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UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, DC 20549

FORM 10-QSB

x Quarterly Report
  under Section 13 or 15(d) of the Securities Exchange Act of 1934 
  For the quarterly period ended MARCH 31, 2004

 ̈ Transition Report
  under 13 or 15(d) of the Securities Exchange Act of 1934 
  For the transition period ________ to ________

Commission File Number 0-50119

IMAGE INNOVATIONS HOLDINGS INC.(Exact name of small Business Issuer as specified in its charter)

|NEVADA                                   | 91-1898414                       
|---------------------------------------- | ---------------------------------
|(State or other jurisdiction of          | (IRS Employer Identification No.)
|incorporation or organization)           |                                  
|                                         |                                  
|SUITE 615, 100 PARK ROYAL                |                                  
|WEST VANCOUVER, BRITISH COLUMBIA         |                                  
|CANADA                                   | V7T 1A2                          
|(Address of principal executive offices) | (Zip Code)                       

Issuers telephone number, including area code: (604)
  925-5283

NOT APPLICABLE(Former name, former address and former fiscal year, if changed since
  last report)

Check whether the issuer (1) 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 issuer was required
  to file such reports), and (2) has been subject to such filing requirements
  for the past 90 days x
  Yes       ̈
  No

State the number of shares outstanding of each of the issuers
  classes of common stock, as of the latest practicable date: 24,235,000 Shares
  of $0.001 par value Common Stock outstanding as of May 8, 2003.

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

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PART I - FINANCIAL INFORMATION

ITEM 1.     FINANCIAL STATEMENTS.

2

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IMAGE INNOVATIONS INC.

Financial Statements





March 31, 2004



F-1

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IMAGE INNOVATIONS HOLDINGS INC. (A development stage enterprise) Consolidated Balance Sheet (Unaudited)

|                                                         | March 31 |            | December 31 |  
|-------------------------------------------------------- | -------- | ---------- | ----------- | -
|                                                         | 2004     |            | 2003        |  
|                                                         |          |            |             |  
|ASSETS                                                   |          |            |             |  
|                                                         |          |            |             |  
|Current Assets                                           |          |            |             |  
|Cash                                                     | $        | 143,446    |             | $
|Accounts receivable trade                                |          | 119,793    |             |  
|Amounts receivable from tax authorities                  |          | 19,941     |             |  
|Inventory                                                |          | 3,004,041  |             |  
|Prepaid expenses                                         |          | 346,471    |             |  
|Total current assets                                     |          | 3,633,692  |             |  
|Equipment (Note 5)                                       |          | 56,909     |             |  
|Total Assets                                             | $        | 3,690,601  |             | $
|                                                         |          |            |             |  
|LIABILITIES AND SHAREHOLDERS EQUITY                      |          |            |             |  
|                                                         |          |            |             |  
|Current Liabilities                                      |          |            |             |  
|                                                         |          |            |             |  
|Accounts Payable                                         | $        | 126,141    |             | $
|Demand loan H.E. Capital S.A.
      (Note 6)             |          | 8,934      |             |  
|Total current liabilities                                |          | 135,075    |             |  
|                                                         |          |            |             |  
|Stockholders' equity                                     |          |            |             |  
|Common Stock (note 7)                                    |          | 24,020     |             |  
|50,000,000 authorized shares, par
      value $          |          |            |             |  
|24,020,000 shares issued and outstanding                 |          |            |             |  
|1,650,000 share warrants issued and
      outstanding    |          |            |             |  
|                                                         |          |            |             |  
|Preferred Stock                                          |          | -          |             |  
|1,000,000 authorized preferred shares,
      par value $ |          |            |             |  
|Nil shares issued and outstanding                        |          |            |             |  
|                                                         |          |            |             |  
|Additional Paid in Capital                               |          | 4,747,718  |             |  
|                                                         |          |            |             |  
|Accumulated Deficit                                      |          | (1,216,212 | )           |  
|Total stockholders' equity                               |          | 3,555,526  |             |  
|Total liabilities and equity                             | $        | 3,690,601  |             | $

The accompanying notes are integral part of the consolidated
  financial statements.

F-2

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IMAGE INNOVATIONS HOLDINGS INC. (A development stage enterprise) Consolidated Statement of Operations (Unaudited)

|                                            |               |            |                    |   |               |   | Period From |           
|------------------------------------------- | ------------- | ---------- | ------------------ | - | ------------- | - | ----------- | ----------
|                                            | Three Months  |            | Period From        |   | January 14    |  
|                                            | Ended         |            | January 14 2003 to |   | 2003 to       |  
|                                            | March 31 2004 |            | March 31 2003      |   | March 31 2004 |  
|                                            |               |            |                    |   |               |   |             |           
|Revenues:                                   |               |            |                    |   |               |   |             |           
|Revenues                                    | $             | 180,968    |                    | $ | -             |   | $           | 286,127   
|                                            |               | 180,968    |                    |   | -             |   |             | 286,127   
|                                            |               |            |                    |   |               |   |             |           
|Cost of sales                               |               | 117,712    |                    |   | -             |   |             | 172,480   
|                                            |               |            |                    |   |               |   |             |           
|Gross Margin                                |               | 63,256     |                    |   | -             |   |             | 113,647   
|                                            |               |            |                    |   |               |   |             |           
|Expenses:                                   |               |            |                    |   |               |   |             |           
|Advertising & Marketing                     |               | 12,086     |                    |   | 923           |   |             | 30,779    
|Automobile operating expenses               |               | 1,800      |                    |   | 454           |   |             | 4,562     
|Brokerage                                   |               | -          |                    |   | -             |   |             | 3,006     
|Contract fees                               |               | 25         |                    |   | -             |   |             | 25        
|Corporate Development                       |               | 318,140    |                    |   | -             |   |             | 318,140   
|Depreciation                                |               | 1,213      |                    |   | 3             |   |             | 2,555     
|Insurance                                   |               | 8,021      |                    |   | -             |   |             | 21,833    
|Legal and Audit                             |               | 37,215     |                    |   | 1,071         |   |             | 43,569    
|Maintenance & Repairs                       |               | 1,355      |                    |   | -             |   |             | 1,355     
|Office & General Expenses                   |               | 26,280     |                    |   | 1,391         |   |             | 55,660    
|Payroll & Consulting                        |               | 146,327    |                    |   | 43,042        |   |             | 450,659   
|Postage and Courier                         |               | 6,055      |                    |   | 412           |   |             | 6,055     
|Product Delivery                            |               | 2,673      |                    |   | -             |   |             | 3,912     
|Product Development                         |               | 13,942     |                    |   | 3,778         |   |             | 66,245    
|Rent and Utilities                          |               | 7,174      |                    |   | 400           |   |             | 26,885    
|Royalties                                   |               | -          |                    |   | -             |   |             | 125,000   
|Telecommunications                          |               | 4,320      |                    |   | 3,379         |   |             | 16,626    
|Transfer Agent and Filing Fees              |               | 1,700      |                    |   | -             |   |             | 4,274     
|Travel                                      |               | 50,575     |                    |   | 16,152        |   |             | 124,994   
|Warehousing                                 |               | 1,872      |                    |   | -             |   |             | 3,725     
|Total Expenses                              |               | 640,773    |                    |   | 71,005        |   |             | 1,309,859 
|Net Income before Taxes                     |               | (577,517   | )                  |   | (71,005       | ) |             | (1,196,212
|                                            |               |            |                    |   |               |   |             |           
|Provision for Income Taxes:                 |               |            |                    |   |               |   |             |           
|Income Tax                                  |               | -          |                    |   | -             |   |             | -         
|Net Income (Loss)                           | $             | (577,517   | )                  | $ | (71,005       | ) | $           | (1,196,212
|                                            |               |            |                    |   |               |   |             |           
|Basic and Diluted Earnings Per Common Share | $             | (0.03      | )                  | $ | (71.01        | ) | $           | (0.11     
|                                            |               |            |                    |   |               |   |             |           
|Weighted Average number of Common Shares    |               |            |                    |   |               |   |             |           
|used in per share calculations              |               | 20,986,667 |                    |   | 1,000         |   |             | 11,140,661

The accompanying notes are integral part of the consolidated
  financial statements.

