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

                                   FORM 10-KSB

(Mark One)

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

         For the fiscal year ended December 31, 2002

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

         For the transition period from ___________ to ___________

                         Commission file number: 0-31705

                             I. A. Europe Group, Inc
                 ----------------------------------------------
                 (Name of Small Business Issuer in its charter)


             Delaware                                   91-2007477
 -------------------------------         ---------------------------------------
 (State or other jurisdiction of         (I.R.S. Employer Identification Number)
  incorporation or organization)

  901 Ponce de Leon Boulevard, Suite 303,
  Coral Gables, Florida                                       33134
  ----------------------------------------------             -------
    (Address of principal executive offices)               (zip code)


                                 (305) 476-1807
                           ---------------------------
                            Issuer's Telephone Number

                          Common Stock, par value $.001
                          -----------------------------
                                (Title of class)

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

         Check if no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is contained in this form, and no disclosure will be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [ ]

         State issuer's revenues for its most recent fiscal year. -0-

         Based on the average if the closing bid and asked prices of the
issuer's common stock on December 31, 2002, the aggregate market value of the
voting stock held by non-affiliates of the registrant on that date was $0.00

         As of December 31, 2002, the issuer had 3,011,300 shares of common
stock outstanding.

         Documents incorporated in reference: See Item 13. Exhibits and Reports
on Form 8-K in Part III.

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


<PAGE>


                                    CONTENTS

                                                                       PAGE
PART I

    Item 1.  Description of Business...................................... 3
    Item 2.  Description of Property.....................................  4
    Item 3.  Legal Proceedings...........................................  4
    Item 4.  Submission of Matters to a Vote of Security Holders.........  4

PART II

    Item 5.  Market for Common Equity and Related Stockholder Matters....  4
    Item 6.  Management's Discussion and Analysis or Plan of Operation...  5
    Item 7.  Financial Statements........................................  5
    Item 8.  Changes in and Disagreements with Accountants on
                Accounting and Financial Disclosure......................  5

PART III

    Item 9.  Directors, Executive Officers, Promoters and Control
                Persons; Compliance with Section 16(a) of the
                Exchange Act.............................................  6
    Item 10. Executive Compensation......................................  7
    Item 11. Security Ownership of Certain Beneficial Owners and
                Management...............................................  7
    Item 12. Certain Relationships and Related Transactions..............  8
    Item 13. Exhibits and Reports on Form 8-K............................  8
    Item 14. Controls and Procedures.....................................  8

SIGNATURES   ............................................................  9


                                       1
<PAGE>

                           Forward-Looking Statements

This report contains forward-looking statements. The forward-looking
statements include all statements that are not statements of historical
fact. The forward-looking statements are often identifiable by their use of
words such as "may," "expect," "believe," "anticipate," "intend," "could,"
"estimate," or "continue," "Plans" or the negative or other variations of
those or comparable terms. Our actual results could differ materially from
the anticipated results described in the forward-looking statements. Factors
that could affect our results include, but are not limited to, those
discussed in Item 6, "Management's Discussion and Analysis or Plan of
Operation" and included elsewhere in this report.


                                       2
<PAGE>


                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS.

A.   INTRODUCTION

         This Information Statement is being delivered on or about December 16,
2002 to the holders of shares of common stock, par value $0.001 (the "Common
Stock") of I.A. Europe Group, Inc. (the "Company"), formerly known as General
Telephony.com, Inc. You are receiving this Information Statement in connection
with the appointment of a new member to the Company's board of directors and the
merger of the Company into its former parent, General Telephony.com, Inc., a
Nevada corporation ("GTI") for purposes of changing the name and domicile.

         On July 12, 2002, I. A. Europe, Inc. purchased approximately 95.8% of
GTI's issued and outstanding Common Stock or a total of 2,886,000 shares of
Common Stock from existing stockholders for an aggregate purchase price of
$550,000. As a condition to closing the transaction, Ms. Melissa Fernandez, who
previously served GTI as a director and corporate secretary, resigned. In
addition, Mr. David D. Selmon, Jr. who served GTI as a director, president,
chief executive officer, chief financial officer and treasurer, also agreed to
resign as an officer effective July 12, 2002. Although Mr. Selmon had previously
agreed to resign as a director effective 10 days after the filing of this
Information Statement, he tendered his resigned as of July 17, 2002 due to other
commitments.

         Mr. Victor Minca, chief executive officer of GTI, replaced Ms.
Fernandez as a director and became president, secretary and treasurer of GTI. On
December 6, 2002, GTI merged into the Company and changed its name to "I. A.
Europe Group, Inc." and its domicile from Nevada to Delaware. In compliance with
Section 14(f) of the Securities Exchange Act of 1934 (the "Exchange Act") and
Rule 14f-1 thereunder, following 10 days from the date of mailing of this
Information Statement, the directors of the Company will be as described below:

                  Victor Minca              Chairman of the board

                  Mario Garcia              Director


B.   CHANGE OF NAME AND DOMICILE

         On December 6, 2002, the Company merged with GTI thereby changing the
Company's name from General Telephony.com, Inc. to I. A. Europe Group, Inc. and
its domicile from Nevada to Delaware. Such merger was recommended and approved
by unanimous consent of the board of directors of GTI (consisting of Mr. Minca)
and by a majority of the voting power of GTI by consent in accordance with
Delaware and Nevada law. The merger did not change any rights of the holders of
Common Stock except to the extent Delaware law differs from Nevada law. Each
share of GTI Common Stock and preferred stock automatically converted into a
share of Common Stock or preferred stock of the Company. The number of shares of
the Common Stock and the preferred stock of the Company outstanding is equal to
the number of shares of Common Stock and preferred stock of GTI which were
outstanding prior to the merger.


