WAVE POWER.NET, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                              FINANCIAL STATEMENTS

                           DECEMBER 31, 2001 AND 2000











<PAGE>
                              WAVE POWER.NET, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                                 BALANCE SHEETS
                                 --------------





                                                          December 31,
ASSETS                                                  2001       2000
------                                              ----------------------
Assets:
  As restated at December 31, 2000                  $    --      $    --
                                                    ---------    ---------

        Total Assets                                $    --      $    --
                                                    =========    =========


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

Current Liabilities:
  Accounts payable and accrued liabilities          $  20,225    $  28,485
  Stockholders' loans payable                         148,005       70,960
                                                    ---------    ---------
        Total Current Liabilities                     168,230       99,445
                                                    ---------    ---------

Commitments and Contingencies

Stockholders' Equity (Deficit):
  Common stock, 75,000,000 shares authorized,
    $.001 par value, 17,780,000 shares issued and
    outstanding at December 31, 2001 and 2000          17,780       17,780
  Additional paid-in capital                           95,220       95,220
  Deficit accumulated during the development
    stage (as restated at December 31, 2000)         (281,230)    (212,445)
                                                    ---------    ---------

        Total Stockholders' Equity (Deficit)         (168,230)     (99,445)
                                                    ---------    ---------

        Total Liabilities
          and Stockholders' Equity (Deficit)        $    --      $    --
                                                    =========    =========

______________________

The accompanying notes are an integral part of these financial statements.




                                       1
<PAGE>








                              WAVE POWER.NET, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                            STATEMENTS OF OPERATIONS
                            ------------------------


<TABLE>
<CAPTION>

                                                                                                        For the Period
                                                                                                       Inception to Date
                                               For the Years Ended      November 6, 1997
                                                 December 31,                  to
                                             2001             2000     December 31, 2001
                                         ------------    ------------  -----------------
                                                          (Restated)

<S>                                      <C>             <C>             <C>
Sales                                    $       --      $       --      $       --
                                         ------------    ------------    ------------

Expenses:
  Amortization (as restated
    for year ended December 31, 2000)            --              --               476
  Bad debt                                       --              --            39,177
  Advertising                                    --              --             2,659
  Bank charges                                   --              --                56
  Foreign exchange loss                          --              --             2,186
  License and dues                                792           1,336           2,793
  Management fees                                --              --            52,000
  Legal and professional fees                  62,409          75,911         140,273
  Rent                                          3,180           3,165          19,975
  Telephone                                      --              --             1,226
  Office                                        2,404           1,819           4,223
  Travel                                         --              --             1,000
                                         ------------    ------------    ------------
                                               68,785          82,231         266,044
                                         ------------    ------------    ------------

Loss before Cumulative Effect of
  Change in Accounting Principle              (68,785)        (82,231)       (266,044)

Cumulative Effect on Prior Periods for
  Change in Accounting Principle -
  Write-Off of Organization Costs                --              --            15,186
                                         ------------    ------------    ------------

Net Loss                                 $    (68,785)   $    (82,231)   $   (281,230)
                                         ============    ============    ============



Loss per Share:
  Basic and diluted loss per share       $       0.00    $       0.00    ($      0.02)
                                         ============    ============    ============
  Basic and diluted common shares
    outstanding                            17,780,000      17,780,000      17,780,000
                                         ============    ============    ============
</TABLE>


______________________

The accompanying notes are an integral part of these financial statements.



                                       2
<PAGE>





                              WAVE POWER.NET, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                  STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
                  --------------------------------------------

        FOR THE PERIOD INCEPTION (NOVEMBER 6, 1997) TO DECEMBER 31, 2001

<TABLE>
<CAPTION>

                                                                                                    Deficit
                                                                                                  Accumulated      Total
                                                                                     Additional    During the   Stockholders'
                                                       Number                          Paid-In    Development     Equity
                                                      of Shares        Amount          Capital      Stage       (Deficit)
                                                     -----------    -----------    -----------   -----------    -----------
<S>                                                   <C>           <C>            <C>           <C>            <C>
At Inception on November 6, 1997
  Issuance of Comon Stock for
  $.001 per Share                                     15,000,000    $    15,000    $      --     $      --      $    15,000

Issuance of Common Stock for $.01 per Share            5,000,000          5,000         45,000        50,000

Net Loss for the Period Ended December 31, 1997             --             --             --             (84)           (84)
                                                     -----------    -----------    -----------   -----------    -----------

Balances - December 31, 1997                          20,000,000         20,000         45,000           (84)        64,916

Issuance of Common Stock for $.10 per Share              480,000            480         47,520        48,000

Less:  Retirement of Stock,                           (2,700,000)        (2,700)         2,700          --             --

