<PAGE>

                      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, 2000
                      ----------------------------------
 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 0-31407

                        LICENSE ACQUISITION CORPORATION
             (Exact name of small business issuer in its charter)

                   Delaware                     52-2257554
         -------------------------              ----------
        (State or other jurisdiction of         (I.R.S. Employer
        incorporation or organization)          Identification No.)

                  1504 R Street, N.W., Washington, D.C. 20009
                  -------------------------------------------
             (Address of principal executive offices)  (zip code)

                  Issuer's Telephone Number:   202/387-5400
                                             ----------------


Securities registered under Section 12(g)       Common Stock, $.0001
of the Exchange Act:                            par value per share


Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the last 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 there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB.  [ ]

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

State the aggregate market value of the voting and non-voting common equity held
by non-affiliates computed by reference to the price at which the common equity
was sold, or the average bid and asked price of such common equity, as of a
specified date within the past 60 days.           $ 0.

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date.

              Class                             Outstanding at December 31, 2000
  -------------------------------               --------------------------------
  Common Stock, par value $0.0001                          1,000,000

Documents incorporated by reference:    None
<PAGE>

                                 PART I

Item 1.  Description of Business

   License Acquisition Corporation (the "Company") was incorporated on March 24,
1999 under the laws of the State of Delaware to engage in any lawful corporate
undertaking, including, but not limited to, selected mergers and acquisitions.
The Company has been in the developmental stage since inception and has no
operations to date other than issuing shares to its original shareholder.

   The Company's purpose is to seek, investigate and, if such investigation
warrants, acquire an interest in a business entity which desires to seek the
perceived advantages of a corporation which has a class of securities registered
under the Exchange Act.  The Company will not restrict its search to any
specific business, industry, or geographical location and it may participate in
a business venture of virtually any kind or nature.  Management anticipates that
it will be able to participate in only one potential business venture because
the Company has nominal assets and limited financial resources.

   The Company registered its common stock on a Form 10-SB registration
statement filed pursuant to the Securities Exchange Act of 1934 (the "Exchange
Act") and Rule 12(g) thereof.  The Company files with the Securities and
Exchange Commission periodic and current reports under Rule 13(a) of the
Exchange Act, including quarterly reports on Form 10-QSB and annual reports Form
10-KSB.

Item 2.  Description of Property

   The Company has no properties and at this time has no agreements to acquire
any properties.  The Company currently uses the offices of management at no cost
to the Company.  Management has agreed to continue this arrangement until the
Company completes a business combination.

Item 3.  Legal Proceedings

   There is no litigation pending or threatened by or against the Company.

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

   No matter was submitted to a vote of security holders, through the
solicitation of proxies or otherwise, during the fourth quarter of the fiscal
year covered by this report.

                                       2
<PAGE>

                                   PART II

Item 5.  Market for Common Equity and Related Stockholder Matters

     Following a business combination, a target company will normally wish to
cause the Company's common stock to trade in one or more United States
securities markets.  The target company may elect to take the steps required for
such admission to quotation following the business combination or at some later
time.

     If, after a business combination, the Company does not meet the
qualifications for listing on the Nasdaq SmallCap Market, the Company may apply
for quotation of its securities on the NASD OTC Bulletin Board.  In certain
cases the Company may elect to have its securities initially quoted in the "pink
sheets" published by the National Quotation Bureau, Inc.

     To have its securities quoted on the NASD OTC Bulletin Board a company
must:

     (1) be a company that reports its current financial information to the
Securities and Exchange Commission, banking regulators or insurance regulators;

     (2) has at least one market maker who completes and files a Form 211 with
NASD Regulation, Inc.

     The NASD OTC Bulletin Board is a dealer-driven quotation service.  Unlike
the Nasdaq Stock Market, companies cannot directly apply to be quoted on the
NASD OTC Bulletin Board, only market makers can initiate quotes, and quoted
companies do not have to meet any quantitative financial requirements.  Any
equity security of a reporting company not listed on the Nasdaq Stock Market or
on a national securities exchange is eligible.

