**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**Form 10-KSB**

**Annual Report Pursuant to Section 13 or 15(d) of**

**the Securities Exchange Act of 1934**

(Mark One)

[ X ] Annual report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934

For the fiscal year ended June 30, 2002

[ ] Transition report under section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from ________ to _______

Commission File Number **0-19620**

**REDDI BRAKE SUPPLY CORPORATION**

(Name of small business issuer in its charter)

|**Nevada**                                                     | **84-1152135**            
|-------------------------------------------------------------- | --------------------------
|(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer I.D. No.)

**5882 South 900 East, Suite 202, Salt Lake City, Utah   84121**

(Address of principal executive offices)                    (Zip Code)

Issuer's telephone number, including area code **801-269-9500**

Securities registered pursuant to Section 12(b) of the Exchange Act: None

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

(Title of class)

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

Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B is contained in this form, and
no disclosure will be contained, to the best of the 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. [ X ]

The issuer's revenue for its most recent fiscal year was: $ -0-

The aggregate market value of the issuer's Common Stock held as of October 4, 2002 by non-affiliates of the issuer was
$93,077.

As of October 4, 2002, issuer had 84,615,220 shares of its $.0001 par value common stock outstanding.

Transitional Small Business Format: Yes [ ] No [ X ]

Documents incorporated by reference: None

FORWARD-LOOKING INFORMATION

THIS FORM 10KSB AND OTHER STATEMENTS ISSUED OR MADE FROM  TIME TO TIME BY THE COMPANY
OR ITS REPRESENTATIVES CONTAIN  STATEMENTS WHICH MAY CONSTITUTE "FORWARD-LOOKING
STATEMENTS" WITHIN THE MEANING OF THE SECURITIES ACT OF 1933 AND THE SECURITIES
EXCHANGE ACT OF 1934, AS AMENDED BY THE PRIVATE SECURITIES LITIGATION REFORM  ACT OF
1995, 15 U.S.C.A. SECTIONS 77Z-2 AND 78U-5. THOSE STATEMENTS INCLUDE STATEMENTS REGARDING
THE INTENT, BELIEF OR CURRENT EXPECTATIONS  OF THE COMPANY AND MEMBERS OF ITS
MANAGEMENT TEAM AS WELL AS THE ASSUMPTIONS ON WHICH SUCH STATEMENTS ARE BASED.

PROSPECTIVE INVESTORS ARE CAUTIONED THAT ANY SUCH FORWARD-LOOKING STATEMENTS ARE
NOT GUARANTEES OF FUTURE PERFORMANCE AND INVOLVE RISKS AND UNCERTAINTIES, AND THAT
ACTUAL RESULTS MAY DIFFER MATERIALLY FROM THOSE CONTEMPLATED BY SUCH
FORWARD-LOOKING STATEMENTS. IMPORTANT FACTORS CURRENTLY KNOWN TO MANAGEMENT
THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM  THOSE IN FORWARD- LOOKING
STATEMENTS ARE SET FORTH HEREIN. THE COMPANY UNDERTAKES NO OBLIGATION TO UPDATE OR
REVISE FORWARD-LOOKING STATEMENTS TO REFLECT CHANGED ASSUMPTIONS, THE OCCURRENCE
OF UNANTICIPATED EVENTS OR CHANGES TO  FUTURE OPERATING RESULTS OVER TIME.

**PART I**

**Item 1. Description of Business.**

The Company was incorporated in Nevada on July 13, 1990 as Franklin Capital, Inc. On October 17, 1991, the Company
changed its name to Wesco Auto Parts Corporation and again effected a name change on April 21, 1994 to Reddi Brake
Supply Corporation.

