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

                                     FORM 10-QSB

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 2002

                                           OR


[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM
______________ TO ______________


                          COMMISSION FILE NUMBER: 0-28749


                          FREESTAR TECHNOLOGY CORPORATION
               (Exact Name of Registrant as Specified in its Charter)

                Nevada                                88-0446457
       (State of Incorporation)                (I.R.S. Employer ID No.)


Calle Fantino Falco, J.A. Baez Building, 2nd Floor, Santo Domingo,
Dominican Republic
                (Address of principal executive offices)

                Registrant's telephone number:  (809) 503-5911

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

        Securities registered pursuant to Section 12(g) of the Act: Common
                            Stock, $0.001 Par Value

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

     As of December 31, 2002, the Registrant had 117,501,557 shares of
common stock issued and outstanding.

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

                                 TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION                                        PAGE

     ITEM 1.  FINANCIAL STATEMENTS

              BALANCE SHEET AS OF
              DECEMBER 31, 2002                                          3

              STATEMENTS OF OPERATIONS
              FOR THE THREE AND SIX MONTHS ENDED
              DECEMBER 31, 2002 AND DECEMBER 31, 2001                    5

              STATEMENTS OF CASH FLOWS
              FOR THE SIX MONTHS ENDED
              DECEMBER 31, 2002 AND DECEMBER 31, 2001                    6

              NOTES TO FINANCIAL STATEMENTS                              8

     ITEM 2.  PLAN OF OPERATION                                         16

     ITEM 3.  CONTROLS AND PROCEDURES                                   35

PART II - OTHER INFORMATION

     ITEM 1.  LEGAL PROCEEDINGS                                         36

     ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS                 39

     ITEM 3.  DEFAULTS UPON SENIOR SECURITIES                           40

     ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS       40

     ITEM 5.  OTHER INFORMATION                                         40

     ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K                          40

SIGNATURES                                                              41

CERTIFICATIONS                                                          41

PART I - FINANCIAL INFORMATION

ITEM 1.  FINANCAL STATEMENTS.

                           FREESTAR TECHNOLOGY CORPORATION
                                     BALANCE SHEET
                                   DECEMBER 31, 2002
                                       (Unaudited)

                                        ASSETS

Current assets:
 Cash and cash equivalents                                      $     79,133
 Accounts receivable, net of allowance for
  doubtful account of $62,462, including $62,462 due from
  related party                                                        2,470
 Credit and deposits for future purchases of inventories             245,000
  Total current assets                                               326,603

Property, plant and equipment, net of accumulated
 depreciation and amortization                                        10,059

Software, net of accumulated amortization                            227,611
Credit for future purchases of merchandise                           675,000
Investment                                                           208,000
Other assets                                                           4,836

                                                                   1,452,109

                        LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
 Accounts payable and accrued expenses                               129,385
 Accrued salaries - related parties                                        -
 Bank overdraft                                                          736
 Line of credit                                                        8,684
 Convertible notes payable                                                 -
 Due to related party for converted pledged collateral               679,869
 Due to related party for advances                                   411,133
   Total current liabilities                                       1,229,807

Stockholders' Equity:
 Convertible preferred stock, series A, $0.001 par value,
  1,000,000 shares authorized, 1,000,000 shares
  issued and outstanding                                               1,000
 Convertible preferred stock, series B, $0.001 par value,
  4,000,000 shares authorized, 2,500,000 shares
  issued and outstanding                                               2,500
 Additional paid-in capital - preferred stock                      2,229,558
 Common stock, $0.001 par value, 500,000,000 shares
 authorized, 117,501,557 issued and outstanding                      116,512
 Additional paid-in capital - common stock                         9,406,739
 Subscription receivable                                            (273,000)
 Deferred compensation                                             (1,435,757)
 Accumulated deficit                                               (9,899,401)
 Accumulated other comprehensive loss                                  74,151
   Total stockholders' equity                                         222,302

                                                                    1,452,109

                  See Accompanying Notes to Financial Statements


                           FREESTAR TECHNOLOGY CORPORATION
                               STATEMENTS OF OPERATIONS
                                     (Unaudited)


<TABLE>
<CAPTION>
                                               Three Months    Three Months    Six Months    Six Months
                                                  Ended           Ended          Ended         Ended
                                               December 31     December 31     December 31   December 31
                                                   2002           2001            2002          2001
<S>                                           <C>              <C>             <C>           <C>
Revenue                                       $          -     $    224,491    $     8,700   $     228,997

Cost of revenue                                          -          108,232            802         108,232

Gross profit                                             -          116,259          7,898         120,765

Selling, general and
administrative expenses                          4,664,773          254,113      5,294,271       2,325,481
Research and development                            44,000                -         44,000               -

                                                (4,708,773)        (137,854)    (5,330,373)     (2,204,716)

Other income/(expenses)                             (7,966)           8,832         42,656           7,321
Interest expense                                  (254,254)               -       (377,862)              -

Loss before income taxes                        (4,970,993)        (129,022)    (5,665,579)     (2,197,395)

Income taxes                                             -                -              -               -

Net Loss                                        (4,970,993)        (129,022)    (5,665,579)     (2,197,395)

Other - Comprehensive income (loss)                164,919                -        126,727               -

Comprehensive loss                              (4,806,074)        (129,022)    (5,538,852)     (2,197,395)

Loss per share - basic and diluted                   (0.07)            0.00          (0.09)          (0.08)

Weighted average shares outstanding
- basic and diluted                             76,011,340       36,316,432     61,059,628      27,795,121
</TABLE>




                    See Accompanying Notes to Financial Statements

                              FREESTAR TECHNOLOGY CORPORATION
                                 STATEMENTS OF CASH FLOWS
                                         (Unaudited)

                                                    Six Months      Six Months
                                                       Ended          Ended
                                                    December 31     December 31
                                                        2002            2001

Cash flows provided by (used for)
operating activities:
Net loss                                            $ (5,665,579)  $(2,197,395)

Adjustments to reconcile net
income to net cash provided by (used for)
operating activities:
Depreciation and amortization                            120,905         4,951
Non-cash compensation                                  4,618,505     2,097,286
Amortization of financing cost
on convertible notes payable                             224,738             -
Amortization of discount for
beneficial conversion features on convertible
notes payable                                            106,752             -

Changes in assets and liabilities:
(Increase) decrease in assets
Accounts receivable                                            -      (229,200)
Inventories                                                    -        15,169
Merchandise credits - current                             44,000             -
Other assets                                               1,811       (74,350)
Increase (decrease) in liabilities
Accounts payable and accrued expenses                     24,139        36,727
Due to shareholders                                        4,853             -
Accrued salaries - related parties                        52,400             -
Total adjustments                                      5,198,103     1,850,583

Net cash used by operating activities                   (467,476)     (346,812)

Cash flows provided by (used for)
investing activities:
Purchase of fixed assets                                  (7,278)         (638)
Investment in Rahaxi                                    (208,000)            -

Net cash used by investing activities                   (215,278)         (638)

Cash flows provided by (used for)
financing activities:
Principal proceeds from line of
credit agreement                                          (2,470)       94,814
Repayment on overdraft                                    (8,842)            -
Proceeds from issuance of notes payable                  350,000             -
Sale of common stock                                     212,000             -
Sale of warrants                                          90,000
Contributions from stockholder                                 -       110,484
Decrease in advances from related party                   (7,700)            -

Net cash provided by financing activities                632,988       205,298

Net increase (decrease) in cash and
cash equivalents                                         (49,766)     (142,152)

Foreign currency translation adjustments                 126,458       (77,848)

Cash and cash equivalents, beginning of period             2,441       220,297

Cash and cash equivalents, end of period                  79,133           297

Supplemental disclosure of cash flow information:
Interest paid                                             30,685             -
Income tax paid                                                -             -
 Shares and warrants issued for service                4,618,505     2,097,286
 Prepaid financing cost as increase of
  convertible notes payable                              135,720             -
 Discount for beneficial conversion features on
  convertible notes payable                              106,752             -
 Loan payable to a stockholder related to
  a deposit transferred to the Company                        -        900,000
 Issuance of 4 million shares of common stock to
  replace shares a shareholder contributed for
  a debt conversion                                     270,000              -

Issuance of 7 million shares of
common stock for unpaid accrued salaries to
officers and salaries for future period                 343,000              -

Debt to related party incurred
 in relation to convertible notes payable and
 related accrued expenses paid off by
 shares owned by president of the Company               679,867              -

                   See Accompanying Notes to Financial Statements


                            FREESTAR TECHNOLOGY CORPORATON
                             NOTES TO FINANCIAL STATEMENTS
                                       (Unaudited)

1.  BASIS OF PRESENTATION AND NATURE OF BUSINESS OPERATIONS

Basis of Presentation.

The accompanying unaudited condensed financial statements have been
prepared in accordance with the instructions to Form 10-QSB and do not
include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements.
These condensed financial statements and related notes should be read
in conjunction with the Company's Form 10-KSB for the fiscal year
ended June 30, 2002.  In the opinion of management, these condensed
financial statements reflect all adjustments which are of a normal
recurring nature and which are necessary to present fairly the
financial position of FreeStar Technology Corporation as of December
31, 2002, and the results of operations for the three-month and six-
month periods ended December 31, 2002 and 2001, and cash flows for the
six-month periods ended December 31, 2002 and 2001.  The results of
operations for the three-month and six-month periods ended December
31, 2002 are not necessarily indicative of the results, which may be
expected for the entire fiscal year.

Nature of Business Operations.

FreeStar Technology Corporation ("Company"), formerly known as
Freestar Technologies and Freedom Surf, Inc., was formed on November
17, 1999 as a Nevada corporation, with its principal offices in Santo
Domingo, Dominican Republic.  The Company has developed software-
enabling e-commerce transactions over the Internet, using credit,
debit, ATM (with PIN), or smart cards.

The Company plans to have two main revenue sources, including 1) sales
of its PaySafe devices "ePayPad" and 2) processing fees related to the
transactions through the use of ePayPad.  The Company would charge a
fee for these transactions ranging from 0.3% to 1.3%.

ePayPad is one of several card swipe devices that the Company intends
to utilize to deliver its pay safe now solution. The ePayPad is a
small desktop hardware device resembling a credit card reader found at
your local supermarket or bank. This unobtrusive box is equipped with
a credit card reader and a ten key numeric keypad.  The ePayPad allows
the consumers to securely shop and pay bills on-line.

Recent Accounting Pronouncements.

On July 21, 2001, the Financial Accounting Standards Board ("FASB")
issued Statements of Financial Accounting Standards ("SFAS") No. 141
("SFAS No. 141"), "Business Combinations", and No. 142 ("SFAS No.
142"), "Goodwill and Other Intangible Assets".  SFAS No. 141 addresses
financial accounting and reporting for goodwill and other intangible
assets acquired in a business combination at acquisition.  SFAS No.
141 requires the purchase method of accounting to be used for all
business combinations initiated after June 30, 2001 and establishes
specific criteria for the recognition of intangible assets separately
from goodwill; SFAS No. 142 addresses financial accounting and
reporting for goodwill and other intangible assets subsequent to their
acquisition. SFAS No. 142 provides that goodwill and intangible assets
which have indefinite useful lives will not be amortized, but rather
will be tested at least annually for impairment. It also provides that
intangible assets that have finite useful lives will continue to be
amortized over their useful lives, but those lives will no longer be
limited to forty years. SFAS No. 141 is effective for all business
combinations after June 30, 2001. The provisions of SFAS No. 142 are
effective beginning January 1, 2002. The Company has implemented the
provisions of SFAS No. 141 and No. 142 and has concluded that the
adoption does not have a material impact on the Company's financial
statements.

In October 2001, the FASB issued SFAS No. 143, "Accounting for Asset
Retirement Obligations", which requires companies to record the fair
value of a liability for asset retirement obligations in the period in
which they are incurred.  The statement applies to a company's legal
obligations associated with the retirement of a tangible long-lived
asset that results from the acquisition, construction, and development
or through the normal operation of a long-lived asset.  When a
liability is initially recorded, the company would capitalize the
cost, thereby increasing the carrying amount of the related asset.
The capitalized asset retirement cost is depreciated over the life of
the respective asset while the liability is accreted to its present
value.  Upon settlement of the liability, the obligation is settled at
its recorded amount or the company incurs a gain or loss.  The
statement is effective for fiscal years beginning after June 30, 2002.
The Company has implemented the provisions of SFAS No. 143 and has
concluded that the adoption does not have a material impact on the
Company's financial statements.

In October 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets".  Statement 144 addresses
the accounting and reporting for the impairment or disposal of long-
lived assets. The statement provides a single accounting model for
long-lived assets to be disposed of.  New criteria must be met to
classify the asset as an asset held-for-sale.  This statement also
focuses on reporting the effects of a disposal of a segment of a
business.  This statement is effective for fiscal years beginning
after December 15, 2001.  The Company has implemented the provisions
of SFAS No. 144 and has concluded that the adoption does not have a
material impact on the Company's financial statements.

