================================================================================

                       Securities and Exchange Commission

                             Washington, D.C. 20549

                                   Form 10-KSB

               [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                  For the fiscal year ended December 31, 2004

                                       OR

            |_| TRANSITIONAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

       For the transition period from _______________to_________________

                        Commission File Number 000-26607

                           SATELLITE ENTERPRISES CORP.
           (Name of small business issuer as specified in its charter)

            Nevada                                             88-0390828
            ------                                             ----------
(State or other jurisdiction of                             (I.R.S.  Employer
incorporation or organization)                             Identification No.)

                            Bank of America Building
                               980 Post Road East
                           Westport, Connecticut 06880
                    (Address of principal executive offices)

Issuer's telephone number, including area code: (203) 672-5912

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

                               Title of Each Class
                     Common Stock, par value $.001 per share

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the 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 requirement for the past 90 days. Yes |X|  No |_|

Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. |_|

Issuer had revenues of $1,090,571 for the year ended December 31, 2004. As of
April 13, 2005, 226,292,559 shares of Common Stock were outstanding of which
105,292,559 were held by non-affiliates of the Company. The aggregate market
value of the Common Stock held by non-affiliates of the Company as of April 13,
2005 was $14,740,958.26 (based upon the closing bid price on such date on the
OTCBB of $0.14).

Transitional Small Business Disclosure Format (check one):

Yes |_|  No |X|

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<PAGE>

                                TABLE OF CONTENTS

<TABLE>
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PART I.......................................................................................................4

   ITEM 1.   DESCRIPTION OF BUSINESS.........................................................................4

   ITEM 2.   DESCRIPTION OF PROPERTIES.......................................................................8

   ITEM 3.   LEGAL PROCEEDINGS...............................................................................8

   ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.............................................9

PART II      ................................................................................................9

   ITEM 5.   MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS...........................9

   ITEM 6.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS..........10

             Forward-Looking Statements.....................................................................10

   ITEM 7.   FINANCIAL STATEMENTS...........................................................................12

   ITEM 8.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE...........13

   ITEM 8A   CONTROLS AND
              PROCEDURES....................................................................................13

   ITEM 8B   OTHER
              INFORMATION...................................................................................13

PART III ...................................................................................................14

   ITEM 9.   DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH
             SECTION 16(A) OF THE EXCHANGE ACT..............................................................14

   ITEM 10.  EXECUTIVE COMPENSATION.........................................................................15

   ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.................................16

   ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.................................................16

PART IV      16

   ITEM 13.  EXHIBITS.......................................................................................17

   ITEM 14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES.........................................................19
</TABLE>


                                       2
<PAGE>

ITEM 1. DESCRIPTION OF BUSINESS

INTRODUCTION

Summary

We receive, distribute and sell newspaper data on a daily basis through multiple
outlets or Kiosks. We produce and sell the Kiosks on an international basis.
After introducing the CLiENT Application CD-ROM version, we increasingly sell
Newspaper prints via this channel. We generate revenue as follows:

      o     we receive a fee for each Kiosk sold;
      o     we receive a user license fee per Kiosk per year;
      o     the user printing at a Kiosk pays a printing fee;
      o     we receive a fee for each client application sold in addition to a
            yearly user fee; and
      o     we receive a percentage of each sale at each user of the client's
            kiosks.

We distribute our content through the use of five satellite stations and three
uplink stations.

History

We were formed as a Nevada corporation on April 14, 1998 to operate a specialty
retailer of fine jewelry. In its fiscal year ending June 30, 2000, we sold a
limited quantity of jewelry through direct mail and word of mouth advertising.

On July 29, 2000, subsequent to the close of our June 30, 2000 fiscal year, we
acquired 100% of the outstanding shares of GreenVolt Corp., an Ontario
Corporation, in a stock for stock exchange. GreenVolt Corp. was in the process
of developing fuel cell technologies for commercial and industrial use. In
connection with this transaction, our management changed, and we disposed of our
retail jewelry business in September 2000, by transfer of all jewelry assets and
liabilities to Larry Beck, a former director of our company. In connection with
such transaction, we changed our name from Beck & Co., Inc. to GreenVolt Corp.

On August 27, 2002, Satellite Holdings, Ltd., a corporation organized under the
laws of Turks & Caicos, acquired 13,783,740 shares of our common stock from
Thomas L. Faul, an officer and director of our company. Such shares represented
approximately 53% of our issued and outstanding common stock. Mr. Faul resigned
as our sole officer and director, after appointing Robert Hodge as our new
President and CEO, and as Chairman of the Board of Directors. In addition, in
exchange for the release by Faul of our company for various claims, we
transferred our wholly-owned subsidiary, GreenVolt Corp., to Faul.

On August 28, 2002, we changed our name to Satellite Enterprises Corp., and on
September 15, 2002, we completed a one-for-one-hundred reverse stock split of
our outstanding common stock. During fiscal year 2003, we concentrated our
efforts on maintaining our corporate status and seeking a merger candidate.

On June 20, 2003, we entered into a Rights Agreement with Satellite Newspapers
Worldwide NV, a corporation organized under the laws of the Netherlands
(hereinafter "Satellite Newspapers"). Under the Rights Agreement, Satellite
Newspapers appointed us as its irrevocable commercial exclusive distributor to
promote the sale and/or lease of its newspaper Kiosks (hereinafter "KiOSK") in
North, South and Central America. These rights include the exclusive rights to
use the trade names, logos and other trade designations, including, but not
limited to, all rights to the Satellite Newspapers derived content fed into the
territories granted to our company which include North, Central and South
America.

In October 2003, Satellite Newspapers sold their patents, software and
trademarks to Media Finance en Suisse GMBH, a Swiss corporation (hereinafter
"Media Finance"). Thereafter, Media Finance set up an operating subsidiary,
Satellite Newspapers Suisse GMBH, a Swiss corporation (hereinafter "Swiss
Satellite Newspapers"). Media Finance granted Swiss Satellite Newspapers a
twenty year exclusive license to distribute all satellite derived contents for
the purpose of commercializing their product under a revenue sharing arrangement
on a worldwide basis.

On November 26, 2003, we entered into a Stock Purchase Option Agreement dated
November 26, 2003 with Media Finance for the purchase of 100% of Swiss Satellite
Newspapers. This option agreement allowed us to acquire the right to purchase
100% of the shares of common stock of Swiss Satellite Newspapers. On February
15, 2004, we exercised the option and acquired 100% of Swiss Satellite
Newspapers in consideration for the issuance of 126,000,000 shares of common
stock.


                                       3
<PAGE>

The Business and its Objectives

The license agreement entered into between Media Finance and Swiss Satellite
Newspapers appoints Swiss Satellite Newspapers as the exclusive distributor to
promote sell and/or lease the Kiosks, content distribution applications and
derived content throughout the world. The license agreement expires in November
2023 and requires that Swiss Satellite Newspapers makes a monthly payment to
Media Finance of $25,000, which has been increased to $30,000 as of January 1,
2005. In the event that Swiss Satellite Newspapers fails to make the $30,000
payment for two consecutive months, then Media Finance may terminate the license
without notice to Swiss Satellite Newspapers.

Swiss Satellite Newspapers consists of two subsidiaries, Satellite Newspapers
Content BV a Dutch corporation that negotiates agreements with newspapers
throughout the world for the rights to distribute their content and Satellite
Newspapers Trading BV, which has the production rights to produce and sell the
KiOSKs.

Swiss Satellite Newspapers has entered into a sub-master license agreement of
its content for a licensing fee in Asia, the Middle East, Europe, Australia,
Africa, South America and the South Pacific. Each license agreement provides a
monthly minimum fee as well a percentage of revenue generated in each territory.
In connection with these licensing agreements, Swiss Satellite Newspapers has
also entered into a Sales Contract with each of the sub-distributors for the
sale of the Kiosks. Each sales contract provides that Swiss Satellite
Newspapers, though one of its wholly owned subsidiaries, will sell Kiosks to
each sub-distributor at a set price.

Swiss Satellite Newspapers entered into an agreement with Eurostar Facilities BV
("Eurostar") to outsource its delivery and transmission of its content
worldwide. On September 30, 2004, the agreement was terminated with Eurostar. We
terminated this agreement as we elected to conduct all delivery and transmission
of our content worldwide internally.

Our goal is to establish the Satellite Newspapers KiOSK name as the defacto
standard in remote electronic newspaper printing Kiosks. We intend to make
newspaper content available on demand to those in need of timely affordable
information. We have entered into copyright license agreements with over 170
newspapers throughout the world, which enables Swiss Satellite Newspapers to
deliver the content of each paper in exchange for a royalty fee.

We will facilitate the communications requirements of numerous users from
business travelers looking for up to date home information, to foreign nationals
who wish to stay in touch with their home country, to students studying foreign
cultures, to remote or isolated communities to anyone interested in news from
locations around the world.

We intend to create a new cost effective channel to market for hundreds of
global newspaper publishers and media organizations ensuring access to their
content anywhere in the world.

Our revenues will be derived from the following major areas:

      o     SALES OF SATELLITE NEWSPAPER KiOSKs - an automated newspaper stand
            which prints-on-demand and delivers in two minutes a copy of any of
            our syndicated newspapers.

      o     SALES OF SATELLITE NEWSPAPER CLiENTS - a software application tool
            which enables users to download and print a copy of any of our
            syndicated newspapers.

      o     SALES OF MASTER SUB-LICENSES - we intend to set up master
            sub-licensing agreements worldwide with strategic partners whereby
            they sell the KiOSK distribution system within their territory on a
            revenue sharing basis.

The KiOSK is a self-contained, fully automated newspaper-vending unit. The unit
is capable of receiving files, processing payments and on demand printing of
newspapers. The KiOSK continuously receives the latest editions of the
newspapers via multicast transmission through our satellite network.

We are focused at the business development and promotion of our digital KiOSK
remote newspaper concept by utilizing sub-master licensing agreements with major
regional strategic partners. Our primary objectives for the 2003-2007 time
periods will be to establishment of sub-master licensing agreements with major
regional strategic partners throughout the world.


                                       4
<PAGE>

Market Information and Analysis

When it comes to newspapers, travelers appreciate, but rarely get, the comfort
and convenience of reading news in their own languages and in their preferred
newspapers. If there are international versions, they usually arrive late.
Compounding the current problem, and supporting our view that there is a
significant market for print-on-demand newspapers, publishers spend large
amounts of money on air freight, and often deliver more copies overseas than
they actually sell. Moreover, readers are asked to pay much higher prices for
inferior international products--that is newspapers that come late and
consequently carry old news.

We strongly believe that the printed-paper model will continue to thrive despite
the growth of the Internet. Publishers today, appear reluctant to aggressively
promote the Internet delivery model because of the threat of the loss of
intellectual property and the inability to develop sustainable business
propositions that actually generate profitable revenues. By providing a single
global electronic distribution network system, our KiOSK system will provide
readers with reasonably priced, current editions of newspapers in a convenient
time frame and in a familiar format. The familiar format of the printed
newspaper has proved itself capable of surviving, despite the many dramatic
changes in the communications industry.

We believe our KiOSK system has another advantage. It provides international
distribution channels at much lower cost than might be the case with traditional
newspapers. Publishers will also be able to specify which sites will receive
their newspaper, in order to avoid competition with any conventional
distribution system. All together, we believe this will open new markets and
create realistic opportunities for publishers to expand regular circulation and
to provide a competitive advantage over other electronic media.

We intend to provide for the worldwide distribution of up-to-date, condensed
versions of daily newspapers, in a variety of languages, anywhere around the
globe.