                                       3
<PAGE>

         In connection with such action, the Company is notifying its
stockholders that: (i) a majority of the voting power of GTI's stockholders
authorized the merger of GTI with and into the Company in accordance with the
agreement and plan of merger attached as Exhibit 1; (ii) as a result,
stockholders of GTI may dissent from such action pursuant to Nevada Revised
Statutes ("NRS") Section 92A.380 and in accordance with NRS Section 92A.410(2)
may obtain payment of fair value for his, her or its shares of GTI; (iii) if any
GTI stockholder desires to obtain fair value, he, she or it must send a demand
to the Company in compliance with NRS 92A.440 and his, her or its certificate
representing such GTI shares to the Company at 901 Ponce de Leon Boulevard,
Coral Gables, Florida 33134, attention: Victor Minca, President; (iv) pursuant
to NRS Section 92A.450(1), transfer of any uncertificated GTI shares will be
restricted from the date any such shareholder demand is received by the Company;
(v) pursuant to NRS Section 92A.430(2)(c), any demand for payment must be in the
form attached hereto as prescribed by Nevada law; (vi) any GTI stockholder
demand for payment must be received by the end of business on January 30, 2003,
and (vii) pursuant to NRS Section 92A.430(2)(e) copies of NRS Section 92A.300
through and including NRS Section 92A.500 are also enclosed.

ITEM 2.  DESCRIPTION OF PROPERTY.

         The Company's corporate offices are located at 901 Ponce de Leon Blvd.,
Suite 303, Coral Gables, FL 33134.

ITEM 3.  LEGAL PROCEEDINGS.

         As of hereof, I.A. Europe Group Inc. is not a party to any material
legal proceedings and none are known to be contemplated against it.

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

         NONE.

                                    PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

Voting Securities of the Company
--------------------------------

         On December 6, 2002, there were 3,011,300 shares of Common Stock issued
and outstanding and each share of Common Stock entitles the holder thereof to
one vote. There were also 2,000 shares of Series A preferred stock issued and
outstanding and each such share entitles the holder thereof to 25,000 votes per
share on each matter that may come before a meeting of the stockholders.


                                       4
<PAGE>


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

I.A. Europe Group, Inc. (the "Company") (formerly General Telephony.com, Inc.
(GTI)) is currently a development-stage company under the provisions of the
Financial Accounting Standards Board Statement of Financial Accounting Standards
No. 7.

On December 6, 2002, the Company merged with GTI thereby changing the Company's
name for General Telephony.com, Inc. to I.A. Europe Group, Inc. and its domicile
from Nevada to Delaware. The merger did not change the rights of the holders of
common stock except to the extent Delaware law differs from Nevada law. Each
share of GTI common and preferred stock automatically converted into a like
share of the Company. The number of common and preferred shares did not change
as a result of the merger.

The financial statements have been presented in accordance with accounting
principles generally accepted in the United States, which assumes the continuity
of the Company as a going concern. However, the Company has generated minimal
revenue to date, and has limited assets and an accumulated deficit of
approximately $69,000 at December 31, 2002. These factors raise substantial
doubt about the Company's ability to continue as a going concern.

Management's plans with regard to these matters include capitalizing on it
acquisition in March 2003 of four Costa Rican subsidiaries. However, there can
be no assurance that management's plans will be successful.

ITEM 7.  FINANCIAL STATEMENTS

         See Financial Statements beginning F-1 through F-12

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

On May 22, 2003, the Company changed its accounting firm from Merdinger,
Fruchter, Rosen & Company, P.C. (MFRC) to Rachlin Cohen & Holtz, LLP. This
change was due to MFRC's decision to no longer service Public Companies. There
were no disputes or disagreements on accounting and financial disclosures with
MFRC.



                                       5
<PAGE>

                                    PART III

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

         The following table sets forth the name and age of the persons who will
be directors and executive officers of the Company effective 10 days after the
mailing of this Information Statement. The executive officers of the Company are
elected annually by the board of directors. The directors serve one year terms
until their successors are elected. The executive officers serve terms of one
year or until their death, resignation or removal by the board of directors.
Unless described below, there are no family relationships among any of the
directors and officers.

Name                       Age           Position(s)
----                       ---           -----------
Victor Minca               65            Chief executive officer, president,
secretary,
                                         chairman of the board of directors

John J. McAuliffe          65            Chief financial officer and
treasurer

Mario Garcia               41            Director (10 days after the mailing
                                         of this Information Statement)

VICTOR MINCA founded I. A. Europe, Inc. in March of 1999, and is its chief
executive officer and chairman of the board of directors. Effective July 12,
2002, he began serving the positions referred to in the above table. He is also
the founder and editor of "Made in 2001", an international magazine written in
English, Italian and Spanish published by the Parent. Previously, Mr. Minca was
self-employed as a fashion and advertising photographer for international
magazines and advertising agencies in Australia, Asia, Africa, North and South
America, from 1963 to 1980. From 1980 to 1991, he was a general manager for
General Development Corp., a major United States land developer, where he was
responsible for sales and marketing.

JOHN J. McAULIFFE has been chief financial officer of the Company since December
6, 2002 and of I. A. Europe, Inc. since July 2002. From August 1989 to December
2000, he worked as controller for a privately held company, Appliance Doctor of
Central Florida, Inc. Concurrently, he worked as an adjunct professor for
Valencia Community College. Later in January 2001, he rejoined Valencia College
as a professor of business where he currently teaches on a part-time basis.