In April 2002, the FASB issued Statement No. 145, "Rescission of FASB
Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and
Technical Corrections".  This Statement rescinds FASB Statement No. 4,
"Reporting Gains and Losses from Extinguishment of Debt", and an
amendment of that Statement, FASB Statement No. 64, "Extinguishments
of Debt Made to Satisfy Sinking-Fund Requirements" and FASB Statement
No. 44, "Accounting for Intangible Assets of Motor Carriers".  This
Statement amends FASB Statement No. 13, "Accounting for Leases", to
eliminate an inconsistency between the required accounting for sale-
leaseback transactions and the required accounting for certain lease
modifications that have economic effects that are similar to sale-
leaseback transactions.  The Company does not expect the adoption to
have a material impact to the Company's financial position or results
of operations.

In July 2002, the FASB issued SFAS No. 146 "Accounting for Exit or
Disposal Activities".  The provisions of this statement are effective
for disposal activities initiated after December 31, 2002, with early
application encouraged.  The Company does not expect the adoption of
FASB No. 146 to have a material impact on the Company's financial
position or results of operations.

In October 2002, the FASB issued Statement No. 147, "Acquisitions of
Certain Financial Institutions-an amendment of FASB Statements No. 72
and 144 and FASB Interpretation No. 9", which removes acquisitions of
financial institutions from the scope of both Statement 72 and
Interpretation 9 and requires that those transactions be accounted for
in accordance with  Statements No. 141, Business Combinations, and No.
142, Goodwill and Other Intangible Assets.  In addition, this
Statement amends SFAS No. 144, Accounting for the Impairment or
Disposal of Long-Lived Assets, to include in its scope long-term
customer-relationship intangible assets of financial institutions such
as depositor- and borrower-relationship intangible assets and credit
cardholder intangible assets.  The requirements relating to
acquisitions of financial institutions are effective for acquisitions
for which the date of acquisition is on or after October 1, 2002.  The
provisions related to accounting for the impairment or disposal of
certain long-term customer-relationship intangible assets are
effective on October 1, 2002.  The adoption of this Statement did not
have a material impact to the Company's financial position or results
of operations as the Company has not engaged in either of these activities.

In December 2002, the FASB issued Statement No. 148, "Accounting for
Stock-Based Compensation-Transition and Disclosure", which amends FASB
Statement No. 123, Accounting for Stock-Based Compensation, to provide
alternative methods of transition for a voluntary change to the fair
value based method of accounting for stock-based employee
compensation. In addition, this Statement amends the disclosure
requirements of Statement 123 to require prominent disclosures in both
annual and interim financial statements about the method of accounting
for stock-based employee compensation and the effect of the method
used on reported results.  The transition guidance and annual
disclosure provisions of Statement 148 are effective for fiscal years
ending after December 15, 2002, with earlier application permitted in
certain circumstances. The interim disclosure provisions are effective
for financial reports containing financial statements for interim
periods beginning after December 15, 2002.  The adoption of this
statement did not have a material impact on the Company's financial
position or results of operations as the Company has not elected to
change to the fair value based method of accounting for stock-based
employee compensation.

In January 2003, the FASB issued Interpretation No. 46, "Consolidation
of Variable Interest Entities".  Interpretation 46 changes the
criteria by which one company includes another entity in its
consolidated financial statements.  Previously, the criteria were
based on control through voting interest.  Interpretation 46 requires
a variable interest entity to be consolidated by a company if that
company is subject to a majority of the risk of loss from the variable
interest entity's activities or entitled to receive a majority of the
entity's residual returns or both. A company that consolidates a
variable interest entity is called the primary beneficiary of that
entity.  The consolidation requirements of Interpretation 46 apply
immediately to variable interest entities created after January 31,
2003.  The consolidation requirements apply to older entities in the
first fiscal year or interim period beginning after June 15, 2003.
Certain of the disclosure requirements apply in all financial
statements issued after January 31, 2003, regardless of when the
variable interest entity was established.  The Company does not expect
the adoption to have a material impact to the Company's financial
position or results of operations.

2.  ACQUISITIONS AND ALLIANCE AGREEMENTS

In July 2002, the Company had an informal agreement with Game Base
Nevada, Inc. ("Game Base") to enter an alliance agreement in August
2002.  Game Base provided a $50,000 deposit to the Company before
finalization of the agreement.  The two parties never finalized the
alliance agreement.  The Company is entitled to retain the deposit from
Game Base, which is classified as other income in the accompanying
financial statements.

In September 2002, the Company entered into an acquisition agreement
with Heroya Investments Limited ("Heroya").  Under the terms of the
agreement, the Company agreed to purchase 100% of common stock of
Rahaxi Processing Oy, a wholly owned subsidiary of Heroya, for a
purchase price of $4,300,000.  The purchase price is payable in 13
months beginning the closing date of the agreement.  Ownership in
Rahaxi increases proportionally with payments made through December 2003.

As of September 30, 2002, the Company made $50,000 as partial payment
against the initial required payment.

For the quarter ended December 31, 2002, the Company made total
payments of $158,000 of the required payments.

On December 16, 2002, the acquisition agreement was amended and was
agreed by both parties.  Under the amended terms, the Company issued
22,000,000 shares of its common stock in exchange for 53.3% of
Rahaxi's common stock outstanding (equivalent of 16 shares of a total
of 30 shares) no later than January 1, 2003.  Beginning February 16,
2003, the Company will remit monthly cash payments totaling $2,150,000
through December 16, 2003.  Ownership in Rahaxi will increase as cash
payments are made.  The purchase price will be based on the market
price of the Company's common stock on the date of the issuance plus
total payments made per the payment schedule.  The accompanying
financial statements did not include the operations of Rahaxi due to
the fact that the 22,000,000 shares were issued subsequent to December
31, 2002.  As of December 31, 2002, the Company had less than 5% of
ownership in Rahaxi.

On February 16, 2003, the acquisition agreement was amended again and
was agreed by both parties.  Under the terms of the second amendment,
the Company will issue 23,200,000 shares of its common stock (in
additional to the 22,000,000 shares issued in January 2003) in
exchange for additional 33.3% upon issuance of these shares.  The remaining
purchase price totaling $552,100 (instead of $2,150,000) will be paid in cash
beginning March 2003 through December 2003.
through December 16, 2003.

3.  STOCKHOLDERS' EQUITY

Common Stock.

Issuance of Common Stock for Service.

During the quarter ended September 30, 2002, the Company issued
400,000 restricted shares and 2,735,000 S-8 shares of its common stock
to various consultants and legal counsel for current and future services.

In July 2002, the Company cancelled 1,000,000 restricted shares issued
to a former executive.  The shares were originally issued to him for
service performed.  The Company claimed that he failed to perform the
required service and therefore cancelled the shares.  Expense of $98,000 was
reversed in the quarter ended September 30, 2002.

In June 2002, the Company issued 9,500,000 shares in error, which were
cancelled in July 2002.

During the quarter ended December 31, 2002, the Company issued
1,000,000 shares of restricted shares and 22,300,000 S-8 shares of its
common stock to various consultants and legal counsel for current and
future services.

Sale of Common Stock.

During the quarter ended September 30, 2002, the Company sold
2,750,000 shares of restricted common stock to outside investors with
proceeds of $200,000.  The Company received $150,000 during the
quarter ended September 30, 2002 and expects to receive the remaining
$50,000 in quarter ended March 31, 2003.

During the quarter ended December 31, 2002, the Company sold 3,000,000
shares of restricted common stock to outside investors with proceeds
of $130,000.  The Company received $62,000 during the quarter ended
December 31, 2002 and expects to receive the remaining $68,000 in the
quarter ended March 31, 2003.

Issuance of Common  Stock for Unpaid Salaries.

During the quarter ended December 31, 2002, the Company issued
7,000,000 shares of restricted common stock with a value of $343,000
to two officers/executives for unpaid past salaries and salaries for
future period.  As of December 31, 2002, $93,100 was included in
deferred compensation.

Issuance of Common Stock for Directors Fees.

During the quarter ended December 31, 2002, the Company issued
16,000,000 shares of restricted common stock to three directors with a
total valuation of $784,000.

Employee Options.

During the quarter ended December 31, 2002, the Company granted
options covering 15,500,000 shares of common stock to three employees
at an exercise price of $0.01 per share.  The Company adopted the
intrinsic-value method of accounting prescribed by Accounting
Principles Board ("APB") Opinion No. 25, "Accounting for Stock Issued
to Employees" ("APB 25").  The Company expensed $800,000 related to
granted options during the quarter ended December 31, 2002.  In
November 2002, these three employees exercised these options.  As of
December 31, 2002, unpaid exercise price of $155,000 was included in
stock subscription receivable.

Warrant to Consultant.

The Company granted a warrant covering 4,500,000 shares of commons
stock to a consultant with a sale price of $0.02 per warrants.  This
warrant vested immediately on the grant date, December 11, 2002 and
will expire on December 11, 2007, and has a strike price of $0.14 per
share.  The Company valued this warrant by using the Black-Scholes
model to value this warrant under the following assumptions: (i)  no
expected dividends (ii)  a risk-free interest rate of 3.99% (iii)
expected volatility of 160% and (iv) an expected life of 2r years.
The entire warrant was still outstanding as of December 31, 2002.  The
fair value of this warrant was $267,796.  The Company expensed
$177,796 (net of $90,000 sales price) during the quarter ended
December 31, 2002.

Other Issuance.

In November 2002, the Company issued 4,000,000 shares to an
officer/executive to replace such shares he pledged to the Company as
collateral to a convertible debt.  The fair value of the shares on the
date of the issuance was below the face value of the debt.  The shares
issued were valued according to the face value of the convertible
debt.

Preferred Stock.

Issuance of Preferred Stock for Directors Fees.

In November 2002, the Company issued 2,500,000 shares of preferred
stock, Series B to three directors as directors' fees.  The Series B
preferred stock is convertible into shares of common stock at a ratio
of 12 to 1, with restriction.  The holders of Series B preferred stock
will be entitled 12 votes for each preferred shares held.  The Company
valued these issuance based on the quoted market price on the date of
the issuance for its common stock.  For the quarter ended December 31,
2002, the Company expensed $1,800,000 as directors' fees for such issuance.

Convertible Notes.

On June 27, 2002, the Company entered into a financing agreement with
the following lenders for a total of $400,000 in convertible notes:
Papell Holdings, Ltd., Boat Basin Investors LLC, vFinance, Inc., David
Stefansky, Marc Siegal and Richard Rosenblum.  These notes are secured
by 14,400,000 shares of common stock pledged by the Company's
president.  The Company received $60,000 of the proceeds in June 2002
and $150,000 in the quarter ended September 30, 2002.  The Company
expensed $2,262 during the year ended June 30, 2002.  The remaining
$190,000 represents financing cost.  The Company prorated the
financing cost of $54,280 as of June 30, 2002 based on the cash
receipts in June 2002.  The remaining $135,720 was recorded as prepaid
financing cost in the quarter ended September 30, 2002.  The prepaid
financing cost is amortized over the term of the loan (approximately
one year).  The Company recorded $47,500 for the amortization of such
cost for the quarter ended September 30, 2002, and fully amortized the
remaining prepaid financing cost of $140,238 during the quarter ended
December 31, 2002.

These notes payable are convertible into equity at the option of the
note holders at beneficial conversion rates, an embedded beneficial
conversion feature will be recorded as a debt discount and amortized
using the effective rate over the life of the debt in accordance with
EITF 00-27.  The Company has an unamortized discount of $62,308
related to convertible notes payable of $270,000 as of June 30, 2002
and recorded a discount of $44,444 related to the $400,000 convertible
debts.  The Company recorded amortization of discounts of $31,880 on
these convertible notes during the quarter ended September 30, 2002,
and fully amortized the remaining discount of $74,872 during the
quarter ended December 31, 2002.

In December 2002, the Company received an additional $237,000 less
$37,000 financing fees from these same lenders.

In June 2002, this lender group exercised their rights against the
4,000,000 shares pledged by the president of the Company in full
satisfaction of the $270,000 note payable.  The note originally was
set to mature in June 2003.  The parties dispute the effect and
effective date of such exercise.  Such dispute had not been resolved
as of December 31, 2002.

In December 2002, this lender group exercised their rights against the
14,400,000 shares pledged by the president of the Company in full
satisfaction of the outstanding notes payable of $637,000, interest
payable of $18,569, and accrued penalties of $24,300.  As of December
31, 2002, the Company considered the notes payable and related
expenses totaling $679,869 with this lender group being paid off and
has recorded a payable to the president for same amount in the
accompanying balance sheet.  The company intends to issue new stock to
replace such pledged shares.

