offices)

(413) 736-9700

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

(1)Yes X No __

(2)Yes X No __

APPLICABLE ONLY TO CORPORATE ISSUERS:

State the number of shares outstanding of each of the issuer's class of common equity, as of the latest practicable date: At November 19, 2004, the issuer had outstanding 397,664,709 shares of Common Stock, par value $.001 per share.

Transitional Small Business Disclosure Format (Check one): Yes[ ] No[X]

BIOMETRICS 2000 CORPORATION

FORM 10-QSB

November 19, 2004

INDEX

PART I - FINANCIAL INFORMATION

		Page
Item 1.
	Unaudited Consolidated Balance Sheets	3

	Unaudited Consolidated Statements of Operations	4

	Unaudited Consolidated Statements of Stockholders’ Deficit	5

	Unaudited Consolidated Statements of Cash Flows	7

	Unaudited Notes to Consolidated Financial Statements	9

Item 2.	Condition and Results of Operations	14

Item 3.	Controls and Procedures	17

	PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	18

Item 2.	Changes in Securities and Small Business Issuer Purchases of Equity Securities	19

Item 3.	Defaults by the Company Upon Its Senior Securities	19

Item 4.	Submission of Matters to a Vote of Security Holders	19

Item 5.	Other Information	20

Item 6.	Exhibits and Reports on Form 8-K	20

	Signatures	21

	Certification of Chief Executive Officer	22

	Sarbanes-Oxley Act of 2002	23

PART I.

FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

BIOMETRICS 2000 CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS - UNAUDITED

		Biometrics 2000 Corporation and Subsidiaries	Biometrics 2000.com Corporation
			(Restated)
		September 30, 2004	December 31, 2003
ASSETS
Current Assets:
Cash		$ 13,068	$ 3,638
Accounts receivable, net of allowance for doubtful accounts		102,064	15,335
Inventory		54,829	20,932
Current assets attributable to discontinued operations		14,802
Prepaid expenses and other current assets		5,244	-
	Total Current Assets	190,007	39,905

Fixed assets, net of accumulated depreciation		38,597	475
	TOTAL	$ 228,604	$ 40,380

LIABILITIES AND STOCKHOLDERS' (DEFICIENCY)
Current liabilities:
Note payable		$ 183,839
Accounts payable and accrued expenses		944,432	$ 697,144
Loan payable, stockholders'		27,534	166,886
Loans payable, related party		1,114,974
Current liabilities attributable to discontinued operations		771,068	-

	Total Current Liabilities	3,041,847	864,030

Long-term debt		28,577	-
	Total Liabilities	3,070,424	864,030

Commitments and Contingencies

Stockholders' (Deficiency):
Common stock; $.001 par value; 400,000,000 authorized; 389,214,709 shares issued, and 184,241,810 shares, as restated, authorized and issued, respectively		389,215	184,242
Additional paid in capital		1,519,206	1,010,468
Accumulated (deficit)		(4,656,897)	(2,018,360)
Stock subscription receivable		(28,720)	-
Treasury stock (65,279 shares at cost)		(64,624)	-
	Total stockholders' deficiency	(2,841,820)	(823,650)

	TOTAL	$ 228,604	$ 40,380

See accompanying notes to consolidated financial statements.

BIOMETRICS 2000 CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED

			Biometrics 2000 Corporation and Subsidiaries	Biometrics 2000.com Corporation	Biometrics 2000 Corporation and Subsidiaries	Biometrics 2000.com Corporation
				(Restated)		(Restated)
			Three Months Ended		Nine Months Ended
			September 30, 2004	September 30, 2003	September 30, 2004	September 30, 2003

REVENUES:
	Keypads		$ 63,275	$ 39,015	$ 103,197	$ 72,999
	Fingerprint readers		45,026	11,973	115,915	44,488
	Other revenues		9,879	6,245	23,813	11,504
		Total revenues	118,180	57,233	242,925	128,991

COSTS AND EXPENSES:
	Cost of sales		65,340	35,740	146,303	84,887
	Selling, general and administrative		273,338	61,515	826,888	185,469
	Interest expense		28,700	2,016	82,994	5,306
	Research and development		2,463	1,417	502,463	2,417
	Total costs and expenses		369,841	100,688	1,558,648	278,079

Pre-tax loss from continuing operations			(251,661)	(43,455)	(1,315,723)	(149,088)

Income from discontinued operations			-	-	4,804	-

Net loss attributable to common stockholders			$ (251,661)	$ (43,455)	$ (1,310,919)	$ (149,088)

Basic and diluted net loss per common share			$ (0.01)	$ (0.01)	$ (0.01)	$ (0.01)

Basic and diluted weighted average common shares outstanding			366,840,632	179,091,001	301,026,661	169,203,001

See accompanying notes to consolidated financial statements.