F-3

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IMAGE INNOVATIONS HOLDINGS INC.(A development stage enterprise) Consolidated Statement of Changes in Shareholders' Equity (Unaudited)

|                                           |            |   |   | $0.001    |  |   | Additional            |   |   | Accumulated |   |   | Shareholders' |  
|------------------------------------------ | ---------- | - | - | --------- |  | - | --------------------- | - | - | ----------- | - | - | ------------- | -
|                                           | Shares     |   |   | Par Value |  |   | Paid-In
      Capital |   |   | Deficit     |   |   | Equity        |  
|Shares issued on incorporation on          |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|January 14, 2003                           | 1,000      |   | $ | -         |  | $ | 1,000                 |   | $ | -           |   | $ | 1,000         |  
|                                           |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|Prior Image share capital, replaced by     |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|Image Holdings share capital upon          |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|consolidation under reverse takeover       |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|accounting                                 | (1,000     | ) |   | -         |  |   | -                     |   |   | -           |   |   | -             |  
|                                           |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|Current Image share capital, replaced by   |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|Image Holdings share capital upon          |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|consolidation under reverse takeover       |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|accounting                                 | 18,170,000 |   |   | 18,170    |  |   | (1,000                | ) |   | (17,170     | ) |   | -             |  
|                                           |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|Net monetary liabilities of Busanda        |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|acquired by Image                          | -          |   |   | -         |  |   | -                     |   |   | (22,377     | ) |   | (22,377       | )
|                                           |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|                                           |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|Transferred to Additional Paid In Capital  | -          |   |   | -         |  |   | (39,547               | ) |   | 39,547      |   |   | -             |  
|                                           |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|                                           |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|Adjustment to Retained Deficit to          |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|recognize costs related to the transaction | -          |   |   | -         |  |   | -                     |   |   | (20,000     | ) |   | (20,000       | )
|                                           |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|Shares issue for payment of debt           | 1,200,000  |   |   | 1,200     |  |   | 898,800               |   |   | -           |   |   | 900,000       |  
|                                           |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|Net Income (Loss)                          | -          |   |   | -         |  |   | -                     |   |   | (618,695    | ) |   | (618,695      | )
|Balance, December 31, 2003                 | 19,370,000 |   |   | 19,370    |  |   | 859,253               |   |   | (638,695    | ) |   | 239,928       |  
|                                           |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|                                           |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|                                           |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|Shares issued for consulting services      | 200,000    |   | $ | 200       |  | $ | 202,636               |   | $ | -           |   | $ | 202,836       |  
|                                           |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|Shares issued for payment of debt          | 266,667    |   |   | 267       |  |   | 399,733               |   |   | -           |   |   | 400,000       |  
|                                           |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|Shares issued for cash                     | 183,333    |   |   | 183       |  |   | 274,817               |   |   | -           |   |   | 275,000       |  
|Shares issued to acquire Inventory         |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|and business operations of MDK             |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|Sports                                     | 4,000,000  |   |   | 4,000     |  |   | 3,011,279             |   |   | -           |   |   | 3,015,279     |  
|                                           |            |   |   |           |  |   |                       |   |   |             |   |   |               |  
|Net Income (Loss)                          | -          |   |   | -         |  |   | -                     |   |   | (577,517    | ) |   | (577,517      | )
|Balance March 31, 2004                     | 24,020,000 |   | $ | 24,020    |  | $ | 4,747,718             |   | $ | (1,216,212  | ) | $ | 3,555,526     |  

The accompanying notes are integral part of consolidated financial
  statements.

F-4

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|                                                             |                |           |               | Period From |                 | Period From |  
|------------------------------------------------------------ | -------------- | --------- | ------------- | ----------- | --------------- | ----------- | -
|                                                             | Three Months   |           | January 14    |             | January 14 2003 |            
|                                                             | Ended March 31 |           | 2003 to March |             | to March 31     |            
|                                                             | 2004           |           | 31 2003       |             | 2004            |            
|                                                             |                |           |               |             |                 |             |  
|Cash Flows from Operating Activities:                        |                |           |               |             |                 |             |  
|Net Income (Loss)                                            | $              | (577,517  | )             | $           | (71,005         | )           | $
|Adjustments to reconcile net loss
      to net cash          |                |           |               |             |                 |             |  
|provided (used) to operating activities:                     |                |           |               |             |                 |             |  
|Depreciation                                                 |                | 1,213     |               |             | 3               |             |  
|Stock Issued for
      Corporate Development Services        |                | 202,836   |               |             | -               |             |  
|Increase
      (Decrease) in Working Capital                 |                | 9,608     |               |             | (18,752         | )           |  
|Total
      Adjustments                                      |                | 213,657   |               |             | (18,749         | )           |  
|Net Cash Used in Operating Activities                        |                | (363,860  | )             |             | (89,754         | )           |  
|                                                             |                |           |               |             |                 |             |  
|                                                             |                |           |               |             |                 |             |  
|Cash Flows from Investing Activities:                        |                |           |               |             |                 |             |  
|Equipment (Note
      5)                                     |                | (40,805   | )             |             | (1,719          | )           |  
|Net Cash Used in Investing Activities                        |                | (40,805   | )             |             | (1,719          | )           |  
|                                                             |                |           |               |             |                 |             |  
|                                                             |                |           |               |             |                 |             |  
|Cash Flows from Financing Activities:                        |                |           |               |             |                 |             |  
|Proceeds from H.E Capital Demand Loan                        |                | -         |               |             | -               |             |  
|Advances Payable                                             |                | -         |               |             | 103,919         |             |  
|Proceeds from
      Issuance of Stock                        |                | 275,000   |               |             | 1,000           |             |  
|Net Cash Provided for Financing Activities                   |                | 275,000   |               |             | 104,919         |             |  
|                                                             |                |           |               |             |                 |             |  
|Net Increase (Decrease) in Cash                              |                | (129,665  | )             |             | 13,446          |             |  
|                                                             |                |           |               |             |                 |             |  
|Cash Balance, Beginning of Period                            |                | 273,111   |               |             | -               |             |  
|Cash Balance, End of Period                                  | $              | 143,446   |               | $           | 13,446          |             | $
|                                                             |                |           |               |             |                 |             |  
|                                                             |                |           |               |             |                 |             |  
|Supplemental Disclosures:                                    |                |           |               |             |                 |             |  
|Cash Paid for interest                                       | $              | -         |               | $           | -               |             | $
|Cash Paid for income taxes                                   | $              | -         |               | $           | -               |             | $
|Non-cash transactions                                        |                |           |               |             |                 |             |  
|Stock Issued for Corporate Development
      Services        | $              | 202,836   |               | $           | -               |             | $
|Stock Issued to Acquire Assets and
      Operations of MDK   | $              | 3,015,279 |               | $           | -               |             | $
|Stock Issued for Repayment of H.E.
      Capital Demand Loan | $              | 400,000   |               | $           | -               |             | $

The accompanying notes are integral part of the consolidated
  financial statements.

