U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                   Form 10-KSB

[X] Annual report under section 13 or 15(d) of the Securities Exchange Act of
1934 for the fiscal year ended December 31, 2003.

[ ] Transition report under section 13 or 15(d) of the Securities Exchange Act
of 1934 for the transition period from ____ to ____.

                           COMMISSION FILE NO: 0-31497

                             VIDEO WITHOUT BOUNDARIES INC.
                     (Name of small business in its charter)

                   FLORIDA                                  65-1001686
                   --------                                 ----------
         (State or other jurisdiction                      (IRS Employer
                of Incorporation)                       Identification No.)

                        1975 E. SUNRISE BLVD., 5TH FLOOR
                        ---------------------------------
            Address of Principal Executive Office (street and number)


                          FORT LAUDERDALE, FL 33304
                          ----------------------------
                            City, State and Zip Code

Issuer's telephone number: (954) 462-8302



Securities registered under Section 12(b) of the Act:

         None

Securities to be registered under Section 12(g) of the Act:

         Common Stock, par value $.001

         Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities 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 there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-B 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 revenue for its most recent fiscal year: $190,770

         State the aggregate market value of the voting stock held by
non-affiliates computed by reference to the price at which the stock was sold,
or the average bid and asked priced of such stock, as of a specified date within
the past 60 days (See definition of affiliate in Rule12b-2): $31,527,728 as of
February 29, 2004.

         Note: If determining whether a person is an affiliate will involve an
unreasonable effort and expense, the issuer may calculate the aggregate market
value of the common equity held by non-affiliates on the basis of reasonable
assumptions, if the assumptions are stated.

<PAGE>

         (Issuers involved in bankruptcy proceedings during the past five years)
Check whether the issuer has filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. Yes ____ No ____

         (Applicable only to corporate registrants) State the number of shares
outstanding of each of the issuer's classes of common equity, as of the latest
practicable date: 25,948,747 shares of common stock as of February 29, 2003.

         (Documents incorporated by reference. If the following documents are
incorporated by reference, briefly describe them and identify the part of the
Form 10-KSB (e.g. Part I, Part II, etc.) into which the document is
incorporated: (1) any annual report to security holders; (2) any proxy or
information statement; and (3) any prospectus filed pursuant to Rule 424(b) or
(c) of the Securities Act of 1933 ("Securities Act"). The listed documents
should be clearly described for identification purposes.

                     FACTORS THAT MAY AFFECT FUTURE RESULTS

         This Annual Report on Form 10-KSB and the documents incorporated herein
by reference contains certain forward-looking statements within the meaning of
the Federal Securities Laws. Specifically, all statements other than statements
of historical facts included in this Annual Report on Form 10-KSB regarding our
financial performance, business strategy and plans and objectives of management
for future operations are forward-looking statements and based on our beliefs
and assumptions. If used in this report, the words "anticipate," "believe,"
"estimate", "expect," "intend," and words or phrases of similar import are
intended to identify forward-looking statements. Such statements reflect the
current view of the Company with respect to future events and are subject to
certain risks, uncertainties, and assumptions, including but without limitation,
those risks and uncertainties contained in our Annual Report on Form 10-KSB.
Although we believe that our expectations are reasonable, we can give no
assurance that such expectations will prove to be correct. Based upon changing
conditions, any one or more of these events described herein as anticipated,
believed, estimated, expected or intended may not occur. All prior and
subsequent written and oral forward-looking statements attributable to the
Company or persons acting on its behalf are expressly qualified in their
entirety by this cautionary statement.

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                         VIDEO WITHOUT BOUNDARIES, INC.

                                   FORM 10-KSB

                                TABLE OF CONTENTS


PART I

ITEM 1.  Description of Business

ITEM 2.  Description of Property

ITEM 3.  Legal Proceedings

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

PART II

ITEM 5.  Market for Common Equity and Related Stockholder Matters

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

PART III

ITEM 9.  Directors, Executive Officers, Promoters and Control Persons

ITEM 10.  Executive Compensation

ITEM 11.  Security Ownership of Certain Beneficial Owners and Management

ITEM 12.  Certain Relationships and Related Transactions

ITEM 13.  Exhibits and Reports on Form 8-K


SIGNATURES


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PART I

ITEM 1.  DESCRIPTION OF BUSINESS

CORPORATE HISTORY

         Video Without Boundaries, Inc. (f/k/a ValuSales.com, Inc.) a Florida
corporation (the "Company" or "Video Without Boundaries") was formed to create a
single-source Internet and streaming media product and solution's company
providing Internet and Technology products and services to various sized
customers.

         Video Without Boundaries, Inc. (f/k/a ValuSales.com, Inc.) was
incorporated in the State of Florida, on March 19,1999, and had no operations
until on July 20, 1999 when it purchased assets for, $75,000, and signed
employment agreements with two individuals, which included the issuance of
900,000 shares of common stock. The assets acquired were property and equipment
for $40,000 and inventory for $35,000. The common stock was valued at par
because the Company was privately owned and no market existed for the sale of
its stock.

         On December 1, 1999, Video Without Boundaries, Inc. (f/k/a
ValuSales.com, Inc.) sold 2,673,000 shares of its common stock for $175,000 and
used the proceeds to acquire an inactive entity, September Project II Corp.,
which then changed its name to Video Without Boundaries, Inc. and became the
surviving entity.

          For accounting purposes, the acquisition has been treated as a capital
transaction rather than a business combination. Accordingly, the 5,000,000
outstanding shares of September Project II, Corp. have been reflected as
outstanding since inception.

          All significant interdivisional transactions and balances have been
eliminated.

         The Company has elected to operate with divisions rather than create
separate corporations for each business segment. The Company is headquartered at
1975 E. Sunrise Blvd. 5th Floor, Fort Lauderdale, FL 33304.

GENERAL

Video Without Boundaries (VWB) now provides products and services in the
converging digital media on demand, enhanced home entertainment and emerging
interactive consumer electronics markets. VWB is focused on home entertainment
media products and solutions that enhance the consumer experience, while
providing new revenue opportunities for online music and movie content
providers. VWB is becoming a supplier of broadband products, services and
content including its ability to deliver broadcast quality digital video and web
interactivity at transfer rates as low as 56K.

Video Without Boundaries (VWB) a provider of streaming digital media and video
on demand (VOD) services, has recently taken actions to reduce the company's
operating cost. These changes will also balance the company's investment across
its two key markets: streaming digital media and video on demand (VOD) services.
Due to the continued decline in economic activity and weakened capital and
business spending for emerging technology products and services, VWB has
redirected its human and capital resources towards its most profitable products
and services, while reducing its exposure to unprofitable markets.

The company is attempting to develop new business partnerships in regards to its
streaming media business within the home entertainment marketplace. Over the
last 12 months, all major PC, consumer electronics, and set-top box manufactures
have added streaming media players within their products to capitalize on the
growth of broadband connections and streaming content offered over the Internet.
With more than 10 million broadband households and nearly 35 million
broadband-enabled screens, VWB is attempting to capitalize on the growth of this
market through its professional services division and potential new partnerships
and business ventures.

Video Without Boundaries (VWB) is repositioning itself within the entertainment
and home broadband marketplace. VWB's goals are 1) to become a producer &


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distributor of interactive consumer electronics equipment 2) establish itself as
a software infrastructure player within the home entertainment media-on-demand
marketplace, 3) attempt to capture revenue and market share from services and
products within the video on demand (IP) marketplace.