The Company's only significant asset was its wholly owned (operating) subsidiary RBSC, Inc., (formerly Reddi Brake
Supply Company, Inc.). The subsidiary filed for Chapter 11 bankruptcy protection on March 17, 1997. All of the
subsidiary's operating assets were sold to satisfy claims of creditors. The subsidiary's Plan of Reorganization became
effective March 22, 1998. The subsidiary's assets, primarily cash from the sale of operating assets and notes, were
transferred to a Creditors' Trust and the subsidiary shell was reorganized for the benefit of creditors. This resulted in the
Company losing the operating subsidiary, its only tangible asset.

Since the divestiture of the Company's subsidiary, the Company has not engaged in any operations. At the present time, the
Company continues to seek, investigate, and if warranted, acquire an interest in a business opportunity. The Company does
not propose to restrict its search for a business opportunity to any particular industry or geographical area and may,
therefore, engage in essentially any business in any industry. The Company has unrestricted discretion in seeking and
participating in a business opportunity, subject to the availability of such opportunities, economic conditions and other
factors.

The selection of a business opportunity in which to participate is complex and extremely risky and will be made by
management in the exercise of its business judgment. There is no assurance that the Company will be able to identify and
acquire any business opportunity which will ultimately prove to be beneficial to the Company and its shareholders.

The activities of the Company are subject to several significant risks which arise primarily as a result of the fact that the
Company has no specific business and may acquire or participate in a business opportunity based on the decision of
management which will, in all probability, act without the consent, vote, or approval of the Company's shareholders.

Sources of Opportunities

It is anticipated that business opportunities may be available to the Company from various sources, including its officers
and directors, professional advisers, securities broker-dealers, venture capitalists, members of the financial community, and
others who may present unsolicited proposals.

The Company will seek a potential business opportunity from all known sources, but will rely principally on personal
contacts of its officers and directors as well as indirect associations between them and other business and professional
people. Although the Company does not anticipate engaging professional firms specializing in business acquisitions or
reorganizations, if management deems it in the best interests of the Company, such firms may be retained. In some
instances, the Company may publish notices or advertisements seeking a potential business opportunity in financial or trade
publications.

Criteria

The Company will not restrict its search to any particular business, industry or geographical location. The Company may
acquire a business opportunity or enter into a business in any industry and in any stage of development. The Company may
enter into a business or opportunity involving a "start up" or new company. The Company may acquire a business
opportunity in various stages of its operation.

In seeking a business venture, the decision of management of the Company will not be controlled by an attempt to take
advantage of an anticipated or perceived appeal of a specific industry, management group, or product or industry, but will
be based upon the business objective of seeking long-term capital appreciation in the real value of the Company.

In analyzing prospective business opportunities, management will consider such matters as the available technical,
financial and managerial resources; working capital and other financial requirements; the history of operations, if any;
prospects for the future; the nature of present and expected competition; the quality and experience of management services
which may be available and the depth of the management; the potential for further research, development or exploration;
the potential for growth and expansion; the potential for profit; the perceived public recognition or acceptance of products,
services, trade or service marks, name identification; and other relevant factors.

Generally, the Company will analyze all available factors in the circumstances and make a determination based upon a
composite of available facts, without reliance upon any single factor as controlling.

Methods of Participation of Acquisition

Specific business opportunities will be reviewed and, on the basis of that review, the legal structure or method of
participation deemed by management to be suitable will be selected. Such structures and methods may include, but are not
limited to, leases, purchase and sale agreements, licenses, joint ventures, other contractual arrangements, and may involve a
reorganization, merger or consolidation transaction. The Company may act directly or indirectly through an interest in a
partnership, corporation, or other form of organization.

Procedures

As part of the Company's investigation of business opportunities, officers and directors may meet personally with
management and key personnel of the firm sponsoring the business opportunity, visit and inspect material facilities, obtain
independent analysis or verification of certain information provided, check references of management and key personnel,
and conduct other reasonable measures.

The Company will generally request that it be provided with written materials regarding the business opportunity
containing such items as a description of product, service and company history; management resumes; financial
information; available projections with related assumptions upon which they are based; an explanation of proprietary
products and services; evidence of existing patents, trademarks or service marks or rights thereto; present and proposed
forms of compensation to management; a description of transactions between the prospective entity and its affiliates;
relevant analysis of risks and competitive conditions; a financial plan of operation and estimated capital requirements; and
other information deemed relevant.