The International Traveler

Addressing the needs of the mobile traveler will dictate a strategy whereby our
KiOSKs are placed at key locations with high traffic. These locations will
include airports (including executive lounges), and hotels that cater to
international travelers. In addition, urban locations that have high
concentrations of immigrant ex- patriot populations (e.g. New York, Miami, San
Francisco, Los Angeles, Seattle, Montreal, Toronto, Vancouver, Sao Paolo,
etc...) will also be targeted by positioning Satellite Newspapers KiOSKs in key
locations with high traffic appeal to these demographics. These would include
upscale bookstores, cafe chains, malls with international appeal, and
newspaper/magazine retailers in ethnic neighborhoods.

The Domestic Single-Copy Buyer

Single-copy buyers are mainly occasional and/or utility readers. They buy a
newspaper with a specific purpose in mind. They may be looking for local news
from back home, getting an international perspective of world happenings,
checking business and financial information or checking on international sports
scores. In addition to those who buy a newspaper for a specific purpose, there
are a substantial number of single-copy buyers who purchase newspapers on a
regular basis. Single-copy buyers are a distinct segment of the total newspaper
audience. Understanding the specific attributes of this market with respect to
international purchasing will be important to our creating successful, targeted
single-copy marketing and promotional plans. While we are targeting the purchase
of international publications, these buyers may also seek the convenient access
that our KiOSK provides, for domestic financial, sports and news information.

Rural Community Development

In addition to the market potential created by the international traveler and
multi-cultural urban dwellers, we believe the rural market for low volume
readership can now be addressed in a very efficient manner. The distribution
costs to deliver newspapers to rural areas can now be dramatically decreased by
using the Satellite Newspapers KiOSK digital distribution model. This
print-on-demand model eliminates the waste associated with the typical newspaper
model. Today newspapers are printed based on a demand estimate which many times
results in either an under supply or over supply. When the over supply is not
sold, they are disposed of, resulting in needless cost expense and environmental
waste. In addition to delivery cost improvements, the rural market can now enjoy
the benefits of flexible access to many domestic and international newspapers,
otherwise either previously not accessible to them, or accessible only by
subscription and mail delivery.


                                       5
<PAGE>

The Publishers Market

The traditional media publishers divide their distribution of daily newspapers
into two main streams: newsstands and deliveries. In most cases, these are
operated by the publisher via local carriers or by dedicated distributors.

Given a limited geographical range, this model allows a publication to reach its
readership within a few hours of being printed. Practically speaking, a
publication should be printed within less than a 500 miles radius to reach its
readership on time and with cost efficiently. Today, the vast majority of daily
publications is locally based and easily fit their readership within this
operational radius.

We intend to redefine these procedures for remote areas and traveling readers by
offering publishers cost efficient alternatives to these issues.

Our KiOSK gives us the flexibility to deliver on a daily basis all of our
affiliated newspapers in all of our locations worldwide. This service is
currently offered to the publisher at no cost. We intend to pay a commission on
sold issues.

By adopting a publisher-oriented approach, we aim to involve the content
generator in our success. This value proposition is beneficial to both parties
as publishers are able to dramatically reduce their remote distribution costs.
This will provide new publishers incentives not only to join the program, but
also to promote to their traveling readership.

Competition

Our distribution model for Satellite Newspapers KiOSK digital printing KiOSK,
with its "PRINT-ON-DEMAND" technology, is a unique business proposition.

While there are several remote newspaper printing concepts on the market, they
predominantly rely on a "print and deliver" model which requires a dealer to
print newspapers remotely, in small quantities, at a centralized location,
potentially based on a pre-determined order or estimated requirements, and then
physically deliver these newspapers to the end user location.

It is also acknowledged that a number of end users may obtain their news
requirements from the Internet. However, there continues to be a compelling
demand for paper versions to suit the preferences of many end users who choose
the simplicity, versatility, portability and user-friendliness of a paper copy
of a newspaper.

There are several key competitors in the remote digital printing arena including
IBM, Xerox, Xeikon, NewspaperDirect and Oce. However, these competitors differ
from our KiOSK system in several areas. They are promoting a business model that
requires newspapers to be printed at a centralized location, using high-speed
printers. This results in newspapers that must be physically delivered to the
end-user. This business model is interesting in that it can also take advantage
of existing local printing and distribution enterprises, rather than trying to
set up new distribution points where none existed previously. Also significant
is that these companies aren't merely attempting to sell their printers for this
application; they are using their expertise in finding local resources and in
arranging the business deals among these partners and publishers.

However, this is not a true print on-demand model and there are additional
distribution costs to be absorbed due to the requirement for shipping of the
locally printed newspapers to the end-users. Our KiOSK model places the system
as close to the end-user as possible; printing only what is actually purchased
by the consumer, at the actual consumer location.

IBM, Xerox, Oce, NewspaperDirect and Xeikon have developed business models based
on a larger scale philosophy, as opposed to our KiOSKs more targeted approach
which focuses on hotels, airports, cruise ships, bookstores, etc. Our
competitors are searching for high-volume printing establishments and
large-scale distributors to increase the volume of business.

We believe that both business models can co-exist, with our KiOSK digital KiOSK
model aimed more specifically at the single copy buyer and the other competitor
models better suited to subscription based or volume international readership.


                                       6
<PAGE>

Employees

We presently have 16 full time employees and 1 part-time employee

ITEM 2 DESCRIPTION OF PROPERTIES

We lease our office space on a rent free basis, which are located at the office
of our General Counsel Jerry Gruenbaum at Bank of America Building, 980 Post
Road East, Westport, Connecticut 06880.

ITEM 3.  LEGAL PROCEEDINGS

      From time to time, we are a party to litigation or other legal proceedings
that we consider to be a part of the ordinary course of our business. Except for
the following, we are not involved currently in legal proceedings that could
reasonably be expected to have a material adverse effect on our business,
prospects, financial condition or results of operations:

      o     On May 14, 2004, Fred DeVries and Renato Mariani (the "Plaintiffs")
            filed suit in the Fifteenth Judicial Circuit Court located in Palm
            Beach County, Florida, claiming breach of employment agreements
            against the Company and against the Company's CEO claiming fraud.
            The Plaintiffs are seeking monies and benefits owed in connection
            with the employment agreements as well as other damages. The trial
            is set on the three month docket running from October 3, 2005
            through December 16, 2005. The Company has filed an Answer and
            Affirmative Defenses.

      o     Three Dutch companies in the Netherlands have commenced a legal
            procedure against Satellite Newspapers Content B.V. claiming an
            amount due to them of approximately $156,000. The parties have
            agreed to suspend legal action until June 1, 2005 based upon a
            settlement reached in February 2004 whereby a shareholder of the
            Company will surrender a comparable number of Company shares to
            offset the obligation.

      We may become involved in material legal proceedings in the future.

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

      No matters were submitted to a vote of the Company's security holders
through the solicitation of proxies or otherwise, during the last quarter of the
fiscal year ended December 31, 2004.


                                       7
<PAGE>

                                    PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Market Information

Our common stock has been quoted on the OTC Bulletin Board since August 2002.
Our symbol is "SENR". For the periods indicated, the following table sets forth
the high and low bid prices per share of common stock. These prices represent
inter-dealer quotations without retail markup, markdown, or commission and may
not necessarily represent actual transactions.

--------------------------------------------------------------------------------
                                           High                       Low
--------------------------------------------------------------------------------
         2005
--------------------------------------------------------------------------------
         First Quarter                     $0.26                      $0.13
--------------------------------------------------------------------------------
         2004
--------------------------------------------------------------------------------
         Fourth Quarter                    $0.35                      $0.21
--------------------------------------------------------------------------------
         Third Quarter                     $0.77                      $0.27
--------------------------------------------------------------------------------
         Second Quarter                    $2.37                      $0.32
--------------------------------------------------------------------------------
         First Quarter                     $4.15                      $4.05
--------------------------------------------------------------------------------
         2003
--------------------------------------------------------------------------------
         Fourth Quarter                    $1.47                      $1.47
--------------------------------------------------------------------------------
         Third Quarter                     $2.60                      $1.25
--------------------------------------------------------------------------------
         Second Quarter                    $1.20                      $0.07
--------------------------------------------------------------------------------
         First Quarter                     $0.75                      $0.05
--------------------------------------------------------------------------------

As of April 13, 2005, there were 226,292,559 shares of common stock outstanding.

As of April 13, 2005, there were approximately 625 stockholders of record of our
common stock. This does not reflect those shares held beneficially or those
shares held in "street" name.

Securities Authorized for Issuance Under Equity Compensation Plans

      As of the year ended December 31, 2004, we did not have an equity
compensation plan authorizing us to issue shares of common stock

Dividends

      It has been the policy of the Company to retain earnings, if any, to
finance the development and growth of its business.

Sale of Securities that were not Registered Under the Securities Act of 1933

The Company sold the following shares of common stock during the three fiscal
year ended December 31, 2004 (adjusted to reflect reverse stock splits and share
issuances through April 15, 2004) without registration based on Regulation S or
Section 4(2) of the Securities Act of 1933, as amended. All of the offerings
were conducted solely by the Company, without the engagement of an underwriter.


                                       8
<PAGE>

 Date         Shares  Purchasers             Total Price          Exemption
--------------------------------------------------------------------------------
04/05/04     169,300  Foreigners           $33,860(1)           Regulation S
--------------------------------------------------------------------------------
03/03/04      67,791  Foreigners           $13,558(1)           Regulation S
--------------------------------------------------------------------------------
03/02/04     562,144  Foreigners          $112,429(1)           Regulation S
--------------------------------------------------------------------------------
02/15/04     215,920  Foreigners           $43,184(1)           Regulation S
--------------------------------------------------------------------------------
02/09/04   1,348,321  Foreigners          $269,664(1)           Regulation S
--------------------------------------------------------------------------------
(1) Company paid a 10% commission to Bel Air Group, Inc. as finders fee.

On November 26, 2003, we entered into a Stock Purchase Option Agreement dated
November 26, 2003 with Media Finance for the purchase of 100% of Swiss Satellite
Newspapers. This option agreement allowed us to acquire the right to purchase
100% of the shares of common stock of Swiss Satellite Newspapers. On February
15, 2004, we exercised the option and acquired 100% of Swiss Satellite
Newspapers in consideration for the issuance of 126,000,000 shares of common
stock.

During the six months ended June 30, 2004, 6,830,864 shares of common stock were
sold under a private placement agreement with GCH Capital, LTD. The total
aggregate proceeds received was $409,444.

On April 16, 2004, the Company issued to GCH Capital, LTD 5,000,000 shares of
its common stock valued at $0.01 per share as consideration under the investment
banking arrangement.

To obtain funding for our ongoing operations, on May 19, 2004, pursuant to an
offering conducted under Rule 506 of Regulation D, as promulgated under the
Securities Act of 1933, we sold 10,869,565 shares of common stock to accredited
investors in a private offering. In connection with the offering, we sold
10,869,565 shares of common stock at a price of $.23 per share. In addition, we
also issued 10,869,565 common stock purchase warrants exercisable at $1.50 per
share. We raised an aggregate of $2,500,000 in connection with this offering. In
November 2004, we entered into an amendment of the Securities Purchase Agreement
whereby we cancelled 2,173,913 shares of common stock and issued to the
investors to the investors secured convertible debentures in the amount of
$500,000.

On October 5, 2004, GCH Capital exercised 4,823,529 of its common stock warrants
under a cashless/net exercise program.

On November 1, 2004, the Company entered into an agreement with GCH Capital
whereby the Company terminated its investment banking relations with respect to
the private placement offering agreement for its common stock dated November 11,
2003. As consideration for terminating the agreement, the Company issued
6,000,000 shares of its common stock to GCH Capital.