Media Convergence

Consumers are becoming acclimated to the benefits and quality of digital media
goods and on-line digital media. DVDs and CDs dominate the audio/video sales
market, and digital cameras and emailing images have become a standard method of
exchanging and sharing photographs.

The acceptance of digital media and storage options, coupled with new digital
distribution (IP) methods, is resulting in new convergence devices being
introduced to consumers that allow for:

         o        Universal Playback and storage of all digital media rented and
                  purchased by the consumer
         o        Consumers to have "on-demand" or immediate access to all
                  digital media purchased & available for rental.
         o        All forms of digital media to be played on all traditional
                  audio/video equipment within the home, but also on relatively
                  new, increasingly portable equipment (laptops, MP3 players)

As a result of the above, consumer interaction with media is changing in
significant ways. Supporting and exploiting this new consumer behavior requires:

         o        Simple to use devices that conform to existing consumer
                  behavior and media needs
         o        Conceptual bridge between the "home PC" and the living room
                  environment Robust Digital Rights Management (DRM) solution to
                  support secure IP media delivery

Convergence Approaches

The existing industry participants are not successfully integrating convergence
functionality in devices suitable for the living room. The result is that
consumers: 1) have too many discrete devices connected to their TVs; and 2) lack
the basic PC functionality required to exploit their TVs as "monitors" with
which to access the Internet.

Industry                                   Product Line Example
--------                                   --------------------
PC Manufacturers:                           Multimedia PC "Media Station"
         o        Form factor (design) and connectivity is not living room &
                  stereo/TV friendly
         o        Designed for early adopter market
         o        Expensive ($1,000-$2,000)

Networking/Wireless Approach:               Wireless PC to TV/Stereo Devices
         o        Complicated for consumers & expensive
         o        Does not support DVD/CD quality playback from PC to TV

Consumer Electronics Manufacturers:         Kenwood Soverign Product Line
         o        Offers limited and fixed chip-set functionality
         o        Cannot be upgraded or changed

Product Architecture ("MediaReady 4000")

Based on the MediaReady software, this product utilizes the basic form factor
and functionality of mainstream DVD players (top selling main platform of home
entertainment) and offers:
         o        "Simple-stupid" Graphical User Interface (GUI) functionality
         o        Internet Media Player that enables full-screen video playback
                  on TV with DVD-like functionality (MPEG4)
         o        Killer IP applications (email, Internet browsing,
                  internet-based audio/video streaming)

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         o        Form factor and Audio/Video connecters that mimic and connect
                  to all consumer electronics products
         o        Picture in picture (PIP) functionality (i.e. TV and Web at
                  same time)

Advanced Features include:
         o        Progressive downloading, storage and playback of digital media
                  files stored on inexpensive external USB and Firewire
                  connected storage devices
         o        Networked digital media playback from any connected PC device
                  within the home network.
         o        Seamless DRM compatibility with mainstream Internet DRM
                  technologies, but enhanced to base DRM ownership to "an
                  individual" rather than a device via CAC Media's proprietary
                  DRM technology
         o        Standard Linux-based operating system to support application
                  scalability and extended power-on usage

In addition, the MediaReady platform allows consumers to upgrade their units
with additional services based on a one-time or subscription charge. Retailers
and resellers of the MediaReady line of products also participate in the
residual revenue stream offered by these upgrades. VWB offers value-added
applications and upgrades that include:
         o        Video Conferencing & IP Telephony
         o        Games (Single or Multiplayer)
         o        PVR (i.e. Tivo)
         o        Online Digital Media Rental and Purchase

STRATEGY

Product Marketing and Sales Approach

MediaReady products provide retailers and resellers with royalty commissions
(sales incentive) on future upgrades and point-of-sale add-on purchases (i.e.
external storage for media). Since consumers already understand the basic
MediaReady features (DVD, PVR, Internet Access) and broadly accept the $299 -
$399 price point, the key sales/marketing proposition is that the product:
         o        Consolidates several popular devices (and features) into one
                  universal unit
         o        Is easily and inexpensively upgradeable via software downloads
         o        Stands out as the "best buy for the dollar" (also provides the
                  best profit ($$) for the retailer/salesperson)

The company expects to become cash/flow positive primarily through Retail
Distribution (VAR and End User) and OEM Licensing Sales. In addition, VWB will
also receive incremental revenue streams based upon: o Purchases of value-added
applications through the MediaReady platform o Professional Services Revenue
based upon customized value-added applications

In January 2003, Video Without Boundaries acquired all assets of
Brokenremote.tv, for 500,000 shares of restricted common stock, a privately held
on-line publisher and subsidiary of CAC Media Inc. Brokenremote.tv publishes
news and market analytics about the emerging convergence of the Interactive TV &
Consumer Electronics, Video On Demand (VOD), & Broadband Internet Entertainment
markets. The acquisition will support Video Without Boundaries attempt to build
its brand recognition within this new emerging market and leverage its existing
relationships with streaming media clients as new advertising clients.
Brokenremote.tv provides day-to-day news updates on topics such as: ongoing
copyright and consumer rights legislation regarding digital media distribution,
Video on Demand, Interactive TV, new technology standards and product
announcements.

In addition to the acquisition of Brokenremote.tv, the company has also made a
strategic investment in privately held CAC Media, Inc. Video Without Boundaries
invested $100,000 to complete the transaction. CAC Media, a privately held
corporation, specializes in interactive consumer electronics software
development, digital rights management, and digital media distribution
infrastructure.

In February 2003, Video Without Boundaries, Inc. (VWB) agreed to a strategic
alliance with Neon Technology, Inc. a privately held corporation and a designer


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of advanced set-top box hardware, under which the companies will collaborate on
the design and production of a line of next-generation multifunction set-top
boxes for the interactive consumer electronics marketplace. Video Without
Boundaries and Neon Technology, have been working together to develop a tightly
integrated multifunction interactive DVD player and set-top box solution.
Next-generation interactive set-top boxes will be the delivery point for new
entertainment programs and services for the home. They will combine Internet
access, web browsing, streaming media playback, video-on-demand, email, online
shopping, and a host of other capabilities into a single, unified system. Since
this is a new market and product, there are may be unforeseen delays in design
and production because of cash flow and manufacturing problems.

In February 2003, Video Without Boundaries, Inc. (VWB) debuted the MediaReady
Internet/DVD Player (VWB-3000), an easy-to-use home entertainment device that
makes it possible to surf the Web, send email, watch DVD videos, and even sing
karaoke from any television. Similar in size and appearance to a conventional
DVD player, MediaReady combines a DVD player and Web browser with a full-sized
wireless keyboard, a media player for playback of Web-based streaming media,
Dolby Digital 5.1 Surround Sound, picture-in-picture capability, a karaoke
microphone jack, and other features that enable consumers to access all popular
forms of home entertainment from the comfort of their couch. The DVD player
supports CDs, VCDs, SVCDs and CDs with MP3 files as well as DVDs, allowing users
to play the latest video and audio. MediaReady supports all forms of Internet
connection including 56 kbps modem, dynamic DSL and cable modems, and 10/100
Base-T Ethernet. The built-in Web browser includes SSL 3.0 for secure online
shopping. MediaReady's VWB Internet PIP picture-in-picture feature allows users
to multi-task their favorite pastimes, such as viewing the Web while watching a
DVD movie or television program. A user-friendly, TV-optimized user interface
allows even first-time users to navigate with ease. The unit carries a
manufacturer's suggested retail price of $349 and ships with a remote control,
microphone, and all cables needed for easy hookup. The MediaReady product is a
result of the strategic alliance with Neon Technology.