     In order to qualify for listing on the Nasdaq SmallCap Market, a company
must have at least (i) net tangible assets of $4,000,000 or market
capitalization of $50,000,000 or net income for two of the last three years of
$750,000; (ii) a public float of 1,000,000 shares with a market value of
$5,000,000; (iii) a bid price of $4.00; (iv) three market makers; (v) 300
shareholders and (vi) an operating history of one year or, if less than one
year, $50,000,000 in market capitalization.  For continued listing on the Nasdaq
SmallCap Market, a company must have at least (i) net tangible assets of
$2,000,000 or market capitalization of $35,000,000 or net income for two of the
last three years of $500,000; (ii) a public float of 500,000 shares with a
market value of $1,000,000; (iii) a bid price of $1.00; (iv) two market makers;
and (v) 300 shareholders.

     In general there is greatest liquidity for traded securities on the Nasdaq
SmallCap Market, less on the NASD OTC Bulletin Board, and least through
quotation by the National Quotation Bureau, Inc. on the "pink sheets".  It is
not possible to predict where, if at all, the securities of the Company will be
traded following a business combination.

     During the past three years, the Company has sold securities which were not
registered as follows:

                                                      NUMBER OF
   DATE              NAME                             SHARES       CONSIDERATION

   March 25, 1999    Pierce Mill Associates, Inc.(1)  1,000,000    $  100
   ________

     (1)  Mr. Cassidy, the president and sole director of the Company, is the
sole director and shareholder of Pierce Mill Associates, Inc. and is therefore
considered to be the beneficial owner of the common stock of the Company issued
to it.

Item 6.  Management's Discussion and Analysis or Plan of Operation

     The Company will attempt to locate and negotiate with a business entity for
the combination of that target company with the Company.  The combination will
normally take the form of a merger, stock-for-stock exchange or stock-for-assets
exchange (the "business combination").  In most instances the target company
will wish to structure the business combination to be within the definition of a
tax-free reorganization under Section 351 or Section 368 of the Internal Revenue
Code of 1986, as amended.  No assurances can be given that the Company will be
successful in locating or negotiating with any target business.

     The Company has not restricted its search for any specific kind of
businesses, and it may acquire a business which is in its preliminary or
development stage, which is already in operation, or in essentially any stage of
its business life. It is impossible to predict the status of any business in
which the Company may become engaged, in that such business may need to seek
additional capital, may desire to have its shares publicly traded, or may seek
other perceived advantages which the Company may offer.

     In implementing a structure for a particular business acquisition, the
Company may become a party to a merger, consolidation, reorganization, joint
venture, or licensing agreement with another corporation or entity.

     It is anticipated that any securities issued in any such business
combination would be issued in reliance upon exemption from registration under
applicable federal and state securities laws.  In some circumstances, however,
as a negotiated element of its transaction, the Company may agree to register
all or a part of such securities immediately after the transaction is
consummated or at specified times thereafter.  If such registration occurs, it
will be undertaken by the surviving entity after the Company has entered into an
agreement for a business combination or has consummated a business combination.
The issuance of additional securities and their potential sale into any trading
market which may develop in the Company's securities may depress the market
value of the Company's securities in the future if such a market develops, of
which there is no assurance.

     The Company will participate in a business combination only after the
negotiation and execution of appropriate agreements.  Negotiations with a target
company will likely focus on the percentage of the Company which the target
company shareholders would acquire in exchange for their shareholdings.
Although the terms of such agreements cannot be predicted, generally such
agreements will require certain representations and warranties of the parties
thereto, will specify certain events of default, will detail the terms of
closing and the conditions which must be satisfied by the parties prior to and
after such closing and will include miscellaneous other terms.  Any merger or
acquisition effected by the Company can be expected to have a significant
dilutive effect on the percentage of shares held by the Company's shareholders
at such time.