Net Loss for the Year Ended December 31, 1998               --             --             --        (114,594)      (114,594)
                                                     -----------    -----------    -----------   -----------    -----------

Balances - December 31, 1998                          17,780,000         17,780         95,220      (114,678)        (1,678)

Net Loss for the Year Ended December 31, 1999
  (as restated for the Cumulative Effect of Change
  in Accounting Principle)                                  --             --             --         (15,536)       (15,536)
                                                     -----------    -----------    -----------   -----------    -----------

Balances - December 31, 1999 (as restated)            17,780,000         17,780         95,220      (130,214)       (17,214)

Net Loss for the Year Ended December 31, 2000
  (as restated)                                             --             --             --         (82,231)       (82,231)
                                                     -----------    -----------    -----------   -----------    -----------

Balances - December 31, 2000 (as restated)            17,780,000         17,780         95,220      (212,445)       (99,445)

Net Loss for the Year Ended December 31, 2001               --             --             --            --           68,785)
                                                     -----------    -----------    -----------   -----------    -----------

Balances - December 31, 2001                          17,780,000    $    17,780    $    95,220   $  (281,230)   $  (168,230)
                                                     ===========    ===========    ===========   ===========    ===========
</TABLE>

______________________

The accompanying notes are an integral part of these financial statements.


                                       3
<PAGE>




                              WAVE POWER.NET, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                            STATEMENTS OF CASH FLOWS
                            ------------------------


<TABLE>
<CAPTION>
                                                                                                              For the Period
                                                                                                            Inception to Date
                                                                                                            November 6, 1997
                                                                      For the Years Ended                          to
                                                                          December 31,                      December 31, 2001
                                                                   2001                   2000
                                                                ---------               ---------           -----------------
                                                                                       (Restated)
<S>                                                             <C>                     <C>                     <C>

Cash Flows from Operating Activities:
  Net loss                                                      $ (68,785)              $ (82,231)              $(281,230)
  Adjustments to reconcile net loss to net
    cash used in operating activities:
      Amortization                                                   --                      --                       476
      Cumulative effect on prior periods -
        write-off of organization costs                              --                      --                    15,186
      (Decrease) increase in accounts payable
        and accrued expenses                                       (8,260)                 26,271                  20,225
                                                                ---------               ---------               ---------
            Net cash used in operating activities                 (77,045)                (55,960)               (245,343)
                                                                ---------               ---------               ---------

Cash Flows from Investing Activities:
  Organization costs                                                 --                      --                   (15,662)
                                                                ---------               ---------               ---------
        Net cash used in investing activities                        --                      --                   (15,662)
                                                                ---------               ---------               ---------

Cash Flows from Financing Activities:
  Proceeds from sale of common stock                                 --                      --                   113,000
  Proceeds of loans from stockholders                              77,045                  55,960                 148,005
                                                                ---------               ---------               ---------
        Net cash provided by financing activities                  77,045                  55,960                 261,005
                                                                ---------               ---------               ---------

Net Increase (Decrease) in Cash                                      --                      --                      --

Cash - beginning of period                                           --                      --                      --
                                                                ---------               ---------               ---------

Cash - end of period                                            $    --                 $    --                 $    --
                                                                =========               =========               =========


Supplemental Disclosures of Cash Flow Information:
  Cash paid during the period for:
    Interest                                                    $    --                 $    --                 $    --
                                                                =========               =========               =========
    Taxes                                                       $    --                 $    --                 $    --
                                                                =========               =========               =========

</TABLE>


____________________

The accompanying notes are an integral part of these financial statements.


                                       4
<PAGE>




                          INDEPENDENT AUDITOR'S REPORT



To the Board of Directors
Wave Power.Net, Inc.
(A Development Stage Company)
Pompano Beach, Florida 33062


We  have  audited  the  accompanying  balance  sheets  of Wave  Power.Net,  Inc.
(formerly Novus Environmental Inc.) (A Development Stage Company) as of December
31, 2001 and 2000 and the related statements of operations, stockholders' equity
(deficit)  and cash  flows for the years  then  ended  and for the  period  from
inception  (November 6, 1997) to December 31, 2001.  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 audits.

We conducted our audits in accordance with auditing standards generally accepted
in the  United  States of  America.  Those  standards  require  that we plan and
perform the audits to obtain  reasonable  assurance  about whether the financial
statements are free of material misstatements. 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  audits  provide  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 Wave  Power.Net,  Inc. (A
Development  Stage  Company) as of December 31, 2001 and 2000 and the results of
its  operations  and its cash  flows for the years then ended and for the period
from  inception  (November  6, 1997) to  December  31, 2001 in  conformity  with
accounting principles generally accepted in the United States of America.