In March 2003 Video Without Boundaries licensed the Lafayette name for its
MediaReady set-top boxes. As a result of this licensing agreement with Lafayette
Electronics, Video Without Boundaries will produce a set-top box under the
Lafayette brand. The Lafayette-branded units will appear in specialty retail
stores and coincide with the introduction of Lafayette's new line of home audio
and video electronic products designed to re-launch the Lafayette brand.
Additionally, Video Without Boundaries signed a Consulting Agreement with Steve
Cavayero, President of Lafayette Electronics for 50,000 shares of restricted
common stock.

In April 2003 Video Without Boundaries announced the debut of a VAR program for
its MediaReady(TM) Internet/DVD Player, the combo entertainment unit that brings
email, web surfing, karaoke, MP3, CD music playback, and more to any television.
Focused on specialty and high-end home electronics and computer retailers, the
VAR program gives merchants an exceptional opportunity to capitalize on the
developing market for convergent home entertainment devices.

In May 2003 Video Without Boundaries signed a manufacturing agreement with Lung
Hwa Electronics, a major consumer electronics manufacturer, to begin production
of Video Without Boundaries' new line of MediaReady(TM) Internet/DVD Players.
MediaReady(TM), a revolutionary combo entertainment device that brings email,
web surfing, karaoke, MP3, CD/DVD playback, and more to any television and home
theater system, will ship to retailers in September 2003.

Lung Hwa Electronics Co. Ltd., established in 1973, is a public company listed
on the Taiwan Stock Market (TSEC: 2424) with a current market capitalization of
$28 million (USD). Lung Hwa, an ISO 9001 certified manufacturer, consistently
provides the most qualified professional products to the market and has become
one of the leading 3C manufacturers in Taiwan. Foreseeing rapid business growth,
Lung Hwa invested in a new factory, Expert Electronics (Wujiang) Co. Ltd., in
Shanghai, China. The 45,000-square-foot factory produces 600,000 PCBA pieces and
200,000 Box Build sets each month. The huge capacity of the China factory
enables Lung Hwa to bring to market more cost-effective products. With 29 years
of innovation, Lung Hwa is expanding its product lines into two categories: EMS
(Electronics Manufacturing Services) and DMS (Design Manufacturing Services).

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In June 2003, Video Without Boundaries began production of its new and more
advanced MediaReady 4000 Internet/DVD player. The convergent device, which
unifies DVD playback, feature-rich TV, Internet, email, karaoke, and CD/MP3
playback with local and networked digital storage along with a host of possible
upgrades and options, is expected to reach consumer electronics shelves in late
November 2003. The biggest change in the MediaReady(TM) 4000 is the addition of
powerful PC componentry, including an onboard hard drive for storage of digital
entertainment. The unit's new connectivity options, including Ethernet 10B/100BT
wired and wireless connections, USB 2.0 and 1394 connectors, enables the device
to download, play, and manage digital movies and other forms of digital
entertainment from the Internet, or from a home networked PC. An improved Web
browser and other feature upgrades ensure that the MediaReady(TM) 4000 will be
the one-stop entertainment and communications choice for the new age of digital
technology.

In July 2003, VWB announced the selection of Sigma's EM8475 digital media
processor, for Video Without Boundaries' new MediaReady(TM) 4000 Internet/DVD
Player, from Sigma Designs, Inc. (Nasdaq: SIGM), a leader in digital media
processing for consumer appliances. The EM8475, an advanced MPEG-4 decoder
designed for set-top box applications, will drive digital video playback on the
MediaReady 4000, a breakthrough in convergent home entertainment. Sigma Designs'
EM8475 MPEG-4 digital processor is the premier product for IP video streaming in
set-top boxes and media gateways. Incorporating the company's award-winning
REALmagic(R) Video Streaming Technology, the chip was the industry's first
MPEG-4 chip to support full-resolution (720x576) and streaming video based on
ISMA specification 1.0. The EM8475 provides highly integrated solutions for
decoding of MPEG-4, as well as DVD, MPEG-2 and MPEG-1 formats.

The EM8475 enables the rapid development of adding PVR, progressive DVD playback
and streaming video playback functionality to advanced set-top boxes and other
PCI-based devices. In addition to providing state-of-the-art MPEG-4 playback
capability, the EM8475 will allow the MediaReady(TM) 4000 to access
sophisticated online multimedia content containing audio, video, text, graphics
and interactivity. MPEG-4's object-oriented environment supports complex scene
manipulation at low bit rates, making it ideal for streaming content over
today's broadband connections.
Sigma Designs specializes in silicon-based MPEG decoding for steaming video,
progressive DVD playback, and advanced digital set-top boxes. The company's
award-winning REALmagic(R) Video Streaming Technology is used in both commercial
and consumer applications providing highly integrated solutions for high-quality
decoding of MPEG-1, MPEG-2, and MPEG-4. Headquartered in Milpitas, Calif., the
company also has offices in China, Europe, Hong Kong, Japan, Korea, and Taiwan.

In September 2003, VWB announced a partnership with Sound Choice(R), the leading
brand and distributor of karaoke sound tracks in the U.S., today announced an
alliance aimed at adding bundled karaoke music titles to VWB's new
MediaReady(TM) 4000 Internet/DVD player. Under the terms of the agreement, VWB's
initial production run, will be factory-equipped with popular karaoke titles,
giving purchasers a chance to enjoy the fun of karaoke in the privacy of their
home. Sound Choice's premium-quality karaoke content will be presented on the
MediaReady 4000 under Sound Choice's Performer's Choice(R) brand. The
Performer's Choice logo will appear on MediaReady 4000 packaging; other
cooperative marketing activities will include the promotion and sale of
MediaReady 4000 players on Sound Choice's websites.

In September 2003, VWB announced it was demonstrating its breakthrough
MediaReady 4000(TM) convergent Internet/DVD Player to OEM manufacturers at
Computex Taipei 2003. The MediaReady 4000, one of the world's first integrated
consumer set-top devices, combines popular media entertainment options including
DVD/MPEG-1/MPEG-2/MPEG-4 playback, feature-rich television, email, web surfing,
karaoke, CD/MP3 playback and more, with an open source, Linux-based architecture
that allows it to support virtually any kind of OEM configuration or upgrade.
Video Without Boundaries' MediaReady 4000 has partnered with Lung Hwa
Electronics Co., Ltd., a leading worldwide consumer electronics equipment
manufacturer, to produce the convergent device. The MediaReady 4000 is being
demonstrated at Computex Taipei 2003 from the Lung Hwa Electronics exhibit,
Booths 427, 429, and 431.

In November 2003, VWB announced that it has expanded its trade credit facilities
to more than $10 million (USD) in order to ensure ample production financing for


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its new line of branded MediaREADY(TM) convergent Internet/DVD players. The $10
million in credit facilities includes a new line of credit from Video Without
Boundaries' primary manufacturing partner.

Currently Video Without Boundaries has minimal revenue but will derive
substantially all of its revenues from product sales and licensing fees
associated with the sale of its MediaReady line of set-top boxes on an order by
order basis which will start in 2004.

Agreements and purchase orders that may be entered into in connection with
product sales are generally on an order by order basis. If customers terminate
purchase orders or if Video Without Boundaries is unable to acquire new customer
and orders for its products, Video Without Boundaries' business, financial
condition, and results of operations could be materially and adversely affected.
In addition, because a proportion of Video Without Boundaries' expenses is
relatively fixed, a variation in the number of products sold can cause
significant variations in operating results from quarter to quarter.