The Company entered into an agreement to acquire on August 31, 2004 to acquire a
52% interest in SoliDAm, a software development company located in the
Netherlands. The purchase price is to consist of the issuance of a $125,000 note
payable to the stockholders of SoliDAM as well as 919,926 shares of the
Company's common stock. If all the conditions set forth in the agreement are
satisfied, the closing of the transaction will take place in the fourth quarter
of 2004. On October 6, 2004, the shares were issued. The note payable has not
been executed as of December 7, 2004. The effect of this transaction has not
been included in these financial statements.

ITEM 6 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

      When used in this Form 10-KSB, in other filings by the Company with the
SEC, in the Company's press releases or other public or stockholder
communications, or in oral statements made with the approval of an authorized
executive officer of the Company, the words or phrases "would be," "will allow,"
"intends to," "will likely result," "are expected to," "will continue," "is
anticipated," "estimate," "project," or similar expressions are intended to
identify "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995.


                                       9
<PAGE>

      The Company cautions readers not to place undue reliance on any
forward-looking statements, which speak only as of the date made, are based on
certain assumptions and expectations which may or may not be valid or actually
occur, and which involve various risks and uncertainties, including but not
limited to the risks set forth above. In addition, sales and other revenues may
not commence and/or continue as anticipated due to delays or otherwise. As a
result, the Company's actual results for future periods could differ materially
from those anticipated or projected.

      Unless otherwise required by applicable law, the Company does not
undertake, and specifically disclaims any obligation, to update any
forward-looking statements to reflect occurrences, developments, unanticipated
events or circumstances after the date of such statement.

Overview

      We receive, distribute and sell newspaper data on a daily basis through
multiple outlets or Kiosks. We produce and sell the Kiosks on an international
basis. After introducing the CLiENT Application CD-ROM version, we increasingly
sell Newspaper prints via this channel. We generate revenue as follows:

      o     we receive a fee for each Kiosk sold;
      o     we receive a user license fee per Kiosk per year;
      o     the user printing at a Kiosk pays a printing fee;
      o     we receive a fee for each client application sold in addition to a
            yearly user fee; and
      o     we receive a percentage of each sale at each user of the client's
            kiosks.

We distribute our content through the use of five satellite stations and three
uplink stations.

Managements' Discussion and Analysis

Results of Operations - Year Ended December 31, 2004 Compared to Year Ended
December 31, 2003

Net Sales

      We had net sales of $1,090,571 for the year ended December 31, 2004 as
compared to $82,705 for the year ended December 31, 2003. This increase in net
sales is a result of our change in business operations to focus on the
deployment of electronic newspapers through our KiOSK system as well as our
recently launched CLiENT Software Application.

Cost and Expenses

      Cost and expenses for the year ended December 31, 2004 was $9,021,805 as
compared to $1,008,670 during the year ended December 31, 2003, which consisted
of selling, general and administrative costs and services. Cost and expenses
during the year ended December 31, 2004 included cost of services ($944,613),
selling general and administrative ($3,099,716), stock issued for services
($3,560,000) and depreciation and amortization ($286,376) and Impairment of
Goodwill ($1,131,100). This increase in cost and expenses is a result of our
change in business operations to focus on the deployment of electronic
newspapers through our KiOSK system as well as our recently launched CLiENT
Software Application.

      As a result of the foregoing factors, we realized a net loss of $7,931,234
for the year ended December 31, 2004 compared to a net loss of $925,965 for the
year ended December 31, 2003.

Liquidity and Capital Resources

      At December 31, 2004, we had a working capital deficit of $1,575,553.
Further, at December 31, 2003 we had a working capital deficit of $73,170, as a
result our auditors have raised, in their current audit report, a substantial
doubt about our ability to continue as a going concern. We will be unable to
continue as a going concern in the event we are not able to raise capital in
order to develop and implement our business plan and continue operations. Until
such time as sufficient capital is raised, we intend to limit expenditures for
capital assets and other expense categories.

      There is no assurance of financial viability for Swiss Satellite
Newspapers. We depend on the financial viability of Swiss Satellite Newspapers
for our content and satellite transmission. Swiss Satellite Newspapers has
limited revenues to date. Our business would be materially harmed if Swiss
Satellite Newspapers is unable to continue to provide us with its content,
satellite transmission and technical support.


                                       10
<PAGE>

      On December 1, 2003, we entered into a consulting agreement with GCH
Capital, Ltd to provide assistance relating to business acquisition and general
business strategies. On April 16, 2004, we issued 5,000,000 shares of common
stock to GCH Capital Ltd. in consideration for services provided. There is also
a monthly consulting fee of $10,000 per month for 24 months payable from the
above shares. In connection with the May 2004 private placement, we paid GCH
Capital, Ltd $150,000 to terminate the consulting agreement.

      We had unsecured loans to individuals in the amount of $1,247,878 at
December 31, 2004. The loans matured between July and November 2004 and are
currently past due. The loans were interest free for the first year and accrue
interest at the rate of 6% commencing after the first anniversary date of the
loan. As of the date hereof, we have not repaid these loans.

      As of December 31, 2004, Roy Piceni, our principal stockholder and an
executive officer and director, has advanced our company $1,436,617.

      To obtain funding for our ongoing operations, on May 19, 2004, pursuant to
an offering conducted under Rule 506 of Regulation D, as promulgated under the
Securities Act of 1933, we sold 10,869,565 shares of common stock to accredited
investors in a private offering. In connection with the offering, we sold
10,869,565 shares of common stock at a price of $.23 per share. In addition, we
also issued 10,869,565 common stock purchase warrants exercisable at $1.50 per
share. We raised an aggregate of $2,500,000 in connection with this offering. In
November 2004, we entered into an amendment of the Securities Purchase Agreement
whereby we cancelled 2,173,913 shares of common stock and issued to the
investors to the investors secured convertible debentures in the amount of
$500,000.

      We believe we will still need additional investments in order to continue
operations to cash flow break even. Financing transactions may include the
issuance of equity or debt securities, obtaining credit facilities, or other
financing mechanisms. However, the trading price of our common stock and the
downturn in the U.S. stock and debt markets could make it more difficult to
obtain financing through the issuance of equity or debt securities. Even if we
are able to raise the funds required, it is possible that we could incur
unexpected costs and expenses, fail to collect significant amounts owed to us,
or experience unexpected cash requirements that would force us to seek
alternative financing. Further, if we issue additional equity or debt
securities, stockholders may experience additional dilution or the new equity
securities may have rights, preferences or privileges senior to those of
existing holders of our common stock. If additional financing is not available
or is not available on acceptable terms, we will have to curtail our operations
again.

Cash Flows

      Net cash used in operating activities was $2,342,285 for the year ended
December 31, 2004 and $547,808 for the year ended December 31, 2003. This
decrease was primarily due to the increase in the net loss.

      Net cash provided by financing activities was $2,798,159 and $1,076,440
for the year ended December 31, 2004 and 2003, respectively. The net cash
provided by financing activities for the year ended December 31, 2004 consisted
primarily of proceeds from sale of common stock and stock subscription receipts.

      During the year ended December 31, 2004 the net cash used in financing
activities consisted primarily of $93,953 from the acquisition of property and
equipment.

Off-Balance Sheet Arrangements

      We have no off-balance sheet arrangements that have or are reasonably
likely to have a current or future material effect on us.

ITEM 7. FINANCIAL STATEMENTS.

      Reference is made to the Consolidated Financial Statements of the Company,
beginning with the index thereto on page F-1

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

      On October 22, 2003, Callahan, Johnston & Associates, LLC (hereinafter
"Callahan") resigned as the principal accountant engaged to audit our financial
statements. Callahan performed the audit of the Company's financial statements
for the fiscal year ended June 30, 2003 and June 30, 2002. During our two more
recent fiscal years and the subsequent interim period preceding the date of
their resignation, there were no disagreements with Callahan on any matter of
accounting principles or practices, financial statement disclosure or auditing
scope or procedure, which disagreements if not resolved to Callaha's
satisfaction would have caused Callahan to make reference to this subject matter
of the disagreements in connection with Callahan's report, nor were there any
"reportable events" as such term is defined in Item 304(a)(1)(iv)of Regulation
S-K, promulgated under the Securities Exchange Act of 1934, as amended.


                                       11
<PAGE>

      The audit reports of Callahan for the Company's fiscal year ended June 30,
2003 and June 30, 2002 did not contain an adverse opinion, a disclaimer of
opinion, or qualification or modification as to uncertainty, audit scope, or
accounting principles. In this connection, Callahan issued a going concern
opinion in its audit report dated October 21, 2003 on the our financial
statements for the years ended June 30, 2003 and June 30, 2002 included in the
Form 10-KSB filed with the Securities and Exchange on October 22, 2003.

      Effective on November 25, 2003, we engaged Meyler & Company, LLC, our
current Certified Public Accountants to audit the our financial statements.
Prior to its engagement, we had not consulted with Meyler & Company, LLC with
respect to: (i) the application of accounting principles to a specified
transaction, either completed or proposed; (ii) the type of audit opinion that
might be rendered on our financial statements; or (iii) any matter that was
either the subject or disagreement (as defined in Item 304(a)(1)(iv) of
Regulation S-K) or a reportable event (as described in Item 304(a)(1)(iv) of
Regulation S-K.

ITEM 8A. CONTROLS AND PROCEDURES

      As of the end of the period covered by this report, an evaluation was
performed under the supervision and with the participation of the Company's
management, including the Chief Executive Officer and the Chief Financial
Officer, of the effectiveness of the design and operation of the Company's
disclosure controls and procedures. Based on that evaluation, the Company's
management, including the Chief Executive Officer and the Chief Executive
Officer, concluded that the Company's disclosure controls and procedures were
effective as of the end of the period covered by this report.

      The Company maintains a system of internal controls designed to provide
reasonable assurance that: transactions are executed in accordance with
management's general or specific authorization; transactions are recorded as
necessary (i) to permit preparation of financial statements in conformity with
generally accepted accounting principles and (ii) to maintain accountability for
assets. Access to assets is permitted only in accordance with management's
general or specific authorization and the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.

      Since the date of the most recent evaluation of the Company's internal
controls by the Chief Executive and Chief Financial Officers, there have not
been changes in the Company's internal controls over financial reporting for the
period covered by this report that materially affected or were likely to
materially affect the Company's internal control over financial reporting.

ITEM 8B. OTHER INFORMATION

None.


                                       12
<PAGE>

                                    PART III

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

Our directors hold office until the annual meeting of shareholders next held
after their election. Our officers and directors as of April 14, 2005 are as
follows:

--------------------------------------------------------------------------------
           Name                  Age                 Position
--------------------------------------------------------------------------------
Roy Piceni                        37                 President, Chief
                                                     Executive Officer and
                                                     Director
--------------------------------------------------------------------------------
Leo P. F. van de Voort            46                 Chief Financial Officer
--------------------------------------------------------------------------------
Henk Meijer                       44                 Director
--------------------------------------------------------------------------------

MR. ROY PICENI/PRESIDENT, CHIEF EXECUTIVE OFFICER AND DIRECTOR

Mr. Piceni has served as Chief Executive Office of our company since December
19, 2003. Prior to joining our company, Mr. Piceni was the founder of Satellite
Newspapers Worldwide and was employed there since 2000. From 1995 to 2000, Mr.
Piceni was employed with Eurostar as CEO. Mr. Piceni provides 100% of his time
to our company.

MR. LEO P. F. VAN DE VOORT/CHIEF FINANCIAL OFFICER

Prior to joining our company, Mr. van de Voort, age 46, served as the Chief
Financial Officer of Flex Group Nederland from 2001 to 2004. Mr. van de Voort's
experience prior to joining Flex Group Nederland includes serving as the
Director of Corporate Finance for Kempen & Co. from 1999 to 2001, the manager of
mergers and acquisitions for Twynstra from 1996 to 1999, a strategy consultant
for A.T. Kearney from 1994 to 1996 and manager of mergers and acquisitions for
KPMG Corporation Finance from 1989 through 1994. Mr. van de Voort studied Dutch
language and Dutch literature and Dutch law at Erasmus University where he
graduated in from 1983 and received his MBA from Rotterdam School of Management
in 1989.