SAMUEL KLEIN AND COMPANY

Newark,  New Jersey
March 26,  2002  except for Note 8A
and 8B which is June 7, 1002 and
8C which is September 20, 2002


                                       5
<PAGE>





                              WAVE POWER.NET, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2001


1.  THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Business
------------------

Wave Power.Net,  Inc. (formerly "Novus Environmental Inc."), a development stage
company  (the  "Company"),  was  incorporated  under  the  laws of the  State of
Delaware on November 6, 1997 to develop or acquire  recycling  technologies.  On
January 20, 2000 the Company entered into a reorganization agreement whereby the
Company  was  to  merge  with  Wave  Power,   Inc.,  a  privately  held  Florida
corporation.  On  March 3,  2000,  the  parties  acknowledged  that  the  merger
contemplated had never been consummated and they subsequently  agreed to rescind
the  agreement  and entered  into an  agreement  releasing  the parties of their
right,  title and interest,  claims,  and obligations  that they might otherwise
have had or had been set forth in the January 20,  2000  agreement  (see Note 7,
Litigation).  The Company formally  changed its name to Wave Power.Net,  Inc. on
March 20, 2000.

Basis of Accounting
-------------------

The financial  statements of the Company have been prepared on the accrual basis
of accounting.

Cash and Cash Equivalents
-------------------------

The Company  considers  all highly liquid  investments  with a maturity of three
months or less to be cash equivalents.

Use of Management's Estimates
-----------------------------

The preparation of 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 as of the date of the financial statements and
the reported amounts of revenues and expenses during the reported period. Actual
results could differ from those estimates.

Translation of Foreign Currencies
---------------------------------

Assets and liabilities of foreign  operations,  where the functional currency is
the local  currency,  are  translated  into U.S.  dollars at the fiscal year end
exchange rate. The related  translation  adjustments are required to be recorded
as cumulative  translation  adjustments,  a separate  component of shareholders'
equity.  Revenues  and  expenses are  required to be  translated  using  average
exchange rates prevailing  during the year.  Foreign currency  transaction gains
and losses,  as well as translation  adjustments  for assets and  liabilities of
foreign operations where the functional  currency is the dollar, are included in
net income (loss). Foreign currency realized and unrealized gains and losses for
the periods presented were not material.


                                       6
<PAGE>


                              WAVE POWER.NET, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2001
                                   (Continued)


1.  THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Earnings (Loss) Per Share
-------------------------

As of December 31, 1997 the Financial  Accounting  Standards Board (FASB) issued
Statement No. 128,  "Earnings Per Share" (SFAS 128) replacing the calculation of
primary and fully diluted earnings per share with basic and diluted earnings per
share.  Unlike primary earnings per share, basic earnings per share excludes the
dilutive  effects of  options,  warrants  and  convertible  securities.  Diluted
earnings  per share is very similar to the  previously  reported  fully  diluted
earnings per share.  Diluted earnings per share reflects the potential  dilution
that could occur if  securities  or other  agreements to issue common stock were
exercised or converted into common stock. Diluted earnings per share is computed
based upon the weighted  average  number of common  shares and  dilutive  common
equivalent  shares  outstanding.  Common stock  options,  which are common stock
equivalents,  had an anti-dilutive effect on earnings per share and no effect on
the weighted average number of common shares.

Impairment of Long-Lived Assets
-------------------------------

The Company has adopted  Statement of  Financial  Accounting  Standards  No. 121
(SFAS  121),  "Accounting  for  the  Impairment  of  Long-Lived  Assets  and for
Long-Lived  Assets  to be  Disposed  of".  SFAS 121  requires  that if facts and
circumstances  indicate  that the cost of fixed  assets or other  assets  may be
impaired,  an evaluation of  recoverability  would be performed by comparing the
estimated  future  undiscounted  pre-tax cash flows associated with the asset to
the asset's  carrying  value to  determine  if a  write-down  to market value or
discounted pre-tax cash flow value would be required.

rU
Comprehensive Income
--------------------

The Company has adopted  Statement of  Financial  Accounting  Standards  No. 130
(SFAS 130), "Reporting  Comprehensive  Income". This statement establishes rules
for the reporting of comprehensive  income and its components which require that
certain items such as foreign currency translation adjustments, unrealized gains
and losses on certain investments in debt and equity securities, minimum pension
liability  adjustments  and  unearned  compensation  expense  related  to  stock
issuances to employees be  presented  as separate  components  of  stockholders'
equity. The adoption of SFAS 130 had no impact on total stockholders' equity for
the period presented in these financial statements.