For the quarter ended December 31, 2002, prepaid financing cost and
debt discounts related to this convertible debt was expensed during
the quarter ended December 31, 2002.

The Company may litigate with this lender group regarding excessive
financing cost, number of shares to be returned to the Company and
certain terms of the debt agreements.  Since the outcome cannot be
reasonably estimated, such matters were not reflected in the financial
statements for the period ended December 31, 2002.

4.  GOING CONCERN

The accompanying financial statements have been prepared on a going
concern basis, which contemplates the realization of assets and the
satisfaction of liabilities in the normal course of business.

Through December 31, 2002, the Company has not been able to generate
significant revenues from its operations to cover its costs and
operating expenses.  Although the Company has been able to issue its
common stock or other financing for a significant portion of its
expenses, it is not known whether the Company will be able to continue
this practice, or if its revenue will increase significantly to be
able to meet its cash operating expenses.

This, in turn, raises substantial doubt about the Company's ability to
continue as a going concern. Management believes that the Company will
be able to raise additional funds through an offering of its common
stock or alternative sources of financing.  However, no assurances can
be given as to the success of these plans.  The financial statements
do not include any adjustments that might result from the outcome of
these uncertainties.

5.  LEGAL PROCEEDINGS

There are legal proceedings involving the Registrant.  Please see "Legal
Proceedings" under Item 1 of Part II hereafter for a complete description
of these proceedings.

ITEM 2.  PLAN OF OPERATION.

Item 303 of Regulation S-B provides that small business issuers
that have not had revenues from operations in each of the last two
fiscal years, or the last fiscal year and any interim period in the
current fiscal year for which financial statements are furnished in
the disclosure document, shall provide the information regarding a
plan of operation.  The Registrant had revenue from operations for the
period from May 25, 2001 (inception) to June 30, 2002 in the amount of
$86,005.  Although the Registrant did have revenue from operations in
the six months ended December 31, 2002 in the amount of $8,700, the
Registrant has chosen to set forth a plan of operation in this Form
10-QSB because of the size of this revenue.

Twelve-Month Plan of Operation.

(a)  General Discussion.

     The payments industry is rapidly transforming.  The Registrant,
after its acquisition of the assets ePayLatina S.A. and Rahaxi
Processing Oy, is part of this transformation.  It is believed that
the Registrant is the first company to provide solutions and services
that enable secure, real-time movement of financial transactions
incorporating hardware and software to enable credit, debit and ATM
with Pin transactions.  While payment media such as credit cards have
reached maturity, it is still the most frequently used method of
online payment. The breathtaking growth in electronic commerce is
forcing financial institutions and merchants to offer new secure
payment forms to their customers.  Internet payment gateways and the
increased prospect of fraud from electronic payments are some of the
issues that are creating challenges for financial institutions around
the world.

     The Registrant's solution and services focus on these areas and
enables financial institutions and merchants to formulate coherent
strategies based on knowledge, insight and understanding of the
transformations taking place in the payments industry.  Charting a
path through this arena requires a deep understanding of the market
and the ability to forecast and predict future trends. The
Registrant's acquisition of the assets of  ePayLatina S.A., and the
formation of its strategic alliances were instigated to help
institutions and merchants position themselves to provide superior
value added services, and differentiate themselves from competitors in
a way that preserves the business line's profitability.

     The Registrant's Enhanced Transactional Secure Software, a
proprietary software package that enables consumers to consummate
secure e-commerce transactions over the Internet using credit, debit,
ATM (with PIN) or smart cards.  The ETSS system integrates a consumer-
side card-swipe terminal with a back-end host-processing center. It
encrypts sensitive financial data at the consumer's personal computer,
using powerful DES encryption and algorithms. It sends an
authorization number to the e-commerce merchant, rather than the
consumer's credit card information, to provide a maximum level of security.

     The Registrant's sales forecast numbers have been derived from
existing contracts currently in place and also after extensive
research and consultations with one of the company's partners Banco
Nacional de Credito, in fact these assumptions were the main factor in
the bank placing the first order for in excess of 2000 units.  The
Registrant has successfully deployed this order, and is currently
awaiting the arrival of its new USB reader to continue its deployment.

     During fiscal year 2003 to date, the Registrant has not received any
new shipments of product due to the fact that it made the decision to
enhance the product to USB port compared to the present PS2 port.  The
enhancement of the Registrant's product required extensive research and
development, hence the deferral of shipments.  This was an important
decision for the Registrant to make especially as it had an adverse
effect on revenues for the quarters ended September 30, 2002 and
December 31, 2002.  However, the Registrant believes that this
decision will derive long term benefits and is an essential part of
the current business plan to have a globally accepted product.  The
Registrant was initially expecting to receive the first shipments of
the newly enhanced product by the end of June 2002, and then again by
the end of  September 2002.  The delay is mainly due to the
unforeseen  lengthy certification process.  The Registrant is now
expecting delivery of its new USB units in early 2003 and then will
recommence distribution of product to its clients.

     The Registrant has an agreement through Rahaxi with Settlement
Services Limited, which provides for a strategic alliance between
Rahaxi and Settlement Services, a company specializing in global high
margin payment processing aggregation and advanced fraud screening
services. The agreement terms outline the rapid deployment of Rahaxi's
online operations over an 18-month period, leveraging Settlement
Services' established client base and substantial high-margin turnover
and is expected  to yield a gross processing volume of $200 million
per month to Rahaxi.  The Registrant anticipates swift completion of
preparations necessary to accommodate Settlement Services' volumes,
including the implementation of the Registrant's Internet Payment
Gateway - due for launch in early April 2003 - and acquiring bank
contracts.  The Registrant  is  also revising its earnings projections
to reflect the full impact of this transaction; based on preliminary
calculations, the company  expects  the Settlement Services' account
alone to contribute substantially to the Registrant's bottom line when
volumes stipulated by the agreement are flowing through the system.

     Currently, the Registrant's subsidiary Rahaxi provides processing
services for over 1,300 merchants.  Rahaxi supports a network serving
over 5,000 point-of-sale devices that generate over one million
transactions each month.  The Registrant intends to rapidly leverage
Rahaxi's 10-year track record, established customer base, growing
revenue stream (currently averaging approximately US$80,000 to 100,000
per month), robust processing platform and historical ties to the
point-of-sale industry to accelerate many of our immediate growth
objectives.

     The Registrant has a contract with La Nacional de Envious, who
will sell and distribute the Registrant's PaySafeNow solution to its
existing and new client base throughout North and Latin America. The
solution will enable clients to securely transfer money, locally or
internationally via the Internet from the comfort of their own home,
anytime during the day or night using their ATM, debit, credit or
smart card.  La Nacional plans to distribute and deploy the system to
its branches and agencies throughout the U.S.  The Registrant
anticipates that it will not only receive revenue from the product
sale but will also receive a transactional revenue fee from each
transaction that takes place.  The first units were deployed in New
York in early 2002 at the "La Nacional Cybercafe," located at 566 West
207th Street in the Washington Heights district in New York City, an
area that boasts the largest concentration of Dominican Republicans in
the Northeast.  The La Nacional Cybercafe features a bank of computer
terminals that have been outfitted with the Registrant's PaySafeNow
system.  Using the PaySafeNow system's proprietary card reader, the
"ePayPad," Cybercafe customers may enjoy virtual one-stop shopping
directly from popular retail stores located in the Dominican Republic
via the Internet.  In addition, the ePayPad will permit customers to
use their PIN-authenticated cards to securely and economically
transfer money locally or to friends and relatives living in the
Dominican Republic or elsewhere around the world.  In accordance with
its contractual agreement with La Nacional, the Registrant will
receive a transactional revenue fee from each PaySafeNow transaction
originated at the Cybercafe.  La Nacional's first U.S.-based Cybercafe
represents a significant opportunity for the Registrant to demonstrate
its system's ease-of-use, global capabilities and technical
functionality in the United States.  However, it also represents an
important and progressive business opportunity to stimulate the local
economy and provide an entire community with cost-efficient access to
the Internet.  The Registrant is awaiting delivery of the new USB unit
to continue implementation.

     The Registrant now has the first fifty merchants on the
Enelpunto.net Payment Gateway live with the Registrant's PaySafeNow
system.  EnelPunto.net has established the Registrant's ETSS as the
standard, approved e-commerce payment technology for EnelPunto's
online merchants.  Now that the first fifty merchants are fully
operational, it will provide the platform for the Registrant to move
forward with the integration of new merchants.  The Registrant had
initially expected to integrate a significant number of merchants by
the middle or latter part of 2002.  Due to the delay in obtaining the
new USB units for distribution, this target date is now expected to be
the latter part of 2003.

     The Registrant has entered into a strategic alliance with Fortech
that will enhance brand awareness for FreeStar's products.  The
alliance will enable the Registrant to integrate its PaySafeNow system
with Fortech's business software package so as to develop a total
business solution for clients.  Fortech will also market and
distribute and act as a reseller of the Registrant's products.  This
strategic alliance will open up new markets for the company thus
accelerating revenue growth.

     The Registrant has entered into a strategic alliance with
Caribbean Postal Services that will implement and develop an
aggressive sales and marketing program for FreeStar's products.  CPS
will market and distribute the Registrant's product to their existing
and future clients through their own portal and extensive marketing
campaigns.  CPS will give added value to the Registrant's clients by
way of their distribution networks not only in the Dominican Republic
but also in the United States.  CPS will deliver goods purchased by
clients using the ePayPad from the United States directly to the
Dominican Republic.  The Registrant believes that the CPS distribution
network will greatly enhance and accelerate sales growth for The
Registrant.

     The Registrant has entered into a technical agreement with GS
Telekom, which will further develop and enhance FreeStar's products.
This agreement will enable the Registrant to enter into the rapidly
expanding and highly profitable Wireless Application Protocol market.
GTKOM and the Registrant  will jointly develop and customize solutions
for specific clients. This agreement is significant for the Registrant
as it will gain the company entry into a potentially lucrative market.
The agreement will also provide the Registrant with resources to
develop the next generation of its products

     Empress Casinos has selected PaySafeNow to provide secure payment
processing for its  five, fully-licensed, land-based  casinos and
sixty sports bank  operations, which are similar to United States off
track betting and Las Vegas Style Sports books.  Based in the
Dominican Republic, Empress Casinos owns and operates one of the
largest regulated, land-based resort casinos and sports banks, which
include the Hotel Casino Hamaca, among others strategically  located
in popular tourist destinations throughout the Dominican Republic.
The PaySafeNow system that is to be initially deployed by Empress
Casinos includes 72 ePayPad point of sale terminals, which will enable
Empress Casinos to offer its customers a secure payment solution. The
PaySafeNow system was chosen primarily because it offers seamless
integration with Empress Casinos' existing infrastructure.  The
PaySafeNow system will also reduce costs by lowering the level of
credit card charge backs while reducing the processing cost of each
transaction.

     The Registrant's system has been implemented by the Sky
International Group of Casinos to offer its customers a secure payment
solution. The advantage of the PaySafeNow system is the seamless
integration with Sky International's existing infrastructure.  With
the Registrant's PaySafeNow system, this company can now offer secure
online an offline payment options.  Seamless system integration was
the key deciding factor in Sky International choosing the PaySafeNow
system.  Based in the Dominican Republic, Sky International owns and
operates regulated, land-based resort casinos and delivers online
gaming action through its Web site.  Sky International's land-based
casinos include the Hotel Casino Sol De Plata and the Catalonia Bavaro
Golf Resort and Casino, both located in Punta Cana, considered the
largest tourist destination in the Dominican Republic

     The Registrant's ePayPad is currently being resold by Radio Shack
in the Dominican Republic, one of the 27 Radio Shack's franchises in
the Latin America and Caribbean area.  EnelPunto has established the
Registrant's PaySafeNow system as the standard, approved e-commerce
payment technology for its merchant network comprised of 50 online
vendors, including Radio Shack-Latin America.  The ePayPad is also
being marketed directly to consumers over Radio Shack-Latin America's
site.  Radio Shack has long been considered a trusted global source
for cutting edge electronic and technology solutions.

     After extensive research and long term negotiations with numerous
manufacturers it was decided to outsource manufacture of the units.
The decision to outsource will have many obvious long term benefits
for the Registrant, for example, no production payroll, not carrying
excess amounts of inventory thus improving its cash flow, immunity
from industrial disputes which will ensure an uninterrupted supply of
units to our clients, the cost of the units will be put out to tender
regularly thus ensuring our product remains at a competitive price in
the market place. It is important for the Registrant to have cash on
hand to maintain a sufficient supply of inventory to meet consumer
demand.  The risk of maintaining inadequate stocks of certain key
components must be minimized by larger than normal forward purchasing.

     ePayLatina, S.A. has secured orders for 20 point-of-sale solutions
that were unveiled at the Ciberferia de BanCredito technology fair
sponsored by BanCredito in Santo Domingo.  In addition, the Company is
following up on over 1000 inquiries received from small business owners
who attended the fair - all of whom have expressed an interest in
deploying the PaySafeNow point-of-sale system on-site at their retail
businesses.  In association with BanCredito, ePayLatina is offering
merchants the opportunity to select from three turnkey, point-of-sale
operating systems, which range in price from US$699 to US$1,299.  The
response the Company  received at BanCredito's technology fair from
merchants seeking to outfit their businesses with a safe ATM and debit
card point-of-sale system leads us to believe that our expectations for
our PaySafeNow technology have not been overly optimistic.  The
Registrant will be exploring opportunities to introduce the packaged
solution to merchants based in the United States.