BIOMETRICS 2000 CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ DEFICIENCY - UNAUDITED

For the Nine Months Ended September 30, 2004

			Additional		Stock			Total
	Common Stock		Paid-In	Accumulated	Subscription	Treasury Stock		Stockholders'
	Shares	Amount	Capital	Deficit	Receivable	Shares	Amount	Deficiency

Balance, January 1, 2004 - (Restated)	184,241,810	$184,242	$ 1,010,468	$ (2,018,360)				$ (823,650)

Reverse acquisition of VillageWorld.com	147,662,911	147,663	(1,010,468)	(1,327,618)	$ (2,720)	65,279	$ (64,624)	(2,257,767)

Exercise of nominal stock options	52,000	52	1,648					1,700

Capital contribution imputed
for interest expense			33,166					33,166

Stock issued for compensation	11,372,988	11,373	389,077					400,450

Conversion of stockholder debt to equity	35,885,000	35,885	605,315		(26,000)			615,200

Stock issued for research and development	10,000,000	10,000	490,000					500,000

Net loss	-	-	-	(1,310,919)	-	-	-	(1,310,919)

Balance, September 30, 2004	389,214,709	$389,215	$ 1,519,206	$ (4,656,897)	$ (28,720)	65,279	$ (64,624)	$ (2,841,820)

See accompanying notes to consolidated financial statements.

BIOMETRICS 2000.COM CORPORATION

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ DEFICIENCY - UNAUDITED

For the Nine Months Ended September 30, 2003

			Additional		Stock			Total
	Common Stock		Paid-In	Accumulated	Subscription	Treasury Stock		Stockholders'
	Shares	Amount	Capital	Deficit	Receivable	Shares	Amount	Deficiency

Balance, January 1, 2003 - (Restated)	154,426,519	$154,427	$ 959,673	$ (1,445,676)	$ -	-	$ -	$ (331,576)

Issuance of stock	29,815,291	29,815	50,795					80,610
								-
Net loss	-	-	-	(149,088)	-	-	-	(149,088)

Balance, September 30, 2003	184,241,810	$184,242	$ 1,010,468	$ (1,594,764)	$ -	-	$ -	$ (400,054)

See accompanying notes to consolidated financial statements.

BIOMETRICS 2000 CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED

				Biometrics 2000 Corporation and Subsidiaries	Biometrics 2000.com Corporation
				Nine Months Ended	Nine Months Ended
				September 30, 2004	September 30, 2003
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss				$ (1,310,919)	$ (149,088)

Adjustments to reconcile net loss to net cash used by operating activities:
	Depreciation			3,604	2,000
	Interest expense accrued and imputed on related party loans			57,989
	Stock issued for compensation and stock discount expense			400,450
	Stock issued for research and development			500,000
	(Increase) decrease in:
			Accounts receivable	(86,729)	(21,897)
			Inventory.	(33,897)	(23,500)
			Prepaid expenses and other current assets	(5,244)
	Increase (decrease) in:
			Accounts payable and accrued expenses	29,426	96,501
			Current liabilities attributable to discontinued operations	351	-
	Total adjustments			865,950	53,104
	Net cash used by operating activities			(444,969)	(95,984)

CASH FLOWS FROM INVESTING ACTIVITIES:

	Purchase of fixed assets			(10,153)
	Proceeds of stockholders loans			475,848	18,382
				-	-
Net cash provided by investing activities				465,695	18,382

CASH FLOWS FROM FINANCING ACTIVITIES:

	Proceeds of stock options exercised			1,700
	Payments on long-term debt			(2,996)
	Issuance of common stock			-	80,610
	Repayment of related party loans, net			(10,000)	-
Net cash (used) provided by financing activities				(11,296)	80,610

NET INCREASE (DECREASE) IN CASH				9,430	(3,008)
Cash, beginning of period				3,638	6,389
Cash, end of period				$ 13,068	$ 9,397
				-
Supplemental disclosures of cash flow information:
	Cash paid during the period for:
		Interest		$ 2,724

See accompanying notes to consolidated financial statements.