Start-Up Activities
-------------------

Start-up  activities are accounted for in accordance with the American Institute
of Certified Public  Accountants'  Statement of Position (SOP 98-5),  "Reporting
the Costs of Start-Up Activities". SOP 98-5 requires start-up costs, as defined,
to be expensed as incurred and was to be effective for financial  statements for
fiscal years  beginning  after  December 15, 1998.  The  application of SOP 98-5
would have resulted in a charge of $15,186 in 1999 for the cumulative  effect on
prior periods of the  application of the provisions of this  pronouncement.  The
Company currently expenses all start-up costs as incurred.


                                       7
<PAGE>

                              WAVE POWER.NET, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2001
                                   (Continued)

1.  THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Stock-Based Compensation
------------------------

The Company has elected to follow  Accounting  Principles  Board  Opinion No. 25
(APB 25),  "Accounting  for Stock Issued to  Employees"  in  accounting  for its
employee  stock  option  plans.  Under APB 25,  when the  exercise  price of the
Company's  employee  stock  options  equals or is above the market  price of the
underlying stock on the date of grant, no compensation expense is recognized.

In  accounting  for  options  granted  to  persons  other  than  employees,  the
provisions  of FASB  Statement No. 123 (SFAS 123),  "Accounting  for Stock Based
Compensation"  are applied.  In accordance with SFAS 123 the fair value of these
options are to be  estimated  at the grant date using the  Black-Scholes  option
pricing model.

Income Taxes
------------

The Company follows  Statement of Financial  Accounting  Standards No. 109 (SFAS
109),  "Accounting  for Income  Taxes".  SFAS 109  requires the  recognition  of
deferred tax liabilities and assets for the expected future tax  consequences of
events that have been included in the financial statements or tax returns. Under
this method,  deferred tax  liabilities  and assets are determined  based on the
difference  between the financial  statement  carrying  amounts and tax bases of
assets and  liabilities  using enacted tax rates in effect in the years in which
the  differences are expected to reverse.  Valuation  allowances are established
when  necessary  to reduce  deferred  tax  assets to the amount  expected  to be
realized.

Recent Accounting Pronouncements
--------------------------------

In July 2001, the FASB issued  Statement of Financial  Accounting  Standards No.
141  (SFAS  141),  "Business  Combinations".  SFAS  141  requires  all  business
combinations  to be accounted for using the purchase method of accounting and is
effective  for all business  combinations  initiated  after June 30,  2001.  The
adoption  of SFAS  141 had no  effect  on the  Company's  operating  results  or
financial condition.

Reclassifications
-----------------

Certain  reclassifications  have been made to the prior year balances to conform
to the current year's presentation.


2.  COMPANY'S BUSINESS PLANS

Wave  Power.Net,  Inc. is a development  stage company and prior to January 2002
was attempting to become involved in the waste management business and had plans
to be involved in the manufacturing,  construction,  installation, licensing and
permitting of recycling facilities specifically for car and truck tires. To date
the Company has not been able to effectuate these plans. During January 2002 the
Company  entered  into a business  transaction  that will  result in a change of
control  occurring in the Company and the Company  acquiring a current operating
entity engaged in the sports marketing business.  This transaction was rescinded
and the Company entered into another business  transaction during August of 2002
(see Note 8).


                                       8
<PAGE>


                              WAVE POWER.NET, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2001
                                   (Continued)


3.  PRIOR PERIOD ADJUSTMENT

The balance  sheet as of December  31, 2000 and the  statements  of  operations,
stockholders'  equity  and cash  flows  for the  periods  presented  reflect  an
adjustment  for the  cumulative  effect on prior periods for the adoption of the
provisions of the American Institute of Certified Public Accountants'  Statement
of Position (SOP 98-5), "Reporting the Costs of Start-Up Activities".  Recording
this adjustment  required a restatement of the amounts that had been reported in
financial  statements  previously issued for the periods ended December 31, 1999
by a charge to  operations of $14,794 (net) and a reduction of the loss reported
for the  year  ended  December  31,  2000  for  $392,  the  previously  recorded
amortization  expense.  The deficit accumulated during the development stage was
restated accordingly. This prior period adjustment results from the write-off of
unamortized organization costs in 1999 of $15,186 as required by SOP 98-5.


4.  DUE TO STOCKHOLDERS

As of December 31, 2001 and 2000 the Company is indebted to certain stockholders
of the Company or to entities  controlled by those stockholders for $148,005 and
$70,960,  respectively.  These amounts are noninterest  bearing loans payable on
demand. On March 22, 2002 pursuant to an agreement related to the Reorganization
Agreement more fully  described  below in "Subsequent  Events",  $123,000 of the
amount due was paid off.