Video Without Boundaries' product sales will vary in size; therefore, a customer
that accounts for a significant portion of Video Without Boundaries' revenues in
one period may not generate a similar amount of revenue in subsequent periods.
No customer accounted for more than 10.0% of Video Without Boundaries' revenues
in the periods ended December 31, 2002 or December 31, 2003. Video Without
Boundaries does not know the scope of its product sales or customer profile as
yet because the products are so new. Any cancellation, deferral, or significant
reduction in future orders could have a material adverse affect on Video Without
Boundaries' business, financial condition, and results of operations.

CLIENTS

         We have focused and will continue to focus on long-term relationships
with client's that will range from retail consumers to small, medium, and large
business customers. If its clients terminate purchase orders or if Video Without
Boundaries is unable to enter into new engagements or sell its new products and
services its business, financial condition and results of operations could be
materially and adversely affected.

         No client accounted for more than 10% of Video Without Boundaries
revenues in 2003 or 2002. Although, Video Without Boundaries does not believe
that it will derive a significant portion of its revenues from a limited number
of clients, there is a risk that it may do so since many of the Companies
products are new and more difficult to sell. Any cancellation, deferral or
significant reduction in work performed for clients or a significant number of
smaller clients could have a material adverse affect on Video Without Boundaries
business, financial condition and results of operations.

SALES AND MARKETING

         The Company plans to promote itself by direct sales efforts using
telephone sales, conventional media advertising, and Internet marketing. These
advertisements are targeted at small, medium, and large business customers as
well as retail consumers who are likely to respond to specific ads or visit
specific web sites to make a purchase. The Company employs two inside and
outside sales people to help customers and to prospect business from various
forms of lead generation. The Company also plans to engage independent sales
agents in various geographic areas as well as product dealers and resellers.

         Our marketing strategy is to promote and enhance our brand by
participating in targeted industry conferences and seminars, engaging in a
public relations campaign. This strategy is designed to strengthen our brand
name and generate new clients by increasing the awareness of our brand with high
quality comprehensive converging digital media on demand, enhanced home
entertainment and emerging interactive consumer electronics companies. As
previously mentioned, the sales and marketing of our products and services is
dependent on the company to continue to raise capital and grow revenues.

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         We believe that establishing and maintaining a good reputation and name
recognition is critical for attracting and expanding our customer base. We also
believe that the importance of product acceptance and market validation will
increase due to the growth in the converging digital media on demand, enhanced
home entertainment and emerging interactive consumer electronics markets. If the
various product markets and customers do not perceive our products and services
to be effective or of high quality, our brand name and reputation could be
materially and adversely affected.

COMPETITION

         Many of Video Without Boundaries competitors have longer operating
histories, larger client bases, longer relationships with clients, greater brand
or name recognition and significantly greater financial, technical, marketing
and public relations resources. Several of these competitors may provide or
intend to provide a broader range of products and services than Video Without
Boundaries. Furthermore, greater resources may enable a competitor to respond
more quickly to new or emerging technologies and changes in customer
requirements and to devote greater resources to the development, promotion and
sale of its products and services than we can. In addition, competition may
intensify in the converging digital media on demand, enhanced home entertainment
and emerging interactive consumer electronics markets by major companies which
could have an adverse on Video Without Boundaries.

         Video Without Boundaries currently has no portion of the converging
digital media on demand, enhanced home entertainment and emerging interactive
consumer electronics markets as it develops its products for launch and there
can be no assurances it that it will be able to penetrate these markets in the
future because of the need for the Company to raise additional capital.

EMPLOYEES

         The Company employs a total of 5 on a full-time and part-time basis. In
addition the company currently has consulting agreements with 4 outside
individuals or firms for sales and marketing, technical consulting, and public
relations. None of the employees belong to a union and the Company has not
experienced any work stoppages. The Company believes that its labor relations
are satisfactory.

         The Company's headquarters is located at 1975 E. Sunrise Blvd. 5th
Floor Ft. Lauderdale, FL 33304 and its telephone number is (954) 462-8302. The
company also has a sales and technical office at 20 SW 27th Ave. Suite 101
Pompano Beach, FL 33069.

ITEM 2.  DESCRIPTION OF PROPERTY

         The Company's corporate office is currently located at 1975 E. Sunrise
Blvd. 5th Floor Ft. Lauderdale, FL 33304. Pursuant to a written lease, the
Company leases approximately 450 square feet at an annual rent of $7,200. The
lease is for a term of 1 year. The company has a sales and technical office at
20 SW 27th Ave. suite 101 Pompano Beach, FL 33069. Pursuant to a written lease,
the company leases approximately 1,000 square feet at an annual rent of $12,000.

ITEM 3.  LEGAL PROCEEDINGS

         The Company is not a party to any pending legal proceedings, and no
such proceedings are known to be contemplated. In addition, no director, officer
or affiliate of the Company, and no owner of record or beneficial owner of more
than 5.0% of the securities of the Company, or any associate of any such
director, officer or security holder is a party adverse to the Company or has a
material interest adverse to the Company in reference to pending litigation.

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

         No matters were submitted to a vote of the security holders of the
Company during the fourth quarter of the fiscal year which ended December 31,
2003.

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PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

         The Company's Common Stock trades in the over-the-counter market under
symbol VDWB on the OTC Electronic Bulletin Board. There was no trading in the
Company's Common Stock prior to May 2000. The following table shows the
quarterly high and low bid prices for the calendar year 2003 as reported by the
National Quotations Bureau Incorporated. These prices reflect inter-dealer
quotations without adjustments for retail markup, markdown or commission, and do
not necessarily represent actual transactions.

        YEAR              PERIOD                   HIGH              LOW
        ----              ------                   ----              ---
        2003             First Quarter             $5.25            $0.20
                         Second Quarter            $2.00            $0.375
                         Third Quarter             $0.83            $0.27
                         Fourth Quarter            $0.55            $0.145

         As of December 31, 2003, there were approximately 181 holders of record
of the Company's Common Stock. Holders of the Company's Common Stock are
entitled to dividends when, as and if declared by the Board of Directors out of
funds legally available therefore. The Company does not anticipate the
declaration or payment of any dividends in the foreseeable future.

         The Company intends to retain earnings, if any, to finance the
development and expansion of its business. Future dividend policy will be
subject to the discretion of the Board of Directors and will be contingent upon
future earnings, if any, the Company's financial condition, capital
requirements, general business conditions and other factors. Therefore, there
can be no assurance that any dividends of any kind will ever be paid.

         The Company's transfer agent is Interwest Transfer Co., Inc., which is
located at 1981 East 4800 South, Suite 100, Salt Lake City, UT 84117 and
Interwest's telephone number is (801) 272-9294.

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

The following discussion of the financial condition and results of operations of
the Company should be read in conjunction with the Financial Statements,
including the Notes thereto, of the Company included elsewhere in this Form
10-KSB.

OVERVIEW

Video Without Boundaries (VWB) now provides products and services in the
converging digital media on demand, enhanced home entertainment and emerging
interactive consumer electronics markets. VWB is focused on home entertainment
media products and solutions that enhance the consumer experience, while
providing new revenue opportunities for online music and movie content
providers. VWB is becoming a supplier of broadband products, services and
content including its ability to deliver broadcast quality digital video and web
interactivity at transfer rates as low as 56K.