Competition

The Company expects to encounter substantial competition in its efforts to acquire a business opportunity. The primary
competition is from other companies organized and funded for similar purposes, small venture capital partnerships and
corporations, small business investment companies and wealthy individuals.

Employees

The Company does not currently have any employees but relies upon the efforts of its officers and directors to conduct the
business of the Company.

**Item 2. Description of Property.**

The Company does not own any property. The Company currently utilizes office space, free of charge, from officers and
directors of the Company.

**Item 3. Legal Proceedings.**

McCormick, et al., v. Reddi Brake Supply Corp., et al, L.A.S.C. Case No. BC 180840. On November 6, 1997, a class
action lawsuit was filed in the Los Angeles Superior Court on behalf of all persons or entities who bought common stock of
the defendant prior to March 23, 1996, and/or who bought or sold any shares thereafter until August 13, 1996, excluding
defendants, their families, employees, agents or assigns.  The complaint asserts causes of action for breach of fiduciary
duty by officers and directors and conspiracy to manipulate the price of the common stock of the defendant.  The Reddi
Brake Defendants have denied the claims.  In May 1999, the parties reached a tentative settlement agreement, which was
presented to the Court in June 1999 and in September 1999, preliminary approval by the Superior Court as fair, reasonable
and adequate to members of the settlement class.  In December 2000, representatives of the named class members
announced their intention to renegotiate certain provisions of the settlement.  In January 2001, defendants served notice of
their withdrawal from the settlement.  In June 2001, the Superior Court rejected the proposed settlement, found the
plaintiffs' counsel inadequate, decertified the settlement class, and ordered the class action allegations stricken from the
complaint.  On August 6, 2002, the California Court of Appeal rejected the plaintiffs' former counsel's appeal of the
Superior Court's June 2001 order.  The action currently is pending in the Superior Court and the named plaintiffs' have
stated their intention to amend the complaint to re-assert class action allegations.  The parties have been negotiating a
settlement agreement which remains unresolved  at the report date.

Sheerin v. McCorrian, Birin and Reddi Brake Supply Corporation, L.A.S.C. Case No. BC 186930. On March 3, 1998,
Allen J. Sheerin filed a lawsuit in the Los Angeles County Superior Court against the Company and specifically against
two former officer's and director's of the Company.  Mr. Sheerin alleges that these officers and directors misrepresented the
financial status of the Company during the time that he was negotiating  to buy shares in the Company  which resulted in a
loss to him of $2,100,000.  The parties have been negotiating a settlement agreement which remains unresolved  at the
report date.

**Item 4. Submission of Matters to a Vote of Securities Holders.**

None

**PART II**

**Item 5. Market for Common Equity, Related Stockholder Matters.**

The Company's common stock is listed on the Over the Counter Bulletin Board ("OTCBB"), under the symbol "REDI". As
of October 4, 2002 the Company had 84,615,220 shares of common stock issued and outstanding, and 2,000,000 shares of
preferred stock issued and outstanding.

The following quotations, as provided by the National Quotation Bureau, represent prices between dealers and do not
include retail markup, markdown or commission. In addition, these quotations do not represent actual transactions.

**CLOSING BID CLOSING ASK**

|**2000**       | **HIGH** | **LOW** | **HIGH** | **LOW**
|-------------- | -------- | ------- | -------- | -------
|First Quarter  | .074     | .003    | .08      | .005   
|Second Quarter | .05      | .0152   | .02      | .058   
|Third Quarter  | .03125   | .015    | .04      | .02    
|Fourth Quarter | .015     | .005    | .02      | .01    
|**2001**       |          |         |          |        
|First Quarter  | .01      | .005    | .015     | .008   
|Second Quarter | .008     | .004    | .01      | .005   
|Third Quarter  | .005     | .003    | .008     | .003   
|Fourth Quarter | .004     | .001    | .006     | .001   
|**2002**       |          |         |          |        
|First Quarter  | .006     | .001    | .008     | .001   
|Second Quarter | .013     | .002    | .014     | .002   