5.  PROVISION FOR INCOME TAXES

For each of the periods from inception November 6, 1997 to December 31, 2001 the
Company had losses  that  totaled  $281,230.  No tax expense or benefit has been
reported  in  the  financial   statements  due  to  the  uncertainty  of  future
operations.


6.  COMMON STOCK

The  authorized  capital stock of the Company  consists of 75,000,000  shares of
common stock, par value $.001 per share.

On December 5, 1997 the Company issued  15,000,000 shares of common stock to the
incorporators of the Company for $15,000.

From December 8, 1997 to December 30, 1997 the Company sold 5,000,000  shares of
its common stock for $.01 per share in connection  with a public  offering under
Regulation D Rule 504 of the  Securities Act of 1933 (the Act). The Company also
sold from April 29, 1998 to May,  1998,  480,000  shares of its common stock for
$.10 per share.  The Company  conducted both offerings in such a manner that the
shares were sold only to  accredited  investors  as such term is defined in Rule
501 of  Regulation D under the Act. The pricing and the terms of the  securities
were  arbitrarily  determined  by the  Company  and had no  relationship  to the
Company's assets,  book value or results of operations or any generally accepted
criteria of value.

In September,  1998 two  incorporators  and officers of the company resigned and
returned for  retirement  2,700,000  shares of their  holdings in the  Company's
common stock.


                                       9
<PAGE>


                              WAVE POWER.NET, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2001
                                   (Continued)


7.  COMMITMENTS AND CONTINGENCIES

Government Regulations
----------------------

The  Company is subject to local,  state and federal  laws of the  jurisdictions
that it operates  in. The Company also  believes  that it will be subject to the
laws of all jurisdictions of its participants and clients.

Litigation
----------

On January 20, 2000 the Company  executed an  agreement  with Wave Power Inc., a
Florida  corporation  ("Wave Power")  whereby Wave Power was to be combined with
Novus Environmental Inc. through the issuance of 17,000,000 shares of restricted
common stock of Novus  Environmental  Inc. in exchange for 17,000,000  shares of
Wave Power which  represented  all of the issued and  outstanding  stock of Wave
Power.  Pursuant to this  agreement,  the Company  also changed its name to Wave
Power.Net, Inc.

On March 3,  2000 the  agreement  with Wave  Power  terminated  and the  Company
entered  into a  settlement  agreement  and mutual  release  with Wave Power and
Vernon  Kendrick,  its  President,  whereby the Company agreed to relinquish its
right to use the name Wave  Power.Net,  Inc. as well as any variations  thereon.
Also, on March 3, 2000,  Wave Power entered into a merger  agreement  with Enter
Tech Corporation, a publicly traded Nevada corporation ("Enter Tech"). Among the
terms of this agreement was the provision that in consideration  for the Company
relinquishing  the rights to the Wave Power name the  Company was to receive one
million  shares of common stock of Enter Tech with a market value at the date of
the signing of the agreement of  approximately $1 per share. The above indicated
settlement agreement and mutual release was made a part of the merger agreement.

On April 11, 2000,  the Company was  notified by  attorneys  for Enter Tech that
they were  claiming  nonperformance  by the  Company  under the above  indicated
settlement  agreement and mutual release,  alleging among other things, that the
Company was still using the name Wave Power.Net Inc.  Accordingly,  in the event
Enter Tech  brings a lawsuit,  the  potential  outcome of such case could not be
determined at this time, nor could any potential  monetary damages be estimated.
As of March 30,  2002  neither  Enter Tech nor the Company  commenced  any legal
action and there has been no change  relating to this  matter.  The December 31,
2001 and March 26, 2002  closing  market  price of Enter Tech  common  stock was
$.01.

Because of the  uncertainty  surrounding  the  realization  of the revenue which
would arise from the  provisions of the merger  agreement  with Enter Tech,  the
Company has not recognized any revenue relating to the transaction.

Leases
------

On March 1, 2000 the Company  rented  office  space in Pompano  Beach,  Florida,
subject to a lease  which was to expire  February  28,  2001 for a total rent of
$3,180.  These premises were never occupied and at December 31, 2000 the Company
owed nine months'  rent,  the  liability  for which it had reflected in accounts
payable at that date,  and could be  considered  in technical  default under the
lease.  During  the first  quarter of 2001 the  Company  cured its  default  and
entered  into a new lease for a one year term  beginning  January  1, 2001 for a
total rent for the year of $3,180,  which was paid in full by a  stockholder  of
the Company. Although this lease was not renewed, management is confident that a
month to month  arrangement is acceptable to the landlord.  The Company has paid
no rent for the period January through March,  2002, and again can be considered
in technical default.