                                       6
<PAGE>

MARIO GARCIA has been a director of I. A. Europe, Inc. since February 2002. Mr.
Garcia has been a partner with several Florida law firms. Since December 1999,
he has been a member of the firm of Mario Garcia, P.A. From August 1995 through
December 2000 he was a member of LaFevre & Garcia, P.A, and from January 1992
through December 1999, Mr. Garcia was a partner of Pappas & Garcia, P.A. During
the Fall of 1999, Mr. Garcia was a visiting professor of business law at the
Valencia Community College, West Campus in Orlando Florida. Mr. Garcia graduated
from Columbia University School of Law in 1987.

ITEM 10.  EXECUTIVE COMPENSATION

         As a result of the Company's limited available cash no officer or
director received compensation during the fiscal year ended 2001.

         Coincident with the merger, the Company assumed GTI's obligations under
an employment agreement by and between GTI and Mr. Minca. Until such time as the
Company generates monthly revenue in excess of $250,000 for three consecutive
months, Mr. Minca's annual salary shall be $75,000. In exchange for Mr. Minca's
receiving a lower annual salary, GTI issued him 2,000 shares of Series A
preferred stock of GTI which was converted into 2,000 shares of Series A
preferred stock of the Company upon the merger of GTI into the Company.


ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         The following table sets forth, as of December 6, 2002, certain
information with respect to the Company's equity securities owned of record or
beneficially by (i) each officer and director of the Company; (ii) each person
who owns beneficially more than 5% of each class of the Company's outstanding
equity securities; and (iii) all directors and executive officers as a group.

                                                   Amount and
                                                   Nature of
Title of Class        Name and Address of          Beneficial          Percent
No. of Votes          Beneficial Owner(1)          Ownership           of Class
--------------        -------------------          ---------           --------
Common Stock          I.A. Europe, Inc.            2,886,000            95.8 %
2,886,000
                      301 Ponce de Leon
                      Suite 303
                      Miami, FL 33134

Common Stock          Victor Minca (2)             2,886,000            95.8 %
2,886,000

Series A Preferred    Victor Minca                   2,000               100%
50,000,000
Stock



                                       7
<PAGE>


(1) Beneficial ownership has been determined in accordance with Rule 13d-3 under
the Exchange Act and unless otherwise indicated, represents securities for which
the beneficial owner has sole voting investment power or has the power to
acquire such beneficial ownership within 60 days.

(2) Mr. Minca, as chief executive officer of I. A. Europe, Inc., may be deemed a
beneficial owner of the Common Stock of the Company. He disclaims beneficial
ownership.

Change in Control
-----------------

         On July 12, 2002, I. A. Europe, Inc. acquired 2,886,000 shares of
Common Stock from certain stockholders of GTI, predecessor of the Company, in a
private transaction. Through this purchase, I. A. Europe, Inc. acquired control
of GTI. Prior to the merger of GTI into the Company, Mr. Minca acquired control
of GTI on December 6, 2002 upon the issuance of the Series A Preferred Stock
referred to above. See "Certain Relationships and Related Transactions"

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         On July 12, 2002, Mr. Minca became president, secretary, treasurer and
a director of GTI. On December 6, 2002, prior to GTI's merger into the Company,
2000 shares of Series A Preferred Stock were authorized by GTI to be issued to
Mr. Minca the Company's president as alternate compensation in lieu of full
salary pursuant to an employment agreement by and between Mr. Minca and the
Company dated November 27, 2002.

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

         EXHIBIT
          NO.
         -----
         99.1     CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED
                  PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

         99.2     CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED
                  PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Item 14. CONTROLS AND PROCEDURES

         We maintain disclosure controls and procedures that are designed to
ensure that information required to be disclosed in our reports pursuant to the
Securities Exchange Act of 1934, as amended, is recorded, processed, summarized
and reported within the rime periods specified in the SEC's rules and forms, and
that such information is accumulated and communicated to out management,
including our President and Chief Executive Officer and Chief Financial Officer,
as appropriate, to allow timely disclosure. In designing and evaluating the
disclosure controls and procedures, management recognized that any controls and
procedures, no matter how well designed and operated, can only provide
reasonable assurance of achieving the desired control objectives, and management
necessarily was required to apply its judgment in evaluating the cost-benefit
relationship of possible controls and procedures.

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

         Within 90 days prior to March 28, 2003, we carried out an evaluation,
under the supervision and with the participation of our management, including
our President and Chief Executive Officer and Chief Financial Officer, of the
effectiveness of the design and operation of our disclosure controls and
procedures, as defined in Rules 13a-14(c) and 15d-14(c) under the Securities
Exchange Act of 1934. Based on the forgoing, our President and Chief Executive
Officer and Chief Financial Officer concluded that our disclosure controls and
procedures were effective as of the evaluation date.

CHANGES IN INTERNAL CONTROLS

         There have been no significant changes in our internal controls or in
other factors that could significantly affect these controls subsequent to the
date carried out this evaluation, including any corrective actions with regard
to significant deficiencies and material weaknesses.

                                       8
<PAGE>


SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, the
registrant caused this report to be signed on its behalf on May 22, 2003 by
the undersigned, thereunto duly authorized.


                                    IA Europe Group, INC.


                                    /s/ John McAuliffe
                                    -----------------------
                                    John McAuliffe
                                    Chief Financial Officer



                                       9
<PAGE>

                                 CERTIFICATION


         I, Victor Minca, certify pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002 that:

         1.       I have reviewed this report on Form 10-KSB of IA Europe Group,
                  Inc.

         2.       Based on my knowledge, this 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 report.

         3.       Based on my knowledge, the financial statements, and other
                  financial information included in this 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 report.