The Company has never declared a dividend on its Common Stock. The Company has not paid, nor declared, any
dividends since its inception and does not intend to declare any such dividends in the foreseeable future. The Company's
ability to pay dividends is subject to limitations imposed by Nevada law. Under Nevada law, dividends may be paid to the
extent that the corporation's assets exceed its liabilities and it is able to pay its debts as they become due in the usual course
of business.

Recent Sale of Unregistered Securities

On February 9, 1995, the Company completed a private placement  of 9% adjustable convertible subordinated debentures
which was originally due 2005 in the amount of $6.9 million. Interest on the unpaid principal was payable quarterly.  The
debentures were subordinated to all of the obligations due to the Company's  bank and suppliers and were convertible into
shares of the Company's common stock, at the option of the holders, at a conversion price of $6.27 per share.  By October
2001, the Company had paid all of the debenture holders, including all of the unpaid interest, through the issuance of
9,615,220 shares of common stock, as payment and settlement of the debentures. The securities were issued, without
registration, in reliance on the exemption provided by Section 4(2) of the Securities Act. No broker was involved and no
commissions were paid in the transaction

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

As of the fiscal year end June 30, 2002 the Company's total current assets are $16 in cash. The Company has current
liabilities in the amount of $197,261, which includes $171,026 in accounts payable, and $26,235 in demand notes for sums
lent to the Company by its directors.

The Company did not generate any revenue from operations during fiscal years 2002 and 2001. The Company has no
material commitments for capital expenditures for the next twelve months.

The Company believes that its current cash needs can be met based upon the continued willingness of management to lend
the Company funds in order to maintain its 1934 Act reporting requirements.  However, should the Company obtain a
business opportunity, it may be necessary to raise additional capital. This may be accomplished by loans from the
principals of the Company, debt financing, equity financing or a combination of financing options.

**Item 7. Financial Statements.**

The financial statements of the Company appear at the end of this report beginning with the Index to Financial Statements
on page F-1.

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

None.

**PART III**

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

The following tables sets forth as of June 30, 2001, the name, age, and position of each executive officer and director and
the term of office of each director of the Company.

|Name           | **Age** | **Position**                     | **Director or Officer Since**
|-------------- | ------- | -------------------------------- | -----------------------------
|John Chymboryk | 48      | President and Director           | February 2000                
|Kip Eardley    | 43      | Secretary/Treasurer and
Director | February 2000                

All Directors hold their positions for one year or until successors are duly elected and qualified. All officers hold their
positions at the will of the Board of Directors.

Set forth below is certain biographical information regarding each of the Company's executive officers and directors:

John Chymboryk, President and Director. Mr. Chymboryk received his bachelor's degree with an emphasis in accounting
and economics in 1982. Following graduation he worked for a large international accounting firm until 1984. He then
taught courses in finance, marketing and management in the business departments of a Community College from 1984 to
1992. Concurrent with his teaching experience, Mr. Chymboryk operated an accounting business that specialized in
preparing financial statements, tax returns and business plans for small businesses. Mr. Chymboryk co-founded a company
that specialized in marketing, customer retention and management training. Mr. Chymboryk served as Vice President and
was responsible for the financial operations and in developing and delivering management training. Mr. Chymboryk was
instrumental in designing and presenting the sales management workshop that was contracted with Lexus, the Toyota
Motor Corporation luxury car line. In 1997, Mr. Chymboryk was involved in designing, developing and implementing a
new application that assists companies in following up and retaining their existing customer base.

Kip Eardley, Secretary/Treasurer and Director. Mr. Eardley acts as a consultant to private and public corporations assisting
with corporate structuring, efficiencies and debt management. Mr. Eardley has a background in finance and economics.