     The Company has entered into an agreement with Rock Creek Capital
Corporation to supervise the search for target companies as potential candidates
for a business combination.  The agreement will continue until such time as the
Company has effected a business combination.  Rock Creek Capital Corporation has
agreed to pay all expenses of the Company until such time as a business
combination is effected, without repayment.  James M. Cassidy, the sole officer
and director of the Company, is the sole officer, director and beneficial
shareholder of Rock Creek Capital Corporation.

     The Company does not anticipate expending funds itself for locating a
target company.  James M. Cassidy, the officer and director of the Company,
provides his services without charge or repayment.  The Company will not borrow
any funds to make any payments to the Company's management, its affiliates or
associates.  If Rock Creek Capital Corporation stops or becomes unable to
continue to pay the Company's operating expenses, the Company may not be able to
timely make its periodic reports required under the Exchange Act nor to continue
to search for an acquisition target.  In such event, the Company would seek
alternative sources of funds or services, primarily through the issuance of its
securities.

     Rock Creek Capital Corporation may only locate potential target companies
for the Company and is not authorized to enter into any agreement with a
potential target company binding the Company.  Rock Creek Capital Corporation
may provide assistance to target companies incident to and following a business
combination, and receive payment for such assistance from target companies. The
agreement with Rock Creek Capital Corporation is not exclusive and the Company
may enter into similar agreements with other persons or entities.

     The Board of Directors has passed a resolution which contains a policy that
the Company will not seek a business combination with any entity in which the
Company's officer, director, shareholders or any affiliate or associate serves
as an officer or director or holds any ownership interest.

Item 7.  Financial Statements

     The financial statements for the year ended December 31, 2000 are attached
to this filing.

Item 8.  Changes in and Disagreements with Accountants on Accounting and
         Financial Disclosure

     There were no changes in or disagreements with accountants on accounting
and financial disclosure for the

                                       3
<PAGE>

period covered by this report.

                                 PART III

Item 9.  Directors, Executive Officers, Promoters and Control Persons;
         Compliance with Section 16(a) of the Exchange Act

     The Directors and Officers of the Company are as follows:

     Name                Age    Positions and Offices Held
     --------------      --     --------------------------
     James M. Cassidy    65     President, Secretary, Director

     There are no agreements or understandings for the officer or director to
resign at the request of another person and the above-named officer and director
is not acting on behalf of nor will act at the direction of any other person.

     Set forth below is the name of the director and officer of the Company, all
positions and offices with the Company held, the period during which he has
served as such, and the business experience during at least the last five years:

     James Michael Cassidy, Esq., LL.B., LL.M., received a Bachelor of Science
in Languages and Linguistics from Georgetown University in 1960, a Bachelor of
Laws from The Catholic University School of Law in 1963, and a Master of Laws in
Taxation from The Georgetown University School of Law in 1968. From 1963-1964,
Mr. Cassidy was law clerk to the Honorable Inzer B. Wyatt of the United States
District Court for the Southern District of New York. From 1964-1965, Mr.
Cassidy was law clerk to the Honorable Wilbur K. Miller of the United States
Court of Appeals for the District of Columbia.  From 1969-1975, Mr. Cassidy was
an associate of the law firm of Kieffer & Moroney and a principal in the law
firm of Kieffer & Cassidy, Washington, D.C.  From 1975 to date, Mr. Cassidy has
been a principal in the law firm of Cassidy & Associates, Washington, D.C. and
its predecessors, specializing in securities law and related corporate and
federal taxation matters. Mr. Cassidy is a member of the bars of the District of
Columbia and the State of New York and is admitted to practice before the United
States Tax Court and the United States Supreme Court.

Other Similar Companies

     James M. Cassidy, the president of the Company, has been and is currently
involved with companies similar to this one.  The initial business purpose of
each of these companies was or is to engage in a business combination with an
unidentified company or companies.