                                       10
<PAGE>


                              WAVE POWER.NET, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2001
                                   (Continued)


7.  COMMITMENTS AND CONTINGENCIES (Continued)

Consulting Agreements
---------------------

On February 10, 2000 the Company entered into an agreement with a consultant for
assistance in seeking and arranging financing for the Company. The agreement has
no fixed term and  compensation for the consultant is contingent upon the amount
and  type of  financing  that it  ultimately  is able to  negotiate  with  third
parties. To date no financing has been provided and no fees have been incurred.

On  February  28,  2000 the  Company  entered  into an  agreement  with  another
consultant  for a one year term whereby the  consultant is required to introduce
the Company to potential sources of financing. This consultant's compensation is
contingent  upon the amount and type of  financing  ultimately  obtained  by the
Company from sources that were introduced by this consultant. This agreement was
cancelled on January 17, 2001.


Other Matters
-------------

On January 3, 2001 the  Company  executed a Letter of Intent to acquire  100% of
the outstanding  capital stock of Emission Controls Corp.  ("ECC"),  a privately
held Nevada corporation,  in exchange for 15,000,000 restricted shares of common
stock of the Company.  ECC's primary  assets  consist of patents to  proprietary
technology for a device known as the Natural Resources Fuel Reformer ("Cracker")
which claims to reduce harmful emissions from internal combustion  engines.  The
Letter of Intent also included the provision that the Company would be obligated
to pay a royalty of three  percent  (3%) of the net income of the company to Syd
Cooke, President of ECC, and/or a nominee, up to a maximum of $1,000,000,000. On
January 7, 2001 the parties entered into a  Reorganization  Agreement  affirming
the terms and  conditions  as set forth in the Letter of Intent.  The  Agreement
also set forth other conditions and established a due diligence period. On March
29, 2001, the parties  mutually agreed to rescind the  Reorganization  Agreement
and Letter of Intent.


8.  SUBSEQUENT EVENTS

A.  Stock Compensation Plan
    -----------------------

On May 15, 2002 the Board of Directors of the Company, ("the Board") adopted the
2002 Compensation Plan I ("the Plan") effective April 1, 2002, and will register
2,000,000  shares  of the  Company's  common  stock  to be used for  payment  of
services  rendered  and/or  the  opportunity  to  purchase  common  stock of the
Company.  The Board or its designee will determine and  designate,  from time to
time, those officers,  directors,  consultants,  advisors,  and employees of the
Company, or consultants, advisors and employees of a parent or subsidiary of the
Company,  to whom  shares  are to be issued  and/or  options  are to be  granted
pursuant  to the Plan,  and the  number of shares to be  optioned,  from time to
time, to any individual or entity.

The share price or option price will be  determined as of the time the shares or
option to purchase  shares is granted and may be  increased  or decreased by the
Board or its designee, form time to time, provided, however, that no shares, nor
option to purchase  shares may be issued at a price that is less than 50% of the
then-current  bid price of the common stock.  The initial and standard price per
share of common stock to be issued directly or by option is $.18 per share,  but
may be changed by the Board or its designee from time to time.



                                       11
<PAGE>


                              WAVE POWER.NET, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2001
                                   (Continued)


8.  SUBSEQUENT EVENTS (Continued)

A.  Stock Compensation Plan (Continued)
    -----------------------

Options  granted  pursuant  to the Plan will expire on the first to occur of the
following dates, whether or not exercisable on such date:

     (a) five years from the date the option is granted, (b) six months from the
     date the optionee ceases to be employed by the Company due to permanent and
     total disability,  (c) the date of termination of employment by the Company
     for reason other than retirement,  permanent and total disability or death,
     unless the Board  determines in its sole discretion that it would be in the
     best  interests  of the  Company to extend the  options for a period not to
     exceed three years or (d) three  months from the date the employee  retires
     with the permission of the Board.

No right or  privilege  of any  person  subject to the Plan is  transferable  or
assignable  except to the person's  personal  representative in the event of the
person's death, at which time such personal  representative  will have up to one
year to exercise such options which were exercisable at the time of the person's
death.  Except for this provision,  options granted  pursuant to the Plan can be
exercised only by the optionee during his lifetime.

If the number of shares of common stock of the Company increases or decreases by
change in par value, spilt-up, reclassification, or payment of a stock dividend,
the  number of shares to be issued,  or an option  held by an  optionee  and the
option  price per share  will be  proportionately  adjusted.  If the  Company is
reorganized,  consolidated or merged with another corporation,  the person shall
be  entitled  to  receive  shares or  options  on  shares  of such  reorganized,
consolidated or merged company in the same  proportion,  at an equivalent  price
per share and subject to the same  conditions as he was  originally  entitled to
receive pursuant to the Plan.