To the knowledge of management, during the past five years, no present or former director, executive officer or person
nominated to become a director or an executive officer of the Company:

(1) filed a petition under the federal bankruptcy laws or any state insolvency law, nor had a receiver, fiscal agent or similar
officer appointed by a court for the business or property of such person, or any partnership in which he was a general
partner at or within two years before the time of such filing, or any corporation or business association of which he was an
executive officer at or within two years before the time of such filing;

(2) was convicted in a criminal proceeding or named subject of a pending criminal proceeding excluding traffic violations
or other minor offenses);

(3) was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of
competent jurisdiction, permanently or temporarily enjoining him from or otherwise limiting, the following activities;

(i) acting as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator,
floor broker, leverage transaction merchant, associated person of any of the foregoing, or as an investment advisor,
underwriter, broker or dealer in securities, or as an affiliate person, director or employee of any investment company, or
engaging in or continuing any conduct or practice in connection with such activity; (ii) engaging in any type of business
practice; or (iii) engaging in any activity in connection with the purchase or sale of any security or commodity or in
connection with any violation of federal or state securities laws or federal commodities laws;

(4) was the subject of any order, judgment, or decree, not subsequently reversed, suspended, or vacated, of any federal or
state authority barring, suspending, or otherwise limiting for more than 60 days the right of such person to engage in any
activity described above under this Item, or to be associated with persons engaged in any such activity;

(5) was found by a court of competent jurisdiction in a civil action or by the Securities and Exchange Commission to have
violated any federal or state securities law, and the judgment in such civil action or finding by the Securities and Exchange
Commission has not been subsequently reversed, suspended, or vacated.

(6) was found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to
have violated any federal commodities law, and the judgment in such civil action or finding by the Commodity Futures
Trading Commission has not been subsequently reversed, suspended or vacated.

**Item 10. Executive Compensation.**

No compensation has been paid to any officer or director of the Company in the past three years. There are no
compensatory plans or arrangements, including payments to be received from the Company, with respect to any officers or
directors of the Company which would in any way result in payments to any such person because of his resignation,
retirement, or other termination of such person's employment with the Company, or any change in control of the Company,
or a change in the person's responsibilities following a change in control of the Company.

**Item 11. Security Ownership of Certain Beneficial Owners and Management.**

The following table sets forth as of October 4, 2002, the name and the number of shares of the Company's voting stock,
consisting of Common Stock, par value. $.0001, one vote per share and Class C Preferred stock with voting rights of 50
votes per share (hereinafter collectively referred to as the "Voting Stock") held of record, or was known by the Company to
own beneficially, more than 5% of the Company's issued and outstanding Voting Stock; plus, the name and shareholdings
of each director and of all officers and directors as a group.

|**Title of Class** | **Name and Address of
Beneficial Owner**                                    | **Amount and Nature
ofBeneficial Ownership** | **Percent Class**
|------------------ | --------------------------------------------------------------------------- | -------------------------------------------- | -----------------
|Common             | CBIC Wood Gundy
(London), Ltd.                                              | 7,297,844 shares                             | 23%              
|Preferred C        | John Chymboryk, (2)(3) 

5882 S. 900 E., Suite 202 Salt
Lake City, UT 84121 | 2,000,000 shares                             | 100%             
|Preferred C        | Kip Eardley, (2)(3) 

5882 S. 900 E., Suite 202 Salt
Lake City, UT 84121    | 2,000,000 shares                             | 100%             
|Preferred C        | Officers, Directors and
Nominees as a Group:          2
persons             | 2,000,000 shares                             | 100%             

(1) For purposes of this table, a beneficial owner is one who, directly or indirectly, has or shares with others (a) the power
to vote or direct the voting of the Voting Stock (b) investment power with respect to the Voting Stock which includes the
power to dispose or direct the disposition of the Voting Stock.

(2) Officer and/or director of the Company.

(3) John Chymboryk and Kip Eardley each own 50% of Capital Holdings, which currently holds all 2,000,000 shares of the
Class C Preferred Stock.