Conflicts of Interest

     A conflict may arise in the event that a similar company with which Mr.
Cassidy is affiliated also actively seeks a target company.  It is anticipated
that target companies will be located for the Company and other similar
companies in chronological order of the date of formation of such companies or,
in the case of companies formed on the same date, alphabetically.  However,
other companies may differ from the Company in certain items such as place of
incorporation, number of shares and shareholders, working capital, types of
authorized securities, or other items.  It may be that a target company may be
more suitable for or may prefer a certain company formed after the Company.  In
such case, a business combination might be negotiated on behalf of the more
suitable or preferred similar company regardless of date of formation.

     Mr. Cassidy is the principal of Cassidy & Associates, a law firm located in
Washington, D.C. As such, demands may be placed on the time of Mr. Cassidy which
would detract from the amount of time he is able to devote to the Company.  Mr.
Cassidy intends to devote as much time to the activities of the Company as
required.  However, should such a conflict arise, there is no assurance that Mr.
Cassidy would not attend to other matters prior to those of the Company.

                                       4
<PAGE>

     The terms of business combination may include such terms as Mr. Cassidy
remaining a director or officer of the Company and/or the continuing securities
or other legal work of the Company being handled by the law firm of which Mr.
Cassidy is the principal. The terms of a business combination may provide for a
payment by cash or otherwise to Pierce Mill Associates, Inc. by a target
business for the purchase of all or some of the common stock of the Company
owned by Pierce Mill Associates, Inc. Mr. Cassidy would directly benefit
from such employment or payment. Such benefits may influence Mr. Cassidy's
choice of a target business.

     Management may agree to pay finder's fees, as appropriate and allowed, to
unaffiliated persons who may bring a target business to the Company where that
reference results in a business combination. The amount of any finder's fee
will be subject to negotiation, and cannot be estimated at this time. No
finder's fee will be paid to the management or promoters of the Company, or to
their associates or affiliates. No loans of any type have been, or will be, made
to management or promoters of the Company or to any of their associates or
affiliates.

     The Company will not enter into a business combination, or acquire any
assets of any kind for its securities, in which management or promoters of the
Company or any affiliates or associates have any interest, direct or indirect.

     There are no binding guidelines or procedures for resolving potential
conflicts of interest. Failure by management to resolve conflicts of interest in
favor of the Company could result in liability of management to the Company.
However, any attempt by shareholders to enforce a liability of management to the
Company would most likely be prohibitively expensive and time consuming.

Item 10.  Executive Compensation

     The Company's officer and director does not receive any compensation for
his services rendered to the Company, nor has he received such compensation in
the past. The officer and director is not accruing any compensation pursuant to
any agreement with the Company. However, the officer and director of the Company
anticipates receiving benefits as a beneficial shareholder of the Company and as
a principal of Pierce Mill Associates, Inc. and its affiliates.

     No retirement, pension, profit sharing, stock option or insurance programs
or other similar programs have been adopted by the Company for the benefit of
its employees.

Item 11.  Security Ownership of Certain Beneficial Owners and Management

     The following table sets forth, as of December 31, 2000, each person known
by the Company to be the beneficial owner of five percent or more of the
Company's common stock and the director and officer of the Company.  Except as
noted, the holder thereof has sole voting and investment power with respect to
the shares shown.

     Name and Address                Amount of Beneficial  Percent of
     of Beneficial Owner             Ownership             Outstanding Stock
     --------------                  --------------------  ------------------
     Pierce Mill Associates, Inc.    1,000,000             100%
     1504 R Street, N.W.
     Washington, D.C. 20009

     James M. Cassidy(1)             1,000,000             100%
     1504 R Street, N.W.
     Washington, D.C. 20009

     All Executive Officers and
     Directors as a Group
     (1 Person)                      1,000,000             100%

(1)  Mr. Cassidy is the sole director and shareholder of Pierce Mill Associates,
     Inc. and is therefore considered the beneficial owner of the shares of
     common stock owned by it.

                                       5
<PAGE>

Item 12.  Certain Relationships and Related Transactions

     On March 25, 1999, the Company issued a total of 1,000,000 shares of common
stock to the following entity for a total of $100 in cash:

                                     NUMBER OF        TOTAL
     NAME                            SHARES           CONSIDERATION
     ----                            ---------        -------------

     Pierce Mill Associates, Inc.    1,000,000           $100

     The Board of Directors has passed a resolution which contains a policy that
the Company will not seek an acquisition or merger with any entity in which the
Company's officer, director or shareholder or their affiliates or associates
serve as officer or director or hold any ownership interest.  Management is not
aware of any circumstances under which this policy may be changed.