MR. HENK MEIJER/DIRECTOR

Prior to joining our company, since 1999, Mr. Meijer served in various
capacities with companies that licensed our technology throughout the world
including serving as the general manager of Satellite Newspapers Europe and
Satellite Newspapers Asia. From 1992 though 1998, Mr. Meijer served as general
manager for Siextrans, a Russian export company. Mr. Meijer studied mathematics
and geography at the University of Amsterdam and graduated in 1983.

Audit Committee

      The Board of Directors does not have a Compensation, Audit or Nominating
Committee, and the usual functions of such committees are performed by the
entire Board of Directors. The board of directors have determined that at
present we do not have an audit committee financial expert. The Board believes
that the members of the Board of Directors are collectively capable of analyzing
and evaluating our financial statements and understanding internal controls and
procedures for financial reporting. In addition, we have been seeking and
continue to seek an appropriate individual to serve on the Board of Directors
and the Audit Committee who will meet the requirements necessary to be an
independent financial expert.

Code of Ethics

      Because we are an early-development stage company with limited resources,
we have not yet adopted a "code of ethics", as defined by the SEC, that applies
to the Company's Chief Executive Officer, Chief Financial Officer, principal
accounting officer or controller and persons performing similar functions. We
are in the process of drafting and adopting a Code of Ethics.


                                       13
<PAGE>

Section 16(a) Beneficial Ownership Compliance

Section 16(a) of the Securities Exchange Act of 1934 requires our directors and
executive officers, and persons who own more then 10 percent of our Common
Stock, to file with the SEC the initial reports of ownership and reports of
changes in ownership of common stock. Officers, directors and greater than 10
percent stockholders are required by SEC regulation to furnish us with copies of
all Section 16(a) forms they file.

      Specific due dates for such reports have been established by the
Commission and we are required to disclose any failure to file reports by such
dates during fiscal 2003. Based solely on our review of the copies of such
reports received by us, or written representations from certain reporting
persons that no Forms 5 were required for such persons, we believe that during
the fiscal year ended December 31, 2004, there was no failure to comply with
Section 16(a) filing requirements applicable to our officers, directors and ten
percent stockholders.

ITEM 10. EXECUTIVE COMPENSATION

The following table provides summary information for the years 2002, 2003 and
2004 concerning cash and noncash compensation paid or accrued by us to or on
behalf of the president and the only other employee(s) to receive compensation
in excess of $100,000.

                           SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
                                                         Long Term Compensation:
                                                         ------------------------------------------
                      Annual Compensation                Awards                            Payouts
                      ---------------------------------  --------------------------------  --------
(a)             (b)     (c)       (d)      (e)           (f)             (g)               (h)         (i)
Name and                                   Other Annual  Restricted      Securities        LTIP
Principle               Salary    Bonus    Compensation  Stock Award(s)  Underlying        Payouts     All Other
Position        Year     ($)      ($)      ($)           ($)             Options/SARs (#)  ($)         Compensation ($)
--------        ----     ---      ---      ---           ---             ----------------  ---         ----------------
<S>             <C>   <C>         <C>       <C>           <C>             <C>               <C>        <C>
Roy Piceni      2004      --       --       --            --                    --          --         --
                2003       0        0        0             0              1,825,000          0          0
                                                                           at $0.20
                2002      --       --       --            --                    --          --         --

Thomas Fahl     2004      --       --       --            --                    --          --         --
                2003      --       --       --            --                    --          --         --
                2002  60,000       --       --            --                    --          --         --
</TABLE>

other officers receiving cash in excess of 100K?

EMPLOYMENT CONTRACTS

We entered into an employment agreement with Roy Piceni, our CEO. The employment
agreement commenced January 1, 2004 and the duration is infinite. The agreement
provides for a monthly salary of $10,000 per month plus reasonable travel
expenses. We do not currently have any other employment contracts with any
employees or consultants.

OPTION CONTRACTS

We implemented a 2003 Stock Option Plan in December 2003 for key employees and
consultants in Holland and Switzerland totaling 24,309,000 at $0.06 per share.
The following individuals are the recipients of the 2003 Stock Option Plan and
the amount of shares involved:

           Roy Piceni                                     5,475,000
           Robert Piceni                                  4,380,000
           Ernst V Kranen                                 2,995,500
           Anne Bogaardt                                    547,500
           Sandy Hibma                                    2,102,400
           Karin Frank                                    1,314,000
           Ralph Vooys                                      876,000
           Karina Tettero                                   876,000
           Cees Jan Quirijns                                 43,800
           Eurostar                                       5,737,800
                                                         ----------
                                                         24,309,000


                                       14
<PAGE>

Family Relationships

      Currently there are no family relationships among our directors, executive
officers or other persons nominated or chosen to become officers or executive
officers.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

      The following table sets forth information regarding the beneficial
ownership of our common stock as of April 14, 2005. The information in this
table provides the ownership information for:

      o     each person known by us to be the beneficial owner of more than 5%
            of our common stock;
      o     each of our directors;
      o     each of our executive officers; and
      o     our executive officers and directors as a group.

      Beneficial ownership has been determined in accordance with the rules and
regulations of the SEC and includes voting or investment power with respect to
the shares. Unless otherwise indicated, the persons named in the table below
have sole voting and investment power with respect to the number of shares
indicated as beneficially owned by them.

                                      Beneficial      Percentage
Name and Address                      Ownership       of Class(1)
----------------                      ---------       -----------
Roy Piceni*                         121,000,000         53.47%
Lussiweg 37
CH 6300  Zug
Switzerland

Henk Meijer*                                0            0.00%
Lussiweg 37
CH 6300  Zug
Switzerland

Leo P.F. van de Voort*                      0            0.00%
Lussiweg 37
CH 6300  Zug
Switzerland

Total                                121,500,000         53.47%

* Executive officer and/or director.

(1) Unless otherwise indicated, each person has sole investment and voting power
with respect to the shares indicated. For purposes of this table, a person or
group of persons is deemed to have "beneficial ownership" of any shares which
such person has the right to acquire within 60 days as of April 14, 2005. For
purposes of computing the percentage of outstanding shares held by each person
or group of persons named above on April 14, 2005 any security which such person
or group of persons has the right to acquire within 60 days after such date is
deemed to be outstanding for the purpose of computing the percentage ownership
for such person or persons, but is not deemed to be outstanding for the purpose
of computing the percentage ownership of any other person. As of April 14, 2005,
we had 226,292,559 shares of common stock outstanding.


                                       15
<PAGE>

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

      No director, executive officer or nominee for election as a director of
our company, and no owner of five percent or more of our outstanding shares or
any member of their immediate family has entered into or proposed any
transaction in which the amount involved exceeds $60,000 except as set forth
below.

      In October 2003, Satellite Newspapers sold their patents, software and
trademarks to Media Finance. Media Finance is 100% owned by Roy Piceni, a
director of our company and CEO. Thereafter, Media Finance set up an operating
subsidiary, Swiss Satellite Newspapers. Media Finance granted Swiss Satellite
Newspapers a twenty year exclusive license to distribute all satellite derived
contents for the purpose of commercializing their product under a revenue
sharing arrangement.

      On November 26, 2003, we entered into a Stock Purchase Option Agreement
with Media Finance to acquire Swiss Satellite Newspaper. On February 15, 2004,
we issued 126,000,000 shares of common stock in connection with the acquisition
of Swiss Satellite Newspapers.

      As of December 31, 2004, Roy Piceni, our principal stockholder and an
executive officer and director, has advanced our company $1,436,617. There is no
specific maturity date and the loan is interest free. Inputed interest on the
loan would approximate $42,000 for the nine months ended September 30, 2004 at
an average rate of 5%.

ITEM 13. EXHIBITS

Exhibit
No.         Description
-------     -----------
2.1         Rights Agreement between Satellite Newspapers Worldwide NV, and
            Satellite Enterprises Corp. dated June 20, 2003, incorporated by
            reference to the Company's Current Report on Form 8-K filed with the
            Securities and Exchange Commission on June 25, 2003.

2.2         Stock Purchase Option Agreement entered between the Company and
            Media Finance en Suisse GMBH dated November 26, 2003 incorporated by
            reference to the Company's Current Report on Form 8-K filed with the
            Securities and Exchange Commission on February 3, 2004.

3.1         Corporate Charter of Beck & Co. as filed with the Nevada Secretary
            of State on April 6, 1998, incorporated by reference to the
            Company's Registration Statement on Form 10-SB filed with the
            Securities and Exchange Commission on April 4, 2000.

3.2         Bylaws of Beck & Co., incorporated by reference to the Company's
            Registration Statement on Form 10-SB filed with with the Securities
            and Exchange Commission on July 6, 1999.

5.1         Sichenzia Ross Friedman Ference LLP Opinion and Consent

10.1        Securities Purchase Agreement, incorporated by reference to the
            Company's Current Report on Form 8-K filed with with the Securities
            and Exchange Commission on June 2, 2004.

10.2        Form of Warrant, incorporated by reference to the Company's Current
            Report on Form 8-K filed with the Securities and Exchange Commission
            on June 2, 2004.

10.3        Joint Escrow Instruction, incorporated by reference to the Company's
            Current Report on Form 8-K filed with the Securities and Exchange
            Commission on June 2, 2004.

10.4        Registration Rights Agreement, incorporated by reference to the
            Company's Current Report on Form 8-K filed with the Securities and
            Exchange Commission on June 2, 2004.


                                       16
<PAGE>

10.5        Security Interest and Pledge Agreement, incorporated by reference to
            the Company's Current Report on Form 8-K filed with the Securities
            and Exchange Commission on June 2, 2004.

10.6        Service Agreement entered between Eurostar Facilities BV and
            Satellite Newspapers Suise GMBH, incorporated by reference to the
            Company's Registration Statement on Form SB-2 filed with with the
            Securities and Exchange Commission on November 12, 2004.

10.7        Exclusive Global Distribution Agreement between Media Finance en
            Suise Holding GMHB and Satellite Newspapers Suise GMBH incorporated
            by reference to the Company's Registration Statement on Form SB-2
            filed with with the Securities and Exchange Commission on November
            12, 2004.

10.8        Amendment to the Securities Purchase Agreement dated October 29,
            2004 , incorporated by reference to the Company's Registration
            Statement on Form SB-2 filed with with the Securities and Exchange
            Commission on November 12, 2004.

16.1        Letter from Callahan, Johnston & Associates, LLC, dated October 22,
            2003 and March 5, 2004. (Incorporated by referenced to Form 8-K
            Current Report filed with the Securities and Exchange Commission on
            March 5, 2004).

31.1        Certification by the Chief Executive Officer Pursuant to Section 302
            of the Sarbanes-Oxley Act of 2002.

31.2        Certification by the Chief Financial Officer Pursuant to Section 302
            of the Sarbanes-Oxley Act of 2002.

32.1        Certification by the Chief Executive Officer Pursuant to 18 U.S.C.
            Section 1350, as Adopted Pursuant to Section 906 of the
            Sarbanes-Oxley Act of 2002.

32.2        Certification by the Chief Financial Officer Pursuant to 18 U.S.C.
            Section 1350, as Adopted Pursuant to Section 906 of the
            Sarbanes-Oxley Act of 2002.

ITEM 14. PRINCIPAL ACCOUNTANTS FEES AND SERVICES

During the fiscal years ended December 31, 2004, and 2003, Meyler & Company
served as our auditors.