F-5

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IMAGE INNOVATIONS HOLDINGS INC. 
  (A development stage enterprise) 
  Notes to Consolidated Financial Statements
  (Unaudited)

As at March 31, 2004

|1. | Development Stage Enterprise
      The accompanying financial statements have been prepared
        on a going concern basis, which contemplates the realization of assets
        and the satisfaction of liabilities and commitments in the normal course
        of business. During its first period of operations the Company did not
        generate sufficient revenues to pay its operating costs and has accumulated
        operating losses. The continuation of the Company is dependent upon achieving
        a profitable level of operations as well as maintaining existing long-term
        financing. Management plans to raise equity capital to finance the operations
        and capital requirements of the Company. The Company has committed all
        of its net working capital as at March 31, 2004 to complete the development
        of the Companys business plan. While the Company is expending its
        best efforts to achieve the above plans, there is no assurance that any
        such activity will generate funds that will be available to sustain operations.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|2. | Basis of preparation and presentation:
      The accompanying consolidated financial statements have
        been prepared to reflect the legal acquisition on June 30, 2003 of Image
        Innovations Inc. (Image) by Image Innovations Holdings Inc.
        formerly Busanda Explorations Inc. (Image Holdings) (the Acquisition).
        The consolidated financial statements of Image Holdings give effect to
        the Acquisition under which the shareholders of Image exchanged all of
        their common shares of Image for common shares of Image Holdings.
      Notwithstanding its legal form, the Acquisition has
        been accounted for as a reverse takeover, as the former shareholders of
        Image own in aggregate approximately 55% of the common shares of Image
        Holdings, and so are now the majority shareholders of Image Holdings.
        Also, as Image Holdings was an inactive company with nominal net non-monetary
        assets, the Acquisition has been accounted for as an issuance of stock
        by Image accompanied by a recapitalization (see note 7 Common Stock).
        The net monetary liabilities of Image Holdings acquired by Image have
        been charged to the accumulated deficit.
      Image Innovations Sports & Entertainment Inc. (Image
        Sports) was incorporated under the laws of the State of Delaware
        on January 20, 2004 for the purpose to promote and carry on any lawful
        business for which a corporation may be incorporated under the laws of
        the State of Delaware. Image Sports has a total of 1,500 authorized common
        shares with no par value and has 1,000 common shares issued and outstanding
        as of March 31, 2004. Image Sports is a wholly owned subsidiary of Image
        Holdings.
      As required under reverse takeover accounting, these
        financial statements have been issued under the name of Image Holdings
        and reflect the share capital structure of Image Holdings. However, they
        reflect the financial statements of Image and account for the Acquisition
        as an acquisition of Image Holdings by Image. The consolidated financial
        statements therefore include:
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

| | (a) | a consolidated balance sheet prepared from the balance sheets of Image
      Holdings, Image and Image Sports as at March 31, 2004.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------

F-6

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IMAGE INNOVATIONS HOLDINGS INC. 
  (A development stage enterprise) 
  Notes to Consolidated Financial Statements
  (Unaudited)

As at March 31, 2004

| | (b) | consolidated statements of operations, cash flows
        and changes in shareholders equity (deficit) prepared from the statements
        of operations, cash flows and changes in shareholders equity (deficit)
        of Image Sports for the period from January 20, 2004 (date of incorporation
        of Image) to March 31, 2004. The results of operations, cash flows and
        changes in shareholders equity (deficit) of Image Holdings are included
        commencing June 30, 2003, the date of the Acquisition.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
| | (c) | The consolidated statement of operations has been
        prepared for the period to March 31, 2004.                                                                                                                                                                                                                                                                                                                                                                                                                                   
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

|3. | Acquisition of a Business
      Image Sports acquired the inventory and celebrity image
        memorabilia business carried on by MDK Sports & Entertainment Inc.
        (MDK Sports). The acquisition of assets was completed pursuant
        to an asset purchase agreement dated March 4, 2004 between Image Innovations
        Holdings, Image Sports and MDK Sports. As consideration of the sale, transfer
        and assignment of the assets by MDK Sports to Image Sports, Image Innovations
        Holdings issued to MDK Sports an aggregate of 4,000,000 restricted shares
        of Image Innovation Holdings common stock on closing.
      Image Sports has also agreed to deliver to MDK Sports
        the following additional shares of Image Innovations Holdings common stock
        upon achievement of the milestones set forth below, provided that no shares
        will be issuable in the event that the milestone is not achieved for whatever
        reason:
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

| | (a) | an aggregate of 2,500,000 shares of Image Innovations
        Holdings common stock will be issued to MDK Sports in the event that each
        of the conditions listed below are met:
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                        

| |  | I.  | The trademark License Agreement made on the 25th
        day of June 2003, by and among Roush Corporation d/b/a Roush Racing and
        Phizer Inc. and Authentic Legends is transferred to Image Sports;                                                                                                                                             
| |  | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  |     |                                                                                                                                                                                                                                                                                                                                                        
| |  | II. | The Authentic Legends Affiliations Agreement by and
        between Millennium International Sports and Entertainment, LLC and Carlo
        Beninati dated 5th day of November, 2003 whereby Carlo Beninati
        is to create a unique original work of art on canvas using the likeness
        of Mark Martin is transferred to Image Sports; and
| |  |     |                                                                                                                                                                                                                                                                                                                                                        

| | (b) | an aggregate of 1,500,000 shares of Image Innovations
        Holdings common stock will be issued to MDK Sports in the event that a
        Trademark License Agreement is made by and among Tony Stewarts Race
        team and Tony Stewarts Sponsor and Image Sports.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                            

| | Image Sports has acquired the complete inventory
        of MDK Sports consisting of over 22,000 pieces of collectible sports memorabilia
        and fine art. Image Sports also acquired all contracts and business arrangements
        that MDK Sports had with artists and sport celebrities. The management
        of MDK Sports have become employees of Image Sports with the objective
        of ensuring that the distribution channels developed by MDK Sports survives
        the acquisition and is expanded to enhance the distribution of the other
        subsidiaries in the Image Group of Companies.
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-7

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IMAGE INNOVATIONS HOLDINGS INC. 
  (A development stage enterprise) 
  Notes to Consolidated Financial Statements
  (Unaudited)

As at March 31, 2004

|4. | Summary of Significant Accounting Policies:
      Organization
      Image Holdings was incorporated under the laws of the
        State of Nevada on March 3, 1998 for the purpose to promote and carry
        on any lawful business for which a corporation may be incorporated under
        the laws of the State of Nevada.
      Prior to the Acquisition Image Holdings, then Busanda
        Explorations Inc., had entered into an agreement to purchase mineral property
        claims in the Laird Mining Division, British Columbia, Canada, but lost
        the claim due to lack of funding. Image Holdings had no other business.
        Image Holdings was therefore an inactive company with nominal net non-monetary
        assets, the shares of which were and continue to be publicly traded on
        the OTC Bulletin Board.
      Image was incorporated under the laws of the State of
        Delaware on January 14, 2003 for the purpose to promote and carry on any
        lawful business for which a corporation may be incorporated under the
        laws of the State of Delaware. Image has a total of 1,500 authorized common
        shares with no par value and has 1,000 common shares issued and outstanding
        as of June 30, 2003.
      Image has been established to become a recognized player
        in the field of promotional licensing and branding. Images goal
        is to add value to a wide variety of relatively low cost, but desirable
        or essential products, by endorsing them with the brand logos of sports
        teams and/or household trademarks.
      Image Innovations Sports & Entertainment Inc. was
        incorporated under the laws of the State of Delaware on January 20, 2004
        for the purpose to promote and carry on any lawful business for which
        a corporation may be incorporated under the laws of the State of Delaware.
        Image Sports has a total of 1,500 authorized common shares with no par
        value and has 1,000 common shares issued and outstanding as of March 31,
        2004. Image Sports is a wholly owned subsidiary of Image Holdings.
      Equipment
      Equipment is recorded at cost. The company provides
        for amortization using the straight-line method at rates designed to amortize
        the cost of the equipment over its estimated useful lives. The rates are
        as follows:
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|Furniture and equipment | 6 years
|----------------------- | -------
|Computer equipment      | 4 years
|Computer software       | 2 years

| | Inventory 
        Inventory is valued at the lower of cost and net realizable value and
        is determined on the first-in, first-out method.
      Accounting Method 
        The Companys financial statements are prepared using the accrual
        method of accounting. Revenues are recognized when earned and expenses
        when incurred. Fixed assets are stated at cost.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-8

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IMAGE INNOVATIONS HOLDINGS INC. 
  (A development stage enterprise) 
  Notes to Consolidated Financial Statements
  (Unaudited)