         4.       The registrant's other certifying officer 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 know to us by others within those entities,
                           particularly during the period in which this 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
                           report (the "Evaluation Date"); and

                  c)       presented in this 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 officer 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
                  function);

                  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 officer and I have indicated
                  in this report whether or not there were significant changes
                  in internal controls or in other factors that could
                  significantly affect internal controls or in other factors
                  that could significantly affect internal controls subsequent
                  to the date or our most recent evaluation, including any
                  corrective actions with regard to significant deficiencies and
                  material weaknesses.


Dated:  May 22, 2003                       /s/ Victor Minca
                                           --------------------------------
                                               Victor Minca
                                               President
                                               (the Chief Executive Officer
                                               of the Company)


                                       10
<PAGE>


                                 CERTIFICATION

         I, John McAuliffe, certify pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002 that:

         1.       I have reviewed this report on Form 10-KSB of IA Europe Group,
                  Inc.

         2.       Based on my knowledge, this 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 report.

         3.       Based on my knowledge, the financial statements, and other
                  financial information included in this 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 report.

         4.       The registrant's other certifying officer 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 know to us by others within those entities,
                           particularly during the period in which this 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
                           report (the "Evaluation Date"); and

                  c)       presented in this 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 officer 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
                  function);

                  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 officer and I have indicated
                  in this report whether or not there were significant changes
                  in internal controls or in other factors that could
                  significantly affect internal controls or in other factors
                  that could significantly affect internal controls subsequent
                  to the date or our most recent evaluation, including any
                  corrective actions with regard to significant deficiencies and
                  material weaknesses.

Dated:  May 22, 2003                       /s/ John McAuliffe
                                           ---------------------------
                                               John McAuliffe
                                               Chief Financial Officer


                                       11

                             I.A. EUROPE GROUP, INC.
                     (FORMERLY GENERAL TELEPHONY.COM, INC.)
                          (A DEVELOPMENT STAGE COMPANY)



                                TABLE OF CONTENTS



                                                                    PAGE

REPORTS OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS              F-1 - F-2

BALANCE SHEETS                                                      F-3

STATEMENTS OF OPERATIONS                                            F-4

STATEMENT OF STOCKHOLDERS' EQUITY                                   F-5

STATEMENTS OF CASH FLOWS                                            F-6

NOTES TO FINANCIAL STATEMENTS                                    F-7 - F-12


                                       i
<PAGE>



               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS


Board of Directors and Shareholders
I.A. Europe Group, Inc.
Miami, Florida


We have audited the accompanying balance sheet of I.A. Europe Group, Inc.
(formerly General Telephony.com, Inc.) (A Development Stage Company) (the
Company) as of December 31, 2002, and the related statements of operations,
stockholders' equity and cash flows for the year then ended and cumulative from
inception (November 12, 1999). The statements of operations, stockholders'
equity and cash flows from inception (November 12, 1999) to December 31, 2001,
were audited by other auditors whose report has been furnished to us, and our
opinion, insofar as it relates to the amounts included as cumulative from
inception (November 12, 1999) to December 31, 2001, is based solely on the
report of the other auditors. These financial statements are the responsibility
of the Company's management. Our responsibility is to express an opinion on
these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.

In our opinion, based on our audit and the report of the other auditor, the
financial statements referred to above present fairly, in all material respects,
the financial position of I.A. Europe Group, Inc. (formerly General
Telephony.com, Inc.) (A Development Stage Company) as of December 31, 2002, and
the results of its operations and its cash flows for the year then ended and
cumulative from inception, in conformity with accounting principles generally
accepted in the United States.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As described in Note 2 to the
financial statements, the Company is subject to certain risks and uncertainties,
which conditions raise substantial doubt about the Company's ability to continue
as a going concern. Management's plans with regard to these matters are also
described in Note 2 to the financial statements. The financial statements do not
include any adjustments that might result from the outcome of these
uncertainties.

                            RACHLIN COHEN & HOLTZ LLP


Miami, Florida
May 23, 2003



                                      F-1
<PAGE>


                          INDEPENDENT AUDITORS' REPORT


To the Board of Directors of General Telephony.com, Inc.:


We have audited the accompanying balance sheet of General Telephony.com, Inc. (A
Development Stage Company) as of December 31, 2001, and the related statements
of operations, stockholders' equity and cash flows for the year then ended.
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements based
on our audit.

We conducted our audit in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.

In our opinion, based on our audit, the financial statements referred to above
present fairly, in all material respects, the financial position of General
Telephony.com, Inc. as of December 31, 2001, and the results of its operations
and its cash flows for the year then ended, in conformity with accounting
principles generally accepted in the United States of America.


                                    MERDINGER, FRUCHTER, ROSEN & COMPANY, P.C.
                                    Certified Public Accountants


New York, New York
March 26, 2002



                                      F-2
<PAGE>

                             I.A. EUROPE GROUP, INC.
                     (FORMERLY GENERAL TELEPHONY.COM, INC.)
                          (A DEVELOPMENT STAGE COMPANY)

                                 BALANCE SHEETS
<TABLE>
<CAPTION>

                                                                          December 31,
                                                                          ------------
                                                                        2002        2001
                                                                     --------    --------
                                     ASSETS
                                     ------
<S>                                                                  <C>         <C>
Assets:
   Cash and cash equivalents                                         $     --    $    687

Property and equipment, net of accumulated
   depreciation of $0 and $5,667                                           --      14,333
                                                                     --------    --------
         Total assets                                                $     --    $ 15,020
                                                                     ========    ========

                LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIENCY)
                -------------------------------------------------

Liabilities:
   Accounts payable and accrued expenses                             $  6,250    $    105
                                                                     --------    --------
Subsequent Event and Other Matters                                         --          --