Audit Fees. The aggregate fees billed by our auditors, for professional services
rendered for the audit of the Company's annual financial statements for the
years ended December 31, 2004 and 2003, and for the reviews of the financial
statements included in the Company's Quarterly Reports on Form 10-QSB during the
fiscal years were $42,500 and $ 16,600, respectively.

Audit Related Fees. For the years ended December 31, 2004 and 2003, the Company
incurred fees to auditors of $0 and $0 for audit related fees, respectively.

All Other Fees. The aggregate fees billed by auditors for services rendered to
the Company, other than the services covered in "Audit Fees" and for the fiscal
years ended December 31, 2004 and 2003 were $35,000 and $0, which fees primarily
related to the review and consent to the Company's registration statement.

The Board of Directors has considered whether the provision of non-audit
services is compatible with maintaining the principal accountant's independence.

The Board of Directors has considered whether the provision of non-audit
services is compatible with maintaining the principal accountant's independence.


                                       17
<PAGE>

                                   SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has dully caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.

SATELLITE ENTERPRISES CORP.

Dated: April 15, 2005


By: /s/ Roy Piceni
   --------------------------------
    Roy Piceni
    CEO, President and Director


By: /s/ Leo P.F. van de Voort
   --------------------------------
    Leo P.F. van de Voort
    CFO and Principal Accounting Officer

In accordance with the Exchange Act, the report has been signed below by the
following persons on behalf of the Company and in the capacities and on the
dates indicated.

<TABLE>
<CAPTION>
         Name                                 Title                                Date
         ----                                 -----                                ----
<S>                                  <C>                                       <C>
/s/ Roy Piceni                       CEO, President and Director               April 15, 2005
-----------------------------------  (Principal Executive Officer)
Roy Piceni


/s/ Leo P.F. van de Voort            CFO  (Principal Accounting/Financial      April 15, 2005
-----------------------------------  Officer)
Leo P.F. van de Voort


/s/ Henk Meijer                      Director                                  April 15, 2005
-----------------------------------
Henk Meijer
</TABLE>


<PAGE>
                           SATELLITE ENTERPRISES CORP.
                        (A Development Stage Enterprise)

                          AUDITED FINANCIAL STATEMENTS

                 FOR THE YEARS ENDED DECEMBER 31, 2004 and 2003

<PAGE>

CONTENTS
--------------------------------------------------------------------------------

Report of Independent Registered Public Accounting Firm               Page F-1

Consolidated Balance Sheets                                                F-2

Consolidated Statements of Operations                                      F-3

Consolidated Statements of Cash Flows                                      F-4

Consolidated Statement of Stockholders' Deficit                            F-6

Notes to Consolidated Financial Statements                                 F-9

<PAGE>

                              MEYLER & COMPANY, LLC
                          CERTIFIED PUBLIC ACCOUNTANTS
                                  ONE ARIN PARK
                                 1715 HIGHWAY 35
                              MIDDLETOWN, NJ 07748

             Report of Independent Registered Public Accounting Firm

To the Board of Directors
Satellite Enterprises Corp.
Zug, Switzerland

We have audited the accompanying consolidated balance sheets of Satellite
Enterprises Corp. and subsidiaries (a Development Stage Enterprise) as of
December 31, 2004 and 2003 and the related consolidated statements of
operations, stockholders' deficit, and cash flows for each of the two years in
the period ended December 31, 2004. These consolidated 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 audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of the Company as of
December 31, 2004 and 2003, and the results of its operations and its cash flows
for each of the two years in the period ended December 31, 2004, in conformity
with U.S. generally accepted accounting principles..

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note A to the
consolidated financial statements, the Company has incurred cumulative losses of
$10,212,366 since inception, has negative working capital, a stockholders'
deficit, and there are existing uncertain conditions the Company faces relative
to its ability to obtain capital and operate successfully. These conditions
raise substantial doubt about its ability to continue as a going concern.
Management's plans regarding those matters are also described in Note A. The
financial statements do not include any adjustments that might result from the
outcome of these uncertainties.


                                                       /s/ Meyler & Company, LLC

Middletown, NJ
March 30, 2005


                                      F-1
<PAGE>

                  SATELLITE ENTERPRISES CORP. AND SUBSIDIARIES
                        (A Development Stage Enterprise)

                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                                     December 31,
                                                                              ----------------------------
                                                                                  2004            2003
                                                                              ------------    ------------
<S>                                                                           <C>             <C>
CURRENT ASSETS
   Cash                                                                       $     54,195    $     34,705
   Accounts receivable                                                             119,644          35,827
   Inventory                                                                        59,079
                                                                              ------------    ------------
         Total Current Assets                                                      232,918          70,532
EQUIPMENT, net of accumulated depreciation of
   $300,765 and $29,969 at December 31, 2004 and
     2003, respectively                                                          1,276,727       1,602,561
OTHER  ASSETS
   Deposits                                                                            236
   Technology rights                                                                15,458          15,458
                                                                              ------------    ------------
                                                                                    15,458          15,694
                                                                              ------------    ------------

         Total Assets                                                         $  1,525,103    $  1,688,787
                                                                              ============    ============

LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES
   5% Convertible subordinated debenture                                      $    500,000
   Accounts payable                                                                951,771          33,048
   Accrued expenses                                                                103,256          56,525
   Accrued salaries and related expenses                                           253,444          54,129
                                                                              ------------    ------------
         Total Current Liabilities                                               1,808,471         143,702

LONG-TERM LIABILITIES
   Notes payable to related parties                                              1,436,617       1,186,159
   Loans payable                                                                 1,247,878         873,926
                                                                              ------------    ------------
         Total Long -Term Liabilities                                            2,684,495       2,060,085

STOCKHOLDERS' DEFICIT
    Preferred stock, par value $0.001 authorized
     5,000,000 shares, none issued and outstanding
   Common stock authorized 500,000,000 shares; par value $0.001; issued and
      outstanding 225,168,271 and 192,316,350 shares
      at December 31, 2004 and, 2003, respectively                                 225,169         192,316
   Additional paid-in capital                                                    7,405,929       1,524,202
   Stock subscription receivable                                                                   180,000
   Accumulated deficit                                                         (10,212,366)     (2,007,354)
   Accumulated  other comprehensive loss                                          (386,595)        (44,164)
                                                                              ------------    ------------
         Total Stockholders' Deficit                                            (2,967,863)       (515,000)
                                                                              ------------    ------------
           Total Liabilities and Stockholders' Deficit                        $  1,525,103    $  1,688,787
                                                                              ============    ============
</TABLE>

                 See accompanying notes to financial statements.


                                      F-2
<PAGE>

                  SATELLITE ENTERPRISES CORP. AND SUBSIDIARIES
                        (A Development Stage Enterprise)
                      CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                                     For the Period
                                      Year Ended December 31,        January 2, 2002
                                   ------------------------------    (Inception) to
                                        2004             2003       December 31, 2004
                                   -------------    -------------   -----------------
<S>                                <C>              <C>              <C>
NET SALES                          $   1,090,571    $      82,705    $   1,173,276

COSTS AND EXPENSES
   Cost of services                      944,613            3,320          947,933
   Selling, general and
     administrative                    3,099,716          736,373        4,917,478
   Stock-based compen-
     sation                                               244,692          244,692
   Stock issued for services           3,560,000           10,000        3,570,000
   Impairment of Goodwill              1,131,100                         1,131,100
   Depreciation and
     amortization                        286,376           14,285          300,661
                                   -------------    -------------    -------------
       Total Costs and Expenses        9,021,805        1,008,670       11,111,864
                                   -------------    -------------    -------------

NET OPERATING LOSS                    (7,931,234)        (925,965)      (9,938,588)

OTHER INCOME (EXPENSE)
   Currency loss                         (39,383)                          (39,383)
   Loss on disposal of equipment        (135,745)                         (135,745)
   Interest expense                      (98,650)                          (98,650)
                                   -------------    -------------    -------------
       Total Other Expense              (273,778)                         (273,778)
                                   -------------    -------------    -------------

NET LOSS                           $  (8,205,012)   $    (925,965)   $ (10,212,366)
                                   =============    =============    =============

NET LOSS PER COMMON
   SHARE (BASIC AND
    DILUTED)                       $       (0.04)   $       (0.02)   $       (0.06)


WEIGHTED AVERAGE
   COMMON SHARES
   OUTSTANDING                       209,877,298       59,797,182      155,852,790
                                   =============    =============    =============
</TABLE>

                 See accompanying notes to financial statements.


                                      F-3
<PAGE>

                  SATELLITE ENTERPRISES CORP. AND SUBSIDIARIES
                        (A Development Stage Enterprise)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                 For the Period
                                                                                 January 2, 2002
                                                                              Year Ended December 31,
                                                                                 (Inception) to
                                                      2004            2003      December 31, 2004
                                                  ------------    ------------  -----------------
<S>                                               <C>             <C>             <C>
CASH FLOWS FROM
OPERATING
   ACTIVITIES
   Net loss                                       $ (8,205,012)   $   (925,965)   $(10,212,366)
   Adjustments to reconcile net loss to
     cash flows used in operating activities:
       Stock based compensation                                        244,692         244,692
       Common stock issued for services              3,560,000          10,000       3,570,000
       Depreciation                                    286,376          14,285         300,661
       Loss on disposal of equipment                   135,745                         135,745
       Impairment of goodwill                        1,131,100                       1,131,100
   Changes in operating assets and liabilities:
       Accounts receivable                             (83,817)        (26,162)       (119,644)
       Inventory                                       (59,079)                        (59,079)
       Accounts payable                                653,228          33,048         686,276
       Accrued expenses                                 39,859          48,165          96,384
       Accrued salaries and related expenses           199,315          54,129         253,444
                                                  ------------    ------------    ------------
         NET CASH FLOWS USED IN
           OPERATING ACTIVITIES                     (2,342,285)       (547,808)     (3,972,787)
                                                  ------------    ------------    ------------

CASH FLOWS FROM INVESTING
   ACTIVITIES
   Cash paid for property and equipment                (94,189)       (459,103)       (587,173)
   Deposits                                                236            (236)              ~
                                                  ------------    ------------    ------------
       NET CASH FLOWS USED IN
         INVESTING ACTIVITIES                          (93,953)       (459,339)       (587,173)
                                                  ------------    ------------    ------------

CASH FLOWS PROVIDED BY FINANCING
   ACTIVITIES
   5% Convertible subordinated debenture               500,000                         500,000
   Cash received in acquisition of subsidiary            9,454                           9,454
   Advances from notes payable to related
      parties                                          115,078         694,238         831,811
   Change in loans payable                             (82,956)        263,907       1,260,396
   Proceeds from issuance of common stock            2,076,583         118,295       2,217,612
   Proceeds from stock subscription receivable         180,000                         180,000
                                                  ------------    ------------    ------------
       NET CASH FLOWS FROM
         FINANCING ACTIVITIES                        2,798,159       1,076,440       4,999,273
                                                  ------------    ------------    ------------

EFFECT OF EXCHANGE RATE
   CHANGES ON CASH                                    (342,431)        (42,687)       (385,118)
                                                  ------------    ------------    ------------
INCREASE IN CASH                                        19,490          26,606          54,195
CASH, BEGINNING OF PERIOD                               34,705           8,099               ~
                                                  ------------    ------------    ------------
CASH, END OF PERIOD                               $     54,195    $     34,705    $     54,195
                                                  ============    ============    ============
</TABLE>

                 See accompanying notes to financial statements.