BIOMETRICS 2000 CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED

(Continued)

					Biometrics 2000 Corporation and Subsidiaries	Biometrics 2000.com Corporation
					Nine Months Ended	Nine Months Ended
					September 30, 2004	September 30, 2003

Supplemental disclosures of non-cash investing and financing activities:

			On March 4, 2004 the Company issued 184,241,810 shares of Common Stock in a merger. The following is a list of the assets, liabilities and equity acquired during the period by the merger.

				Current assets attributable to discontinued operations	$ (47,651)
				Current liabilities attributable to discontinued operations	803,566
				Accounts payable	217,862
				Loans from related parties	1,100,151
				Note payable, bank	183,839
				Common stock	306,905
				Additional paid in capital	(1,169,710)
				Stock subscription receivable	(2,720)
				Accumulated deficit	(1,327,618)
				Treasury stock	(64,624)



	Purchase of fixed assets				$ 41,726
	Proceeds of long-term debt				(31,573)
					-
		Cash paid			$ 10,153


	Conversion of debt to equity
		Loans, stockholders			$ (615,200)
		Common stock			35,885
		Additional paid in capital			605,315
		Stock subscription receivable			(26,000)

See accompanying notes to consolidated financial statements.

BIOMETRICS 2000 CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

(Note 1) Merger

On March 4, 2004, VillageWorld.com, Inc. (“VillageWorld”) completed its previously announced reverse merger with Biometrics 2000.com Corporation ("Biometrics") which agreed to merge Biometrics with a subsidiary of VillageWorld, Biometrics Acquisition Corporation. Pursuant to the merger agreement, the shareholders of Biometrics have been issued 184,241,810 shares of common stock of VillageWorld, an amount as to equal approximately fifty-five percent (55%) of the issued and outstanding common stock of VillageWorld at such time the merged companies will seek to expand the business line of Biometrics with the goal of returning to profitability. In the Amendment to the Certification of Incorporation filed pursuant to the merger agreement, VillageWorld has changed its name to Biometrics 2000 Corporation (the “Company”) and increased the aggregate number of shares of common stock from 201,000,000 to 400,000,000 par value $.001. The Company has been put on notice by a single shareholder that the transfer of his 8,106,635 shares pursuant to the merger may be challenged by such shareholder's assertion of appraisal rights pursuant to Florida law.

(Note 2) The Company and Basis of Presentation

The Company is a developer and reseller of biometric products for access control. Management believes that the Company has the opportunity to leverage its core competencies to capture a leading position in a rapidly growing, but as yet underdeveloped, segment of the electronic security market by establishing a position in pre-existing distribution channels which are used for related products and accessories to the Company's products. The Company seeks to become a leader in developing and delivering state-of-the-art biometric solutions for the physical access control segment of the Security Electronics Industry. The Company's hardware and software applications include BioXTouch fingerprint readers and its Touch Device Management (TDM ) software control package. Management believes that it will use its knowledge of the access control market and the long association of its management with the distribution channels to maximize the credibility and acceptance of its products from distributors and dealers who control the majority of sales into the market.

The comparative data for results of operations and statement of cash flows presented for the three and nine months ending September 30, 2004 consists of the merged companies of VillageWorld and Biometrics, compared to Biometrics 2000.com Corporation, only, for the three and nine months ending September 30, 2003. The balance sheet and statement of stockholders’ equity comparison consists of the merged companies of VillageWorld and Biometrics 2000 Corporation at September 30, 2004 and Biometrics 2000.com Corporation, only, at December 31, 2003. The information herein for the three and nine months ended 2004 and 2003 is unaudited. However, in the opinion of management, such information reflects all adjustments (consisting only of normal recurring adjustments) necessary to make the financial statements not misleading. Additionally, in accordance with applicable standards for interim reporting, the accompanying financial statements do not include all disclosures in conformity with generally accepted accounting principles.

Certain balances for the period 2003 have been reclassified to conform to the current period presentation with no effect on the results of operations.

The results of operations for the three and nine months ended September 30, 2004 are not necessarily indicative of the results of operations for the full year ending December 31, 2004. The accompanying financial statements should be read in conjunction with the Company’s financial statements for the year ended December 31, 2003 appearing in the Company’s Annual Report on Form 10-KSB.