Stockholders' Equity (Deficiency):
   Preferred stock, $0.001 par value; 5,000,000 shares authorized,
      2,000 shares issued and outstanding                                   2          --
   Common stock, $0.001 par value; 20,000,000 share authorized,
      3,011,300 shares issued and outstanding                           3,011       3,011
   Additional paid-in capital                                          66,602      65,604
   Deficit accumulated during the development stage                   (75,865)    (53,700)
                                                                     --------    --------
         Total stockholders' equity (deficiency)                       (6,250)     14,915
                                                                     --------    --------
         Total liabilities and stockholders' equity (deficiency)     $     --    $ 15,020
                                                                     ========    ========
</TABLE>




                                      F-3
<PAGE>

                             I.A. EUROPE GROUP, INC.
                     (FORMERLY GENERAL TELEPHONY.COM, INC.)
                          (A DEVELOPMENT STAGE COMPANY)

                            STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>

                                                                         November 12,
                                                                            1999
                                                   Year Ended           (Inception) to
                                                   December 31,          December 31,
                                               2002           2001           2002
                                           -----------    -----------    -----------
<S>                                        <C>            <C>            <C>
Revenue                                    $        --    $     3,511    $     4,949
Cost of Goods Sold                                  --          3,727          5,967
                                           -----------    -----------    -----------
Gross Loss                                          --           (216)        (1,018)

General and Administrative Expenses              7,832         20,039         60,514
Impairment of Long Lived Assets                 14,333             --         14,333
                                           -----------    -----------    -----------
Loss Before Provision for Income Taxes         (22,165)       (20,255)       (75,865)

Provision for Income Taxes                          --             --             --
                                           -----------    -----------    -----------
Net Loss                                   $   (22,165)   $   (20,255)   $   (75,865)
                                           ===========    ===========    ===========


Net Loss Per Share - Basic and Diluted     $     (0.01)   $     (0.01)
                                           ===========    ===========

Weighted Average Number of Common Shares     3,011,300      3,011,300
                                           ===========    ===========
</TABLE>



                                      F-4
<PAGE>

                             I.A. EUROPE GROUP, INC.
                     (FORMERLY GENERAL TELEPHONY.COM, INC.)
                          (A DEVELOPMENT STAGE COMPANY)

                       STATEMENTS OF STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>


                                                             Preferred Stock
                                                               Series A             Common Stock
                                                           Shares       Amount    Shares      Amount
                                                         ---------   ---------   ---------   ---------
<S>                                                          <C>     <C>         <C>         <C>
Balance, Nov. 12, 1999 (Inception)                              --   $      --          --   $      --
Issuance of Founder Shares for Cash, November 15, 1999          --          --   1,800,000       1,800
Shares Issued for Cash at $0.05 Per Share (Pursuant to
   Rule 506 Offering), December 5, 1999                         --          --     840,000         840
Net Loss                                                        --          --          --          --
                                                         ---------   ---------   ---------   ---------
Balance, December 31, 1999                                      --          --   2,640,000       2,640
Shares Issued for Cash at $0.05 Per Share (Pursuant to
   Rule 504 Offering), May 31, 2000                             --          --     371,300         371
Net Loss                                                        --          --          --          --
                                                         ---------   ---------   ---------   ---------
Balance, December 31, 2000                                      --          --   3,011,300       3,011
Shareholder Contribution                                        --          --          --          --
Net Loss                                                        --          --          --          --
                                                         ---------   ---------   ---------   ---------
Balance, December 31, 2001                                      --          --   3,011,300       3,011
Shares Issued in Lieu of Compensation                        2,000           2          --          --
Net Loss                                                        --          --          --          --
                                                         ---------   ---------   ---------   ---------
Balance, December 31, 2002                                   2,000   $       2   3,011,300   $   3,011
                                                         =========   =========   =========   =========
[RESTUBBED]
<CAPTION>

                                                                        Deficit
                                                                      Accumulated     Total
                                                         Additional    During the  Stockholders'
                                                           Paid-In     Development    Equity
                                                           Capital       Stage     (Deficiency)
                                                           ---------   ---------    ---------
<S>                                                        <C>         <C>          <C>
Balance, Nov. 12, 1999 (Inception)                         $      --   $      --    $      --
Issuance of Founder Shares for Cash, November 15, 1999            --          --        1,800
Shares Issued for Cash at $0.05 Per Share (Pursuant to
   Rule 506 Offering), December 5, 1999                       41,160          --       42,000
Net Loss                                                          --     (12,460)     (12,460)
                                                           ---------   ---------    ---------
Balance, December 31, 1999                                    41,160     (12,460)      31,340
Shares Issued for Cash at $0.05 Per Share (Pursuant to
   Rule 504 Offering), May 31, 2000                           18,194          --       18,565
Net Loss                                                          --     (20,985)     (20,985)
                                                           ---------   ---------    ---------
Balance, December 31, 2000                                    59,354     (33,445)      28,920
Shareholder Contribution                                       6,250          --        6,250
Net Loss                                                          --     (20,255)     (20,255)
                                                           ---------   ---------    ---------
Balance, December 31, 2001                                    65,604     (53,700)      14,915
Shares Issued in Lieu of Compensation                            998          --        1,000
Net Loss                                                          --     (22,165)     (22,165)
                                                           ---------   ---------    ---------
Balance, December 31, 2002                                 $  66,602   $ (75,865)   $  (6,250)
                                                           =========   =========    =========
</TABLE>


                                      F-5
<PAGE>

                             I.A. EUROPE GROUP, INC.
                     (FORMERLY GENERAL TELEPHONY.COM, INC.)
                          (A DEVELOPMENT STAGE COMPANY)