As at March 31, 2004

|   | Depreciation and amortization using the straight-line
        method for financial reporting purposes and accelerated methods for income
        tax purposes.
      Foreign Exchange 
        Assets and liabilities of the Company, which are denominated in foreign
        currencies, are translated at exchange rates prevailing at the balance
        sheet date. Non-monetary assets and liabilities are translated at historical
        rates. Revenues and expenses are translated at average rates throughout
        the year. The unrealized translation gains and loses are accumulated in
        a separate component of stockholders equity. Translation exchange
        gains and losses are reflected in net earnings.
      Earnings per Common Share 
        The Company adopted Financial Accounting Standards (SFAS) No. 128, Earnings
        Per Share, which simplifies the computation of earnings per share
        requiring the restatement of all prior periods.
      Basic earnings per share are computed on the basis of
        the weighted average number of common shares outstanding during each year.
      Diluted earnings per share are computed on the basis
        of the weighted average number of common shares and dilutive securities
        outstanding. Dilutive securities having an anti-dilutive effect on diluted
        earnings per share are excluded from the calculation.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|5. | Equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

| |                         |         |  | Accumulated  |  |                | 
| | ----------------------- | ------- |  | ------------ |  | -------------- | 
| |                         | Cost    |  | Amortization |  | Net book Value | 
| | Furniture and equipment | $40,699 |  | $581         |  | $40,118        | 
| |                         |         |  |              |  |                | 
| | Computer equipment      | 9,975   |  | 1,264        |  | 8,711          | 
| |                         |         |  |              |  |                | 
| | Computer software       | 8,789   |  | 709          |  | 8,080          | 
| |                         | $59,463 |  | $2,554       |  | $56,909        | 

|   | A total of $1,213 has been recognized as depreciation
        expense for the period ended March 31, 2004.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|6. | Demand Loan H. E. Capital S. A.
      We have been dependent upon H.E. Capital S.A. (H.E
        Capital), a related party in order to fund the business of Image
        to date. H.E. Capital has agreed to advance funds to Image in order to
        finance the start-up of our business operations pursuant to a loan agreement
        between H.E. Capital and Image.
      On March 4 the Company sold 266,667 Units consisting
        of one (1) Common Share and one (1) Warrant to H.E. Capital at a purchase
        price equal to US$1.50 per Unit, for an aggregate purchase price of US$400,000.
        In accordance with The Regulation S Subscription Agreement made between
        the Company an H.E. Capital. The Purchase Price was paid by H.E. Capital
        by cancellation of $400,000 of indebtedness of the Company to H.E. Capital.
      H.E. Capital had advanced to Image a total of $8,934
        as of March 31, 2004. The loans are secured

F-9

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IMAGE INNOVATIONS HOLDINGS INC. 
  (A development stage enterprise) 
  Notes to Consolidated Financial Statements
  (Unaudited)

As at March 31, 2004

|   | by a general security agreement granted by Image
        against all of its assets. There is no assurance that H.E. Capital will
        advance additional amounts in order to fund the business of Image.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                            
|7. | Common Stock                                                                                                                                                                                               
|   |                                                                                                                                                                                                            

| | a) | Image Holdings has authorized 50,000,000 common
        shares with a par value of $0.001 per share. At March 31, 2004, Image
        Holdings has issued 24,020,000 shares of common stock to various investors.                                                                                                                                                                                                                                                                                                                                                                                                    
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | b) | Image Holdings issued 4,000,000 common shares to acquire
        the inventory and business operations of MDK Sports on March 5, 2004.
        Image Holdings issued 200,000 common shares for services received in connection
        with the MDK Sports acquisition.                                                                                                                                                                                                                                                                                                                                              
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
| | c) | The company has a stock option plan, which allows
        the Company to issue options to employees, directors and consultants to
        purchase common shares of the Company. Stock purchase options are granted
        having exercise prices based on the previous 30 days market price from
        the date of grant. The stock options expire on December 31, 2005. One
        third of the stock options vest on June 1, 2004 with the remainder vesting
        equally over the following 18 months to January 1, 2006. The following
        summarizes changes in stock options since January 1, 2004:
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

| |                                  | Number of |  | Weighted       | 
| | -------------------------------- | --------- |  | -------------- | 
| |                                  | options   |  | average        | 
| |                                  |           |  | exercise price | 
| | Outstanding, beginning of period | -         |  | -              | 
| |                                  |           |  |                | 
| | Granted                          | 1,450,000 |  | $1.26          | 
| |                                  |           |  |                | 
| | Exercised                        | -         |  | -              | 
| |                                  |           |  |                | 
| | Forfeited                        | -         |  | -              | 
| | Outstanding, end of period       | 1,450,000 |  | $1.26          | 

| |  | As at March 31, 2004, none of the outstanding stock purchase options had
      vested.
| |  | --------------------------------------------------------------------------------------
| |  |                                                                                       

| | d) | Shares issued to third parties for services rendered
        and for settlement of debt are recorded based upon the previous 30 days
        market trading value of the shares from the date of the related agreements
        to issue the shares.
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

F-10

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IMAGE INNOVATIONS HOLDINGS INC. 
  (A development stage enterprise) 
  Notes to Consolidated Financial Statements
  (Unaudited)

As at March 31, 2004

|8. | Commitments
      a. License agreements
      Image has entered into a license agreement with NHL
        Enterprises, LP for the license of the National Hockey League name and
        other NHL logos and indicia for use in connection with batteries and other
        battery related products. The license is a non-exclusive license for the
        United States. The license is for a term expiring December 31, 2004.
      Image has entered into a license agreement with NHL
        Enterprises Canada, LP for the license of the National Hockey League name
        and other NHL logos and indicia for use in connection with batteries and
        other battery related products in Canada. The license is a non-exclusive
        license for Canada. The license is for a term expiring December 31, 2005.
      Image has also entered into a license agreement with
        NFL Properties LLC for the grant of a license to use the National Football
        League mark and other related marks in connection with batteries, flashlights
        with batteries, e-badge with batteries, radios with batteries, and universal
        remote controls with batteries. The license will be limited to the United
        States. The license was for a term expiring March 31, 2004 and Image has
        received a letter of intent extending the license for a term expiring
        March 31, 2005.
      Image has also entered into a license agreement with
        Riddell Sports Group. Riddell is the official supplier of Football helmets
        to the NFL and supplies helmets to most football teams of the NCAA and
        the CFL. Under the terms of the agreement Image Innovations Inc. will
        manufacture and distribute a pocket size AM/FM radio with ear jacks, replicating
        Riddell-style football helmet. The initial term of the agreement is for
        one year with renewal terms up to the year 2005 if certain conditions
        are fulfilled.
      Image has entered into a license agreement with ABC Sports
        the broadcast network of Monday Night Football, Super Bowl XXXVII, the
        National Basketball Association, the Bowl Championship Series, the National
        Hockey League, World Cup soccer, figure skating, professional golf, Indy
        Racing League and Formula One. The License secured will be for the development
        and marketing of officially licensed fiber optic apparel products in the
        United States and Canada for Monday Night Football, ABC Sports, ABC Wide
        World of Sports and ABCs Bowl Championship Series. The ABC Sports
        license expires on September 30, 2005.
      Image plans to pursue negotiations with further sports
        leagues and sports teams to obtain additional license rights.
      The annual payments for these licenses for the next
        three years are as follow:
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 2004 | $85,000 | 
| | ---- | ------- | 
| | 2005 | 130,000 | 
| | 2006 | 40,000  | 

F-11

---

IMAGE INNOVATIONS HOLDINGS INC. 
  (A development stage enterprise) 
  Notes to Consolidated Financial Statements
  (Unaudited)

As at March 31, 2004

| | b. Lease commitments
      Image entered into a lease commencing April 1, 2004 for a five year
        term for office space. The annual payments under this lease for the next
        five years are as follows:
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 2004 | $21,584 | 
| | ---- | ------- | 
| | 2005 | 32,376  | 
| | 2006 | 32,376  | 
| | 2007 | 32,376  | 
| | 2008 | 32,376  | 

| | Image Sports has entered into a lease commencing January 1, 2004 for a
      seven year term for office space. The annual payments under this lease for
      the next five years are as follows:
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | 2004 | $18,000 | 
| | ---- | ------- | 
| | 2005 | 18,000  | 
| | 2006 | 18,000  | 
| | 2007 | 18,000  | 
| | 2008 | 18,000  | 

F-12

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ITEM 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS
  OR PLAN OF OPERATION.