Video Without Boundaries (VWB) a provider of streaming digital media and video
on demand (VOD) services, has recently taken actions to reduce the company's
operating cost. These changes will also balance the company's investment across
its two key markets: streaming digital media and video on demand (VOD) services.
Due to the continued decline in economic activity and weakened capital and
business spending for emerging technology products and services, VWB has
redirected its human and capital resources towards its most profitable products
and services, while reducing its exposure to unprofitable markets.

The company is attempting to develop new business partnerships in regards to its
streaming media business within the home entertainment marketplace. Over the
last 12 months, all major PC, consumer electronics, and set-top box manufactures
have added streaming media players within their products to capitalize on the
growth of broadband connections and streaming content offered over the Internet.
With more than 10 million broadband households and nearly 35 million
broadband-enabled screens, VWB is attempting to capitalize on the growth of this


                                       10
<PAGE>

market through its professional services division and potential new partnerships
and business ventures.

Video Without Boundaries (VWB) is repositioning itself within the entertainment
and home broadband marketplace. VWB's goals are 1) to become a producer &
distributor of interactive consumer electronics equipment 2) establish itself as
a software infrastructure player within the home entertainment media-on-demand
marketplace, 3) attempt to capture revenue and market share from services and
products within the video on demand (IP) marketplace.

Media Convergence

Consumers are becoming acclimated to the benefits and quality of digital media
goods and on-line digital media. DVDs and CDs dominate the audio/video sales
market, and digital cameras and emailing images have become a standard method of
exchanging and sharing photographs.

The acceptance of digital media and storage options, coupled with new digital
distribution (IP) methods, is resulting in new convergence devices being
introduced to consumers that allow for:

         o        Universal Playback and storage of all digital media rented and
                  purchased by the consumer
         o        Consumers to have "on-demand" or immediate access to all
                  digital media purchased & available for rental.
         o        All forms of digital media to be played on all traditional
                  audio/video equipment within the home, but also on relatively
                  new, increasingly portable equipment (laptops, MP3 players)

As a result of the above, consumer interaction with media is changing in
significant ways. Supporting and exploiting this new consumer behavior requires:

         o        Simple to use devices that conform to existing consumer
                  behavior and media needs
         o        Conceptual bridge between the "home PC" and the living room
                  environment Robust Digital Rights Management (DRM) solution to
                  support secure IP media delivery

Convergence Approaches

The existing industry participants are not successfully integrating convergence
functionality in devices suitable for the living room. The result is that
consumers: 1) have too many discrete devices connected to their TVs; and 2) lack
the basic PC functionality required to exploit their TVs as "monitors" with
which to access the Internet.

Industry                                   Product Line Example
--------                                   --------------------
PC Manufacturers:                          Multimedia PC "Media Station"
         o        Form factor (design) and connectivity is not living room &
                  stereo/TV friendly
         o        Designed for early adopter market
         o        Expensive ($1,000-$2,000)

Networking/Wireless Approach:                   Wireless PC to TV/Stereo Devices
         o        Complicated for consumers & expensive
         o        Does not support DVD/CD quality playback from PC to TV

Consumer Electronics Manufacturers:         Kenwood Soverign Product Line
         o        Offers limited and fixed chip-set functionality
         o        Cannot be upgraded or changed

Product Architecture ("MediaReady 4000")

Based on the MediaReady software, this product utilizes the basic form factor
and functionality of mainstream DVD players (top selling main platform of home
entertainment) and offers:


                                       11
<PAGE>

         o        "Simple-stupid" Graphical User Interface (GUI) functionality
         o        Internet Media Player that enables full-screen video playback
                  on TV with DVD-like functionality (MPEG4)
         o        Killer IP applications (email, Internet browsing,
                  internet-based audio/video streaming)
         o        Form factor and Audio/Video connecters that mimic and connect
                  to all consumer electronics products
         o        Picture in picture (PIP) functionality (i.e. TV and Web at
                  same time)

Advanced Features include:
         o        Progressive downloading, storage and playback of digital media
                  files stored on inexpensive external USB and Firewire
                  connected storage devices
         o        Networked digital media playback from any connected PC device
                  within the home network.
         o        Seamless DRM compatibility with mainstream Internet DRM
                  technologies, but enhanced to base DRM ownership to "an
                  individual" rather than a device via CAC Media's proprietary
                  DRM technology
         o        Standard Linux-based operating system to support application
                  scalability and extended power-on usage

In addition, the MediaReady platform allows consumers to upgrade their units
with additional services based on a one-time or subscription charge. Retailers
and resellers of the MediaReady line of products also participate in the
residual revenue stream offered by these upgrades. VWB offers value-added
applications and upgrades that include:
         o        Video Conferencing & IP Telephony
         o        Games (Single or Multiplayer)
         o        PVR (i.e. Tivo)
         o        Online Digital Media Rental and Purchase

         Historically Video Without Boundaries has derived substantially all of
its revenues from fees and product sales for services and products generated on
an order by order basis. Video Without Boundaries services and products are
provided on a fixed-price basis and on a time and material basis.

         In addition, because a proportion of Video Without Boundaries' expenses
is relatively fixed, a variation in the number of client purchase orders can
cause significant variations in operating results from quarter to quarter.

         Video Without Boundaries' orders vary in size and scope; therefore, a
client that accounts for a significant portion of Video Without Boundaries'
revenues in one period may not generate a similar amount of revenue in
subsequent periods. No client accounted for more than 10.0% of Video Without
Boundaries' revenues in the period ended December 31, 2003.

         Video Without Boundaries does not believe that it will derive a
significant portion of its revenues from a limited number of clients in the near
future. However, there is a risk that the source of Video Without Boundaries'
revenues may be generated from a small number of clients. These clients may not
retain Video Without Boundaries in the future. Any cancellation, deferral, or
significant reduction in work performed for these principal clients or a
significant number of smaller clients could have a material adverse affect on
Video Without Boundaries' business, financial condition, and results of
operations.

Quarter-to-quarter fluctuations in margins

The Company's operating results and quarter-to-quarter margins may fluctuate in
the future as a result of many factors, some of which are beyond the Company's
control. Historically, the Company's quarterly margins have been impacted by:
         o        the number of client purchase orders completed;
         o        seasonality;
         o        the number of days during the quarter;
         o        marketing and business development expenses;
         o        pricing changes; and
         o        economic conditions generally or in the information technology
                  products and services markets.

                                       12
<PAGE>

The Company expects these trends to continue.

Results of Operations.

         Year Ended December 31, 2003 Compared to Year Ended December 31, 2002.

REVENUES

         Net sales are comprised of product and services sales, net of returns
and allowances. In 2003, revenues were $190,770 compared to $330,621 for 2002.
The decrease in net sales was due to the consolidation and elimination of
non-profitable company divisions while investing in the development of new
digital media products for future sales.

         Cost of sales increased from $3,921 in 2002 to $176,046 in 2003.
As a percentage of net sales, the Company's gross margin was 98.8% for 2002 and
7.7% for 2003. This decrease in gross margin is due to consulting services in
2002 and product sales in 2003. The current margin is more indicative of
anticipated future margins.

GENERAL AND ADMINISTRATIVE

         General and administrative expense includes personnel costs,
administrative expenses, general office expenses, depreciation expenses,
advertising costs, and professional fees. General and administrative expenses
were $1,277,027 representing 669% as a percentage of revenue for the year ended
December 31, 2003 compared to $715,651 representing 216% as a percentage of
revenue for the year ended December 31, 2002. The increase in general and
administrative expenses as a percentage of revenue was a result of company
investment in the development of new products and services.