                            STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>

                                                                                    November 12,
                                                                                        1999
                                                                   Year Ended       (Inception) to
                                                                   December 31,      December 31,
                                                                 2002        2001        2002
                                                               --------    --------    --------
<S>                                                            <C>         <C>         <C>
Cash Flows from Operating Activities:
   Net loss                                                    $(22,165)   $(20,255)   $(75,865)
   Adjustments to reconcile net loss to
      net cash used by operating activities:
         Depreciation and amortization                               --       4,000       5,667
         Issuance of preferred stock in lieu of compensation      1,000          --       1,000
         Impairment of long lived assets                         14,333          --      14,333
         Increase (decrease) in accounts payable                  6,145        (610)      6,250
                                                               --------    --------    --------
            Net cash used in operating activities                  (687)    (16,865)    (48,615)
                                                               --------    --------    --------
Cash Flows Used from Investing Activities:
   Purchase of fixed assets                                          --          --     (20,000)
                                                               --------    --------    --------
Cash Flows from Financing Activities:
   Shareholder contributions                                         --       6,250       6,250
   Issuance of capital stock                                         --          --      62,365
                                                               --------    --------    --------
             Net cash provided by financing activities               --       6,250      68,615
                                                               --------    --------    --------
Net Change in Cash                                                 (687)    (10,615)         --

Cash - Beginning of Period                                          687      11,302          --
                                                               --------    --------    --------
Cash - End of Period                                           $     --    $    687    $     --
                                                               ========    ========    ========
Supplemental Information:
   Cash payments made for:
      Income taxes                                             $     --    $     --    $     --
                                                               ========    ========    ========
      Interest                                                 $     --    $     --    $     --
                                                               ========    ========    ========
</TABLE>



                                      F-6
<PAGE>

                             I.A. EUROPE GROUP, INC.
                     (FORMERLY GENERAL TELEPHONY.COM, INC.)
                          (A DEVELOPMENT STAGE COMPANY)

                              FINANCIAL STATEMENTS

                           DECEMBER 31, 2002 AND 2001


NOTE 1.  DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING
         POLICIES

         NATURE OF OPERATIONS

             I.A. Europe Group, Inc. (the "Company") (formerly General
             Telephony.com, Inc. (GTI)) is currently a development-stage company
             under the provisions of the Financial Accounting Standards Board
             Statement of Financial Accounting Standards No. 7.

             On December 6, 2002, the Company merged with GTI thereby changing
             the Company's name from General Telephony.com, Inc. to I.A. Europe
             Group, Inc. and its domicile from Nevada to Delaware. The merger
             did not change the rights of the holders of common stock except to
             the extent Delaware law differs from Nevada law. Each share of GTI
             common and preferred stock automatically converted into a like
             share of the Company. The number of common and preferred shares did
             not change as a result of the merger.

         CASH AND CASH EQUIVALENTS

             The Company considers all highly liquid investments purchased with
             original maturities of three months or less to be cash equivalents.

         LONG-LIVED ASSETS

             Long-lived assets to be held and used are reviewed for impairment
             whenever events or changes in circumstances indicate that the
             related carrying amount may not be recoverable. When required,
             impairment losses on assets to be held and used are recognized
             based on the fair value of the assets and long-lived assets to be
             disposed of are reported at the lower of carrying amount or fair
             value less cost to sell.

         INCOME TAXES

             Income taxes are provided for based on the liability method of
             accounting pursuant to SFAS No. 109, "Accounting for Income Taxes".
             Deferred income taxes, if any, are recorded to reflect the tax
             consequences on future years of differences between the tax bases
             of assets and liabilities and their financial reporting amounts at
             each year-end.

         EARNINGS PER SHARE

             The Company calculates earnings per share in accordance with SFAS
             No. 128, "Earnings Per Share", which requires presentation of basic
             earnings per share ("BEPS") and diluted earnings per share
             ("DEPS"). The computation of BEPS is computed by dividing income
             available to common stockholders by the weighted average number of
             outstanding common shares during the period. DEPS gives effect to
             all dilutive potential common shares outstanding during the period.
             The computation of DEPS does not assume conversion, exercise or
             contingent exercise of securities that would have an antidilutive
             effect on earnings. As of December 31, 2002 and 2001, the Company
             had no securities that would affect loss per share if they were to
             be dilutive.


                                      F-7
<PAGE>


                             I.A. EUROPE GROUP, INC.
                     (FORMERLY GENERAL TELEPHONY.COM, INC.)
                          (A DEVELOPMENT STAGE COMPANY)

                              FINANCIAL STATEMENTS
                                   (Continued)


NOTE 1.  DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING
         POLICIES (Continued)

         USE OF ESTIMATES

             The preparation of financial statements in conformity with
             accounting principles generally accepted in the United States
             requires management to make estimates and assumptions that affect
             the reported amounts of assets and liabilities and disclosure of
             contingent assets and liabilities at the dates of the financial
             statements and the reported amounts of revenues and expenses during
             the reporting periods. Actual results could differ from those
             estimates.

         RECENT ACCOUNTING PRONOUNCEMENTS

             In November 2002, the FASB issued FASB Interpretation No., or FIN
             45, Guarantor's Accounting and Disclosure Requirements for
             Guarantees, Including Indirect Guarantee of Indebtedness of Others.
             FIN 45 requires that upon issuance of a guarantee, the guarantor
             must recognize a liability for the fair value of the obligation it
             assumes under that guarantee. FIN 45's provisions for initial
             recognition and measurement should be applied on a prospective
             basis to guarantees issued or modified after December 31, 2002. The
             guarantor's previous accounting for guarantees that were issued
             before the date of FIN 45's initial application may not be revised
             or restated to reflect the effect of the recognition and
             measurement provisions of the Interpretation. The disclosure
             requirements are effective for financial statements of both interim
             and annual periods that end after December 15, 2002. The Company is
             not a guarantor under any significant guarantees and thus this
             interpretation is not expected to have a significant effect on the
             Company's financial position or results of operations.