FORWARD-LOOKING STATEMENTS

The information in this Quarterly Report on Form 10-QSB 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. These forward-looking statements involve risks and uncertainties,
  including statements regarding Image Innovations Holdings' capital needs, business
  plans and expectations. Forward-looking statements are made, without limitation,
  in relation to operating plans, business development, availability of funds
  and operating costs. Any statements contained herein that are not statements
  of historical facts may be deemed to be forward-looking statements. In some
  cases, you can identify forward-looking statements by terminology such as "may",
  "will", "should", "expect", "plan", "intend", "anticipate", "believe", "estimate",
  "predict", "potential" or "continue", the negative of such terms or other comparable
  terminology. Actual events or results may differ materially. In evaluating these
  statements, you should consider various factors, including the risks outlined
  below, and, from time to time, in other reports Image Innovations Holdings files
  with the SEC, including Image Innovations Holdings Annual Report on Form
  10-KSB for the year ended December 31, 2003. These factors may cause Image Innovations
  Holdings' actual results to differ materially from any forward-looking statement.
  Image Innovations Holdings disclaims any obligation to publicly update these
  statements, or disclose any difference between its actual results and those
  reflected in these statements. The information constitutes forward-looking statements
  within the meaning of the Private Securities Litigation Reform Act of 1995.
  Given these uncertainties, readers are cautioned not to place undue reliance
  on such forward-looking statements.

OVERVIEW

Image Innovations Holdings Inc., formerly Busanda Explorations
  Inc., (We, Image Innovations Holdings or the Company)
  completed the acquisition of all of the issued and outstanding shares of Image
  Innovations Inc., a Delaware corporation (Image Innovations) effective
  June 30, 2003. Image Innovations was incorporated on January 14, 2003 to engage
  in the business of promotional licensing and branding with the objective of
  adding value to a wide variety of relatively low cost, but desirable or essential
  products, by endorsing them with the brand logos of sports teams and/ or other
  recognized trademarks. We have been involved in developing the business of Image
  Innovations since June 30, 2003.

ACQUISITION OF IMAGE INNOVATIONS

We completed the acquisition of all of the issued and outstanding
  shares of Image Innovations effective June 30, 2003 pursuant to offers made
  by us dated June 23, 2003 to all the shareholders of Image Innovations to purchase
  their shares in exchange for an aggregate of 10,000,000 shares of our common
  stock on the basis of 10,000 shares for each outstanding share of Image Innovations.
  It was a condition precedent of closing that all shareholders of Image Innovations
  accept our offer and that audited financial statements of Image Innovations
  had been delivered to us. We issued 10,000,000 shares of our common stock to
  the existing shareholders of Image Innovations in consideration of the transfer
  by the existing shareholders of all of their shares of Image Innovations to
  us. As a result of this transaction, Image Innovations is now a wholly owned
  subsidiary of Image Innovations Holdings.

IMAGE SPORTS

Image Innovations Sports & Entertainment Inc. (Image
  Sports), our wholly owned subsidiary, acquired all of the inventory, personal
  property and material contracts of the celebrity image memorabilia business
  carried by MDK Sports & Entertainment Inc. (MDK Sports) during
  our first quarter of 2004. The acquisition of assets was completed pursuant
  to an asset purchase agreement dated March 4, 2004 between Image Innovations
  Holdings, Image Sports and MDK Sports (the Asset Purchase Agreement).
  As consideration of the sale, transfer and assignment of the assets by MDK Sports
  to Image Sports, we issued to MDK Sports an aggregate of 4,000,000 restricted
  shares of Image Innovation Holdings common stock on closing.

3

---

We have also agreed to deliver to MDK Sports the following additional shares of our common stock upon achievement of the milestones set forth below, provided that no shares will be issuable in the event that the milestone is not achieved for
whatever reason:

| | (a) | an aggregate of 2,500,000
        shares of Image Innovations Holdings common stock will be issued to MDK
        Sports in the event that each of the conditions listed below are met:                                                                                            
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     | (i)                                                                                                                                                                                                                                                                                
| |     | (ii)                                                                                                                                                                                                                                                                               
| | (b) | an aggregate of 1,500,000
        shares of Image Innovations Holdings common stock will be issued to MDK
        Sports in the event that a Trademark License Agreement is made by and
        among Tony Stewarts Race team and Tony Stewarts Sponsor and
        Image Sports.

The inventory of MDK Sports acquired by Image Sports consists
  of over 22,000 pieces of collectible sports memorabilia and fine art. Image
  Sports also acquired all contracts and business arrangements that MDK Sports
  had with artists and sport celebrities. The management of MDK Sports have become
  consultants of Image Sports with the objective of ensuring that the distribution
  channels developed by MDK Sports survives the acquisition and is expanded to
  enhance the distribution of the other subsidiaries in the Image group of companies.

PLAN OF OPERATIONS

We anticipate that we will require approximately $6,800,000
  over the next twelve months in order to carry out the plan of operations for
  Image Innovations and Image Sports. This amount is comprised of the following
  amounts:

|1. | We anticipate that we will spend approximately $2,000,000
        to fund the acquisition of inventory for Image Innovations. We will also
        apply a portion of the proceeds of the sale of inventory sold to the acquisition
        of additional inventory for the Image Innovations business. We anticipate
        that sales of inventory will be used to satisfy the revenue commitments
        pursuant to our license arrangements for Image Innovations, subject to
        our achieving the necessary sales levels. The amount that we spend to
        maintain our inventory will be dependent both on the amount of financing
        that we are able to achieve and upon our success in establishing sales
        of products bearing the brand names we have licensed.
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2. | We anticipate spending approximately $100,000 to
        research and develop new products under license arrangements for marketing
        to customers. Included in this estimate is approximately $50,000 to attend
        trade shows to display and market our products to potential customers,
        including retailers.                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|3. | We anticipate that we will spend approximately $2,000,000
        to establish and maintain the inventory of celebrity art creations for
        the business of Image Sports. We anticipate that we will maintain our
        inventory of sports memorabilia at the present level of approximately
        $3,000,000 as opportunities to acquire unique memorabilia present themselves.
        The celebrity art creations inventory include the cost of creating the
        celebrity art creations and the cost of paying celebrities to endorse
        the art creations that are created for Image Sports. Our ability to acquire
        additional inventory for our Image Sports business will be contingent
        upon the amount of financing that we are able to obtain.      
|4. | We anticipate that we will require approximately
        $400,000 to fund the acquisition and refurbishing of a warehouse located
        in Tannersville, New York. $300,000 will be required to complete the purchase
        of the warehouse and we anticipate spending approximately $75,000 to complete
        the refurbishing the warehouse. We anticipate that this facility will
        handle all of our inventory warehousing once acquired                                                                                                                                                                                                                                                                                                                                       

4

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|   | and refurbished. We are presently renting distribution
        space from a facility in Bellingham, Washington on a fee-for-usage basis
        that is being phased out.                                                                                                                                                                         
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|5. | We anticipate our overhead expenses which are currently
        approximately $150,000 per month will increase as we introduce new products
        and increase our revenues. If we achieve less than the necessary financing
        or if our sales are less than projected, then we will scale back our overhead
        expenses accordingly.