                                      F-4
<PAGE>

                  SATELLITE ENTERPRISES CORP. AND SUBSIDIARIES
                        (A Development Stage Enterprise)

                CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)


<TABLE>
<CAPTION>
                                                                                   For the Period
                                                     Year Ended December 31,      January 2, 2002
                                                   ----------------------------   (Inception) to
                                                        2004            2003     December 31, 2004
                                                   -------------    -----------  -----------------
<S>                                                  <C>           <C>              <C>
SUPPLEMENTAL DISCLOSURES
   OF CASH FLOW INFORMATION
     Interest paid                                   $    94,484                    $    94,484

NON-CASH INVESTING AND FINANCING
   ACTIVITIES
     Increase in paid-in capital from contribution
       of property and equipment                                    $1,131,444        1,131,444
     Recharacterization of loans payable to notes
       payable to related parties                                      469,426          469,426
     Common stock subscription receivable                              180,000          180,000
     Outstanding common stock of Satellite
       Newspapers Corp. at date of merger                                9,353            9,353
     Issuance of common stock for compensation                         244,692          244,692
     Issuance of common stock for consulting
       services                                        3,560,000        10,000        3,570,000
     Issuance of common stock in payment of
       accounts payable                                   38,816                         38,816
     Assets acquired and liabilities assumed in
       acquisition of 52% of subsidiary:
         Cash                                              9,454                          9,454
         Equipment                                         2,098                          2,098
         Goodwill                                      1,131,100                      1,131,100
         Accounts payable                               (304,311)                      (304,311)
         Accrued expenses                                 (6,872)                        (6,872)
         Loans payable                                  (456,908)                      (456,908)
         Acquisition note payable                       (135,380)                      (135,380)
         Issuance of common stock                       (239,181)                      (239,181)
</TABLE>

                 See accompanying notes to financial statements.


                                      F-5
<PAGE>

                         SATELLITE ENTERPRISES CORP. AND
                                  SUBSIDIARIES
                        (A Development Stage Enterprise)

                 CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIT
        For the Period January 2, 2002 (Inception) to December 31, 2004

<TABLE>
<CAPTION>
                                                                                                        Accumulated
                                          Common Stock          Additional                                 Other         Total
                                   --------------------------    Paid In    Subscription  Accumulated   Comprehensive  Stockholders
                                     Shares         Amount       Capital     Receivable     Deficit     Income (Loss)    Deficit
                                   ----------    ------------  ------------ ------------  -----------   ------------- -------------
<S>                               <C>            <C>            <C>           <C>           <C>           <C>          <C>
Issuance of shares to
   original stockholders
   for cash                            30,000    $     61,564                                                          $     61,564
Net loss for the year ended
   December 31, 2002                                                                        $(1,081,389)  $   245,134      (836,255)
                                   ----------    ------------  -------------  -----------   -----------   -----------  ------------
Balance December 31, 2002              30,000          61,564                                (1,081,389)      245,134      (774,691)

Reverse merger (Note A)
   Exchange of Satellite
     Newspapers en Suisse
    GMBH common stock                 (30,000)        (61,564)  $     61,564
Fair value of equipment
   contributed                                                     1,131,444                                              1,131,444
Issuance of common stock
   to satellite Newspapers
   en Suisse GMBH                 126,000,000         126,000       (126,000)
Outstanding common stock
   of Satellite Newspapers
   Corp                            58,992,000          58,992        (49,639)                                                 9,353
Exercise of common stock
   warrant @ $0.06, net of
   commissions                      3,000,000           3,000        177,000  $  (180,000)
Issuance of shares under private
   placement @ $0.06, net of
   commissions                      1,324,350           1,324         78,141                                                 79,465
Issuance of shares to invest-
   ment bankers @$0.01
   per share                        3,000,000           3,000          7,000                                                 10,000
</TABLE>


                 See accompanying notes to financial statements.


                                      F-6
<PAGE>

                  SATELLITE ENTERPRISES CORP. AND SUBSIDIARIES
                        (A Development Stage Enterprise)

           CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIT (CONTINUED)
        For the Period January 2, 2002 (Inception) to December 31, 2004

<TABLE>
<CAPTION>
                                                                                                        Accumulated
                                          Common Stock          Additional                                 Other         Total
                                   --------------------------    Paid In    Subscription  Accumulated   Comprehensive  Stockholders
                                     Shares         Amount       Capital     Receivable     Deficit     Income (Loss)    Deficit
                                   ----------    ------------  ------------ ------------  -----------   ------------- -------------
<S>                               <C>            <C>            <C>           <C>           <C>           <C>          <C>
Stock based compensation                                          244,692                                                 244,692
Net loss for the year ended
   December 31, 2003                                                                          (925,965)    (289,298)   (1,215,263)
                                   ---------     ---------     ----------   ---------       ----------    ---------    ----------

Balance, December 31,
    2003                         192,316,350       192,316      1,524,202    (180,000)      (2,007,354)     (44,164)     (515,000)

Payment for stock subscription                                                180,000                                     180,000

Issuance of shares under
   private placement at $0.06
   per share net of commission     6,830,864         6,831        402,612                                                 409,443

Issuance of shares for consulting
   services at $0.06 per share     5,000,000         5,000        295,000                                                 300,000

Issuance of shares under a
   private placement at $0.23
   per share                       8,695,653         8,696      1,658,444                                               1,667,140

Issuance of shares at $.06 per
   share settlement of obligations   581,949           582         38,234                                                  38,816

Issuance of shares for consulting
   services upon exercise of
   warrants valued at $.34         4,823,529         4,824      1,635,176                                               1,640,000
</TABLE>

                See accompanying notes to financial statements.


                                      F-7
<PAGE>

                  SATELLITE ENTERPRISES CORP. AND SUBSIDIARIES
                        (A Development Stage Enterprise)

           CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIT (CONTINUED)
        For the Period January 2, 2002 (Inception) to December 31, 2004

<TABLE>
<CAPTION>
                                                                                                        Accumulated
                                          Common Stock          Additional                                 Other         Total
                                   --------------------------    Paid In    Subscription  Accumulated   Comprehensive  Stockholders
                                     Shares         Amount       Capital     Receivable     Deficit     Income (Loss)    Deficit
                                   ----------    ------------  ------------ ------------  -----------   ------------- -------------
<S>                               <C>            <C>            <C>           <C>         <C>             <C>          <C>

Issuance of shares in connection
   with acquisition of 52% interest
    in SoliDam at $.26 per share     919,926           920        238,261                                                  239,181

Issuance of shares to
   consultant at $.27 per share in
   connection with general
   release and settlement
   agreement                       6,000,000         6,000      1,614,000                                                1,620,000

Net loss for year ended
   December 31, 2004                                                                       $(8,205,012)   $(342,431)   $(8,547,443)
                                 -----------      --------     ----------     ----------  ------------    ---------    -----------
Balance at December 31, 2004     225,168,271      $225,169     $7,405,929                 ($10,212,366)   ($386,595)   ($2,967,863)
                                 ===========      ========     ==========     ==========  ============    =========    ===========
</TABLE>

                 See accompanying notes to financial statements.


                                      F-8
<PAGE>

                  SATELLITE ENTERPRISES CORP. AND SUBSIDIARIES
                        (A Development Stage Enterprise)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                December 31, 2004

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

      Nature of Business

      Satellite Enterprises Corp., ("Company") through its wholly owned
      subsidiary Satellite Newspapers en Suisse GMBH ("Suisse"), provides
      newspaper publishers access to an advanced methodology of distribution for
      national, international and local newspapers. The Company digitally
      distributes, prints and sells publishers' newspapers through interactive
      vending units placed in hotels, airports and cruise ships.

      The Company merged with Suisse (formerly Media finance en Suisse GMBH)
      under a stock purchase option agreement dated November 26, 2003 which was
      exercised on February 15, 2004. Suisse has two wholly owned companies in
      the Netherlands, Satellite Newspapers Content B.V. (incorporated on May
      24, 2001) which negotiates agreements with the newspaper publishers and
      Satellite Newspapers Trading, B.V. (incorporated on May 17, 2001) which
      markets and sells vending units known as Kiosks which are used to
      distribute the digitized newspapers. Neither company had operations in
      2001.

      On June 20, 2003, in conjunction with a change of control of the Company,
      the Company entered into a Rights Agreement with Satellite Newspapers
      Worldwide NV, a corporation organized under the laws of the Netherlands
      ("Satellite Newspapers"). Under this Agreement, Satellite Newspapers
      appointed the Company as its irrevocable commercial non-exclusive
      distributor to promote the sale and/or lease of its newspaper Kiosks and
      the associated Satellite Newspaper content distribution technology which
      Satellite Newspapers developed. Satellite Newspapers owns the patents,
      engineering and technical design for this technology.

      Reverse Merger

      On February 15, 2004, the Company exercised its stock purchase agreement
      to merge with Suisse and its wholly owned subsidiaries and acquired all of
      Suisse's outstanding common stock by the issuance of 126,000,000 shares of
      its $0.001 par value common stock (the "Merger"). In connection with the
      Merger, Suisse became a wholly owned subsidiary of the Company. Prior to
      the Merger, Satellite Enterprises Corp. was a non-operating "shell"
      corporation. Pursuant to Securities and Exchange Commission rules, the
      Merger of a private operating company into a non-operating public shell
      corporation with nominal net assets is considered a capital transaction.
      Accordingly, for accounting purposes, the Merger has been treated as an
      acquisition of the Company by Suisse and a recapitalization of Suisse. The
      Merger has been reflected in the accompanying financial statements as
      though it occurred on December 31, 2003. The historical financial
      statements prior to December 31, 2003 are those of Suisse. Since the
      Merger is a recapitalization and not a business combination, proforma
      information is not presented.

      Suisse was previously owned by Media Finance en Suisse Holding GMBH, a
      company wholly owned by the family of the President and Chief Executive
      Officer of the Holding Company. As part of the merger, an exclusive 20
      year world wide license was granted to the Company to market and
      distribute digital newspapers. See also Note E - Related Party
      Transactions-License Agreement.


                                      F-9
<PAGE>

                  SATELLITE ENTERPRISES CORP. AND SUBSIDIARIES
                        (A Development Stage Enterprise)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                December 31, 2004

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

      Going Concern

      As shown in the accompanying financial statements, the Company has
      incurred cumulative net operating losses of $10,212,366 since inception,
      has negative working capital, stockholders' deficit, and is considered a
      company in the development stage. Management's plans include the raising
      of capital through the equity markets to fund future operations and the
      generating of revenue through its business. Failure to raise adequate
      capital and generate adequate sales revenues could result in the Company
      having to curtail or cease operations. Additionally, even if the Company
      does raise sufficient capital to support its operating expenses and
      generate adequate revenues, there can be no assurance that the revenue
      will be sufficient to enable it to develop business to a level where it
      will generate profits and cash flows from operations. These matters raise
      substantial doubt about the Company's ability to continue as a going
      concern. However, the accompanying financial statements have been prepared
      on a going concern basis, which contemplates the realization of assets and
      satisfaction of liabilities in the normal course of business. These
      financial statements do not include any adjustments relating to the
      recovery of the recorded assets or the classification of the liabilities
      that might be necessary should the Company be unable to continue as a
      going concern.

      Change of Year End

      In December 2003, the Company elected to change its accounting year end
      from June 30 to December 31.

      Foreign Currency Translation

      In 2004, the Company considered the Swiss Frank to be its functional
      currency. Assets and liabilities were translated into US dollars at the
      year-end exchange rates. Statement of operations amounts were translated
      using the average rate during the year. Gains and losses resulting from
      translating foreign currency financial statements were accumulated in
      other comprehensive loss, a separate component of stockholders' deficit.

      Cash Equivalents

      For purposes of reporting cash flows, cash equivalents include investment
      instruments purchased with a maturity of three months or less. There were
      no cash equivalents in 2004.

      Use of 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 at the date of the
      financial statements and reported amounts of revenues and expenses during
      the reporting period. Actual results could differ from those estimates.