BIOMETRICS 2000 CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

(Note 3) Going Concern

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company’s losses from operations in fiscal years ended December 31, 2003 and 2002, and related use of cash for operating activities have resulted in an extremely tight cash position and a deficit in working capital of $2,851,840 at September 30, 2004 and a current ratio at such date of 0.06 to 1. These factors indicate that the Company's continuation as a going concern is dependent upon its ability to generate sufficient cash flow to meet its obligations on a timely basis, to obtain additional financing, and ultimately attain profitability. Management through its merger with VillageWorld is attempting to raise capital with new investors. In addition, the Company is attempting to broaden its market to increase sales and working capital. If the Company is not successful in increasing sales and obtaining additional financing its ability to continue as a going concern is in doubt.

(Note 4) Bank Loans

The Company has a revolving bank line of credit providing for a maximum borrowing of $200,000, of which the current outstanding balance is $183,839. Interest is payable monthly at prime plus two percent. Borrowings are secured by a pledge of the Company’s assets. The Company has not made any principal payments on the loan since December 2003 and has not made any interest payments since February 2004.

(Note 5) Loans Payable, Related Parties

The Company's repaid $20,000 of related party indebtedness during the first nine months of 2004. At September 30, 2004, $1,114,974 including accrued interest, is outstanding.

(Note 6) Long-Term Debt

Note payable to a bank for the purchase of fixed assets. The note is due in equal monthly installment of $570, including interest at a rate of 8.94%. The note matures January 2010. The note is secured by the related asset.

(Note 7) Common Stock Options

Pursuant to the Company's 1996 Performance Equity Plan, on March 31st of each calendar year during the term of the 1996 Plan, assuming there are enough shares and/or options then available for grant under the 1996 Plan, each person who is then a director of the Company is awarded stock options to purchase 2,000 shares of common stock at the fair market value thereof, all of which options are immediately exercisable as of the date of grant and have a term of ten years. These are the only awards that may be granted to a director of the Company under the 1996 Plan. At September 30, 2004 there were 60,012 shares exercisable and outstanding under the plan and no options available for future grants.

The Company's 1998 Performance Equity Plan provides for the issuance of up to 400,000 shares of common stock to employees, officers, directors and consultants. The awards may consist of incentive stock options, nonqualified options, restricted stock awards, deferred stock awards, stock appreciation rights and other awards as described in the 1998 Plan. The board of directors determines vesting periods. At September 30, 2004, there were 100,000 options outstanding, exercisable at $1.00 per share and 100,000 options outstanding, exercisable at $.01 per share. There are no options available for future grants under the 1998 Plan. The Company's 2002 Stock Award and Incentive Plan was adopted and ratified in June 2002. The 2002 Plan provides for a broad range of awards, including incentive and

BIOMETRICS 2000 CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

(Note 7) Common Stock Options (continued)

non-qualified options, restricted and deferred stock, performance awards, stock appreciation rights and other types of equity awards. A total of 2,000,000 of shares of Common Stock are reserved and available for grant under the 2002 Plan. The 2002 Plan carries forward the automatic annual grant of 2000 options to each director provided by the 1996 Plan.

At September 30, 2004 a total of 355,012 options were outstanding under the above plans and the freestanding grant. Options to purchase 272,000 shares at $.01 per share are excluded from the above totals, as such shares are deemed issued and outstanding due to the nominal exercise price of such options.

At September 30, 2004, the following warrants were outstanding:

Shares Reserved Exercise Price Expiration Date

Private Placement

Unit Warrants 666,667 1.00April 16, 2005

Placement Agent

Warrants 5,000 1.00April 16, 2005

Total 671,667

(Note 8) Litigation

On September 20, 2002, the Company was named as the defendant in a breach of contract complaint brought by UltraStar Entertainment, LLC. The complaint, presently pending in New York County Supreme Court, asserts damages of not less than $220,000, plus costs and interest, arising from the Company’s alleged failure to deliver a certain software package as specified in the related agreement between the parties as well as the Company’s alleged failure to pay over certain monies to the plaintiff. Management does not believe that any significant loss to will result. No trial date has been scheduled. Approximately one half of the claim has been accrued and recorded.

In July 2003, Graybar Electric Company filed a $5,101 summons and complaint against ICS, (a subsidiary of the Company). Graybar is one of ICS's vendors and the complaint asserts a claim for restitution for various materials needed to complete sales jobs purchased by ICS plus interest and penalties. Neither depositions nor a trial date have been scheduled. The amount of $4,300 has been accrued.