Of the total amount of projected expenditures, we anticipate
  that approximately one-half of these expenses will be incurred over the next
  six month period, provided these expenses may be accelerated if we achieve the
  necessary financing. We are pursing both debt and equity financing in order
  to raise the necessary funds ($6,800,000) to proceed with the plan of operations
  for Image Innovations and Image Sports. We have arranged financing with Coach
  Capital LLC and H.E Capital as described below and continue to pursue other
  financing opportunities however there is no assurance that the necessary financing
  will be achieved. Accordingly, there is a risk that we will not achieve additional
  financing and that we will have to scale back the plan of operations of Image
  Innovations and Image Sports to reflect the actual proceeds available to us.
  While H.E. Capital S.A. has provided loans to fund our initial business operations,
  there is no assurance that H.E. Capital S.A. will advance further funds to us
  in order to continue to fund our plan of operations. If we are not able to achieve
  the necessary financing, then our ability to complete our plan of operations
  and our business and financial condition will be adversely affected. Should
  we be unable to raise the $6,800,000 we would adjust the operations by reducing
  the inventory levels and delaying the refurbishing of the warehouse in accordance
  with available funding.

PRESENTATION OF FINANCIAL INFORMATION

As discussed above, we completed the acquisition of Image
  Innovations effective June 30, 2003. Under United States generally accepted
  accounting principles, our financial statements have been prepared using reverse-acquisition
  accounting principles, which resulted in Image Innovations acquiring Image Innovations
  Holdings for accounting purposes. Accordingly, Image Innovations is treated
  as the acquirer for accounting purposes, even though Image Innovations Holdings
  is the legal acquirer. Under United States generally accepted accounting principles,
  comparative figures for prior periods are based on the operating results of
  Image Innovations, but the type of share capital and number of issued and outstanding
  shares continue to reflect those of Image Innovations Holdings. Image Innovations
  was incorporated on January 14, 2003.

OPERATING RESULTS

Our Consolidated Statement of Operations and Consolidated
  Statement of Cash Flows included in this Quarterly Report on Form 10-QSB provide
  comparative financial information for the results of our operations for the
  three months from January 1, 2004 to March 31, 2004 to our results of operations
  for the period from January 14, 2003, being the date of incorporation of Image
  Innovations, to March 31, 2003. While we have commenced earning revenues, we
  continue to be in the start-up phase of our operations.

Revenues

We earned revenues of $180,968 for the three months ended
  March 31, 2004. We earned revenues of $174,114 from sales attributable to our
  Image Sports sports memorabilia business. These sales included sales of inventory
  acquired for repurchase and sales of inventory acquired from MDK Sports. We
  earned revenues of $6,854 from sales attributable to our Image Innovations business,
  of which $6,529 was attributable to products sold under our NHL and NFL license
  arrangements.

Our cost of sales was $117,712 for the three months ended
  March 31, 2004, resulting in a gross margin of $63,256 or 35% of revenues. Cost
  of sales attributable to our Image Sports business were $114,661, and were comprised
  of inventory acquisition costs, resulting in gross margins of $59,453 or 34%
  of revenues. Cost of sales attributable to our Image Innovations business were
  $3,051, resulting in gross margins of $3,803 or 55% of revenues.

We did not earn any revenues or incur any cost of sales during
  the period ended March 31, 2003.

5

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Expenses

We incurred expenses totalling $640,773 during the three months
  ended March 31, 2004, compared to $71,005 for the period ended March 31, 2003.
  This increase in expenses reflects the expansion of our business operations
  through our start-up phase and costs associated with the acquisition completed
  by Image Sports.

Our payroll and consulting expenses increased to $146,327
  during the three months ended March 31, 2004, compared to $43,042 during the
  period ended March 31, 2003. This increase reflects the increase in our staff
  as our business operations have expanded. We presently have 17 full-time equivalent
  consultants. We anticipate converting our full-time equivalent consultants to
  employees during our current fiscal year.

We incurred corporate development expenses in the amount of
  $318,140 during the three months ended March 31, 2004. These development expenses
  were comprised primarily of consultant fees payable in connection with the acquisition
  by Image Sports of the assets acquired from MDK Sports. No corporate development
  expenses were incurred during the period ended March 31, 2003. The majority
  of these expenses were paid through the issuance of restricted shares of our
  common stock.

We incurred product development expenses of $13,942 during
  the three months ended March 31, 2004, compared to $3,778 for the period ended
  March 31, 2003. These product development expenses were incurred in connection
  with the development of products under our license agreements. Product development
  expenses included expenses associated with the development of our Riddell football
  helmet radio.

We incurred travel expenses of $50,575 during the three months
  ended March 31, 2004, compared to $16,152 during the period ended March 31,
  2003. These travel expenses were incurred in connection with the acquisition
  completed by Image Sports, negotiating our license agreements, attending three
  trade shows, and our establishing contacts for our distribution network.

We anticipate that our operating expenses will continue to
  increase as we carry out our plan of operations for Image Innovations and Image
  Sports. These increased operating expenses will be incurred prior to our realizing
  revenues from sales of products by Image Innovations and Image Sports. In view
  of these factors, we continue to require financing in order to carry out our
  plan of operations.

Loss

We incurred a loss of $577,517 for the three months ended
  March 31, 2004, compared to a loss of $71,005 for the period ended March 31,
  2003. $318,140 of our loss is attributable to fees paid by us in connection
  with the acquisition by Image Sports of the assets acquired from MDK Sports.
  Our increased losses reflect the fact that our business has expanded concurrent
  with our efforts to achieve revenues. Our expenses have increased through the
  start-up phase of our operations as we have expanded our business operations
  with the objective of achieving revenues.

LIQUIDITY AND FINANCIAL CONDITION

We had cash of $143,446 as of March 31, 2004, compared to
  cash of $273,111 as of December 31, 2003. We had working capital of $3,498,617
  as of March 31, 2004, compared to working capital of $222,611 as of December
  31, 2003. The increase in working capital is primarily attributable to the acquisition
  of the inventory assets of MDK Sports in March 2004, as described above under
  the heading Image Sports.

Inventory

Our inventory increased to $3,004,041 as of March 31, 2004
  from $nil as of December 31, 2003 as a result of the acquisition of the inventory
  of MDK Sports. This inventory included the collectible sports memorabilia and
  fine art inventory of MDK Sports.

6

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Cash Flows

We used cash of $363,860 in operating activities during the
  three months ended March 31, 2004, compared to $89,754 for the period ended
  March 31, 2003. Cash used in operating activities was offset by cash of $275,000
  provided by financing activities that resulted from a private placement of shares
  and share purchase warrants during our first quarter. We anticipate we will
  continue to use cash in our operating activities for the current fiscal year
  as we implement our plan of operations.

Requirement of Additional Financing to fund Plan of Operations

We anticipate that we will require approximately $6,800,000
  over the next twelve months in order to carry out the plan of operations for
  Image Innovations and Image Sports, as described above under Plan of Operations.
  Our ability to generate revenues will depend on our ability to obtain financing
  to fund our plan of operations and our success in implementing our plan of operations.
  We have no arrangement for the financing of the business of Image Innovations
  and Image Sports and there is no assurance that the required financing will
  be obtained. There is no assurance that we will be able to obtain the financing
  required to enable us to carry out our plan of operations.

We plan to pursue financings through debt and or private placements
  of our common stock or common stock and share purchase warrants in order to
  raise the funds necessary to enable us to pursue our plan of operations for
  the next twelve months.

We entered into private placement financing with two non-United
  States investors in March 2004 whereby we raised proceeds of $275,000 from the
  issuance of shares and share purchase warrants to the investors. See Item 2
  of Part II of this Quarterly Report on Form 10-QSB for a description of the
  securities issued to the investor.

We do not have any arrangements in place for financings and
  there is no assurance that any financing will be achieved. If any financing
  is achieved, then it is anticipated that existing shareholders will suffer dilution.

Loan Agreement

We entered into a loan agreement dated April 27, 2004 with
  Coach Capital LLC (the Loan Agreement) whereby we borrowed $800,000
  for a six month term. Under the Loan Agreement, we have agreed to pay interest
  on the principal amount borrowed at the rate of 10% per annum payable monthly
  for the first four months of the term and at the rate of 18% per annum thereafter.
  We also agreed to pay a loan fee of $8,000. Further, we have agreed to grant
  a first charge against our assets and undertaking and the assets and undertaking
  of its Image Sports and agreed not to grant any additional charges against such
  assets and undertaking without the prior written consent of Coach Capital LLC.
  The proceeds will be used to acquire inventory for our Image Sports business.