                                      F-10
<PAGE>

                  SATELLITE ENTERPRISES CORP. AND SUBSIDIARIES
                        (A Development Stage Enterprise)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                December 31, 2004

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

      Equipment and Depreciation

      Equipment is stated at cost and is depreciated using the straight line
      method over the estimated useful lives of the respective assets. Routine
      maintenance, repairs and replacement costs are expensed as incurred and
      improvements that extend the useful life of the assets are capitalized.
      When equipment is sold or otherwise disposed of, the cost and related
      accumulated depreciation are eliminated from the accounts and any
      resulting gain or loss is recognized in operations. The Company
      depreciates the equipment (principally computer related equipment) over 3
      years.

      Net Loss Per Common Share

      The Company computes per share amounts in accordance with Statement of
      Financial Accounting Standards ("SFAS") No. 128, "Earnings per Share".
      SFAS No. 128 requires presentation of basic and diluted EPS. Basic EPS is
      computed by dividing the income (loss) available to Common Stockholders by
      the weighted-average number of common shares outstanding for the period.
      Diluted EPS is based on the weighted-average number of shares of Common
      Stock and Common Stock equivalents outstanding during the periods.

      Consolidated Financial Statements

      The consolidated financial statements include the Company and its wholly
      owned subsidiaries. All significant intercompany transactions and balances
      have been eliminated in consolidation.

      Comprehensive Income (Loss)

      SFAS No. 130 establishes standards for the reporting and disclosure of
      comprehensive income and its components which will be presented in
      association with a company's financial statements. Comprehensive income is
      defined as the change in a business enterprise's equity during a period
      arising from transactions, events or circumstances relating to non-owner
      sources, such as foreign currency translation adjustments and unrealized
      gains or losses on available-for-sale securities. It includes all changes
      in equity during a period except those resulting from investments by or
      distributions to owners. Comprehensive income is accumulated in
      accumulated other comprehensive income (loss), a separate component of
      stockholders' deficit.

      Business Combinations and Goodwill

      SFAS No. 123, "Accounting for Stock-Based Compensation" prescribes
      accounting and reporting standards for all stock-based compensation plans,
      including employee stock options, restricted stock, employee stock
      purchase plans and stock appreciation rights. SFAS No. 123 requires
      employee compensation expense to be recorded (1) using the fair value
      method or (2) using the intrinsic value method as prescribed by accounting
      Principles Board Opinion No. 25, "Accounting for Stock Issued to
      Employees" ("APB25") and related interpretations with pro forma disclosure
      of what net income and earnings per share would have been if the Company
      adopted the fair value method. The Company accounts for employee stock
      based compensation in accordance with the provisions of APB 25. For
      non-employee options and warrants, the company uses the fair value method
      as prescribed in SFAS 123.


                                      F-11
<PAGE>

                  SATELLITE ENTERPRISES CORP. AND SUBSIDIARIES
                        (A Development Stage Enterprise)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                December 31, 2004

NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

      Business Combinations and Goodwill (Continued)

      In July 2001, the FASB issued SFAS NO. 142, "Goodwill and Other Intangible
      Assets", which the Company adopted during 2003. SFAS No. 142 requires,
      among other things, the discontinuance of goodwill amortization. In
      addition, the standard includes provisions for the reclassification of
      certain existing recognized intangibles as goodwill, reassessment of the
      useful lives of existing recognized intangibles, reclassification of
      certain intangibles out of previously reported goodwill and the
      identification of reporting units for purposes of assessing potential
      future impairment of goodwill.

      In August 2001, the FASB issued SFAS No. 144, "Accounting for the
      Impairment or Disposal of Long-Lived Assets". SFAS No. 144 changes the
      accounting for long-lived assets to be held and used by eliminating the
      requirement to allocate goodwill to long-lived assets to be tested for
      impairment, by providing a probability weighted cash flow estimation
      approach to deal with situations in which alternative courses of action to
      recover the carrying amount of possible future cash flows and by
      establishing a primary-asset approach to determine the cash flow
      estimation period for a group of assets and liabilities that represents
      the unit of accounting for long-lived assets to be held and used. SFAS No.
      144 changes the accounting for long-lived assets to be disposed of other
      than by sale by requiring that the depreciable life of a long-lived asset
      to be abandoned be revised to reflect a shortened useful life and by
      requiring the impairment loss to be recognized at the date a long-lived
      asset is exchanged for a similar productive asset or distributed to owners
      in a spin-off if the carrying amount of the asset exceeds its fair value.
      SFAS No 144 changes the accounting for long-lived assets to be disposed of
      by sale by requiring that discontinued operations no longer be recognized
      at a net realizable value basis (but at the lower of carrying amount or
      fair value less costs to sell), by eliminating the recognition of future
      operating losses of discontinued components before they occur, and by
      broadening the presentation of discontinued operations in the income
      statement to include a component of an entity rather than a segment of a
      business. A component of an entity comprises operations and cash flows
      that can be clearly distinguished operationally, and for financial
      reporting purposes, from the rest of the entity.

      Revenue Recognition

      The Company's policy is to recognize revenue at the time a transaction is
      completed at a local interactive vending unit (Kiosk) located at various
      sites around the world. To manage this global network, the Company has
      divided the network into eight distinct regions with the intent to issue
      each regional distributor rights to market and sell the Company's product.
      Each distribution agreement requires a defined monthly minimum fee. To the
      extent that revenues generated within the region exceed the minimum, no
      minimum fee would be required and the Company, based upon internally
      generated settlement reports, would compensate the distributors.

NOTE B - ACQUISITIONS

      On December 20, 2004, the Company acquired a 52% interest in SoliDam from
      Solid Group, a Dutch Company. The acquisition price consisted of 1)
      919,926 shares of the Company's common stock and 2) a $135,380
      subordinated loan. SoliDam provides standard and custom made software
      solutions in the area of archiving, asset management, plate room
      management, and distributed print management for newspaper publishers.


                                      F-12
<PAGE>

                  SATELLITE ENTERPRISES CORP. AND SUBSIDIARIES
                        (A Development Stage Enterprise)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                December 31, 2004

NOTE B - ACQUISITIONS

      The allocation of the purchase price for this acquisition is as follows:

       Issuance of common stock                  $   239,181
       Issuance of subordinated note                 135,380
                                                 -----------
                                                 $   374,561

      Fair value of assets acquired:

       Cash                                      $     9,454
       Equipment, net                                  2,098
       Accounts payable                             (304,311)
       Accrued expenses                               (6,872)
       Loans payable                                (456,908)
                                                 -----------
                                                    (756,539)

       Goodwill                                      767,961
       Minority interest - negative (Goodwill)       363,139
                                                 -----------
                                                   1,131,100
                                                 -----------
                                                 $   374,561
                                                 ===========

      Under generally accepted accounting principles, the negative minority
      acquired interest is required to be charged to operations. Additionally,
      the Company has elected not to capitalize the goodwill due to the negative
      financial condition of SoliDam.

      The common stock issued was issued at $0.26 per share based upon a 30 day
      average price per share prior to the closing. The Company was acquired in
      December and accordingly, the Company has not included any results of
      operations in its statement of operations for the year ended December 31,
      2004.

NOTE C - EQUIPMENT

      Equipment is comprised of the following at December 31,

                                                     2004               2003
                                                 -----------        -----------
Molds                                            $ 1,131,444        $ 1,131,444
Kiosks                                               381,758            453,198
Furniture and fixtures                                64,290             32,204
                                                 -----------        -----------
                                                   1,577,492          1,616,846
Less: accumulated depreciation                      (300,765)           (14,285)
                                                 -----------        -----------

                                                 $ 1,276,727        $ 1,602,561
                                                 ===========        ===========


                                      F-13
<PAGE>

                  SATELLITE ENTERPRISES CORP. AND SUBSIDIARIES
                        (A Development Stage Enterprise)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                December 31, 2004

NOTE D - LOANS PAYABLE

      During the years ended December 31, 2004 and 2003, individuals made
      unsecured loans to the company aggregating $1,247,848 and $873,926,
      respectively. The loans matured between July and November 2004 and are
      currently past due. The loans were interest free for the first year and
      accrue interest at the rate of 6% commencing after the first anniversary
      date of the loan. Included in the Loans Payable, is a loan at December 31,
      2003 from a relative of the President and Chief Executive Officer in the
      amount of $184,212 which was repaid in 2004.

NOTE E - RELATED PARTY TRANSACTIONS

      Advances and Company Loans Payable

      The President and Chief Executive Officer has advanced the Company and/or
      assumed individual loans totaling $1,436,617 and $1,186,159 as of December
      31, 2004 and 2003, respectively. These loans are unsecured and bear
      interest at the rate of 10% per annum. The loans have no stated maturity
      dates.

      License Agreement

      In connection with the merger of the Company and Suisse, the former parent
      company of Suisse granted the company a 20 year exclusive world wide
      license to market and distribute newspapers digitally. The license
      agreement also provides access to the patents and technology that transmit
      the newspaper content digitally around the world and the technological
      knowledge to produce the Kiosks. Media Finance en Suisse Holding GMBH, the
      former parent of Suisse, is wholly owned and controlled 100% by the family
      of the President and Chief Executive Officer of the Company. The license
      agreement provides for a monthly payment of $25,000 per month to Media
      Finance en Suisse Holding GMBH commencing November 3, 2003 and a royalty
      of $0.10 for each newspaper sold.

      Distribution Agreement

      The Company had a service agreement with Eurostar facilities, BV
      ("Eurostar"). Under the terms of the service agreement Eurostar is to
      provide all international transmissions and communications with the Kiosks
      and provide administration and support services, including management
      personnel, to the Company's wholly owned operating entity, Suisse. The
      agreement is for a minimum of 5 years commencing November 3, 2003 and
      provides for a base monthly payment of $55,000 ($50,000 for transmission
      service and $5,000 for rent of installed equipment). Additionally, it
      provides for management personnel, technical staff and administrative
      staff at separate hourly rates. Since inception, Eurostar has been paid a
      total of approximately $1,100,000.

      All of the employees of the Company except the President work for Eurostar
      and the same personnel who manage and operate Eurostar work for the
      Company. Eurostar's billing to the Company is based on cost plus a profit
      mark up. The mark up to Eurostar is estimated to approximate $220,000 per
      year. The Company discontinued the service agreement November 1, 2004 and
      currently the Company pays directly all of its obligations for employees
      and services rendered.

      See also Note H- Operating Leases and Note I - Employment Contract for
      further related party disclosures.


                                      F-14
<PAGE>

                  SATELLITE ENTERPRISES CORP. AND SUBSIDIARIES
                        (A Development Stage Enterprise)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                December 31, 2004

NOTE F - INCOME TAXES

      The Company has adopted Financial Accounting Statement SFAS No. 109,
      Accounting for Income Taxes. Under this method, the Company recognizes a
      deferred tax liability or asset for temporary differences between the tax
      basis of an asset or liability and the related amount reported on the
      financial statements. The principal types of differences, which are
      measured at current tax rates, are net operating loss carry forwards. At
      December 31, 2004, these differences resulted in a deferred tax asset of
      approximately $2,425,000. SFAS No. 109 requires the establishment of a
      valuation allowance to reflect the likelihood of realization of deferred
      tax assets. Since realization is not assured, the Company has recorded a
      valuation allowance for the entire deferred tax asset, and the
      accompanying financial statements do not reflect any net asset for
      deferred taxes at December 31, 2004.

      The Company's net operating loss carry forwards amounted to approximately
      $9,710,281 at December 31, 2004, which will expire through 2020.