On July 7, 2003, Sandata Home Health Care Systems, Inc. filed a summons and complaint against the Company alleging breach of contract of goods sold to ICS. A judgment for the outstanding balance of $41,640 plus interest and legal fees was issued in December 2003. The latest judgment is a total of $50,304, inclusive of interest and fees of which the amount of $41,640 has been accrued.

In May 2003 there was a $4,247 judgment filed against the Company by Kemper Insurance Companies for an outstanding balance plus interest on a Worker's Compensation Insurance policy that was in effect from November 29, 1999 through November 29, 2000. The total amount of the judgment has been accrued.

BIOMETRICS 2000 CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

(Note 8) Litigation (continued)

In April 2002, ICS, was named as the defendant in a breach of contract complaint brought by Metro-North Commuter Railroad, which had ordered computer equipment pursuant to a fixed bid. The complaint specified damages of $91,052 plus costs. Management does not believe that any significant loss will result and therefore no accrual has been booked. No trial date has been scheduled.

The landlord of the Bohemia office facilities leased by the Company has obtained a judgment on the Company for past due rent, interest and legal costs and fees amounting to $38,100. On September 1, 2003, the Company had been released from its lease on Suite 1B. On October 15, 2003, the Company had been released from its lease on Suite 1A. No further expense will be incurred as of those dates, although the Company is still liable for past due rent.

Federal Express, a service provider to Biometrics, a subsidiary of the Company, has obtained a judgment on Biometrics for past due invoices, interest and legal costs and fees amounting to $4,692.78. Biometrics has been making monthly payments toward such judgment. The past due invoices plus interest and legal fees are included in accounts payable.

Wayne Alarm Systems, Inc., a service provider to Biometrics, has obtained a judgment on Biometrics for past due invoices, interest and legal costs and fees amounting to $2,120.92. Biometrics has been making monthly payments toward such judgment. The past due invoices plus interest and legal fees are included in accounts payable.

Alan Glasser has obtained a judgment on Biometrics in connection with a note to Biometrics in the amount of $33,081.67. The principal balance and interest on the note is included in loans payable to stockholders and accrued expenses. During the nine months ending September 30, 2004, $10,000 was paid on the outstanding balance.

In July 2004, Nicolai Law Group, former general legal counsel to Biometrics, initiated legal proceedings for payment of outstanding legal fees including interest of $199,787.49. The past due invoices and interest are included in accounts payable.

CIT Group/Commercial Services, Inc., a service provider to Biometrics, has obtained a judgment on Biometrics for past due invoices, interest and legal costs and fees amounting to $4,182.13. Biometrics has been making monthly payments toward such judgment. The past due invoices plus interest and legal fees are included in accounts payable.

W.W. Grainger, Inc., a service provider to Biometrics, has obtained a judgment on Biometrics for past due invoices, interest and legal costs and fees amounting to $3,090.16. Biometrics has been making monthly payments toward such judgment. The past due invoices plus interest and legal fees are included in accounts payable.

The Company is involved in other various legal proceedings and claims incident to the normal conduct of its business. The Company believes that such legal proceedings and claims, individually and in the aggregate, are not likely to have a material adverse effect on its financial position or results of operations.

(Note 9) Research and Development Costs

The Company has entered into an oral agreement with its supplier of fingerprint readers, to purchase the rights to their manufacturing technology and software. The Company has the rights to modify the hardware and software. In addition, the Company has the exclusive distribution rights to North and South America, whereas the supplier will not sell directly to any customer in this geographic region. In exchange for the technology and distribution rights, Biometrics has issued to the supplier 10,000,000 share of common stock. These shares have been valued at $.05 per share for a total of $500,000. The agreement does not allocate costs to either the technology or distribution rights. Management has determined that it would be proper to expense these costs as research and development costs in the current period.

BIOMETRICS 2000 CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - UNAUDITED

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2004 AND 2003

(Note 10) Capital Stock Transactions

In May 2004, the Company issued 44,643 shares of common stock to satisfy $2,500 of consulting fees.

In June 2004, the Company issued an aggregate of 4,909,000 shares of common stock to various individuals for services performed for the Company. Management determined the then fair value of Biometrics’ common stock to be $.05 per share. Total compensation for this issuance of stock was $245,450.