         Net cash used in operating activities was $1,259,757 for the year ended
December 31, 2003. Net cash used in operating activities was primarily
attributable to net losses.

         Net cash provided by financing activities was $1,570,610 for the year
ended December 31,2003. Net cash provided by financing activities resulted from
an advance from a shareholder and a Convertible Debenture.

LIQUIDITY AND CAPITAL RESOURCES

         As of December 31, 2003, the Company had ($1,123,166) of working
capital. On February 28, 2004 the Company secured financing for $1,100,000. The
Company believes that the new financing and cash generated from operations will
be sufficient to meet the Company's cash requirements for the next twelve
months.

PART III

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

         The current executive officers, directors and significant employees of
the Company are as follows:

         Directors and Executive Officers. The following is the Director and
Executive Officer of the Company. None of the Directors hold similar positions
in any reporting company. The directors named below will serve until the next
annual meeting of the Company's stockholders. Thereafter, directors will be
elected for one-year terms at the annual stockholders' meeting.

         V. Jeffrey Harrell, age 38, is the Chairman of the Board, President,
CEO, and Secretary of the Company. Mr. Harrell has held these positions since
December 1999. Prior to joining Video Without Boundaries, Mr. Harrell was
employed by Southeast Bankers Mortgage Corp. as Vice President of Sales from
December 1998 to January 1999, and before that he served as Vice President of
Kensington-Ashworth Financial Group, Inc. from March 1994 to January 1998.

                                       13
<PAGE>

The Company has not adopted yet the code of ethics for its Officers but intends
to adopt code of ethics at its meeting of the Board of Directors in the near
future.

ITEM 10.  EXECUTIVE COMPENSATION

         The Company paid the following salaries to its executives:

                                                         2002           2003
                                                         ----           ----
V. Jeffrey Harrell,                                    $29,025        $32,250
President, CEO, and
Chairman of the Board

         None of the executives received any stock options or stock dividends.
The above executive received reimbursement for health insurance as part of his
compensation. The director was not compensated for any Board of Directors
meetings.

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

         As of December 31, 2003, the Company had 15,448,747 shares of its
Common Stock issued and outstanding. The following table sets forth, as of
December 31, 2003, the beneficial ownership of the Company's Common Stock (i) by
the only persons who are known by the Company to own beneficially more than 5%
of the Company's Common Stock; (ii) by each director of the Company; and (iii)
by all directors and officers as a group.

                  Name and                         Amount
                  Address of                         of
Title of          beneficial                      beneficial         Percent of
Class             owner                             owner              class

Common         V. Jeffrey Harrell                 1,523,440             9.9%
               PO Box 30057
               Ft. Lauderdale, FL 33303

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         The director named above will serve until the next annual meeting of
the Company's stockholders. Thereafter, directors will be elected for one-year
terms at the annual stockholders' meeting. Officers will hold their positions at
the pleasure of the board of directors, absent any employment agreement, of
which none currently exists or is contemplated. There is no arrangement or
understanding between any of the directors or officers of the Company and any
other person pursuant to which any director or officer was or is to be selected
as a director or officer.

         None of the executives received any stock options or stock dividends.
The executive received reimbursement for health insurance as part of
compensation. The directors were not compensated for any Board of Directors
meetings.

ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K.

          (a) The Exhibits listed below are filed as part of this Annual Report.

3.1      Articles of Incorporation (incorporated by reference from Registration
         Statement on Form 10SB filed with the Securities and Exchange
         Commission under File No. 0-31497 filed 09/11/00)

3.2      Amended Articles of Incorporation (incorporated by reference from
         Registration Statement on Form 10SB filed with the Securities and
         Exchange Commission under File No. 0-31497 filed 09/11/00)

3.3      Bylaws (incorporated by reference from Registration Statement on Form
         10SB filed with the Securities and Exchange Commission under File No.
         0-31497 filed 09/11/00)

                                       14
<PAGE>

10.1     Office Lease (incorporated by reference from Registration Statement on
         Form 10SB Amendment #1 filed with the Securities and Exchange
         Commission under File No. 0-31497 filed 11/06/00)

10.2     Office Lease (incorporated by reference from Registration Statement on
         Form 10SB Amendment #1 filed with the Securities and Exchange
         Commission under File No. 0-31497 filed 11/06/00)

10.3     Office Lease (incorporated by reference from Annual Report filed with
         the Securities and Exchange Commission under File No. 0-31497 filed
         06/28/02)

10.4     Office Lease (incorporated by reference from Annual Report filed with
         the Securities and Exchange Commission under File No. 0-31497 filed
         06/28/02)

10.5     Office Lease (incorporated by reference from Quarterly Report filed
         with the Securities and Exchange Commission under File No. 0-31497
         filed 05/15/03)

10.10    Executive Employment Contract - Pete Fisher (incorporated by reference
         from Registration Statement on Form 10SB Amendment #1 filed with the
         Securities and Exchange Commission under File No. 0-31497 filed
         11/06/00)

10.11    Executive Employment Contract - Jonathan Silverstein (incorporated by
         reference from Registration Statement on Form 10SB Amendment #1 filed
         with the Securities and Exchange Commission under File No. 0-31497
         filed 11/06/00)

         No reports on Form 8-K were filed by the Company during the third
         quarter of it's fiscal year ending December 31, 2003.

31.1     Certification

32.1     Certification

                                       15
<PAGE>

                                  Signatures


         In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant has caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.


                                         VIDEO WITHOUT BOUNDARIES, INC.

April 14, 2004                           By: /s/ V. JEFFREY HARRELL
                                         ---------------------------
                                         V. Jeffrey Harrell,
                                         President and Chief
                                         Executive Officer

                                       16



<PAGE>
                                NORMAN STUMACHER
                           CERTIFIED PUBLIC ACCOUNTANT
                               85 ATLANTIC AVENUE
                               LYNBROOK, NY 11563
                                TEL# 516-594-9500
                                FAX# 516-594-9550

                          INDEPENDENT AUDITOR'S REPORT
                          ----------------------------

To the Board of Directors
Video Without Boundaries, Inc.


         I have audited the accompanying balance sheet of Video Without
Boundaries, Inc. as of December 31, 2003 and the related statements of
operations, shareholders' equity, and cash flows for the year ended December 31,
2003. These financial statements are the responsibility of the Company's
management. My responsibility is to express an opinion on these financial
statements based on my audit.

         I conducted my audit in accordance with generally accepted auditing
standards. Those standards require that I 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.
I believe that my audit provides a reasonable basis for my opinion.

         In my opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Video Without
Boundaries, Inc. as of December 31, 2003, and December 31, 2002 and the results
of its operations and cash flows for the years ended December 31, 2003 and
December 31, 2002 in conformity with generally accepted accounting principles.

         The accompanying financial statements have been prepared assuming that
the Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company has suffered recurring losses from operations
and has a net capital deficiency that raises substantial doubt about its ability
to continue as a going concern. Management's plans in regard to these matters
are also described in Note 1. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty. In January
and February 2004, $1,100,000 was invested in the Company through purchase of
Sec. 144 shares.