Upon dissolution or liquidation of the Company,  the options granted pursuant to
the Plan will terminate and become null and void, but an optionee shall have the
right  immediately  prior to such  dissolution  or  liquidation  to exercise any
options granted that are still  exercisable  pursuant to the Plan, to the extent
not previously exercised.

The Plan will  terminate  either on the date of  issuance  of the last  share of
common stock  allocated  under the Plan, or ten years from the Plan's  effective
date, whichever is earlier.

B.  Business Combinations
    ---------------------

On  February  14,  2002  the  Company  entered  into an  Agreement  and  Plan of
Reorganization  ("the  Agreement") with 3 Strikes (USA),  Inc. ("3 Strikes"),  a
privately held New York  corporation.  In order for the Company to complete this
transaction the Company will file an amendment to its Articles of  Incorporation
with the Secretary of State of Delaware  reflecting a reverse stock split of the
Company's common stock on the basis of one share exchanged for every five shares
currently  outstanding.  The Company will also increase its  authorized  capital
stock to  100,000,000  shares and change its name from Wave  Power.Net,  Inc. to
Insta-Win,  Ltd. The agreement sets forth the terms and conditions  whereby upon
its completion the Company will acquire all of the issued and outstanding shares
of 3 Strikes in exchange for the Company  issuing  20,000,000 post reverse split
shares of its common stock to the  stockholders of 3 Strikes,  or their assigns,
and  1,300,000  post  reverse  split  shares of its common  stock to the current
principal stockholder of the Company.



                                       12
<PAGE>


                              WAVE POWER.NET, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2001
                                   (Continued)


8.  SUBSEQUENT EVENTS (Continued)

B.  Business Combinations (Continued)
    ---------------------

In connection  with this  transaction  current  shareholders  of the Company who
control  approximately 90% of the Company's outstanding common stock have agreed
to exchange  their shares for cash  amounting to $240,000 of which $148,005 will
be used to retire the current outstanding stockholder loans.

As a result of these transactions,  the current stockholders of the Company will
own  approximately  1,656,000  post  reverse  split  shares of  common  stock or
approximately 7% of the  approximately  24,856,000 total  outstanding  shares of
common stock on a post  reverse  split basis,  and the current  stockholders  or
assigns of 3 Strikes will own  23,200,000 of the post reverse  split shares,  or
approximately  93% of the outstanding  post reverse split shares of common stock
of the Company, after giving effect to the 1 for 5 reverse stock split.

The transactions  will result in a change of control with 3 Strikes being deemed
the acquiror for accounting and financial  reporting purposes in accordance with
the view  that the  acquisition  by a public  shell of the  assets  of a private
company's business should be accounted for as a reverse merger.

The  terms and  conditions  of the  Agreement  and Plan of  Reorganization  were
conditional and subject to modification.  For several reasons, on April 19, 2002
the parties  mutually  agreed to rescind  the  Agreement  and the  parties  were
returned to their pre-agreement status quo, released each other from any further
obligations and indemnified each other for any resulting liabilities.

Via-Tek Transaction
-------------------

On April 25, 2002 the Company  entered into a conditional  Agreement and Plan of
Reorganization ("the Agreement") with Via-Tek Inc. ("Via-Tek"), a privately held
Delaware  corporation.  In order to complete this  transaction  the Company will
effect a  reverse  stock  split of its  common  stock on the  basis of one share
exchanged for every five shares currently outstanding.  The Agreement sets forth
the terms and  conditions  whereby upon its  completion the Company will acquire
all of the issued and outstanding  shares of Via-Tek in exchange for the Company
issuing  18,000,000  post  reverse  split  shares  of its  common  stock  to the
stockholders of Via-Tek,  or their assigns,  and 1,816,000 shares to the current
principal  stockholder  of the Company,  on a post reverse  split basis for past
services rendered.  The Company and its principal stockholders have consented to
the reverse stock split and the issuance of additional shares of common stock of
the Company to the Via-Tek  shareholders to allow for the number of post reverse
split shares to be issued as  indicated.  The parties  agreed that the surviving
entity will have no more than  31,816,000  post reverse  split shares issued and
outstanding after the closing of the transaction.

C.  New Developments - Via-Tek Recision
    -----------------------------------

A condition of the Agreement and Plan of  Reorganization  ("Agreement")  between
the  Company  and Via-Tek  was that  Via-Tek  comply and adhere to,  among other
provisions  that "Each of the parties  hereto will use its best  efforts to take
all  actions  and to do all things  necessary  in order to  consummate  and make
effective the transaction contemplated by this Agreement..."