H.E. Capital

We have been dependent upon H.E. Capital S.A. (H.E.
  Capital) in order to fund the business of Image Innovations to date. H.E.
  Capital originally agreed to advance up to $500,000 to Image Innovations in
  order to finance the start-up of our business operations pursuant to a loan
  agreement between H.E. Capital and Image Innovations dated January 14, 2003.
  We entered into an amendment to the loan agreement with H.E. Capital on November
  5, 2003 whereby H.E. Capital agreed to advance up to $1,000,000 under the terms
  of the loan agreement. The loans accrued interest at the rate of 9% per annum
  and were repayable upon demand. The loans were secured by a general security
  agreement granted by Image Innovations against all of its assets.

H.E. Capital advanced to Image Innovations a total of $1,075,704
  as of December 31, 2003. Of the amount advanced during 2003, an aggregate of
  $900,000 was converted into shares and share purchase warrants effective December
  29, 2003. H.E. Capital agreed to cancel, surrender and forgive all interest
  accrued on the indebtedness of $900,000 that was converted into shares and share
  purchase warrants. An amount of $175,704 was payable to H.E. Capital as of December
  31, 2003. H.E. Capital advanced additional funds to us as a loan during our
  first quarter. On March 25, 2004, we repaid the balance of $400,000 owing to
  H.E. Capital, by the issuance of shares and share purchase warrants. H.E. Capital
  agreed to cancel, surrender and forgive all interest accrued on the indebtedness
  of $400,000 that was converted into shares and share purchase warrants. No amounts
  were owed to H.E. Capital as at March 31, 2004. See Item 2 of Part II of this

7

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Quarterly Report on Form 10-QSB for a description of the securities
  issued to H.E. Capital during our first quarter.

There is no assurance that H.E. Capital S.A. will advance
  any additional amounts to us in order to continue to fund our business.

CRITICAL ACCOUNTING POLICIES

Revenue and Cost Recognition

Revenue on product sales is recognized when persuasive evidence
  of an arrangement exists, such as when a purchase order or contract is received
  from the customer, the price is fixed, title to the goods has changed and there
  is a reasonable assurance of collection of the sales proceeds. We obtain written
  purchase authorizations from our customers for a specified amount of product
  at a specified price and consider delivery to have occurred at the time of shipment.
  Revenue is recognized at shipment and we record a reserve for estimated sales
  returns, which is reflected as a reduction of revenue at the time of revenue
  recognition.

Inventory

Inventory is valued at the lower of cost and net realizable
  value and is determined on the first-in, first-out method.

Use of estimates

The preparation of financial statements in conformity with
  accounting principles generally accepted in the United States requires management
  to make estimates and assumptions that affect the reported amounts of assets
  and liabilities and the disclosure of contingent assets and liabilities at the
  date of the financial statements as well as the reported amounts of revenues
  and expenses during the reporting period. Actual results could differ from those
  estimates. These estimates and assumptions relate to recording net revenue,
  collectibility of accounts receivable, and the realizability of other intangible
  assets, accruals, income taxes, inventory realization and other factors. Management
  has exercised reasonable judgment in deriving these estimates; however, actual
  results could differ from these estimates. Consequently, change in conditions
  could affect our estimates.

Fair value of financial instruments

We have various financial instruments, including cash, cash
  equivalents, accounts receivable, accounts payable and capitalized lease obligations.
  We believe the carrying values of our financial instruments approximate their
  values. The carrying amount of the short- and long-term debt approximates fair
  value at December 31, 2003 based on interest rates available to us and debt
  instruments with similar terms.

Stock-based compensation

We believe that stock-based compensation is a critical accounting
  policy that affects our financial condition and results of operations. Statement
  of Financial Accounting Standards ("SFAS") No. 123, Accounting for Stock-Based
  Compensation defines a fair-value based method of accounting for stock-based
  employee compensation plans and transactions in which an entity issues its equity
  instruments to acquire goods or services from non-employees, and encourages
  but does not require companies to record compensation cost for stock-based employee
  compensation plans at fair value. The Company has chosen to continue to account
  for employee stock-based compensation using the intrinsic value method prescribed
  in Accounting Principles Board Opinion No. 25, Accounting for Stock Issued to
  Employees ("APB No. 25") and related interpretations

Foreign Exchange

Our head office is located in Canada, whereas we conduct business
  primarily in United States dollars. Assets and liabilities of the Company, which
  are denominated in foreign currencies, are translated at exchange rates prevailing
  at the balance sheet date. Non-monetary assets and liabilities are translated
  at historical rates.

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Revenues and expenses are translated at average rates throughout
  the year. The unrealized translation gains and loses are accumulated in a separate
  component of stockholders equity Translation exchange gains and losses
  are reflected in net earnings.

ITEM 3.     CONTROLS AND PROCEDURES.

As required by Rule 13a-15 under the Securities Exchange Act
  of 1934 (the Exchange Act), we carried out an evaluation of the
  effectiveness of the design and operation of our disclosure controls and procedures
  as of March 31, 2004, being the date of our most recently completed fiscal quarter.
  This evaluation was carried out under the supervision and with the participation
  of our Chief Executive Officer, Mr. Alain Kardos and Chief Financial Officer,
  Mr. Derick Sinclair. Based upon that evaluation, our Chief Executive Officer
  and Chief Financial Officer concluded that our disclosure controls and procedures
  are effective in timely alerting management to material information relating
  to us required to be included in our periodic SEC filings. There have been no
  significant changes in our internal controls or in other factors that could
  significantly affect internal controls subsequent to the date we carried out
  our evaluation.

Disclosure controls and procedures are controls and other
  procedures that are designed to ensure that information required to be disclosed
  in our reports filed or submitted under the Exchange Act is recorded, processed,
  summarized and reported, within the time periods specified in the Securities
  and Exchange Commission's rules and forms. Disclosure controls and procedures
  include, without limitation, controls and procedures designed to ensure that
  information required to be disclosed in our reports filed under the Exchange
  Act is accumulated and communicated to management, including our Chief Executive
  Officer and Chief Financial Officer, to allow timely decisions regarding required
  disclosure.

During our most recently completed fiscal quarter ended March
  31, 2004, there were no changes in our internal control over financial reporting
  that have materially affected, or are reasonably likely to affect, our internal
  control over financial reporting.

The term internal control over financial reporting
  is defined as a process designed by, or under the supervision of, the registrant's
  principal executive and principal financial officers, or persons performing
  similar functions, and effected by the registrant's board of directors, management
  and other personnel, to provide reasonable assurance regarding the reliability
  of financial reporting and the preparation of financial statements for external
  purposes in accordance with generally accepted accounting principles and includes
  those policies and procedures that:

| | (1) | Pertain to the maintenance of records
        that in reasonable detail accurately and fairly reflect the transactions
        and dispositions of the assets of the registrant;                                                                                                                                                                                                 
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | Provide reasonable assurance that transactions
        are recorded as necessary to permit preparation of financial statements
        in accordance with generally accepted accounting principles, and that
        receipts and expenditures of the registrant are being made only in accordance
        with authorizations of management and directors of the registrant; and
| | (3) | Provide reasonable assurance regarding
        prevention or timely detection of unauthorized acquisition, use or disposition
        of the registrant's assets that could have a material effect on the financial
        statements.                                                                                                                                          

9

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PART II--OTHER INFORMATION

ITEM 1.     LEGAL PROCEEDINGS

We are not a party to any material legal proceedings and to
  our knowledge, no such proceedings are threatened or contemplated.