In June 2004, the Company issued 8,815,000 shares of common stock for the conversion of $236,500 of shareholder debt to equity. Shares of common stock were issued in satisfaction of stockholder debt at an average conversion price ranging from $.02 to $.05 per share.

In July 2004, the Company issued 49,345 shares of common stock to satisfy $2,500 of consulting fees.

In July, August and September 2004, the Company issued an aggregate of 6,425,357 shares of common stock to various individuals for services performed for the Company. Management determined the then fair value of Biometrics’ common stock to be from $.006 to $.045 per share. This is a 25% discount from the market price on the date of issuance for the services performed. The Company recorded a stock discount expense for this in the amount of $39,340 for the period. Total compensation for this issuance of stock was $152,500 including the discount expense.

In July, August and September 2004, the Company issued 27,070,000 shares of common stock for the conversion of $378,700 of shareholder debt to equity. Shares of common stock were issued in satisfaction of stockholder debt at an average conversion price ranging from $.006 to $.045 per share. This is a 25% discount from the market price on the date of issuance for the debt converted.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

5. The following discussion and analysis should be read in conjunction with our condensed financial statements and the notes thereto appearing elsewhere in this report. The discussion of results, causes and trends should not be construed to imply any conclusion that such results or trends will necessarily continue in the future. This report contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We caution you that forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from the statements that constitute forward-looking statements as a result of various factors.

Recent Accounting Pronouncements:

There have been no recent Accounting Pronouncements that would have a significant effect on the Company.

Overview

On March 4, 2004, VillageWorld closed on its reverse merger with Biometrics 2000.com Corporation ("Biometrics") which agreed to merge Biometrics with a subsidiary of VillageWorld. Pursuant to the merger agreement, the shareholders of Biometrics have been issued shares of common stock of VillageWorld in such an amount as to equal approximately fifty-five percent (55%) of the issued and outstanding common stock of VillageWorld at such time. The closing of the transaction occurred on March 4, 2004. The merged companies will seek to expand their business with the goal of returning to profitability. In the Amendment to the Certification of Incorporation VillageWorld has changed its name to Biometrics 2000 Corporation (the "Company") and increased the aggregate number of shares of common stock from 201,000,000 to 400,000,000 par value $.001.

General

Biometrics which was founded in 2000, is a Springfield, MA based developer and reseller of biometric products for access control. Management believes that the Company has the opportunity to leverage its core competencies to capture a leading position in a rapidly growing, but as yet underdeveloped, segment of the electronic security market by establishing a position in pre-existing distribution channels which are used for related products and accessories to the Company's products. The Company seeks to become a leader in developing and delivering state-of-the-art biometric solutions for the physical access control segment of the Security Electronics Industry. The Company's hardware and software applications include BioXTouch fingerprint readers and its Touch Device Management (TDM ) software control package. The Company will use its knowledge of the access control market and the long association of its management with the distribution channels to maximize the credibility and acceptance of its products from distributors and dealers who control the majority of sales into the market. Management believes that it understands the installed base, has working knowledge of the available technology and an understanding of the potential role of biometric solutions for access control and related security functions.

The identification and security products that it develops recognize people through their unique characteristics such as fingerprints. Fingerprint readers solve the significant problems associated with traditional access methods from a security standpoint. Fingerprint technology also will also be preferred in the future over other methods such as smart cards, magnetic stripe cards and conventional keys, all of which can be lost or stolen.

Summary of Critical Accounting Policies; Significant Judgments and Estimates

Our discussion and analysis of our financial condition and results of operations are based upon our Consolidated Financial Statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make significant estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. These items are regularly monitored and analyzed by management for changes in facts and circumstances, and material changes in these estimates could occur in the future. Changes in estimates are recorded in the period in which they become known. We base our estimates on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ from our estimates if past experience or other assumptions do not turn out to be substantially accurate.

A summary of those accounting policies that we believe are most critical to fully understanding and evaluating our financial results is set forth below.

Revenue Recognition and Allowance for Doubtful Accounts. - Revenues are recognized when products are shipped. The allowance is reviewed continually, and accordingly, an allowance for doubtful account is accrued based upon the collect ability of the receivable.

Results of Operations

Three Months Ended September 30, 2004 Compared to Three Months Ended September 30, 2003:

Revenues for the three ended September 30, 2004 were $118,180 compared to $57,233 for the three ended September 30, 2003, an increase of $60,947 or 106%. This increase was principally due to the Company’s shipments amounting to $55,265, on its new $600,000 contract signed May 2004.