/s/ Norman Stumacher
--------------------
Norman Stumacher
April 12, 2004



                                      F-1
<PAGE>

                         VIDEO WITHOUT BOUNDARIES, INC.
                                 Balance Sheets


-------------------------------------------------------------------------------
                                                       12/31/02       12/31/03
-------------------------------------------------------------------------------
Assets                                                 audited         audited
Current assets:
Cash                                                 $    12,047    $    73,912
Accounts receivable                                  $       621    $   300,000
Inventory                                                     --    $     3,250
Deposit Neon Tech                                    $    10,000             --
                                                     -----------    -----------
Total current assets                                 $    22,668    $   377,162

Fixed assets:
Property and equipment                               $    66,006    $    94,198
                                                     -----------    -----------
Net fixed assets                                     $    66,006    $    94,198

Other assets                                                  --    $     1,850
Deposit CAC Media                                    $    70,000    $   163,000
Investment Cornerstone Entertainment                 $   210,871             --
International Consortium                             $    25,000             --
Media Ready Software                                          --    $   198,668
Prepaid Box Tooling                                           --    $    40,000
Brokenremote.tv                                               --             --
                                                     -----------    -----------
Total other assets                                   $   305,871    $   403,518

Total assets                                         $   394,545    $   874,877
===============================================================================

Liabilities and owner's equity
Current liabilities:
Accounts payable                                     $    85,375    $   224,769
Due To Shareholders                                  $   763,780    $ 1,238,258
Interest Payable                                     $     9,948    $     7,301
Notes Payable                                        $    20,000    $    30,000
Other                                                         --             --
Convertible Debentures                               $   268,000             --
-------------------------------------------------------------------------------
Total current liabilities                            $ 1,147,103    $ 1,500,328


Shareholders Equity
Common stock-par value $.001, 50,000,000 shares
authorized, 119,087 issued and outstanding
at December 31, 2002 and 15,448,747 at
December 31, 2003                                    $       119    $    15,449
Additional paid -in capital                          $ 1,415,770    $ 2,789,851
Deficit                                              ($2,168,447)   ($3,430,750)
-------------------------------------------------------------------------------
Total owner's equity                                 ($  752,558)   ($  625,450)

Total liabilities and stockholders' equity           $   394,545    $   874,877
===============================================================================

The accompanying notes are an integal part of these financial statements


                                      F-2
<PAGE>

                         VIDEO WITHOUT BOUNDARIES, INC.

                            STATEMENTS OF OPERATIONS
         For year ended December 31, 2002 & year ended December 31, 2003

                                                     12/31/02        12/31/03
                                                   ------------    ------------
                                                      audited         audited

Revenues                                           $    330,621    $    190,770

Costs of Sales                                     $      3,921    $    176,046
                                                   ------------    ------------
              Gross Profit                         $    326,700    $     14,724

Selling,General, and Administrative Expenses       $    715,651    $  1,277,027
Research and Development                           $    427,000              --
Loss on Discontinued Business                      $    107,125              --
                                                   ------------    ------------
                                                   $  1,249,776    $  1,277,027

              Net Loss                             $   (923,076)   $ (1,262,302)
                                                   ============    ============


Basic Loss Per Share                               $      (7.75)   $     (0.082)
                                                   ============    ============
Diluted Earnings Per Share                         $      (7.72)   $     (0.162)
                                                   ============    ============

Weighted-average common shares outstanding
Basic                                                   119,087      15,448,747
                                                   ============    ============

Diluted                                                 119,573       7,783,917
                                                   ============    ============


The accompanying notes are an integal part of these financial statements


                                      F-3
<PAGE>

                        STATEMENT OF SHAREHOLDERS' EQUITY
                 March 19, 1999 (Inception) to December 31, 2003
<TABLE>
<CAPTION>
                                                                            Common Stock                  Additional Paid-In
                                                                        Shares        Amount            Capital         Deficit
                                                                        ------        ------            -------         -------

<S>                                                                       <C>         <C>              <C>             <C>
Sales of common stock-net                                                 18,750      $    19          $  293,591

Stock issued for services                                                 52,600      $    53          $  102,360

Stock issued for acquired companies                                       45,000      $    45          $      855

Sale of common stock for cash                                            133,650      $   133          $  174,867

Purchase of September Project II, Corp                                                                 $ (175,000)

Reverse acquisition of Video Without Boundaries, Inc.                    250,000      $   250          $    4,750

(Loss) for period March 19,1999(inception) to December 31, 1999                                                        $  (162,116)
                                                                      ============================================================
                                        Balance December 31, 1999        500,000      $   500          $  401,423      $  (162,116)

(Loss) for the year ended December 31, 2000                                                                            $  (226,714)

Stock issued for services                                                184,250      $   184          $    3,501
                                                                      ============================================================
                                        Balance December 31, 2000        684,250      $   684          $  404,924      $  (388,830)

Private Placement Offer                                                  144,307      $   145          $   25,455

(Loss) for the year ended December 31, 2001                                                                            $  (742,412)
                                                                      ============================================================
                                        Balance December 31, 2001        828,557      $   829          $  430,379      $(1,131,242)

Reverse Split 1 for 20                                                  (787,130)     $  (787)

Stock Issued For Services                                                     75      $     7          $  492,450

Stock Issued For Convertible Debenture                                    94,866      $   242          $  492,941

Reverse Split 1 for 300                                                  (17,281)     $  (172)

Dividend Cornerstone Entertainment                                                                                     $  (114,129)

(Loss) For The Year Ended December 31,2002                                                                             $  (923,076)
                                                                      ------------------------------------------------------------
                                        Balance December 31, 2002        119,087      $   119          $1,415,770      $(2,168,447)

Stock Issued For Acquisitions                                            750,000      $   750          $  449,250

Stock Issed For Convertible Debenture                                    949,660      $   950          $  495,510

Stock Issued For Debt                                                 12,795,000      $12,795          $  220,155

Stock Issued For Services                                                835,000      $   835          $  209,165

(Loss) For The Period Ended December 31, 2003                                                                          $(1,262,302)
                                                                      ------------------------------------------------------------
                                        Balance December 31, 2003     15,448,747      $15,449          $2,789,850      $(3,430,749)
</TABLE>

                                      F-4
<PAGE>
                         VIDEO WITHOUT BOUNDARIES, INC.

                            STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>

                                                                                12/31/02        12/31/03
                                                                               -----------    -----------
                                                                                 audited        audited
<S>                                                                            <C>            <C>
Cash flows from operating activities
            Net (loss)                                                         $  (923,076)   $(1,262,302)
            Adjustments to reconcile net (loss) to net cash
            (used) by operating activities
                                  Stock issued for services and acquired
                                  companies                                    $         7    $    15,330
                                  Depreciation                                 $    34,294    $   140,001
                                  Decrease (Increase) in accounts receivable   $      (621)   $  (299,379)
                                  Decrease (Increase) in inventories           $    (3,250)
                                  Decrease (Increase) in other Assets          $  (254,921)   $    (6,850)
                                  Increase (Decrease) in notes payable         $    17,301
                                  Increase (Decrease) in accounts payable      $   (84,049)   $   139,394
                                                                               -----------    -----------
                                            Total Adjustments                  $  (305,290)   $     2,546

                                            Net cash (used) by operating
                                            activities                         $(1,228,366)   $(1,259,757)

Cash flows from investing activities
                                  Purchase of property and equipment           $         0    $    (8,857)

                                  Net cash (used) by investing
                                  activities                                   $         0    $  (240,132)

Cash flows from financing activities
                                  Loan from shareholder                        $   554,094    $   474,478
                                  Sale of common stock                         $   427,191    $ 1,374,080
                                  Convertible Debentures                       $   237,000    $  (277,948)

                                            Net cash provided by financing
                                            activities                         $ 1,218,285    $ 1,570,610

Net change in cash                                                             $   (10,081)   $    61,865

Cash - beginning                                                               $    22,128    $    12,047

Cash - end                                                                     $    12,047    $    73,912
                                                                               ===========    ===========

Supplemental disclosures of cash flow information:
                                  Interest paid                                $        --    $        --
                                                                               ===========    ===========
                                  Taxes paid                                   $        --    $        --
                                                                               ===========    ===========
</TABLE>

The accompanying notes are an integal part of these financial statements

                                      F-5


<PAGE>

                         VIDEO WITHOUT BOUNDARIES, INC.