     The Registrant on the January 27, 2003 announced the signing
of a $7.5 million equity funding agreement with a category leading
domestic investment fund.  The Term Sheet, which was negotiated in
December 2002 and executed by the parties on January 9, 2003, provides
for the Registrant to place $7.5 million of the company's common stock
with this investor over the next 24 months.  The underlying Agreement
is subject to effective registration with the Securities and Exchange
Commission covering the resale of the shares, and will be filed
shortly.  Under the terms of the agreement, the Registrant has the
right but not the obligation to draw under the commitment only upon
the effectiveness of the registration statement.

(b)  Rahaxi Acquisition.

(1)  General Discussion.

     The Registrant has acquired a majority interest in privately-held
Rahaxi Processing Oy, a leading Northern European online credit card
processing enterprise headquartered in Helsinki, Finland. Rahaxi
operates full, online connectivity to all Finnish banks, including
Nordea, Sampo, Oko and the domestic bank credit card company,
Luottokunta, and provides processing services for over 1,300
merchants.  Currently, Rahaxi supports a network serving over 5,000
point-of-sale devices that generate over one million transactions each
month.

     On September 10, 2002, the Registrant entered into an agreement
with Heroya Investments Limited for the acquisition of Rahaxi
Processing Oy.  The terms of the acquisition, valued at $4,300,000,
provide for the Registrant to make incremental cash payments to the
seller over the course of 13 months, and to collateralize the full
value of the acquisition in the form of an equivalent amount of common
stock of the Registrant.  In addition, the seller is entitled to
receive 10% of the net profits generated by Rahaxi for the first four
quarters immediately following the closing date.

     On December 16, 2002, the parties to that agreement executed an
amendment to the acquisition agreement.  Under this amendment, the
purchase price of $4,300,000 is to be paid in restricted common stock
of the Registrant, and cash, as follows:

     (a)  The Registrant is to issue to Heroya 22,000,000 shares of
     common stock in consideration for 53.3% of Rahaxi's common stock
     outstanding (16 of 30 shares) no later than January 1, 2003.

     (b)  The remainder of the purchase price is to be paid in cash,
     with payments due from February 16, 2003 to December 16, 2003.

The Registrant may pay the entire balance of the purchase price
in full at any time.

     On January 16, 2003, the Registrant issued 22,000,000 shares
of common stock in order to obtain a majority interest of Rahaxi.
Since the remainder of the purchase price is to be made in
installments, the Registrant considers this transaction to be
completed as of that date.

     On February 25, 2003, the parties to that agreement executed a
second amendment.  Under this second amendment, the cash purchase
price is to be reduced from approximately 47% to approximately 13%.
Thus, the Registrant's holding of Rahaxi shares increases from 16 to
26 (representing approximately 87% of the 30 shares issued and
outstanding).  Payment is to be made as follows:

     (a)  The Registrant is to issue to Heroya 23,200,000 shares of
     common stock in consideration for an additional 33.3% of Rahaxi's
     common stock outstanding (additional 10 of 30 shares) no later
     than March 10, 2003.

     (b)  The remainder of the cash purchase price totaling $552,100
     is to be paid in cash, with payments due from March 10, 2003 to
     December 16, 2003.  The Registrant may pay the entire balance of
     the purchase price in full at any time.

This strategic acquisition marks a major milestone in the Registrant's
development and helps to cement the company's position in the international
marketplace as a provider of leading PIN-authenticated payment
technology and proprietary processing solutions.   The Registrant
intends to rapidly leverage Rahaxi's 10-year track record, established
customer base, growing volume stream (currently averaging
approximately US$100,000 per month), robust processing platform and
historical ties to the point-of-sale industry to accelerate many of
our immediate growth objectives.  Foremost, Rahaxi empowers the
Registrant with an end-to-end financial processing capability that few
can rival.  And, securing an established processing base in what is
arguably the European Union's most progressive telecommunications and
electronic payments market clearly bodes well for the successful
implementation of the Registrant's long term growth strategy.

     Established 10 years ago as a subsidiary of Telecom Finland
(subsequently Sonera SmartTrust), Rahaxi Processing Oy is a Payment
Service Provider located in Helsinki which routes credit and debit
card transactions from merchants to relevant banks and card issuers
for authorization and settlement.  As the cornerstone of Sonera's bid
to become a leading player in the Scandinavian payments market,
approximately US$10 million have been invested in Rahaxi's hardware,
software and brand name to date. Rahaxi's revenue base has been
growing organically for the past few years with little or no market
effort from Sonera SmartTrust.

     Rahaxi operates full, on-line connectivity to all Finnish banks,
including Nordea, Sampo, Oko, the savings and loans (Aktia, etc.) and
Luottokunta, the local bank-established credit card company. A similar
connection has been established with Luottokunta's Estonian
counterpart, Cardikesku, to facilitate the needs of international
clients such as Stockmann's department stores. Costs have been kept to
a minimum through outsourcing, which lends the company a high degree
of flexibility. It is currently one of the leading players in the
Finnish payment market for card present transactions.

(2)  Current State of the Business.

     Rahaxi currently provides these services to some 1,300 blue-chip
merchants.  The network supports over 5,000 POS devices, generating
over 1 million transactions per month and is readily capable of
handling an additional 7 million transactions per month under its
current software licenses.

(3)  Company and Organization.

     Prior to the sale of Rahaxi, Sonera SmartTrust had streamlined
the entity's operations to the point where it was literally running
itself.  Thus, the company's three main areas of activity are
outsourced as follows:

Call Center:  The company's Call Center, which was previously
operated by Sonera, has been merged with that of Dione Systek in
Finland to ensure maximum efficiency. The combined Call Center seats 7
and currently provides merchant support during office hours.

Data Center:  Rahaxi's Tandem/Base24 system is outsourced to and
housed by Tieto Enator, Scandinavia's leading hosting company in a
specialized Financial Center together with other Banks and the
Helsinki Stock exchange, where Systems are monitored on a 24/7 basis.
The service comprises: 1. Support for Rahaxi's ACI Base24 software as
deployed by 2,600 banks world-wide with a proven track record. 2. All
servers are redundant Tandem systems. 3. All systems are duplicated,
so that the redundant system takes over in case of a failure. 4.
Regular back-ups of data are provided internally.

Terminal deployment: An independent company, DioneSystek, provides and
manages the company's terminals. Merchants lease terminals directly
from DioneSystek.

(4)  Products and Services.

     Rahaxi provides a range of card swipe terminals and payment
solutions that support sophisticated, integrated POS systems to meet
the ever changing, complex needs of the hotel, restaurant, airline
business sectors. The company's end-to-end solutions are proven to be
robust and reliable, ensuring a swift and secure payment path for both
low volume and multi-outlet, high-volume retailers. The Systek 610
terminal developed in co-operation with Rahaxi is ideal for the target
markets as it can communicate along a variety of channels (Analogue,
digital and GSM-wireless), as well as conversion into a stand-alone
EPOS system for small to medium sized retailers. The extensive
flexibility offered by the system allows Rahaxi to support single
terminal, multi-terminal, multi-location and multi-country outlets.

     The company provides full card payment processing, transaction
authorization, data capture and settlement facilities for Visa,
MasterCard, American Express, Diners Club, JCB and all bank-issued
domestic debit cards. Rahaxi also provides specialist value-added
processing applications for fleet, fuel and loyalty card schemes. The
company currently offers a multi-currency facility to merchants in
Finnish Marks, Euros and Estonian Crowns. However the systems are
fully prepared to handle a variety of currencies, subject to the
sponsoring bank having the required currency facilities via Visa
and/or MasterCard.

     As Rahaxi supports merchant loyalty programs, all transactions
are logged and marked for loyalty points. This functionality can be
used with credit, debit and specialty cards used by merchants.

     Terminals are connected on a 24/7 basis to Rahaxi both via the
fixed line telephone network and GSM data channel. The communications
costs in Finland, which are borne by Rahaxi's merchants, are
competitively priced.  Software upgrades need only be performed at the
central level, thus ensuring a highly "future-proof" environment.

     The ePayPad, which was developed by the Registrant, allows
transactions to be completed in a "Card present" environment.  This
allows small merchants to obtain a credit card facility with a minimal
investment using an existing PC and Internet connection. It also
allows transactions to be made securely over the Internet by
cardholders themselves and offers a "Cash advance" functionality for
loading accounts, debit cards, etc. The latter can also be extended to
offer a money transfer facility using the existing worldwide ATM networks.

     Rahaxi has established relationships with the main suppliers of
cash registers, such as Edacom, Siemens-Nixdorf and NCR, comprising a
captive service market as the product lines of these suppliers contain
the necessary software to connect directly to the Rahaxi. For those
companies that build their own POS systems, a software module is
available which enables connection to Rahaxi via server or PC.

(5)  The Finnish Market.

     Long known as one of the key protagonists in the development of
electronic banking, Finland has a population 5 million and a  total of
35,000 POS terminals. Approximately 35% of all payments are made by
card.  Of these, approximately 70% are executed with debit cards and
the remaining 30% are made by credit card.  Visa is the predominant
card brand in Finland.

     Rahaxi is the only independent Payment Service Provider in the
country and the only provider of an online service.  Terminals
operated by the Finnish banks, however, are operated in an offline mode.

     Finland boasts a plethora of advanced Internet payment solutions,
yet customers must complete transactions away from retailers' sites.
Existing methods are, in other words, relatively cumbersome and give
Rahaxi the opportunity to launch more user-friendly products.

     Finland's clearing rules differ favorably in comparison to the
rules applied by the banks and card organizations in most other
jurisdictions. Finland does not, for example, differentiate between
"card present" and "card not present" transactions.  This means that
the approximately 0.5% premium for "card not present" transactions is
not applicable in Finland.

(6)  The International Market.

     Rahaxi is targeting the surrounding Baltic countries (Estonia,
Latvia, and Lithuania) and other Central/Eastern European markets to
broaden its client base.  Through the expansion of its acquiring bank
relationships, Rahaxi intends to market a variety of services,
including a third party processing facility, in these local markets
and to international cross-border merchants.

(7)  Technical Infrastructure.

     Rahaxi supports full on-line connectivity to all Finnish banks
and Luottokunta - the local card network gateway company. Rahaxi is a
lean operation with a very competitive cost base. As most activities
are outsourced, the company enjoys a high degree of flexibility.

     As mentioned above, the technical infrastructure consists of a
large BASE24/TANDEM infrastructure. The system incorporates full
redundancy and disk mirroring to guarantee data integrity at all times
in a 24/7 environment. Following the initial purchase of these
systems, Sonera commissioned a significant amount of development to
adapt the system to the requirements of the Finnish market.

     The internal systems guarantee complete interchange compliance
with Visa and MasterCard by virtue of determining the compliance of
transactions before transmission to respective card schemes.  All
transactions are stored in a data warehouse, from where reports can be
generated to support the internal merchant business process.  This
capability encompasses feedback reports and monthly billing.

(8)  Strategic Advantages.

     Rahaxi is currently under-utilized and has strong growth
potential.  The company's focus can readily be redirected from "card
present" domestic processing to Pan-European eCommerce merchant
processing. The following facts attest to Rahaxi's tremendous future
growth potential:

     (a)  Finland has one of the lowest Visa/MC interchange fee
     structures in Europe.  In the case of "card not present"
     transactions, Finnish interchange is typically 0.5% less than
     many other European countries.

     (b) Rahaxi is not currently processing any "card not present"
     transactions associated with eCommerce, which is one of the
     fastest growing segments of the processing market.

     (c)  Rahaxi's customer base consists of established, Blue Chip
     customers with low charge back/retrieval rates.  This opens up
     the opportunity of accepting a percentage of high margin
     business, which generally incur higher charge back rates.

     (d)  The introduction of the Euro has made it easier to transact
     across Europe and allows companies located in other member states
     to base their eCommerce businesses in Finland.

     (e)  Rahaxi can offer additional services to clients that
     increase the margin per customer such as multi-currency accounts
     and Dynamic Currency Conversion.  The Systek terminals used by
     Rahaxi are available in a GSM version using the GSM data channel.
     Deployment in other markets is technically simple as this channel
     works in all countries possessing GSM networks.