NOTE G - STOCKHOLDERS' EQUITY (DEFICIT)

      Private Placement Offering - GCH Capital

      In November 2003, the Company entered into private placement agreements
      with Hyde Investments, LTD., and Livingston Investments, LTD, British
      Virgin Islands Corporations, whereby these entities would purchase
      15,000,000 shares of the Company's common stock at $0.06 per share net of
      10% for commissions with the right to purchase and sell an additional
      15,000,000 shares once $1,000,000 has been paid to the Company. The intent
      of the agreement is for the Company to receive approximately $200,000 per
      month from the sale of its common stock. Through December 31, 2003, the
      Company received $79,465 in net proceeds from the sale of 1,324,350 shares
      of its common stock.

      In connection with the private placement offering, a warrant was issued to
      GCH Capital, LTD for 3,000,000 shares of the Company's common stock at an
      exercise price of $0.06 per share. The warrant was exercised in June 2004.

      In December 2003, the Company issued 3,000,000 shares of its common stock
      to GCH Capital @ $0.01 per share as compensation under the consulting
      agreement dated December 1, 2003.

      Consulting Agreement - GCH Capital, LTD

      Additionally, as part of the consulting agreement with GCH Capital, LTD is
      to provide assistance relating to business acquisition and general
      business strategies. Under the terms of the agreement, the Company was to
      issue 5,000,000 shares of the Company's common stock. None of these shares
      were issued as of December 31, 2003. In March 2004, the 5,000,000 shares
      were issued. GCH Capital, LTD is also to receive a monthly consulting fee
      of $10,000 per month for 36 months. The Company has the right to buy back
      up to 1,000,000 shares of the common stock held in escrow at $0.20 per
      share. This purchase right shall expire as to 50,000 shares on the first
      day of each month, beginning January 1, 2004.

      GCH Capital, LTD also received an additional warrant for 3,000,000 shares
      of the company's common stock as part of a consulting agreement dated
      December 31, 2003. The exercise price of the warrant is $0.06 per share,
      and is fully vested and exercisable at the date of the agreement. The
      warrant was exercised in June 2004.


                                      F-15
<PAGE>

                  SATELLITE ENTERPRISES CORP. AND SUBSIDIARIES
                        (A Development Stage Enterprise)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                December 31, 2004

NOTE G - STOCKHOLDERS' EQUITY (DEFICIT)(CONTINUED)

      Increase in Authorized Shares

      On March 11, 2004, the Directors and Shareholders of Satellite Enterprises
      Corp. approved an increase in the authorized number of shares of common
      stock from 200,000,000 to 500,000,000 and declared a 3-for-1 stock split
      effective in the form of a 200% dividend payable on or about March 31,
      2004 to shareholders of record as of March 22, 2004. All share data and
      per share figures have been adjusted to give effect to the 3-for-1 split.

      Stock Option Agreement

      On November 26, 2003, the shareholders approved a Stock Purchase Option
      Agreement with Media Finance en Suisse Holding GMBH, a Swiss Corporation
      ("Media Finance"). Media Finance is wholly owned by the family of the
      President and Chief Executive Officer of the Company. This option
      agreement allowed the Company to acquire the right to obtain 100% of the
      shares of common stock of Suisse and a 20 year exclusive license agreement
      to distribute all satellite device content. The exercise of this option
      agreement gave the Company worldwide rights to market and distribute its
      products. Under the Option Agreement, Media Finance granted the Company
      the right and option to acquire from it all of the shares of Suisse
      (20,000 shares) for the aggregate consideration of 126,000,000 shares of
      common stock, par value $0.001 per share of the company.

      Other Stock Issuances

      During the first quarter of 2004, GCH Capital, as part of the private
      placement, sold 6,830,864 shares for $409,443. The shares were sold at
      $0.06 per share, net of commissions.

      The company issued 5,000,000 shares of its common stock to GCH Capital
      valued at $0.06 per share or $300,000 in connection with a 3 year
      consulting agreement relating to investment banking commencing December 1,
      2003. The agreement was terminated in September 2004 and the shares issued
      were accounted for as stock based compensation.

      In May 2004, the Company entered into a private placement arrangement with
      a group of investment bankers and amended the agreement on October 29,
      2004 to sell 8,695,653 shares of its common stock at a price of $0.23 per
      share and the issuance of $500,000 5% convertible debentures due October
      31, 2005. The debentures are convertible into common stock at $0.23 per
      share. Interest is payable to maturity. The Company will receive the
      proceeds of the convertible debentures upon filing of a registration
      statement to register the shares sold under the private placement.
      Additionally, $150,000 was paid to GCH Capital as a break-up fee under
      their investment banking arrangement. Under the terms of the agreement,
      20,000,000 shares of the Company's common stock owned by Media Finance en
      Suisse GMBH was pledged as collateral, 8,695,653 warrants were issued to
      acquire shares of the Company's common stock at $1.50 per share and the
      Company has issued an option to each of the investors to purchase an
      equivalent number of shares within a four month period subsequent to the
      effective date of the Registration Statement at $0.23 per share.

      Under the terms of the securities Purchase Agreement, the company is
      subject to penalties payable in cash or stock for non-compliance with
      certain terms and conditions of the agreement.


                                      F-16
<PAGE>

                  SATELLITE ENTERPRISES CORP. AND SUBSIDIARIES
                        (A Development Stage Enterprise)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                December 31, 2004

NOTE G - STOCKHOLDERS' EQUITY (DEFICIT) (CONTINUED)

      Other Stock Issuances (Continued)

      In June 2004, the Company issued 581,949 shares @ $0.06 per share of its
      common stock to GCH Capital to settle unpaid expenditures paid by GCH
      Capital on behalf of the Company.

      In June 2004, the Company issued 4,823,529 shares of its common stock
      under a net cash basis formula for 6,000,000 warrants outstanding, held by
      GCH Capital, in connection with consulting and investment banking
      agreements. This transition was considered stock based compensation.

      In December 2004, the Company issued 919,926 shares of its common stock at
      $0.26 per share in connection with the acquisition of SoliDam.

      In September 2004, the Company issued 6,000,000 shares of its common stock
      to GCH Capital in order to terminate all consulting and investment banking
      relationships. This transition was considered stock based compensation.

      Stock Options

      On December 1, 2003, the Company granted options to purchase 24,309,000
      shares of the company's common stock to consultants with an exercise price
      of $0.06 per share. These options vested immediately and will expire five
      years from issuance date. The options issued to consultants had a fair
      value of $244,692 based upon the Black-Scholes options pricing model. The
      compensation associated with these options was expensed in 2003.

      Transactions involving options are summarized as follows:


Options granted December 1, 2003                           24,309,000     $0.066
                                                           ----------     ------
Balance December 31, 2003                                  24,309,000     $0.066
Options granted in 2004
                                                           ----------     ------

Balance December 31, 2004                                  24,309,000     $0.066
                                                           ==========     ======

      Pro forma information regarding net loss and net loss per share as
      required by SFAS 123 has been determined as if the Company had accounted
      for its employee stock options under the fair value method of SFAS 123.
      The fair value of these options was estimated at the date of grant using
      the Black-Scholes option-pricing model with weighted-average assumptions
      for the year ended December 31, 2003 as follows:

Assumptions

Risk-free rate                                                             3.46%
Dividend yield                                                              N/A
Volatility factor of the expected market price of the
  Company's common stock                                                    .10%
Average life                                                             1 year
Interest rate                                                              3.46%


                                      F-17
<PAGE>

                  SATELLITE ENTERPRISES CORP. AND SUBSIDIARIES
                        (A Development Stage Enterprise)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                December 31, 2004

NOTE G - STOCKHOLDERS' EQUITY (CONTINUED)

      Assumptions (Continued)

      For purposes of pro forma disclosures, the estimated fair value of the
      options has been expensed in the current period. Accordingly, there is no
      difference between actual and pro forma results.

      Information concerning stock options outstanding at December 31, 2004.

                                                                  Remaining
  Exercise Price    Number Outstanding    Contractual Life    Number Exercisable

      $0.066             24,309,000            5 years            24,309,000

      Stock Warrants

      The Company has issued stock warrants to purchase an aggregate of
      4,050,000 shares of the Company's common stock at $0.11 through June 2006
      as part of a general release and settlement agreement entered into with
      respect to previously issued convertible debentures. These warrants are
      fully vested and 100% exercisable.

      Reserved Shares

      At December 31, 2004, the Company reserved 45,749,000 shares of its common
      stock under existing agreements for private placements, options, warrant
      agreements and consulting arrangements.

NOTE H - OPERATING LEASES

      The company pays Eurostar $12,000 per month for its administrative and
      technical facility under a long-term lease expiring in August 2006.
      Minimum annual rentals are as follows:

              Year ended December 31, 2005           144,000
                                      2006            96,000

      Rent expense for the years ended December 31, 2004 and 2003 was $144,000
      for each year.

      The Company has entered into two operating leases for (1) a corporate home
      in Switzerland and (2) an automobile for the President. The corporate home
      lease commenced April 1, 2004 and has an unlimited duration which can be
      cancelled upon three months written notice in advance. The monthly rent is
      $1,620 per month. The auto lease is for a period of 48 months commencing
      March 1, 2004 with a monthly payment of $1,556.

      Minimum annual rentals are as follows:

              2005                                   $38,112
              2006                                    38,112
              2007                                    38,112
              2008                                    22,552


                                      F-18
<PAGE>

                  SATELLITE ENTERPRISES CORP. AND SUBSIDIARIES
                        (A Development Stage Enterprise)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                December 31, 2004

NOTE I - EMPLOYMENT CONTRACT

      The Company has entered into an employment contract with the President and
      Chief Operating Officer of Suisse. The contract commenced January 1, 2004
      and its duration is infinite. The agreement provides for a monthly salary
      of approximately $10,000 per month plus reasonable travel expenses.

NOTE J - COMMITMENTS AND CONTINGENCIES

      The Company had employment contracts with two former employees who
      resigned from the Company. Each contract involved salaries, stock options
      and stock warrants commitments. The former employees are asserting claims
      for salary settlements and shares of the Company's common stock and have
      brought suit against the Company. On March 28, 2004, the Company's
      attorney received permission from the court to withdraw from the case.
      Accordingly, the Company may be subject to a judgment for the maximum
      amount of the employment contracts which approximate $1,500,000 and the
      issuance of approximately 1,000,000 shares of the Company's common stock.

      On August 27, 2002, before a change in control and the reverse merger
      discussed in Note A, the Company transferred its former GreenVolt Corp.
      subsidiaries and its fuel cell technology to its former Chief Executive
      Officer as part of a general release and settlement agreement. As part of
      this agreement, the liabilities of GreenVolt Corp. were included. It is
      possible that creditors of GreenVolt Corp. could look to the Company for
      payment. The Company and its legal counsel believe that these liabilities
      remain with GreenVolt Corp. and that the Company has no further
      obligation. Through December 31, 2004, no creditors of GreenVolt Corp.
      have contacted the Company for settlement of liabilities of GreenVolt
      Corp.

      Three Dutch companies in the Netherlands have commenced a legal procedure
      against Satellite Newspapers Content B.V. claiming an amount due to them
      of approximately $156,000. The parties have agreed to suspend legal action
      until June 1, 2005 based upon a settlement reached in February 2004
      whereby a shareholder of the Company will surrender a comparable number of
      Company shares to offset the obligation.

      Legal proceedings have been entered against the Company in the State of
      Pennsylvania for violation of the Pennsylvania Unsolicited
      Telecommunication Advertisement Act which will ultimately result in a
      default judgment of $11,700 against the Company.

NOTE K - SUBSEQUENT EVENTS

      In January 2005, the Company entered into a new Satellite transmission
      agreement which requires monthly payments of $13,300 per month. The
      agreement can be terminated on a three month notice.

      In February 2005, the Company entered into a new 2 year office lease in
      Zug, Switzerland. The lease requires monthly payments of $3,100 per month
      for 2005 and $3,500 for 2004.


                                      F-19