Item 13.  Exhibits and Reports on Form 8-K

     (a)  Exhibits

     (b)  There were no reports on Form 8-K filed by the Company during the
quarter ended December 31, 2000.

                                       6
<PAGE>

                                 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.

                              LICENSE ACQUISITION CORPORATION


                         By:   /s/ James M. Cassidy
                              ----------------------
                                    James M. Cassidy, President

Dated:  March 29, 2001


     Pursuant to the Securities Exchange Act of 1934, this report has been
signed below by the following persons on behalf of the registrant and in the
capacities and on the dates indicated.

NAME                        OFFICE              DATE

/s/ James M. Cassidy        Director            March 29, 2001

                                       7
<PAGE>

                        LICENSE ACQUISITION CORPORATION
                         (A DEVELOPMENT STAGE COMPANY)
                              FINANCIAL STATEMENTS
                            AS OF DECEMBER 31, 2000



                                       8
<PAGE>

                        LICENSE ACQUISITION CORPORATION
                         (A DEVELOPMENT STAGE COMPANY)


                                    CONTENTS
                                    --------



PAGE         1  INDEPENDENT AUDITORS' REPORT

PAGE         2  BALANCE SHEET AS OF DECEMBER 31, 2000

PAGE         3  STATEMENTS OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2000
                AND FOR THE PERIOD FROM MARCH 24, 1999 (INCEPTION) TO DECEMBER
                31, 2000

PAGE         4  STATEMENT OF CHANGES IN STOCKHOLDER'S EQUITY FOR THE PERIOD
                FROM MARCH 24, 1999 (INCEPTION) TO DECEMBER 31, 2000

PAGE         5  STATEMENTS OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 2000
                AND FOR THE PERIOD FROM MARCH 24, 1999 (INCEPTION) TO DECEMBER
                31, 2000

PAGES    6 - 8  NOTES TO FINANCIAL STATEMENTS AS OF DECEMBER 31, 2000

                                       9
<PAGE>

                          INDEPENDENT AUDITORS' REPORT
                          ----------------------------


To the Board of Directors of:
License Acquisition Corporation
(A Development Stage Company)

We have audited the accompanying balance sheet of License Acquisition
Corporation (a development stage company) as of December 31, 2000 and the
related statements of operations, changes in stockholder's equity and cash flows
for the year ended December 31, 2000 and for the period from March 24, 1999
(inception) to December 31, 2000.  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, the financial statements referred to above present fairly in all
material respects, the financial position of License Acquisition Corporation (a
development stage company) as of December 31, 2000, and the results of its
operations and its cash flows for the for the year then ended and for the period
from March 24, 1999 (inception) to December 31, 2000 in conformity with
accounting principles generally accepted in the United States.



                              WEINBERG & COMPANY, P.A.



Boca Raton, Florida
February 15, 2001


<PAGE>

                        LICENSE ACQUISITION CORPORATION
                         (A DEVELOPMENT STAGE COMPANY)
                                 BALANCE SHEET
                            AS OF DECEMBER 31, 2000
                            -----------------------



<TABLE>
<CAPTION>
                                              ASSETS
                                              ------

<S>                                                                            <C>
Cash                                                                            $             100
                                                                                -----------------

TOTAL ASSETS                                                                    $             100
------------                                                                    =================


                                LIABILITIES AND STOCKHOLDER'S EQUITY
                                ------------------------------------

LIABILITIES                                                                     $              --
                                                                                -----------------

STOCKHOLDER'S EQUITY

 Preferred Stock, $.0001 par value, 20,000,000 shares authorized,
  none issued and outstanding                                                                  --
 Common Stock, $.0001 par value, 100,000,000 shares authorized,
  1,000,000 issued and outstanding                                                            100
 Additional paid-in capital                                                                   535
 Deficit accumulated during development stage                                                (535)
                                                                                -----------------

 Total Stockholder's Equity                                                                   100
                                                                                -----------------

TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY                                      $             100
------------------------------------------                                      =================
</TABLE>




                See accompanying notes to financial statements.