                          NOTES TO FINANCIAL STATEMENTS
                                DECEMBER 31, 2003


Note 1. Nature of Business

         Video Without Boundaries is in the converging digital media on demand,
enhanced home entertainment and emerging interactive consumer electronics
market. VWB is focused on home entertainment media products and solutions that
enhance the consumer experience, while providing new revenue opportunities for
online music and movie content providers. VWB, and its subsidiaries, are leading
suppliers of broadband products, services, and content including its ability to
deliver broadcast quality digital video and web interactivity at transfer rates
as low as 56K. All prior segments in 2001 were discontinued.

         A. The accompanying financial statements have been prepared on the
going concern basis, which contemplates the realization of assets and
liquidation of liabilities in the normal course of business. The Company has
incurred a loss of ($1,262,303) for the current year, and has a working capital
deficiency of ($1,123,166) at December 31, 2003. Such factors raise substantial
doubt about the ability of the Company to continue as a going concern.
Continuation of the Company as a going concern is dependent on the Company's
ability to attain profitable operations and/or obtain additional financing. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty. In January and February 2004, $1,100,000 was
invested in the Company through the purchase of Sec. 144 shares.

Note 2. Summary of Significant Accounting Policies

Basis of Presentation

         Video Without Boundaries, Inc. was incorporated in the State of
Florida, on March 19, 1999 under the name of ValuSales.com, Inc. and had no
operations. On July 20, 1999, it acquired the assets of, and signed employment
agreements with the principals of, two privately held operating companies for
$75,000 and 45,000 shares of common stock. The transaction was accounted for as
a purchase. The assets were recorded at cost, which approximated market value.
Operations are included from the date of acquisition. The company changed its
name to Video Without Boundaries on November 16, 2001.

Note 2. Summary of Significant Accounting Policies-Continued

         On December 1, 1999, the Company, a public shell (with no historical
operations) changed its name to Valusales.com, and acquired 100% of the
outstanding stock of ValuSales.Com, Inc. for 250,000 shares. For accounting
purposes, the acquisition has been treated as a capital transaction rather than
a business combination.


                                      F-6
<PAGE>

The accounting is identical to that resulting from a reverse acquisition.
Therefore, a re-capitalization of the Acquired Company took place with the
Acquired Company as the acquirer. The historical financial statements prior to
December 1, 1999 are those of the Acquired Companies. All significant
interdivisional transactions and balances have been eliminated.

Revenues

         The Company recognizes revenues as follows:

         A. Product sales revenue its recognized when the product is delivered.

         B. Service revenue is recognized when the services are performed.

Use of Estimates

         Use of estimates and assumptions by management is required in the
preparation of financial statements in conformity with generally accepted
accounting principles. Actual results could differ from those estimates and
assumptions.

Property and Equipment

         Property and equipment is recorded at cost. Depreciation is computed
using the straight-line method over the three year estimated useful lives of the
assets.

         Property and equipment at December 31, 2003 and December 31, 2002
consist of:

                                            2003         2002
                                          ---------    ---------

         Computer equipment               $ 405,179    $ 118,294
         Furniture and fixtures              27,687       27,687
                                          ---------    ---------
                                            432,866      145,981
         Less: Accumulated Depreciation    (140,001)     (79,974)
                                          ---------    ---------
                                          $ 292,865    $  66,007
                                          =========    =========

Note 2. Summary of Significant Accounting Policies-Continued

(Loss) Per Share

         (.082) Basic (loss) per share equals net (loss) divided by the weighted
average shares outstanding during the period. Fully diluted shares assumes the
average shares for the year.

         Leases - The Company's operating facilities are on a month to month
leases for an annual rent of approximately $24,000.

                                      F-7
<PAGE>

         Due to Shareholders - The Company obtained loans from two shareholders
totaling $474,478. The note is payable on demand with interest on the unpaid
principal at the rate of 8.0% per annum. The balance of loans outstanding was
$1,238,258 at December 31, 2003 and $763,780 at December 31, 2002.

Note 4. Income taxes

         At December 31, 2003 the Company had net operating loss carry forward
of approximately $3,430,750, which expires thru 2023. The deferred benefit of
the net operating loss carry forward has been fully reserved for due to the
uncertainty of the timing of its recognition.

         At December 31, 2003, there are no items that give rise to deferred
income taxes.

Note 5. Shareholders' Equity

         On April 1, 1999, Video Without Boundaries, Inc. had a private
placement offering of 18,750 shares of its common stock at $1 per share. Cost of
the offering was approximately $81,000. Such stock was sold pursuant to Rule 504
of Regulation D under the United States Securities Act of 1933.

         In 2001 the Company had a private placement offering of 144,307 shares
of its common stock at $0.18 per share.

         Effective November 18, 2002 the Company effectuated a one-for-twenty
reverse stock split. All share and per share data, is stated to reflect the
split.

         In 2001 the Company sold convertible debentures totaling $485,500
interest on the outstanding principal shall accrue at the rate of 12% per annum.
Holder may elect on maturity to collect the outstanding principal in shares of
common stock at the rate of $0.05 per share. Subsequent to the balance sheet
date all of the debentures were converted into common stock. In 2002 the company
sold convertible debentures totaling 268,000. Interest on the outstanding
principle share accrue at the rate of 12% per am mum. Holder may elect to
collect the outstanding principal in shares of common stock at the rate of 50%
of the bid price on conversion. These debentures were converted to 949,660
shares in 2003.

Note 6. Business Segments

         The Company is organized as on entity (See Note 1). Summarized
financial information concerning the Company is shown in the following table.
Corporate related items not allocated to reportable segments are included in the
reconciliation to the Balance Sheets and Statements of Operations.
Reconciliation to Balance Sheets and Statements of Operations:

                                      F-8
<PAGE>

--------------------------------------------------------------------------------
2003                        Totals        2002                         Totals
--------------------------------------------------------------------------------
Net Sales                   190,770       Net Sales                    330,621
--------------------------------------------------------------------------------
Operating earnings (loss)   (1,262,303)   Operating earnings (loss)    (923,076)
--------------------------------------------------------------------------------
Depreciation                140,001       Depreciation                 32,230
--------------------------------------------------------------------------------
Total Assets                874,877       Total Assets                 394,545
--------------------------------------------------------------------------------
Capital Expenditures        353,108       Capital Expenditures         8,903
--------------------------------------------------------------------------------

Reconciliation to Balance Sheets and Statements of Operations:

                                                        2003          2002
                                                    -----------    -----------
         Assets
                  Corporate                         $   874,877    $   394,545
                                                    -----------    -----------

                           Total                    $   874,877    $   394,545
                                                    ===========    ===========

         Operating Results
                  Total s for reportable segments
                           Corporate                ($1,262,303)   ($  923,076)
                                                    -----------    -----------

                                    Total           ($1,262,303)   ($  923,076)
                                                    ===========    ===========

Note 7. Subsequent Events

         During 2002 Convertible Debentures totaling $485,500 were converted
into 9,710,000 shares of common stock.

         During 2003 Convertible Debentures totaling $496,460 was converted into
949,660 shares of common stock.

                                      F-9