Cost of sales were $65,340, representing 55% of total revenues for the three ended September 30, 2004, compared to $35,740 or 62% of total revenues for the three ended September 30, 2003. This decrease in cost of sales as a percentage of sales was primarily attributable to the product mix of high margin products.

Selling, general and administrative expenses (SG&A) were $273,338 for the three ended September 30, 2004, an increase of 344% from $61,515 for the three ended September 30, 2003. This increase was primarily attributable an increase in salaries, which were paid in the form stock grants to employees amounting to $115,000. Professional fees increased by $56,024 from the comparative three month period of 2003. SEC expenses increased by $9,416 from the comparative three month period of 2003.

Interest expense was $28,700 for the three months ended September 30, 2004, an increase of 1324% from $2,016 for the three ended September 30, 2003. This increase in interest expense was primarily due to the assumption of loans payable from VillageWorld and an increase in loans from stockholders.

The net loss for the three ended September 30, 2004 was $251,661 compared to $43,455 for the three ended September 30, 2003. The primary reasons for the increase in the current period loss were: (i) the increase in salaries of $126,734; (ii) professional fees of $56,024; and (iii) an increase in SEC expenses.

Nine Months Ended September 30, 2004 Compared to Nine Months Ended September 30, 2003:

Revenues for the nine ended September 30, 2004 were $242,925 compared to $128,991 for the nine ended September 30, 2003, an increase of $113,934 or 88%. This increase was principally due to the Company’s initial shipments amounting to $100,225, on its new $600,000 contract signed May 2004.

Cost of sales were $146,303, representing 60% of total revenues for the nine ended September 30, 2004, compared to $84,887 or 66% of total revenues for the nine ended September 30, 2003. This decrease in cost of sales as a percentage of sales was primarily attributable to the product mix of higher margin products.

Selling, general and administrative expenses (SG&A) were $826,888 for the nine ended September 30, 2004, an increase of 346% from $185,469 for the nine ended September 30, 2003. This increase was primarily attributable an increase in salaries and stock discount expense, which were paid in the form stock grants to employees of $360,450 and to an individual as a commission for the merger amounting to $175,000. The addition of the SG&A expenses of VillageWorld amounting to $68,819 for the nine months ended September 30, 2004. Professional fees increased by $60,354 from the comparative nine month period of 2003, relating to merger costs. Travel increased by $28,367 from the comparative nine month period of 2003. Marketing and advertising expenses increased by $39,502 from the comparative nine month period of 2003 relating to the promotion of the Company’s products.

Interest expense was $82,994 for the nine months ended September 30, 2004, an increase of 1464% from $5,306 for the nine ended September 30, 2003. This increase in interest expense was primarily due to the assumption of loans payable from VillageWorld and an increase in loans from stockholders.

Research and development increased by $500,046 from the purchase of technology from its main supplier of fingerprint readers and associated software amounting to $500,000 in the form of a stock grant of 10,000,000 shares of common stock.

The net loss for the nine ended September 30, 2004 was $1,310,919 compared to $149,088 for the nine ended September 30, 2003. The primary reasons for the increase in the current period loss were: (i) the increase in salaries and stock discount expense of $409,477, primarily in the form of stock grants; (ii) research and development costs of $500,046; and (iii) an increase in travel and marketing expenses.

Liquidity and Capital Resources

Cash and cash equivalents at September 30, 2004 were $13,068 compared to $3,638 at December 31, 2003. This increase in cash was primarily attributable to an increase in loans from stockholders.

Accounts receivable increased to $102,064 at September 30, 2004 from $15,335 at December 31, 2003, due to an increase in sales and timing in collecting of receivables.

Inventory increased to $54,829 at September 30, 2004 from $20,932 at December 31, 2003, due to a buildup of product awaiting shipment in relation to the new contract.

The combination of accounts payable and accrued expenses increased to $944,432 from $697,144 at December 31, 2003. This increase was primarily attributable to the acquisition of accounts payable and accrued expenses in the merger with VillageWorld.

Notes and loans payable increased to $1,155,805 from $166,886 at December 31, 2003, primarily attributable to the acquisition of notes and loans payable in the merger with VillageWorld. In addition, $615,200 of shareholder debt was converted to equity during the nine months ended.