             In April 2002, the FASB issued SFAS No. 145, Rescission of FASB
             Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13,
             and Technical Corrections. SFAS 145 is effective for fiscal years
             beginning after May 15, 2002. The Company does not expect the
             adoption of this standard to have any impact on its financial
             position or results of operations.

             In July 2002, the FASB issued SFAS No. 146, Accounting for Costs
             Associated with Exit or Disposal Activities. SFAS 146 is effective
             for exit or disposal activities initiated after December 31, 2002.

             On December 31, 2002, the FASB issued SFAS No. 148, Accounting for
             Stock-Based Compensation - Transition and Disclosure - An Amendment
             of SFAS 123. The standard provides additional transition guidance
             for companies that elect to voluntarily adopt the accounting
             provisions of SFAS 123, Accounting for Stock-Based Compensation.
             SFAS 148 does not change the provisions of SFAS 123 that permits
             entities to continue to apply the intrinsic value method of APB 25,
             Accounting for Stock Issued to Employees. As the Company continues
             to follow APB 25, its accounting for stock-based compensation will
             not change as a result of SFAS 148. SFAS 148 does require certain
             new disclosures in both annual and interim financial statements.
             The required annual disclosures are effective immediately and have
             been included in Note 10 of the Company's consolidated financial
             statements. The new interim disclosure provisions will be effective
             in the first quarter of 2003.

                                      F-8
<PAGE>

NOTE 1.  DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING
         POLICIES (Continued)

         RECENT ACCOUNTING PRONOUNCEMENTS (Continued)

             In April 2003, The FASB issued SFAS No. 149, "Amendment of
             Statement 133 on Derivative Instruments and Hedging Activities".
             This standard amends and clarifies financial accounting and
             reporting for derivative instruments, including certain derivative
             instruments embedded in other contracts, collectively referred to
             as derivatives, and for hedging activities under SFAS No. 133,
             "Accounting for Derivative Instruments and Hedging Relationships".
             SFAS 149 is effective for contracts entered into or modified after
             June 30, 2003 and for hedging relationships after June 30, 2003.
             The Company does not expect the adoption of this standard to have
             any impact its financial position or results of operations.

             In May 2003, the FASB issued SFAS 150, "Accounting for Certain
             Financial Instruments with Characteristics of Both Liabilities and
             Equity". This statement establishes standards for how a company
             classifies and measures certain financial instruments with
             characteristics of both liabilities and equity. This statement is
             effective for financial instruments entered into or modified after
             May 31, 2003 and otherwise is effective at the beginning of the
             first interim period beginning after June 15, 2003. The statement
             will be implemented by reporting the cumulative effect of a change
             in accounting principle for financial instruments created before
             the issuance date of the statement and still existing at the
             beginning of the period of adoption. Although we are still in the
             process of reviewing the new statement, we do not expect the
             adoption of this statement to have any material impact on our
             financial statements.

NOTE 2.  GOING CONCERN

         The accompanying financial statements have been presented in accordance
         with accounting principles generally accepted in the United States,
         which assumes the continuity of the Company as a going concern.
         However, the Company has generated minimal revenue to date, and has
         limited assets and an accumulated deficit accumulated during the
         development stage of approximately $76,000 at December 31, 2002. These
         factors raise substantial doubt about the Company's ability to continue
         as a going concern.

         Management's plans with regard to these matters include capitalizing on
         it acquisition in March 2003 of four Costa Rican subsidiaries (see Note
         8). However, there can be no assurance that management's plans will be
         successful.

NOTE 3.  SIGNIGICANT FOURTH QUARTER ADJUSTMENT

         In December 2002, the Company determined that the telephone equipment
         would not be utilized in future operations of the Company and therefore
         was considered impaired and written down to zero. The amount of the
         write-down amounted to $14,333 and is reflected as an impairment loss
         on the accompanying statement of operations for 2002.

                                      F-9
<PAGE>


NOTE 4.  INCOME TAXES
<TABLE>
<CAPTION>

         The components of the provision for income taxes are as follows:

                                                                   2002       2001
                                                                 --------   --------
<S>                                                              <C>        <C>
          Current Tax Expense
             U.S. Federal                                        $     --   $     --
             State and local                                           --         --
                                                                 --------   --------
                Total current                                          --         --

          Deferred Tax Expense
             U.S. Federal                                              --         --
             State and local                                           --         --
                                                                 --------   --------
                Total deferred                                         --         --
                                                                 --------   --------
                Total tax provision from continuing operations   $     --   $     --
                                                                 ========   ========
</TABLE>

         The reconciliation of the effective income tax rate to the Federal
         statutory rate is as follows:

                                                           2002          2001
                                                           ----          ----

           Federal Income Tax Rate                         34.0%         34.0%
           Effect of Valuation Allowance                  (34.0)        (34.0)
                                                          -----         -----
           Effective Income Tax Rate                        0.0%          0.0%
                                                          =====         =====

         At December 31, 2002, the Company had net carryforward losses of
         approximate $76,000. Because of the current uncertainty of realizing
         the benefits of the tax carryforward, a valuation allowance equal to
         the tax benefits for deferred taxes has been established. The full
         realization of the tax benefit associated with the carryforward depends
         predominantly upon the Company's ability to generate taxable income
         during the carryforward period.