     (f)  Being unwilling to update their systems to accommodate
     technologies such as the Internet, chip cards, 3Dsecure and
     interactive television, etc., banks are increasingly outsourcing
     their payment processing.

     (g)  Finland has one of the most developed mobile networks in the
     world, and is therefore expected to be the first market to emerge
     with a viable mobile payments environment.

(9)  Opportunity.

     In order for Rahaxi to process increasing volumes of e-commerce
traffic, the Registrant will seek to secure relationships with an
additional two to three European "acquiring banks."  The opportunity
to acquiring banks, meaning banks certified to accept credit card
transactions on behalf of merchants, is principally the very
substantial volume of traffic available in the market.  The key to a
sustainable business model in a perceived high-risk environment is
grounded in risk management and control. It is the early stage of a
co-operation between Rahaxi and new acquiring banks that represent the
period of highest risk as the merchant is still unknown to the bank
and reserves are still in the process of being built up.

Business Strategy.

     The Registrant's objective is to become a leading provider of
card present Internet payment systems.  Key elements of this strategy
include:

(a)  Research and Development.

     As research and development is an integral part of its growth
strategy, the Registrant projects this important expense to increase
to ensure the quality of its products and satisfy consumer
expectations.  The Registrant is presently in the process of
developing a wireless application for the PaySafeNow system; this
development process is set to continue through the next twelve months.
Salary and compensation increases are projected to be in line with
growth in sales and profits, the personnel plan calls for expanding
the workforce in accordance with growth projections.

     The largest portion of the Registrant's research and development
costs in the past year has related to the development of e-commerce
software for card present internet  transactions, and this policy will
continue to account for a significant portion of the Registrant's
total research and development costs.  Over the past two years, the
company has spent substantial sums on research and development.  While
the company believes the research and development expenditures have
created significant future revenue producing opportunities, some of
the products are just entering production.

(b)  Sales and Marketing.

     The Registrant markets, sells and distributes products via the
Internet, as well as traditional methods through its direct sales
force, indirect sales channels, and through or strategic
relationships.  The company intends to devote significant resources to
marketing efforts and business development activities designed to
build its brand name and expand its business distribution channels.
Target audiences include: the home user, the small business user,
financial institutions, healthcare, education and entertainment
industries.  The Registrant's sales force is responsible for
soliciting prospective customers and providing technical advice and
support with respect to our products.  It is the company's intention
to achieve greater penetration into markets by using direct and
indirect sales personnel with significant market expertise.  The
Registrant will also be employing consultants with established
relationships in the commercial marketplace.

     Currently, the Registrant depends on a limited number of
customers for a substantial portion of its revenue and a portion its
contracts with some of its customers are short-term contracts.  The
non-renewal of any significant contract upon expiration, or a
substantial reduction in sales to any of its significant customers,
would adversely affect its business unless the company was able to
replace the revenue received from these customers.

(c)  Expand Targeted Customer Base.

     The Registrant intends to develop strong sales and marketing
force initially targeting merchant and consumer requirements, money
transfer, secure gaming applications and financial institutions.  It
also intends to build a strong customer base for the PaySafeNow System
in both the domestic and international sales markets, strengthen its
relationship with its strategic partners such as Banco Nacional de
Credito, La Nacional de Envious and SSP Solutions, and develop
relationships with other financial institutions.  The Registrant
believes that strategic relationships and partnerships with large
financial institutions and online merchants represent our greatest
opportunity to penetrate the secure online card present systems.

(d)  Promote Sales of Point of Sale Units for Brick and Mortar
Establishments.

     The versatility of FreeStar's products will enable them to be
sold as point of sale units for traditional brick and mortar
merchants. For example, by connecting a card reader to the merchant's
PC, and downloading our PaySafeNow merchant software, the registered
user can incorporate a secure device for online payment processing.

(e)  Establishing a Recognized Quality Brand Name.

     Establishing a strong brand name is a key essential component to
attracting and expanding a broad and diverse customer base in both the
domestic and international markets.  The Registrant intends to build
its brand by leveraging its relationships with well-known financial
institutions and merchants through joint marketing efforts with such
strategic partners.  The company intends to participate in major
industry trade shows, and engage in aggressive advertising campaigns.
It is the company's goal to establish a brand name that is associated
with an assurance of security and simplicity of usage.

(f)  Continue to Enhance FreeStar PaySafeNow Solution.

     FreeStar's PaySafeNow system provides the end-user with a
comprehensive solution for their secure online payment processing
needs.  The company will continuously seek to develop and identify new
hardware and software to enhance and add to the PaySafeNow system.  As
the Registrant identifies appropriate technologies, it will add new
products to the PaySafeNow System.  These additions will be made
either through internal development or through third party licenses.

Risk Factors Connected with Plan of Operation.

(a)  Limited Prior Operations, History of Operating Losses, and
Accumulated Deficit May Affect Ability of Registrant to Survive.

     The Registrant has had limited prior operations to date.  Since
the Registrant's principal activities to date have been limited to
organizational activities, research and development, and prospect
development, it has no record of any revenue-producing operations.
Consequently, there is only a limited operating history upon which to
base an assumption that the Registrant will be able to achieve its
business plans.  In addition, the Registrant has only limited assets.
As a result, there can be no assurance that the Registrant will
generate significant revenues in the future; and there can be no
assurance that the Registrant will operate at a profitable level.  If
the Registrant is unable to obtain customers and generate sufficient
revenues so that it can profitably operate, the Registrant's business
will not succeed.  Accordingly, the Registrant's prospects must be
considered in light of the risks, expenses and difficulties
frequently encountered in connection with the establishment of a new
business in a highly competitive industry, characterized by new
product introductions.

     The Registrant incurred a net loss of $4,233,822 for the period
from inception (May 25, 2001) to June 30, 2002, and a net loss of
$5,665,579 for the six months ended December 31, 2002.  At December
31, 2002, the Registrant had an accumulated deficit of $9,899,401.
This raises substantial doubt about the Registrant's ability to
continue as a going concern.

(b)  Need for Additional Financing May Affect Operations and Plan of
Business.

     Current funds available to the Registrant will not be adequate
for it to be competitive in the areas in which it intends to operate.
The Registrant's continued operations, as well as the implementation
of its business plan, therefore will depend upon its ability to raise
additional funds through bank borrowings, equity or debt financing.
The Registrant has previously negotiated a financing package with
Papell Holdings, Ltd., a Turks & Caicos Islands company, and Boat
Basin Investors LLC, a Nevis limited liability company, that is a
total of: (a) $270,000 convertible debenture; (b) a total of $400,000
in convertible promissory notes from those companies and three
individuals, plus vFinance, Inc. (a total of $210,000 of which has
been received - the remainder of the $400,000 was paid by the
Registrant for certain fees; and (c) $237,000 borrowed from these
individuals and companies on December 23, 2002, for which the
Registrant does not have any documentation ($200,000 net of fees and
expenses).  In addition, the Registrant recently signed an equity line
of credit agreement with Cornell Capital Partners, LP to provide up to
$7,500,000 in financing for the Registrant over a maximum period of 24
months.  Under the terms of the agreement, the Registrant has the
right but not the obligation to draw under the commitment only upon
the effectiveness of a Form SB-2 registration statement.

     The Registrant defaulted in connection with the registration
deadline in connection with the $270,000 convertible debenture.
Consequently, in June 2002, the lenders then exercised their rights
with respect to all of the 4,000,000 shares of restricted common stock
that Paul Egan pledged as collateral for this loan. The Registrant is
contesting the date and effect of such exercise.   The lenders have
claimed  in connection with financing set forth in (a) above, that the
Registrant was required to pay the investors a 9% penalty on the
amount borrowed as the registration statement was not filed within 60
days of registration requirement date.  As of September 30, 2002, the
Company recorded $24,300 related to this penalty.

     The Registrant also defaulted in connection with the registration
deadlines required of the $400,000 convertible promissory notes.
Consequently, in December 2002 the lender group exercised their rights
with respect to all of the 14,400,000 shares of restricted common
stock that Paul Egan pledged as collateral for these loans.  The
Registrant is contesting the date and effect of such exercise.

     There is no guarantee that these funding sources, or any others,
will be available in the future, or that they will be available on
favorable terms.  In addition, this funding amount may not be adequate
for the Registrant to fully implement its business plan.  Thus, the
ability of the Registrant to continue as a going concern is dependent
on additional sources of capital and the success of FreeStar's
business plan.  Regardless of whether the Registrant's cash assets
prove to be inadequate to meet FreeStar's operational needs, the
Registrant might seek to compensate providers of services by issuance
of stock in lieu of cash.

     If funding is insufficient at any time in the future, the
Registrant may not be able to take advantage of business opportunities
or respond to competitive pressures, any of which could have a
negative impact on the business, operating results and financial
condition.  In addition, if additional shares were issued to obtain
financing, current shareholders may suffer a dilutive effect on their
percentage of stock ownership in the Registrant.

(c)  No Assurance of Protection of Proprietary Rights May Affect
Ability to Manufacture Products.

     The Registrant's success and ability to compete will be dependent
in part on the protection of its potential patents, trademarks, trade
names, service marks and other proprietary  rights.  The Registrant
intends to rely on trade secret and copyright laws to protect the
intellectual property that it plans to develop, but there can be no
assurance that such laws will provide sufficient protection to the
Registrant, that others will not develop a service that are  similar
or superior to the Registrant's, or that third parties will not copy
or otherwise obtain and use the Registrant's proprietary information
without authorization.  In addition, certain of the Registrant's know-
how and proprietary technology may not be patentable.

     The Registrant may rely on certain intellectual property licensed
from third parties, and may be required to license additional products
or services in the future, for use in the general operations of its
business plan.  The Registrant currently has no licenses for the use
of any specific products.  There can be no assurance that these third
party licenses will be available or  will continue to be available to
the Registrant on acceptable terms or at all.  The inability to enter
into and  maintain any of these licenses could have a material
adverse effect on the Registrant's business, financial condition or
operating results.

     There is a risk that some of the Registrant's products may
infringe the proprietary rights of third parties.  In addition,
whether or not the Registrant's products infringe on proprietary
rights of third parties, infringement or invalidity claims may be
asserted or prosecuted against it and it could incur significant
expense in defending them.  If any claims or actions are asserted
against the company, it may be required to modify its products or seek
licenses for these intellectual property rights.  The Registrant may
not be able to modify its products or obtain licenses on commercially
reasonable terms, in a timely manner or at all.  The Registrant
failure to do so could have a negative affect its business and
adversely its revenues .

(d)  Product Errors Could Affect Impact Business of FreeStar.

     The Registrant develops products that are extremely complex, and
the products it produces  may contain undetected errors when first
introduced or when new updated versions are released to the
marketplace.  Despite the company's rigorous product testing
procedures and testing by current and potential customers, it is
possible that errors will be found in new products or upgrades after
commencement of commercial shipments.  The occurrence of product
defects or errors could result in adverse publicity, delay in product
introduction, diversion of resources to remedy defects, loss of or a
delay in market acceptance, claims by customers against us, or could
cause us to incur additional costs, any of which could adversely
affect our business.

(e)  Dependence on Outsourced Manufacturing May Affect Ability to
Bring Products to Market.

     The risks of association with outsourced manufacturers are
related to aspects of these firms' operations, finances and suppliers.
The Registrant may suffer losses if the outside manufacturer fails to
perform its obligations to manufacture and ship the product
manufactured.  These manufacturers' financial affairs may also affect
the Registrant's ability to obtain product from these firms in a
timely fashion should they fail to continue to obtain sufficient
financing during a period of incremental growth.  The Registrant
intends to maintain a strong relationship with these manufacturers to
ensure that any issues they may face are dealt with in a timely manner

(f)  No Assurance of Market Acceptance May Affect Ability to Sell
Products.

     There can be no assurance that any products successfully
developed by the Registrant or its corporate collaborators, if
approved for marketing, will ever achieve market acceptance.  The
Registrant's products, if successfully developed, may compete with a
number of traditional products manufactured and marketed by major e-
commerce and technology companies, as well as new products currently
under development by such companies and others.  The degree of market
acceptance of any products developed by the Registrant or its
corporate collaborators will depend on a number of factors, including
the establishment and demonstration of the efficacy of the product
candidates, their potential advantage over alternative methods and
reimbursement policies of government and third party payors.  There
can be no assurance that the marketplace in general will accept and
utilize any products that may be developed by the Registrant or its
corporate collaborators.

     The standards for card present e-commerce payment transactions
that the Registrant support may not achieve broad market acceptance or
market acceptance may be slower than the Registrant expected.
Additionally, if a new standard emerges that is more accepted by the
marketplace, the Registrant may not be successful in developing
products that comply with that standard on a timely basis unable.  To
be successful, the Registrant will need to effectively respond on a
timely basis to future changes in the ever expanding markets in which
the Registrant sells its software products.  The markets for
FreeStar's e-payment software solutions for the physical world and, in
particular, for payment card transactions over the Internet, are at
early stages of development and are rapidly expanding .