ITEM 2.     CHANGES IN SECURITIES
  AND USE OF PROCEEDS

We completed the following sales of our common stock without
  registration pursuant to the Securities Act of 1933 (the 1933 Act)
  during our fiscal quarter ended March 31, 2004:

|1. | On March 4, 2004, we completed
        a private placement with H.E. Capital S.A. whereby we sold 266,667 units
        at a price of $1.50 per unit for a purchase price of $400,000. The purchase
        price for the units was paid for by cancellation of indebtedness in the
        amount of $400,000 owed by us to H.E. Capital. Each unit consisted of
        one common share and one common share purchase warrant. Each common share
        purchase warrant entitles the warrant holder to purchase one common share
        at a price of $2.00 per share until March 4, 2006. No commission or fee
        was paid in connection with the offering. The sale was completed pursuant
        to Regulation S of the Act on the basis that H.E. Capital is a non-U.S.
        person, as defined under Regulation S of the Act. All securities issued
        were endorsed with a restrictive legend confirming that the securities
        could not be resold without registration under the Act or an applicable
        exemption from the registration requirements of the Act.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2. | On March 4, 2004, we completed
        a private placement with H.E. Capital whereby we sold 133,333 units at
        a price of $1.50 per unit for a purchase price of $200,000. Each unit
        consisted of one common share and one common share purchase warrant. Each
        common share purchase warrant entitles the warrant holder to purchase
        one common share at a price of $2.00 per share until March 4, 2006. No
        commission or fee was paid in connection with the offering. The sale was
        completed pursuant to Regulation S of the Act on the basis that H.E. Capital
        is a non-U.S. person, as defined under Regulation S of the Act. All securities
        issued were endorsed with a restrictive legend confirming that the securities
        could not be resold without registration under the Act or an applicable
        exemption from the registration requirements of the Act.                                                                                                                                                         
|3. | We issued 4,000,000 shares
        of our common stock to MDK Sports & Entertainment Inc. (MDK
        Sports) pursuant to an asset purchase agreement dated March 4, 2004
        between Image Innovations Holdings, Image Sports and MDK Sports. The shares
        were issued pursuant to Rule 506 of Regulation D of the Securities Act
        of 1933. All securities issued were endorsed with a restrictive legend
        confirming that the securities could not be resold without registration
        under the Act or an applicable exemption from the registration requirements
        of the Act                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|4. | On March 12, 2004, we completed
        a private placement with one non-United States investor whereby we sold
        75,000 units at a price of $1.50 per unit for a purchase price of $75,000.
        Each unit consisted of one common share and one common share purchase
        warrant. Each common share purchase warrant entitles the warrant holder
        to purchase one common share at a price of $2.00 per share until March
        12, 2006. No commission or fee was paid in connection with the offering.
        The sale was completed pursuant to Regulation S of the Act on the basis
        that the investor is a non-U.S. person, as defined under Regulation S
        of the Act. All securities issued were endorsed with a restrictive legend
        confirming that the securities could not be resold without registration
        under the Act or an applicable exemption from the registration requirements
        of the Act.                                                                                                                               
|5. | On March 16, 2004, we issued
        200,000 shares of our common in accordance with an agreement with Wellfleet
        Partners, Inc. related to the successful conclusion of the asset purchase
        agreement dated March 4, 2004 between Image Innovations Holdings, Image
        Sports and MDK Sports. The shares were issued pursuant to Section 4(2)
        of the Securities Act of 1933. All securities issued were endorsed with
        a restrictive legend confirming that the securities could not be resold
        without registration under the Act or an applicable exemption from the
        registration requirements of the Act                                                                                                                                                                                                                                                                                                                                                                                                                                          

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ITEM 3.     DEFAULTS UPON SENIOR SECURITIES

None.

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

No matters were submitted to our security holders for a vote during the fiscal quarter ended March 31, 2004.

ITEM 5.     OTHER INFORMATION.

None.

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ITEM 6.     EXHIBITS AND REPORTS ON FORM 8-K

EXHIBITS REQUIRED BY ITEM 601

|Exhibit Number |                                                                                                                                                                                                     
|-------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|               |                                                                                                                                                                                                     
|3.1            | Articles of Incorporation (1)                                                                                                                                                                       
|               |                                                                                                                                                                                                     
|3.2            | Bylaws (1)                                                                                                                                                                                          
|               |                                                                                                                                                                                                     
|3.3            | Certificate of Amendment to Articles of Incorporation (4)                                                                                                                                           
|               |                                                                                                                                                                                                     
|10.1           | Offer Letter dated June 23, 2003 to the shareholders of Image Innovations
      Inc. to acquire all of the issued and outstanding shares of Image Innovations
      Inc., a Delaware corporation (2)
|               |                                                                                                                                                                                                     
|10.2           | Loan Agreement dated January 14, 2003 between H.E. Capital SA and Image
      Innovations Inc. (3)                                                                                                  
|               |                                                                                                                                                                                                     
|10.3           | Amendment to Loan Agreement dated November 5, 2003 between H.E. Capital
      SA and Image Innovations Inc. (4)                                                                                     
|               |                                                                                                                                                                                                     
|10.4           | Asset Purchase Agreement dated March 4, 2004 between Image Innovations
      Holdings Inc., Image Innovations Sports & Entertainment Inc. and MDK
      Sports & Entertainment Inc. (5)             
|               |                                                                                                                                                                                                     
|10.5           | Loan Agreement between the Company and Coach Capital LLC (6)                                                                                                                                        
|               |                                                                                                                                                                                                     
|14.1           | Code of Ethics (5)                                                                                                                                                                                  
|               |                                                                                                                                                                                                     
|31.1           | Certification of Chief Executive Officer pursuant
      to Section 302 of the Sarbanes-Oxley Act of 2002 (7)                                                                                        
|               |                                                                                                                                                                                                     
|31.2           | Certification of Chief Financial Officer pursuant
      to Section 302 of the Sarbanes-Oxley Act of 2002 (7)                                                                                        
|               |                                                                                                                                                                                                     
|32.1           | Certification of Chief Executive Officer pursuant
      to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
      Act of 2002 (7)                                   
|               |                                                                                                                                                                                                     
|32.2           | Certification of Chief Financial Officer pursuant
      to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley
      Act of 2002 (7)                                   
|               |                                                                                                                                                                                                     

|    |                                                                                                                                                                               
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | Previously filed with the Securities and Exchange Commission
      as an exhibit to our Form 10-SB registration statement filed on December
      6, 2002, as amended.        
|(2) | Previously filed with the Securities and Exchange Commission
      as an exhibit to our Current Report on Form 8-K filed on July 11, 2003.                                    
|(3) | Previously filed with the Securities and Exchange Commission
      as an exhibit to Amendment No. 2 to our Current Report on Form 8-K originally
      filed on July 11, 2003.
|(4) | Previously filed as an Exhibit to our Quarterly Report on
      Form 10-QSB filed on November 14, 2003.                                                                       
|(5) | Previously filed as an Exhibit to our Annual Report on Form
      10-KSB on April 14, 2004                                                                                    
|(6) | Previously filed as an Exhibit to our Current Report on Form
      8-K filed on May 5, 2004                                                                                   
|(7) | Filed as an Exhibit to this Quarterly Report on Form 10-QSB.                                                                                                                  
|    |                                                                                                                                                                               

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REPORTS ON FORM 8-K

During our fiscal quarter ended September 30, 2003, we filed
  a Current Report on Form 8-K on July 11, 2003 to disclose our acquisition of
  Image Innovations. This Current Report on Form 8-K was further amended on July
  21, 2003, September 23, 2003 and again on March 2, 2004.

We filed a Current Report on Form 8-K on January 6, 2004 to
  disclose our issuance of securities to H.E. Capital on December 29, 2003.

Subsequent to March 31, 2004, we filed a Current Report on
  Form 8-K on May 5, 2004 to disclose our loan agreement with Coach Capital LLC.

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SIGNATURES

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

IMAGE INNOVATIONS HOLDINGS INC.

Date:MAY 13, 2004

| | By: | /s/ Alain Kardos       
| | --- | -----------------------
| |     |                        
| |     | ALAIN KARDOS           
| |     | Chief Executive Officer
| |     | and Director           
| |     |                        
| |     |                        
| | By: | /s/ Derick Sinclair    
| |     |                        
| |     | DERICK SINCLAIR        
| |     | Chief Financial Officer
| |     | and Director           

14

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