         Deferred tax assets and liabilities reflect the net tax effect of
         temporary differences between the carrying amount of assets and
         liabilities for financial reporting purposes and amounts used for
         income tax purposes. Significant components of the Company's deferred
         tax assets and liabilities as of December 31, 2002 and 2001 are as
         follows:
                                                          2002         2001
                                                          ----         ----
           Deferred Tax Assets
              Loss carryforwards                        $ 1,800     $ 1,800
              Less valuation allowance                   (1,800)     (1,800)
                                                        -------     -------
           Net deferred tax assets                      $    --     $    --
                                                        =======     =======

         Net operating loss carryforwards expire through 2022.

         In addition, the Company has experienced a change in ownership that
         under the Internal Revenue Service Code Section 382, the use of the net
         operating loss carryforward may be limited.


                                      F-10

<PAGE>


NOTE 5.  STOCKHOLDERS' EQUITY

         COMMON STOCK

             On November 15, 1999, the Company issued 1,800,000 shares of its
             $0.001 par value common stock to its founders for cash of $1,800.

             On May 31, 2000, the Company issued 840,000 shares of its $0.001
             par value common stock at $0.05 per share for cash of $42,000. The
             shares were issued pursuant to Regulation D, Rule 506 of the
             Securities and Exchange Commission Act of 1933 offering.

             On December 5, 2000, the Company issued 371,300 shares of its
             $0.001 par value common stock at $0.05 per share for cash of
             $18,565. The shares were issued pursuant to a Regulation D, Rule
             504 of the Securities and Exchange Commission Act of 1933 offering.

             In April 2001, a shareholder contributed $6,250 to the Company as
             additional paid-in capital.

         PREFERRED STOCK

             In December 2003, the Company issued 2,000 shares of its $0.001 par
             value Series A preferred stock valued at $1,000 to a shareholder
             under an employment agreement (see Note 7).

NOTE 6.  RELATED PARTY TRANSACTIONS

         The Company neither owns nor leases any real or personal property. The
         officers/directors of the Company provide office and other services
         without charge. Such costs are immaterial to the financial statements
         and, accordingly, have not been reflected therein. These individuals
         are involved in other business activities and may, in the future,
         become involved in other business opportunities. If specific business
         opportunity becomes available, such persons may face a conflict in
         selecting between the Company and their other business interest. The
         Company has not formulated a policy for the resolution of such
         conflicts.

         In April 2001, a shareholder contributed $6,250 to the Company as
         additional paid-in capital.

NOTE 7.  EMPLOYMENT AGREEMENT

         Effective December 1, 2002, the Company entered into an employment
         agreement with a shareholder for executive services for a period of
         five years. The agreement calls for an annual salary of $250,000, but
         due to the Company's cash flows, the Company is unable to meet this
         salary. In accordance with the agreement, the salary was reduced to
         $75,000 until the Company has revenue in excess of $250,000 for three
         consecutive months. As consideration for this reduction of salary, the
         executive was issued 2,000 shares of Series A preferred stock which has
         voting power equal to 25,000 votes per share. The preferred stock shall
         convert to common stock

                                      F-11
<PAGE>

NOTE 7.  EMPLOYMENT AGREEMENT (Continued)

         on a share for share basis upon the expiration of the agreement. The
         Company determined the value of the 2,000 shares issues on an
         as-converted basis using the closing price of the common stock on
         December 6, 2002, the date the shares were issued. The value of the
         2,000 shares issued amounted to $1,000.

NOTE 8.  SUBSEQUENT EVENTS

         ACQUISITIONS

             On March 4, 2003, the Company purchased all of the issued and
             outstanding shares of capital stock of Internet De Centroamerica
             S.A., I.A. Europe Group Costa Rica, S.A. I.A. Europe Group Villa,
             S.A., and El Sueno Tropical Mountain Resort, S.A., (collectively,
             the "Designated Subsidiaries") from I.A. Europe, Inc., a Delaware
             corporation (the "Seller"). The consideration for the purchase was
             the issuance to the Seller of 100 shares Series B Preferred Stock
             of the Company with a stated value of $18,000 per share (or
             $1,800,000) and was arrived at by estimating the potential net
             realizable value of the assets upon any future sale.

             The assets owned by these subsidiaries constitute physical
             property. The assets of Internet De Centroamerica S.A. consist of
             computer equipment used in providing Internet and website services.
             The assets of I.A. Europe Group Costa Rica, S.A. consist of
             approximately 170 hectares in San Juan de Barbacoas de Puriscal,
             San Jose, Costa Rica used as a farm and held for investment
             purposes. The assets of I.A. Europe Group Villa, S.A. consist of a
             house or villa in Villas Malibu, Guachipelin de Escazu, San Jose
             Costa Rica used as a residence. The assets of El Sueno Tropical
             Mountain Resort, S.A. consist of preliminary development plans for
             a hotel. It is the present intent of the Company to continue to use
             the assets in the same manner as they were used by the Seller.
             There is no present intent or plans concerning any sale of the
             assets.

         SERIES B PREFERRED STOCK

             On February 24, 2003 the Board of Directors adopted a resolution
             authorizing the Company to issue a series of preferred stock
             entitled Series B Preferred Stock. The number of shares
             constituting this series is 100 shares with a stated value of
             $18,000 per share. The number of shares may be increased or
             decreased, but not to a number less than the number of shares of
             Series Preferred then issued and outstanding, by resolution adopted
             by the Board of Directors.

             The Series B Preferred Stock has liquidation preferences in the
             event of the sale of all or substantially all of the assets of, or
             the dissolution, winding up, or liquidation of, the Company or the
             Designated Subsidiaries, provides the holder with the right to
             receive up to $50,000 from any of the net proceeds from the sale of
             each of Internet De Centroamerica S.A. and El Sueno Tropical
             Mountain Resourt, S.A., and up to $850,000 from any of the net
             proceeds from each of I.A. Europe Group Costa Rica, S.A. and I.A.
             Europe Villa, S.A.



                                      F-12