(g)  Substantial Competition May Affect Ability to Sell Products.

     The Registrant may experience substantial competition in its
efforts to locate and attract customers for its products.  Some
competitors in its industry have greater experience, resources, and
managerial capabilities than the Registrant and may be in a better
position than the Registrant to obtain access to attract customers.
There are a number of larger companies that will directly compete with
the Registrant.  Such competition could have a material adverse effect
on the Registrant's profitability or viability.

     Also, the Registrant experiences significant competition from
existing and potential customers that develop, implement and maintain
their own proprietary e-payment solutions.  Additionally, the
Registrant's current and future competitors may develop products or
systems that may be comparable or superior to those developed by it or
adapt more quickly than it to new technologies, evolving industry
standards or customer requirements.  Increased competition could
result in price reductions, reduced margins and loss of market share,
any or all of which could have a material adverse effect on our
business, financial condition, results of operations and prospects.

     Finally, in today's competitive marketplace, personal computer
input devices face substantial competition from computer
manufacturers, since computers are almost always sold with a keyboard
and mouse.  There are also several large scale manufacturers who
specialize in the production of these input devices who may be able to
produce a device at a lower cost than the Registrant's.

(h)  Government Regulations May Affect the Ability of FreeStar to Operate.

     Because the Registrant sells its products internationally, as
well as domestically, it must comply with federal laws that relate to
the export and applicable foreign government laws regulating the
import of our products.  However, the federal government may rescind
these approvals at any time.  Under current regulations these products
can be exported without a license to most countries for use by banks,
money transfer companies, general online and traditional merchants
organizations.

     Additionally, the Registrant may apply for export approval, on a
specific case by case  basis, for specific future products.
Government export regulation for security products is less stringent
for products designed for banking and finance, e-commerce.  It is
possible that the Registrant will not receive approval to export
future products on a timely basis, on the basis we request, or at all.
As a result of government regulation of our products, the company may
be at a disadvantage when competing for international sales with
foreign companies not subject to these restrictions.

     Various aspects of the Registrant's business are subject to
governmental regulation in the United States and other countries in
which it operates.  Failure to comply with such regulation may,
depending upon the nature of the noncompliance, result in the
suspension or revocation of any license or registration at issue, the
termination or loss of any contract at issue or the imposition of
contractual damages, civil fines or criminal penalties.  The
Registrant has experienced no material difficulties in complying with
the various laws and regulations affecting its business.

(i)  Other External Factors May Affect Viability of Registrant.

     The industry of the Registrant in general is a speculative venture
necessarily involving some substantial risk.  There is no certainty
that the expenditures to be made by the Registrant will result in
commercially profitable business.  The marketability of its products
will be affected by numerous factors beyond the control of the
Registrant.  These factors include market fluctuations, and the general
state of the economy (including the rate of inflation, and local
economic conditions), which can affect peoples' spending.  Factors
that leave less money in the hands of potential customers of the
Registrant will likely have an adverse effect on the Registrant.  The
exact effect of these factors cannot be accurately predicted, but  the
combination of these factors may result in the Registrant not receiving
an adequate return on invested capital.

(j)  Control by Officers and Directors Over Affairs of FreeStar May
Override Wishes of Other Stockholders.

     The Registrant officers and directors currently own common stock
equal to approximately 39% of the outstanding shares of the
Registrant's common stock.  As a result, such persons, acting
together, have the ability to exercise significant influence over all
matters requiring stockholder approval.  In addition, all decisions
with respect to the management of the Registrant will be made
exclusively by the officers and directors of the Registrant.
Investors will only have rights associated with stockholders to make
decisions that affect the Registrant.  Accordingly, it could be
difficult for the investors hereunder to effectuate control over the
affairs of the Registrant.

     Therefore, the success of the Registrant, to a large extent, will
depend on the quality of the directors and officers of the company.
Accordingly, no person should invest in the Registrant unless he is
willing to entrust all aspects of the management of the company to the
officers and directors.

(k)  Loss of Any of Current Management Could Have Adverse Impact on
Business and Prospects for Registrant.

     The Registrant's success is dependent upon the hiring and
retention of key personnel.  Two of the Registrant's officers and
directors currently have employment and non-competition agreements
with the Registrant for a period of three years; however, no other
directors or employees have such an agreement.  Therefore, there can
be no assurance that these other personnel will remain employed by the
Registrant.  Should any of these individuals cease to be affiliated
with the Registrant for any reason before qualified replacements could
be found, there could be material adverse effects on the Registrant's
business and prospects.

     The Registrant's success will also be highly dependent on its
ability to attract and retain qualified employees.  Competition for
employees is intense in the e-commerce software industry.  To date,
the Registrant believes it has been successful in its efforts to
recruit qualified employees, but there is no assurance that it will
continue to be as successful in the future.  The Registrant believes
relations with its employees are more than satisfactory.

(l)  Potential Conflicts of Interest May Affect Ability of Officers
and Directors to Make Decisions in the Best Interests of Registrant.

     The officers and directors have other interests to which they
devote time, either individually or through partnerships and
corporations in which they have an interest, hold an office, or serve
on boards of directors, and each will continue to do so
notwithstanding the fact that management time may be necessary to the
business of the Registrant. As a result, certain conflicts of interest
may exist between the Registrant and its officers and/or directors
that may not be susceptible to resolution.

     In addition, conflicts of interest may arise in the area of
corporate opportunities that cannot be resolved through arm's length
negotiations.  All of the potential conflicts of interest will be
resolved only through exercise by the directors of such judgment as is
consistent with their fiduciary duties to the Registrant.  It is the
intention of management, so as to minimize any potential conflicts of
interest, to present first to the Board of Directors to the
Registrant, any proposed investments for its evaluation.

(m)  Limitations on Liability, and Indemnification, of Directors and
Officers May Result in Expenditures by FreeStar.

     The Registrant's articles of incorporation include provisions to
eliminate, to the fullest extent permitted by the Nevada Revised
Statutes as in effect from time to time, the personal liability of
directors of the Registrant for monetary damages arising from a breach
of their fiduciary duties as directors.  The By-Laws of the Registrant
also include provisions to the effect that the company may indemnify
any director, officer, or employee.  Any limitation on the liability
of any director, or indemnification of directors, officer, or
employees, could result in substantial expenditures being made by the
Registrant in covering any liability of such persons or in
indemnifying them.

(n)  Absence of Cash Dividends May Affect Investment Value of
FreeStar's Stock.

     The Board of Directors does not anticipate paying cash dividends
on the common stock for the foreseeable future and intends to retain
any future earnings to finance the growth of the Registrant's
business. Payment of dividends, if any, will depend, among other
factors, on earnings, capital requirements and the general operating
and financial conditions of the Registrant as well as legal
limitations on the payment of dividends out of paid-in capital.

(o)  No Cumulative Voting May Affect Ability of Some Shareholders to
Influence Mangement of FreeStar.

     Holders of the shares of common stock of the Registrant are not
entitled to accumulate their votes for the election of directors or
otherwise. Accordingly, the holders of a majority of the shares
present at a meeting of shareholders will be able to elect all of the
directors of the Registrant, and the minority shareholders will not be
able to elect a representative to the company's board of directors.

(p)  No Assurance of Continued Public Trading Market and Risk of Low
Priced Securities May Affect Market Value of FreeStar's Stock.

     There has been only a limited public market for the common stock
of the Registrant.  The common stock of the Registrant is currently
quoted on the Over the Counter Bulletin Board.  As a result, an
investor may find it difficult to dispose of, or to obtain accurate
quotations as to the market value of the Registrant's securities.  In
addition, the common stock is subject to the low-priced security or so
called "penny stock" rules that impose additional sales practice
requirements on broker-dealers who sell such securities.  The
Securities Enforcement and Penny Stock Reform Act of 1990 requires
additional disclosure in connection with any trades involving a stock
defined as a penny stock (generally, according to recent regulations
adopted by the U.S. Securities and Exchange Commission, any equity
security that has a market price of less than $5.00 per share, subject
to certain exceptions), including the delivery, prior to any penny
stock transaction, of a disclosure schedule explaining the penny stock
market and the risks associated therewith.   The regulations governing
low-priced or penny stocks sometimes limit the ability of broker-
dealers to sell the Registrant's common stock and thus, ultimately,
the ability of the investors to sell their securities in the secondary
market.

(q)  Failure to Maintain Market Makers May Affect Value of FreeStar's
Stock.

     If the Registrant is unable to maintain a National Association of
Securities Dealers, Inc. member broker/dealers as market makers, the
liquidity of the common stock could be impaired, not only in the
number of shares of common stock which could be bought and sold, but
also through possible delays in the timing of transactions, and lower
prices for the common stock than might otherwise prevail.
Furthermore, the lack of  market makers could result in persons being
unable to buy or sell shares of the common stock on any secondary
market.  There can be no assurance the Registrant will be able to
maintain such market makers.

(r)  Sale of Shares Eligible For Future Sale Could Adversely Affect
the Market Price.

     All of the 45,500,000 shares of common stock that are currently
held, directly or indirectly, by management have been issued in
reliance on the private placement exemption under the Securities Act
of 1933.  Such shares will not be available for sale in the open
market without separate registration except in reliance upon Rule 144
under the Securities Act of 1933.  In general, under Rule 144 a
person, or persons whose shares are aggregated, who has beneficially
owned shares acquired in a non-public transaction for at least one
year, including persons who may be deemed affiliates of the
Registrant, as defined, would be entitled to sell within any three-
month period a number of shares that does not exceed the greater of 1%
of the then outstanding shares of common stock, or the average weekly
reported trading volume during the four calendar weeks preceding such
sale, provided that current public information is then available.  If
a substantial number of the shares owned by these shareholders were
sold under Rule 144 or a registered offering, the market price of the
common stock could be adversely affected.

Forward Looking Statements.

     The foregoing Plan of Operation contains "forward looking
statements" within the meaning of Rule 175 under the Securities Act of
1933, as amended, and Rule 3b-6 under the Securities Act of 1934, as
amended, including statements regarding, among other items, the
Registrant's business strategies, continued growth in the Registrant's
markets, projections, and anticipated trends in the Registrant's
business and the industry in which it operates.  The words "believe,"
"expect," "anticipate," "intends," "forecast," "project," and similar
expressions identify forward-looking statements.  These forward-
looking statements are based largely on the Registrant's expectations
and are subject to a number of risks and uncertainties that are beyond
the Registrant's control.  The Registrant cautions that these
statements are further qualified by important factors that could cause
actual results to differ materially from those in the forward looking
statements, including, among others, the following: reduced or lack of
increase in demand for the Registrant's products, competitive pricing
pressures, changes in the market price of ingredients used in the
Registrant's products and the level of expenses incurred in the
Registrant's operations.  In light of these risks and uncertainties,
there can be no assurance that the forward-looking information
contained in this document will in fact transpire or prove to be
accurate.  The Registrant disclaims any intent or obligation to update
"forward looking statements."

ITEM 3.  CONTROLS AND PROCEDURES.

Controls and Procedures.

(a)  Evaluation of disclosure controls and procedures.

     Within the 90 days prior to December 31, 2002, the Registrant
carried out an evaluation of the effectiveness of the design and
operation of its disclosure controls and procedures pursuant to Rule
13a-14 under the Securities Exchange Act of 1934 ("Exchange Act").
This evaluation was done under the supervision and with the
participation of the Registrant's President and Chief Financial
Officer.  Based upon that evaluation, they concluded that the
Registrant's disclosure controls and procedures are effective in
gathering, analyzing and disclosing information needed to satisfy the
Registrant's disclosure obligations under the Exchange Act.

(b)  Changes in internal controls.

     There were no significant changes in the Registrant's internal
controls or in its factors that could significantly affect those
controls since the most recent evaluation of such controls.

Critical Accounting Policies.

     The Securities and Exchange Commission recently issued Financial
Reporting release No. 60, "Cautionary Advice Regarding Disclosure
About Critical Accounting Policies" ("FRR 60"), suggesting companies
provide additional disclosure and commentary on their most critical
accounting policies.  In FRR 60, the SEC defined the most critical
accounting policies as the ones that are most important to the
portrayal of a company's financial condition and operating results,
and require management to make its most difficult and subjective
judgments, often as a result of the need to make estimates of matters
that are inherently uncertain.  Based on this definition, the
Registrant's most critical accounting policies include: non-cash
compensation valuation that affects the total expenses reported in the
current period.  The methods, estimates and judgments the Registrant
uses in applying these most critical accounting policies have a
significant impact on the results the Registrant reports in its
financial statements.

PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS.

     Other than as set forth below, the Registrant is not a party to
any material pending legal proceedings and, to the best of its
knowledge, no such action by or against the Registrant has been
threatened.