                                       2
<PAGE>

                                LICENSE ACQUISITION CORPORATION
                                 (A DEVELOPMENT STAGE COMPANY)
                                   STATEMENTS OF OPERATIONS
                                   ------------------------



                                                           March 24, 1999
                                   For the Year Ended       (Inception) to
                                    December 31, 2000     December 31, 2000
                                    -----------------     ------------------
Income                              $              -     $                -
Expenses
 Organization expense                              -                     535
                                    -----------------     ------------------
  Total expenses                                   -                     535
                                    -----------------     ------------------
NET LOSS                            $              -     $              (535)
--------                            =================     ==================



                See accompanying notes to financial statements.

                                       3
<PAGE>

                        LICENSE ACQUISITION CORPORATION
                         (A DEVELOPMENT STAGE COMPANY)
                 STATEMENT OF CHANGES IN STOCKHOLDER'S EQUITY
                FOR THE PERIOD FROM MARCH 24, 1999 (INCEPTION)
                             TO DECEMBER 31, 2000
                             --------------------

<TABLE>
<CAPTION>
                                                                                     DEFICIT
                                                                                   ACCUMULATED
                                                                ADDITIONAL           DURING
                                     COMMON STOCK ISSUED         PAID-IN           DEVELOPMENT
                                     SHARES       AMOUNT          CAPITAL              STAGE           TOTAL
                                    --------     --------   --------------------   -------------      -------
<S>                                <C>           <C>        <C>                    <C>                <C>
Common Stock Issuance                1,000,000   $    100   $                 -   $           -       $   100

Fair value of expenses                      -          -                     535              -           535
 contributed

Net loss for the years ended:
 December 31, 1999                          -          -                      -             (535)        (535)
 December 31, 2000                          -          -                      -               -            -
                                 -------------   --------   --------------------   -------------      -------

BALANCE AT DECEMBER 31, 2000         1,000,000   $    100   $                535   $        (535)     $   100
----------------------------     =============   ========   ====================   =============      =======
</TABLE>

                                See accompanying notes to financial statements.

                                       4
<PAGE>

                        LICENSE ACQUISITION CORPORATION
                         (A DEVELOPMENT STAGE COMPANY)
                           STATEMENTS OF CASH FLOWS
                           ------------------------

<TABLE>
<CAPTION>
                                                                                       March 24, 1999
                                                         For the Year Ended            (Inception) to
                                                          December 31, 2000           December 31, 2000
                                                      -----------------------     -----------------------
<S>                                                  <C>                         <C>
CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss                                              $                    -      $                 (535)
 Adjustment to reconcile net loss to net cash
  used by operating activities

 Contributed expenses                                                      -                          535
                                                      -----------------------     -----------------------

 Net cash used in operating activities                                     -                           -
                                                      -----------------------     -----------------------

CASH FLOWS FROM INVESTING ACTIVITIES                                       -                           -
                                                      -----------------------     -----------------------

CASH FLOWS FROM FINANCING ACTIVITIES:

 Proceeds from issuance of common stock                                    -                          100
                                                      -----------------------     -----------------------

 Net cash provided by financing activities                                 -                          100
                                                      -----------------------     -----------------------

INCREASE IN CASH AND CASH EQUIVALENTS                                      -                          100

CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD                           100                          -
                                                      -----------------------     -----------------------

CASH AND CASH EQUIVALENTS - END OF PERIOD             $                   100     $                   100
-------------------------------------------------     =======================     =======================


                                         See accompanying notes to financial statements.
</TABLE>

                                       5
<PAGE>

                        LICENSE ACQUISITION CORPORATION
                         (A DEVELOPMENT STAGE COMPANY)
                         NOTES TO FINANCIAL STATEMENTS
                            AS OF DECEMBER 31, 2000
                            -----------------------