                                       13
<PAGE>


                              WAVE POWER.NET, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2001
                                   (Continued)


8.  SUBSEQUENT EVENT (Continued)

C.  New Developments - Via-Tek Recision (Continued)
    -----------------------------------

Via-Tek  Director  Thomas  Bergman  ("Bergman"),  who  has  acted  as  Via-Tek's
representative  throughout its  discussions  and  negotiations  with the Company
prior to the Agreement and ever since, has intentionally and repeatedly violated
the  spirit of Section  III.,  COVENANTS,  Article  3.1,  General,  by trying to
renegotiate the terms and conditions of the original and conformed Agreement and
Plan of  Reorganization  executed by the parties on April 14, 2002.  Bergman was
attempting to coerce more favorable terms from the Company by refusing to submit
the necessary financial information to their auditors, auditors retained by, and
paid for, by the  Company.  Bergman  was  cognizant  that  pursuant to rules and
regulations of the Securities and Exchange  Commission,  Via-Tek must be audited
in order to consummate the Agreement.  Bergman's actions,  on behalf of Via-Tek,
constitute an intentional and willful breach of the Agreement.

On July 26,  2002 a Mutual  Recision  of Merger  Agreement  was  executed by the
Company's  President  under false  pretenses and that Bergman had  intentionally
misled Fisher to believe that the terms and conditions of the Mutual Recision of
Merger  Agreement had been reviewed and approved by the  principals  involved in
the  transaction  and by the other board  members of the Company.  In fact,  the
other board members of the Company,  Dominic Martinez and Dan Motsinger, had not
been apprised of the content in the Mutual  Recision of Merger  Agreement nor of
Bergman's intent.

Accordingly,  the  Company is  refusing to  acknowledge  the Mutual  Recision of
Merger Agreement  executed by the Company's  President,  Brian Fisher. It is the
Company's  contention that pursuant to the Delaware Revised Statues, as amended,
that a recision  of a merger  agreement  must be  approved  by a majority of the
Company's directors.

In August 2002,  the Company  unilaterally  rescinded  the Agreement and Plan of
Reorganization  between the Company and Via-Tek based upon Via-Tek's willful and
intentional breach of the Agreement.  Furthermore,  the Company is exploring its
right to pursue a legal action against Via-Tek, and Thomas Bergman individually,
for breach of contract, misrepresentation, fraud and extortion.

Since its recent attempts to procure merger and acquisition  opportunities  have
proved unfruitful,  the Company intends to continue to review  opportunities and
to  consider  viable   merger/acquisition   opportunities  should  they  present
themselves.

Telco Blue Transaction
----------------------

On August 7, 2002 the Company  entered into a conditional  Agreement and Plan of
Reorganization  ("Agreement")  with Better  Call Home,  Inc.  ("BCH"),  a Nevada
corporation.

As set  forth  in the  Agreement,  the  Company  and BCH  desired  to  effect  a
reorganization on the terms and conditions whereby the Company would acquire all
of the issued and outstanding  shares of BCH's common stock by issuing solely in
exchange therefore to BCH's shareholders,  pro-rata,  Sixteen Million Restricted
Common  Shares  (16,000,000)  (the  "Shares")  after a 1:5 reverse  split of the
shares.


                                       14
<PAGE>


                              WAVE POWER.NET, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                          NOTES TO FINANCIAL STATEMENTS

                                DECEMBER 31, 2001
                                   (Continued)


8.  SUBSEQUENT EVENTS (Continued)

Telco Blue Transaction (Continued)
----------------------------------

Prior to reorganization,  the Company's authorized  capitalization  consisted of
75,000,000  shares  of  capital  stock,  .001 par  value,  of  which  20,065,000
pre-reverse split common shares were issued and outstanding,  after the issuance
of 2,285,000  common  shares as  compensation  for expense prior to reverses and
9,987,400  post-reverse  split  common  shares  have been  reserved  for  future
issuance based upon consummation of the Agreement, expenses advanced and certain
specified  contingencies.  Upon payment of all reserved shares and shares issued
pursuant to this Agreement there will be approximately  30,000,000  common stock
shares issued and outstanding.  All issued and outstanding shares have been duly
authorized,  validly issued and fully paid and  nonassessable  and the Company's
Common  Shares  to be  issued  and  delivered  on the  Closing  Date  to the BCH
Shareholders  pursuant  to the  Agreement  will  be,  when  so  delivered,  duly
authorized  and  validly  issued  and  subject  to no  preemptive  rights of any
Shareholder.

On August 29, 2002,  the Company  effectuated  its 1:5 reverse split and changed
its name from Wave Power.Net, Inc. to Telco Blue, Inc.

On September 9, 2002,  the parties,  the Company and BCH complied with the terms
and conditions as set forth in the  aforementioned  August 7, 2002 Agreement and
Plan of Reorganization and consummated their transaction.













                                       15