     (a)  On March 6, 2002 the Securities and Exchange Commission
filed an action against Raece Richardson and David McKenzie, formerly
the President and Vice President of Freedom Surf, Inc. (predecessor
entity to the Registrant), for securities fraud, for falsifying
Freedom Surf"s financial statements.  In connection with that action
against Raece Richardson and David McKenzie, the Commission also
charged the Registrant, as successor corporation to Freedom Surf, with
violations of Section 17(a) of the Securities Act of 1933, Sections
10(b), 12(g), 13(a), 13(b)(2)(A) and 13(b)(2)(B) of the Securities
Exchange Act of 1934, and Rules 10b-5, 12b-20, 13a-1, 13a-11 and 13a-
13 thereunder.  The Registrant resolved the litigation without
admitting or denying the allegations in the complaint by consenting to
an entry of final judgments of permanent injunction from violating any
of the foregoing sections of the Securities Act and the Exchange Act,
and rules there under.  The settlement represents neither evidence nor
an admission of wrongdoing or liability of the Registrant.  All the
violations alleged predated current management's assumption of
control.  For additional information, shareholders are urged to review
the Commission's Litigation Release No. 17397 and Accounting and
Auditing Enforcement Release No. 1514, dated March 6, 2002 at the
SEC's website www.sec.gov.

     On or about January 15, 2003, the Commission advised the
Registrant that it was conducting an informal investigation into
potential violations of the securities laws.  As part of that informal
investigation, the Registrant has voluntarily agreed to produce
documents concerning certain items, including documents pertaining to
vFinance Investments, vFinance, Inc., David Stefansky, Richard
Rosenblum, Marc Siegel, Boat Basin Investors LLC, and Papell Holdings,
Ltd., all of which have threatened litigation against the Registrant
and have filed an involuntary bankruptcy petition against the company.
The Registrant has agreed to cooperate fully with the Commission and
is producing all documents called for on a voluntary basis.

     (b)  On or about March 4, 2002, the Registrant and certain of its
agents, Paul Egan, Ciaran Egan, First American Stock Transfer and
Phillip Young, were named as a defendants in a suit brought by the
Registrant's former interim chief executive officer and attorney,
Dennis Johnston.  That suit was filed in the United States District
Court for the Central District of California, Dennis Johnston v.
FreeStar Technologies, Paul Egan, Ciaran Egan, et al., Case No. SA02-
224.  The complaint alleged fraud and deceit in the sale of securities
in violation of Section 10(b) of the Exchange Act, fraud and deceit in
the issuance of securities, negligent misrepresentation, and breach of
contract.  The complaint also seeks damages in an unspecified amount
and involves the alleged failure of the Registrant to transfer
2,000,000 shares of its common stock to Mr. Johnston for legal services.

     In response to the complaint, the defendants filed a motion to
dismiss pursuant to Rules 9(b) and 12(b)(6) of the Federal Rules of
Civil Procedure for failure to state a claim upon which relief can be
granted.  On or about May 17, 2002, Federal Judge Gary Taylor granted
the defendant's motion to dismiss.

     On or about June 10, 2002, the defendants were served with a
first amended complaint in the foregoing action.  That action sought
damages in an unspecified amount and involves claims for legal fees by
Mr. Johnston, fraud and deceit in the sale of securities in violation
of Rule 10b-5 of the Exchange Act, fraud and deceit in the issuance of
securities, negligent misrepresentation, breach of contract,
interference with economic relations, violations of California
Business and Professions Code Section 17200, breach of implied
covenant of good faith and fair dealings, invasion of privacy-false
light, defamation, civil conspiracy, and conversion.  On June 27,
2002, the case was assigned to Judge John F. Walter for all further
proceedings.

     On July 1, 2002, the defendants filed a motion to dismiss the
first amended complaint based on Rules 9(b), 12(b)(1) and 12(b)(6) of
the Federal Rules of Civil Procedure for failure to state a claim
upon which relief can be granted and failure of subject matter
jurisdiction.  On July 22, 2002, Mr. Johnston filed a motion to
disqualify Corrigan & Morris LLP as counsel to the Registrant; the
company opposed that motion.

     On August 6, 2002, the Hon. Judge Walker granted the Registrant's
motion to dismiss each and all eleven claims for relief in the first
amended complaint granting Mr. Johnston ten days leave to amend.
Judge Walker advised Mr. Johnston that he would not be granted any
further opportunities to amend.  On August 16, 2002 Mr. Johnston filed
a second amended complaint against the Registrant, Paul Egan, Ciaran
Egan, First American Stock Transfer, Inc. and Phillip Young alleging
breach of contract, writ of mandate, injunctive relief and an
unspecified amount of damages.

     On August 27, 2002, Judge Walker denied Mr. Johnston's motion to
disqualify Corrigan & Morris LLP.  In addition on that date, the
Registrant filed a third motion to dismiss all allegations pursuant to
Rules 9(b), 12(b)(1) and 12(b)(6) of the Federal Rules of Civil
Procedure for failure to state a claim upon which relief can be
granted.  On September 10, 2002, Mr. Johnston dismissed, without
prejudice, the federal action in its entirety against the Registrant,
Paul Egan, Ciaran Egan, First American Stock Transfer and Phillip Young.

     On or about September 13, 2002 the Registrant and ePayLatina,
S.A. initiated an action in the Superior Court for the State of
California against Mr. Johnston, Freestar Technologies v. Dennis
Johnston, Case No. BC 281514.  This action seeks unspecified damages
resulting from alleged legal malpractice, breach of fiduciary duty,
deceit, and declaratory relief.  Mr. Johnston demurred to the
complaint.  On January 30, 2003, Judge Judith Chirlin rejected Mr.
Johnston's demurrer and ordered Mr. Johnston to answer the complaint
as it stands.

     Mr. Johnston answered the complaint on February 19, 2003 with a
general denial.  Mr. Johnston also filed a cross-complaint on February
19, 2003 in the Superior Court for the State of California: Dennis
Johnston v. ePayLatina, Freestar Technologies, Paul Egan, Ciaran Egan,
et al., Case No. BC 260420.  This action also names certain other
individuals, including the Registrant's attorneys and its transfer
agent.  Mr. Johnston seeks damages in excess of $1 million dollars
for, among other things, breach of contract, fraud and negligence.
Notably, many of the allegations in the Johnston cross-complaint
appear similar to those previously dismissed twice in the federal
court proceeding noted above.  The company asserts that Mr. Johnston's
cross-complaint lacks merit and it intends to vigorously defend
against the cross-complaint.  The company intends to vigorously
prosecute its action against Mr. Johnston on the merits.

     (c)  On January 9, 2003, the Registrant was named in an
involuntary petition under Chapter 7 of the U.S. Bankruptcy Code
filed by vFinance, Inc., David Stefansky, Richard Rosenblum, Marc
Siegel, Boat Basin Investors LLC, and Papell Holdings, Ltd. in the
U.S. Bankruptcy Court  for the Southern District of New York,
Petition No. 03-10096 (ALG).  In their petition, the petitioners
alleged that the Registrant is generally not paying its debts as they
become due, and that the total amount of their claims is $637,000.
The Registrant filed a motion to dismiss that petition, which was
granted on March 4, 2003.  The Registrant intends to seek
compensatory and punitive damages.

     (d)  On or about January 29, 2003, the petitioners in the
bankruptcy action sought an affirmative preliminary injunction
against Paul Egan and First American Stock Transfer seeking the
removal of restrictive legends placed on certain unregistered shares
of FreeStar common stock purportedly owned by Plaintiffs by an action
in the U.S. District Court for the Southern District of New York,
Boat Basin Investors, LLC, Papell Holdings, Ltd., Marc Siegel, David
Stefansky, Richard Rosenblum v. First American Stock Transfer, Inc.,
Paul Egan, Phillip Young, and Margaux Investments Group, S.A., Case
No. 03-0493 (RWS).  The Registrant, as an indepensable party, opposed
the motion for affirmative injunctive action on the grounds that
removal of the legends would constitute a violation of the
registration provisions of federal securities laws.  District Court
Judge Sweet issued an opinion dated February 7, 2003 denying the
Plaintiffs motion for a preliminary injunction.  Further, that action
is stayed pending resolution of the bankruptcy case, or relief from
the automatic stay.  This matter involves a complex set of facts that
the Registrant anticipates will be aggressively disputed.

     All of the foregoing orders set forth in (c) and (d) above are,
of course, subject to appeals or other attacks.

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS.

     The Registrant sold the following securities without registration
(restricted) during the three months ended December 31, 2002:

     (a)  On November 12, 2002, the Registrant sold 1,000,000 shares
of common stock to one accredited investor for $30,000 ($0.03 per
share).  On this date the closing trading price of the stock was
$0.06.

     (b)  On November 22, 2002 and November 25, 2002, the Registrant
issued shares of common stock for directors fees, as a guarantee of
accrued salaries, and (in the case of Paul Egan) to replace shares
pledged as collateral as follows: (a) Paul Egan: 18,000,000; (b)
Ciaran Egan: 8,000,000 shares; and (c) Fionn Stakelum: 1,000,000
shares.  On this date, the Registrant also issued shares of Series B
preferred stock (currently convertible into shares of common stock in
the Registrant at the ratio of 12 to 1 with no restrictions) as
follows: (a) Paul Egan: 1,000,000 shares; (b) Ciaran Egan: 1,000,000
shares; and (c) Fionn Stakelum: 500,000 shares.  Finally, on this date
the Registrant granted options under its Stock Incentive Plan as
follows: (a) Paul Egan: an option for 10,000,000 shares; (b) Ciaran
Egan: an option for 5,000,000 shares; and (c) Fionn Stakelum: an
option for 500,000 shares.  These options were immediately exercised
at $0.01 per share.

     (c)  On December 13, 2002, the Registrant sold a total of
2,000,000 shares of common stock to two accredited investors for
$100,000 ($0.05 per share).  On this date the closing trading price of
the stock was $0.09.  Also on this date, the Registrant sold a warrant
covering 4,500,000 shares of common stock to one accredited investor,
exercisable at $0.14 per share.  The Registrant received $90,000 cash
related to this sale during the quarter ended December 31, 2002.

     (d)  On December 18, 2002, the Registrant issued 2,000,000 shares
of common stock to one consultant for services to be rendered by that
person to the company under a consulting agreement.

     These sales were undertaken under Rule 506 of Regulation D under
the Securities Act of 1933, as amended ("Act"), by the fact that:

     - the sales were made to sophisticated or accredited investors as
       defined in Rule 502;

     - the Registrant gave each purchaser the opportunity to ask
       questions and receive answers concerning the terms and conditions
       of the offering and to obtain any additional information which
       the Registrant possessed or could acquire without unreasonable
       effort or expense that is necessary to verify the accuracy of
       information furnished;

     - at a reasonable time prior to the sale of securities, the
       Registrant advised each purchaser of the limitations on resale in
       the manner contained in Rule 502(d)2 of this section;

     - neither the Registrant nor any person acting on its behalf sold
       the securities by any form of general solicitation or general
       advertising; and

     - the Registrant exercised reasonable care to assure that each
       purchaser of the securities is not an underwriter within the
       meaning of Section 2(11) of the Act in compliance with Rule  502(d)

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES.

     None.

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

     None

ITEM 5.  OTHER INFORMATION.

     None.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

Exhibits.

     Exhibits included or incorporated by reference herein are set
forth in the attached Exhibit Index.

Reports on Form 8-K.

     The Registrant filed the following reports on Form 8-K during the
second quarter of the fiscal year covered by this Form 10-QSB:

     (a)  An amended Form 8-K was filed on October 22, 2002 to include
as an exhibit the letter from the former accountant for the
Registrant, Ludlow & Harrison, indicating that firm's agreement with
the statements made by the Registrant in the Form 8-K filed on October
24, 2001 to report the change in accountant for the Registrant as of
October 18, 2001.

     (b)  An amended Form 8-K filed on December 3, 2002 to report that
the Registrant was not in compliance with certain terms of the
Acquisition Agreement between the Registrant and Heroya Investments
Limited for the acquisition of Rahaxi Processing Oy, dated September
10, 2002.

     (c)  An amended Form 8-K was filed on December 24, 2002 to report
that the Acquisition Agreement between the Registrant and Heroya
Investments Limited for the acquisition of Rahaxi Processing Oy, dated
September 10, 2002, was amended by a document signed by the parties,
dated December 16, 2002.