NOTE(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
------- ------------------------------------------

        (A) Organization and Business Operations
        ----------------------------------------

        License Acquisition Corporation (a development stage company) ("the
        Company") was incorporated in Delaware on March 24, 1999 to serve as a
        vehicle to effect a merger, exchange of capital stock, asset acquisition
        or other business combination with a domestic or foreign private
        business. At December 31, 2000, the Company had not yet commenced any
        formal business operations, and all activity to date relates to the
        Company's formation.  The Company's fiscal year end is December 31.

        The Company's ability to commence operations is contingent upon its
        ability to identify a prospective target business.

        (B) Use of Estimates
        --------------------

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

        (C) Cash and Cash Equivalents
        -----------------------------

        For purposes of the statement of cash flows, the Company considers all
        highly liquid investments purchased with an original maturity of three
        months or less to be cash equivalents.

        (D) Income Taxes
        ----------------

        The Company accounts for income taxes under the Financial Accounting
        Standards Board of Financial Accounting Standards No. 109, "Accounting
        for Income Taxes" ("Statement 109"). Under Statement 109, deferred tax
        assets and liabilities are recognized for the future tax consequences
        attributable to differences between the financial statement carrying
        amounts of existing assets and liabilities and their respective tax
        basis. Deferred tax assets and liabilities are measured using enacted
        tax

                                       6
<PAGE>

                        LICENSE ACQUISITION CORPORATION
                         (A DEVELOPMENT STAGE COMPANY)
                         NOTES TO FINANCIAL STATEMENTS
                            AS OF DECEMBER 31, 2000
                            -----------------------


        rates expected to apply to taxable income in the years in which those
        temporary differences are expected to be recovered or settled.  Under
        Statement 109, the effect on deferred tax assets and liabilities of a
        change in tax rates is recognized in income in the period that includes
        the enactment date. There were no current or deferred income tax expense
        or benefits due to the Company not having any material operations for
        the period ending December 31, 2000.

NOTE(2) STOCKHOLDER'S EQUITY
------- --------------------

        (A) Preferred Stock
        -------------------

        The Company is authorized to issue 20,000,000 shares of preferred stock
        at $.0001 par value, with such designations, voting and other rights and
        preferences as may be determined from time to time by the Board of
        Directors.

        (B) Common Stock
        ----------------

        The Company is authorized to issue 100,000,000 shares of common stock at
        $.0001 par value.  The Company issued 1,000,000 shares of its common
        stock to Pierce Mill Associates, Inc. pursuant to Section 4(2) of the
        Securities Act of 1933 for an aggregate consideration of $100.

        (C) Additional Paid-In Capital
        ------------------------------

        Additional paid-in capital at December 31, 2000 represents the fair
        value of the amount of organization and professional costs incurred by
        related parties on behalf of the Company (See Note 3).

NOTE(3) AGREEMENT
------- ---------

        On April 1, 1999, the Company signed an agreement with Rock Creek
        Capital Corporation ("Rock Creek"), a related entity (See Note 4). The
        Agreement calls for Rock Creek to provide the following services,
        without reimbursement from the Company, until the Company enters into a
        business combination as described in Note 1(A):

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<PAGE>

                        LICENSE ACQUISITION CORPORATION
                         (A DEVELOPMENT STAGE COMPANY)
                         NOTES TO FINANCIAL STATEMENTS
                            AS OF DECEMBER 31, 2000
                            -----------------------



           1.  Preparation and filing of required documents with the Securities
               and Exchange Commission.
           2.  Location and review of potential target companies.
           3.  Payment of all corporate, organizational, and other costs
               incurred by the Company.

NOTE(4) RELATED PARTIES
------- ---------------

        Legal counsel to the Company is a firm owned by a director of the
        Company who also owns 100% of the outstanding stock of Pierce Mill
        Associates, Inc. and Rock Creek (See Note 3).

                                       8