At September 30, 2004, we had a working capital deficit of $2,851,840 and a current ratio of 0.06 to 1.

Our operating activities used cash of $444,969 for the nine months ended September 30, 2004 as compared to $95,984 used by operating activities for the nine months ended September 30, 2003. This increase in use of cash was primarily due to the funding of our net loss from operations, the increase in accounts receivable and inventory.

For the nine months ended September 30, 2004, $465,695 was provided by investing activities compared to $18,382 for the same period in 2003. This change was primarily due to loans made by stockholders to finance the loss from operations and provide working capital.

For the nine months ended September 30, 2004, $11,296 was used by financing activities to reduce a portion of the loan from a related party.

As a result of the reverse merger with VillageWorld, the Company will require additional working capital. These funds will be needed to finance operations and hire additional employees to market and promote the Company’s products. The Company is seeking additional working capital through the private placement of equity securities. However, there can be no assurance that the Company will be able to do so, that the terms to the Company in such a financing will be favorable to the Company or that the proceeds of such financing will provide sufficient working capital for more than a limited period of time.

ITEM 3. CONTROLS AND PROCEDURES

Within 90 days prior to the date of this report, the Company carried out an evaluation, under the supervision and with the participation of its principal executive officer and principal financial officer, of the effectiveness of the design and operation of the Company's disclosure controls and procedures. Based on this evaluation, the Company's principal executive officer and principal financial officer concluded that the Company's disclosure controls and procedures are effective in timely alerting them to material information required to be included in this quarterly report. It should be noted that the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.

In addition, the Company reviewed its internal controls, and there have been no significant changes in those internal controls or in other factors that could significantly affect those controls subsequent to the date of their last evaluation.

PART II.

OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

In July 2003, Graybar Electric Company filed a $5,101 summons and complaint against ICS (a subsidiary of the Company). Graybar is one of ICS's vendors and the complaint asserts a claim for restitution for various materials needed to complete sales jobs purchased by ICS plus interest and penalties. Neither depositions nor a trial date have been scheduled. The amount of $4,300 has been accrued.

Alan Glasser has obtained a judgment on Biometrics in connection with a note to Biometrics in the amount of $33,081.67. The principal balance and interest on the note is included in the loans payable to stockholders and accrued expenses. During the nine months ending September 30, 2004, $10,000 was paid on the outstanding balance.

ITEM 2. CHANGES IN SECURITIES AND SMALL BUSINESS ISSUER PURCHASES OF EQUITY SECURITIES

In January 2004 we issued an aggregate of 52,000 shares for options previously granted to employees. These options were exercised at an option price ranging from $.01 to $.10. Proceeds amounting to $1,700 were used for operations.

In May 2004, the Company issued 44,643 shares of common stock to satisfy $2,500 of consulting fees.

In June 2004 the Company issued an aggregate of 4,909,000 shares of common stock were issued to various individuals for services performed for the Company. Management determined the then fair value of Biometrics’ common stock to be $.05 per share. Total compensation for this issuance of stock was $245,450.

In July 2004, the Company issued 55,357 shares of common stock to satisfy $2,500 of consulting fees.

During the nine months ended September 30, 2004, the Company did not repurchase any of its equity securities.

ITEM 3. DEFAULTS BY THE COMPANY UPON ITS SENIOR SECURITIES

None.

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

6. On October 29, 2003, stockholders representing a majority of the issued and outstanding common stock of the Company executed a written consent providing for an amendment to the Company's Certificate of Incorporation: (i) changing its name to Biometrics 2000 Corporation; and (ii) increasing the authorized capital of the Company to 400,000,000 shares of common stock, par value $0.001 per share. The Company filed Schedule 14C, an information statement, with the Securities and Exchange Commission on February 12, 2004, in connection with the merger with Biometrics 2000.com Corporation.

ITEM 5. OTHER INFORMATION

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

a) Exhibits

Exhibit 31.1 Certification of Joseph J. Turek pursuant to Rule 13-14(a) and Item 307

of Regulation SB

Exhibit 32.1 Certification by Joseph J. Turek Pursuant to the 18 U.S.C. Section

1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

b) Reports on Form 8-K

None

SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

BIOMETRICS 2000 CORPORATION

(Registrant)

Dated: November 19, 2004

By: /s/ Joseph J. Turek.

Joseph J. Turek

Chairman, Chief Executive Officer and President

(Principal Executive Officer and Principal Accounting and Financial Officer)