                                  SIGNATURES

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

                                   FreeStar Technology Corporation



Dated: March 11, 2003              By: /s/ Paul Egan
                                   Paul Egan, President


Dated: March 11, 2003              By: /s/ Ciaran Egan
                                   Ciaran Egan, Chief Financial Officer

                               CERTIFICATIONS

I, Paul Egan, certify that:

1.  I have reviewed this quarterly report on Form 10-QSB of FreeStar
Technology Corporation;

2.  Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this quarterly report;

3.  Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly
present in all material respects the financial condition, results of
operations and cash flows of the Registrant as of, and for, the
periods presented in this quarterly report;

4.  The Registrant's other certifying officers and I are responsible
for establishing and maintaining disclosure controls and procedures
(as defined in Exchange Act Rules 13a-14 and 15d-14) for the
Registrant and have:

     (a)  designed such disclosure controls and procedures to ensure
     that material information relating to the Registrant, including
     its consolidated subsidiaries, is made known to us by others
     within those entities, particularly during the period in which
     this quarterly report is being prepared;

     (b)  evaluated the effectiveness of the Registrant's disclosure
     controls and procedures as of a date within 90 days prior to the
     filing date of this quarterly report (the "Evaluation Date"); and

     (c)  presented in this quarterly report our conclusions about the
     effectiveness of the disclosure controls and procedures based on
     our evaluation as of the Evaluation Date;

5.  The Registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the Registrant's auditors and
the audit committee of Registrant's board of directors (or persons
performing the equivalent functions):

     (a)  all significant deficiencies in the design or operation of
     internal controls which could adversely affect the Registrant's
     ability to record, process, summarize and report financial data
     and have identified for the Registrant's auditors any material
     weaknesses in internal controls; and

     (b)  any fraud, whether or not material, that involves management
     or other employees who have a significant role in the
     Registrant's internal controls;

6.  The Registrant's other certifying officers and I have indicated
in this quarterly report whether there were significant changes in
internal controls or in other factors that could significantly affect
internal controls subsequent to the date of our most recent
evaluation, including any corrective actions with regard to
significant deficiencies and material weaknesses.

Dated: March 11, 2003                   /s/ Paul Egan
                                        Paul Egan, President

I, Ciaran Egan, certify that:

1.  I have reviewed this quarterly report on Form 10-QSB of FreeStar
Technology Corporation;

2.  Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact
necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to
the period covered by this quarterly report;

3.  Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly
present in all material respects the financial condition, results of
operations and cash flows of the Registrant as of, and for, the
periods presented in this quarterly report;

4.  The Registrant's other certifying officers and I are responsible
for establishing and maintaining disclosure controls and procedures
(as defined in Exchange Act Rules 13a-14 and 15d-14) for the
Registrant and have:

     (a)  designed such disclosure controls and procedures to ensure
     that material information relating to the Registrant, including
     its consolidated subsidiaries, is made known to us by others
     within those entities, particularly during the period in which
     this quarterly report is being prepared;

     (b)  evaluated the effectiveness of the Registrant's disclosure
     controls and procedures as of a date within 90 days prior to the
     filing date of this quarterly report (the "Evaluation Date"); and

     (c)  presented in this quarterly report our conclusions about the
     effectiveness of the disclosure controls and procedures based on
     our evaluation as of the Evaluation Date;

5.  The Registrant's other certifying officers and I have disclosed,
based on our most recent evaluation, to the Registrant's auditors and
the audit committee of Registrant's board of directors (or persons
performing the equivalent functions):

     (a)  all significant deficiencies in the design or operation of
     internal controls which could adversely affect the Registrant's
     ability to record, process, summarize and report financial data
     and have identified for the Registrant's auditors any material
     weaknesses in internal controls; and

     (b)  any fraud, whether or not material, that involves management
     or other employees who have a significant role in the
     Registrant's internal controls;

6.  The Registrant's other certifying officers and I have indicated
in this quarterly report whether there were significant changes in
internal controls or in other factors that could significantly affect
internal controls subsequent to the date of our most recent
evaluation, including any corrective actions with regard to
significant deficiencies and material weaknesses.

Dated: March 11, 2003               /s/ Ciaran Egan
                                    Ciaran Egan, Chief Financial Officer

                                EXHIBIT INDEX

Number                            Exhibit Description

1      Agency Agreement between the Registrant and vFinance
       Investments, Inc., dated March 24, 2002 (including the
       following exhibits: Exhibit B: Form of Warrant) (the
       following exhibits have been omitted: Exhibit A: Term Sheet)
       (incorporated by reference to Exhibit 1 of the Form 10-KSB
       filed on November 13, 2002).

2.1    Asset Purchase Agreement between the Registrant and Southern
       California Logo, Inc., dated April 26, 2000 (incorporated by
       reference to Exhibit 1 of the Form 8-K filed on May 15, 2000).

2.2    Asset Purchase Agreement between the Registrant and
       Ronbridge Investments, Ltd., dated October 17, 2000
       (incorporated by reference to Exhibit 10 of the Form 8-K
       filed on October 23, 2000).

2.3    Binding Letter of Intent between the Registrant and
       ePayLatina, S.A., dated July 23, 2001 (incorporated by
       reference to Exhibit 10.2 of the Form 8-K filed on July 25, 2001).

2.4    Asset Purchase Agreement between the Registrant and
       ePayLatina, S.A., dated August 9, 2001 (incorporated by
       reference to Exhibit 10.1 of the Form 8-K filed on August 14, 2001).

2.5    Acquisition Agreement between the Registrant and Heroya
       Investments Limited, dated September 10, 2002 (the following
       schedules have been omitted: Schedule 1, books and records
       of Rahaxi; Schedule 2, draft employment agreements with Hans
       Turitz and Tony Horrell; and Schedule 3, list of clients
       introduced to Rahaxi by HEROYA) (incorporated by reference
       to Exhibit 2 of the Form 8-K filed on September 25, 2002).

2.6    Amendment 1 to Acquisition Agreement between the Registrant
       and Heroya Investments Limited, dated December 16, 2002
       (incorporated by reference to Exhibit 2.2 of the Form 8-K/A
       filed on December 24, 2002).

2.3    Amendment 2 to Acquisition Agreement between the Registrant
       and Heroya Investments Limited, dated February 25, 2003
       (incorporated by reference to Exhibit 2.3 of the Form 8-K/A
       filed on February 26, 2003).

3.1    Articles of Incorporation, dated November 17, 1999
       (incorporated by reference to Exhibit 3.3 of the Form 10-SB
       filed on January 3, 2000).

3.2    Certificate of Amendment of Articles of Incorporation, dated
       September 8, 2000 (incorporated by reference to Exhibit 3.4
       of the Form S-8 filed on August 17, 2001).

3.3    Certificate of Amendment to Articles of Incorporation, dated
       February 15, 2001 (incorporated by reference to Exhibit 3.1
       of the Form 8-K filed on February 20, 2001).

3.4    Certificate of Amendment to Articles of Incorporation, dated
       December 15, 2002 (see below).

3.5    Certificate of Amendment to Articles of Incorporation, dated
       February 24, 2003 (see below).

3.6    Bylaws, dated November 17, 1999 (incorporated by reference
       to Exhibit 3.2 of the Form 10-SB filed on January 3, 2000)

4.1    Consulting Services Agreement between the Registrant and
       Public Securities Service, dated November 30, 1999
       (incorporated by reference to Exhibit 10.1 of the Form S-8
       filed on September 29, 2000).

4.2    Consulting Agreement between the Registrant and Dennis H.
       Johnston, dated August 1, 2001 (incorporated by reference to
       Exhibit 10.1 of the Form S-8 filed on August 17, 2001).

4.3    Certificate of Powers, Designations, Preferences and Rights
       of Series A Preferred Stock of the Registrant Technologies,
       dated August 10, 2001 (incorporated by reference to Exhibit
       4 of the Form 8-K filed on August 14, 2001).

4.4    Non-Employee Directors and Consultants Retainer Stock Plan,
       dated October 25, 2001 (incorporated by reference to Exhibit
       4.1 of the Form S-8 filed on November 9, 2001).

4.5    Employee Stock Incentive Plan, dated October 25, 2001
       (incorporated by reference to Exhibit 4.2 of the Form S-8
       filed on November 9, 2001).

4.6    Form of Financing Agreement between the Registrant, and
       Papell Holdings, Ltd. and Boat Basin Investors LLC, dated
       March 25, 2002 (including the following exhibits: Exhibit A:
       Form of Convertible Note; Exhibit B: Form of Warrant;
       Exhibit C: Registration Rights Agreement; Exhibit D: Stock
       Pledge Agreement;  Exhibit E: Form of Opinion of Counsel;
       and Exhibit F: Unconditional Guarantee (the following
       exhibits have been omitted: Schedule 4(c): Compliance with
       Laws; Schedule 4(d): Litigation; Schedule 4(h):
       Capitalization; and Schedule 7(j): Consolidations)
       (incorporated by reference to Exhibit 4.6 of the Form 10-KSB
       filed on November 13, 2002).

4.7    Loan Agreement between the Registrant, and David Stefansky,
       Marc Siegal and Richard Rosenblum, dated June 12, 2002
       (including the following exhibits: Exhibit A: Form of
       Promissory Note; and Exhibit C: Unconditional Guarantee) (the
       following exhibits have been omitted: Exhibit B: Term Sheet;
       and Exhibit D: Corporate Resolution) (incorporated by
       reference to Exhibit 4.7 of the Form 10-KSB filed on
       November 13, 2002).

4.8    Form of Financing Agreement between the Registrant, and
       Papell Holdings, Ltd., Boat Basin Investors LLC, vFinance,
       Inc., David Stefansky, Marc Siegal and Richard Rosenblum
       dated June 27, 2002 (except for Papell Holdings, which is
       dated September 9, 2002) (including the following exhibits:
       Exhibit A: Form of Convertible Note; Exhibit B: Registration
       Rights Agreement; Exhibit C: Unconditional Guarantee;
       Exhibit D: Form of Stock Pledge Agreement; and Exhibit E:
       Form of Opinion of Counsel) (the following exhibits have
       been omitted: Schedule 4(c): Compliance with Laws; Schedule
       4(d): Litigation; Schedule 4(h): Capitalization; and
       Schedule 7(j): Consolidations) (incorporated by reference to
       Exhibit 4.8 of the Form 10-KSB filed on November 13, 2002).

4.9    Supplementary Agreement between the Registrant and vFinance
       Investments, Inc., Boat Basin Investors LLC. Marc Siegel,
       David Stefansky, and Richard Rosenblum, dated June 27, 2002
       (incorporated by reference to Exhibit 4.9 of the Form 10-KSB
       filed on November 13, 2002).

4.10   Amended and Restated Non-Employee Directors and Consultants
       Retainer Stock Plan, dated November 15, 2002 (incorporated
       by reference to Exhibit 4.1 of the Form S-8 POS filed on
       December 11, 2002).

4.11   Amended and Restated Stock Incentive Plan, dated November
       15, 2002 (incorporated by reference to Exhibit 4.2 of the
       Form S-8 POS filed on December  11, 2002).

10.1   Agreement between the Registrant and Southern California
       Logo, Inc., dated April 30, 2001 (incorporated by reference
       to Exhibit 10.1 of the Form 8-K filed on July 25, 2001).

10.2   Employment Agreement between the Registrant and Ciaran Egan,
       dated August 9, 2001 (incorporated by reference to Exhibit
       10.2 of the Form 8-K filed on August 14, 2001).

10.3   Employment Agreement between the Registrant and Paul Egan,
       dated August 9, 2001 (incorporated by reference to Exhibit
       10.3 of the Form 8-K filed on August 14, 2001).

10.4   Employment Agreement between the Registrant and Dennis H.
       Johnston, dated August 9, 2001 (incorporated by reference to
       Exhibit 10.4 of the Form 8-K filed on August 14, 2001).

10.5   Consulting Services Agreement between the Registrant and
       Henry Bohl, dated October 17, 2001 (incorporated by
       reference to Exhibit 10.5 of the Form 10-QSB filed on
       February 14, 2002).

10.6   Consulting Agreement between the Registrant and America
       Fermin, dated October 25, 2001 (incorporated by reference to
       Exhibit 10.6 of the Form 10-QSB filed on February 14, 2002).

10.7   Consulting Agreement between the Registrant and Marcelina
       Ramos, dated October 25, 2001 (incorporated by reference to
       Exhibit 10.7 of the Form 10-QSB filed on February 14, 2002).

10.8   Memorandum of Understanding between the Registrant and Game
       Base Nevada, Inc., dated July 17, 2002 (incorporated by
       reference to Exhibit 10.8 of the Form 10-KSB filed on
       November 13, 2002).

16.1   Letter on change in certifying accountant, dated March 9,
       2001 (incorporated by reference to Exhibit 16.2 of the Form
       8-K/A filed on March 13, 2001).

16.2   Letter on change in certifying accountant, dated October 17,
       2002 (incorporated by reference to Exhibit 16 of the Form 8-
       K/A filed on October 22, 2002).

99     Certification Pursuant to Section 906 of the Sarbanes-Oxley
       Act of 2002 (18 U.S.C. Section 1350) (see below).