**Item 12. Certain Relationships and Related Transactions.**

On June 14, 2000, by resolution of the Board of Directors, the Company authorized and issued 2,000,000 shares of a Class
C Preferred Stock with voting rights of 50 votes per share to Capital Holdings, in consideration of $10,000 paid by Capital
Holdings, for legal debts incurred by the Company. John Chymboryk and Kip Eardley, both officers and directors of the
Company, jointly own Capital Holdings. This gives Capital Holdings control of the Company with a total of 100,000,000
votes, which is equivalent to fifty seven percent (57%) of all issued and outstanding Voting Stock.

The Company utilizes office space provided by the officers and directors of the Company at no charge to the Company.

**Item 13. Exhibits and Reports on Form 8-K.**

Reports on Form 8-K

None

Exhibits

Copies of the following documents are included as exhibits to this report pursuant to Item 601 of Regulation S-B.

|**Exhibit No.** | **SEC Ref. No.** | **Title of Document**                                  | **Location**
|--------------- | ---------------- | ------------------------------------------------------ | ------------
|1               | (3)(i)           | Articles of Incorporation                              | See Note (1)
|2               | (3)(i)           | Articles of Amendment to the
Articles of Incorporation | See Note (1)
|3               | (3)(i)           | Articles of Amendment to the
Articles of Incorporation | See Note (1)
|4               | (3)(i)(3)(i)     | Articles of Amendment to the
Articles of Incorporation | See Note (1)
|5               |                  | Articles of Amendment to the
Articles of Incorporation | See Note (1)
|6               | (3)(i)           | Articles of Amendment to the
Articles of Incorporation | See Note (1)
|7               | (3)(ii)          | By Laws                                                | See Note (1)
|8               | (4)              | Certificate of Designation for
Preferred Class C Stock | See Note (2)
|9               | (4)              | Certificate of Amendment to
Preferred Class B Stock    | See Note (3)
|10              | (10)             | Asset Purchase Agreement                               | See Note (1)
|11              | (10)             | Lease Agreement                                        | See Note (1)
|12              | (27)             | Financial Data Schedule                                | See Note (1)
|13              | (99)             | Order Confirming Plan of
Reorganization                | See Note (1)

Note (1) - Filed as an Exhibit on Form 10-KSB for the fiscal year ended June 30, 1999 and filed March 20, 2000, is
incorporated herein by reference.

Note (2) - Filed as an Exhibit on Form 8-K, which was filed on June 23, 2000, and is incorporated herein by reference.

Note (3) - Filed as an Exhibit on Form 10-KSB for the fiscal year ended June 30, 2001, and filed October 1, 2001, is
incorporated herein by reference.

**SIGNATURES**

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report has been signed below by the
following persons on behalf of the Registrant and in the capacities and on the dates indicated:

REDDI BRAKE SUPPLY CORPORATION

Date: October 10, 2002                               By: /s/ John Chymboryk

John Chymboryk, President and Director

Date: October 10, 2002                               By: /s/ Kip Eardley

Kip Eardley, Secretary, Treasurer and Director

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

In connection with the Annual Report of Reddi Brake Supply Corporation (the "Company") on Form 10-KSB for the
period ended June 30, 2002 as filed with the Securities and Exchange Commission on the Date hereof (the "Report"), the
undersigned certify, pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of
2002, that to the best of my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934;
and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of
operations of the Company.

Date: October 10, 2002                                              By: /s/ John Chymboryk

John Chymboryk , Chief Executive Officer

Date: October 10, 2002                                              By: /s/ Kip Eardley

Kip Eardley, Chief Financial Officer

**Financial Statements**

**June 30, 2002**

**CONTENTS**

|Independent Auditors' Report      | F-2
|--------------------------------- | ---
|Balance Sheet                     | F-3
|Statements of Operations          | F-4
|Statement of Stockholders' Equity | F-5
|Statement of Cash Flows           | F-6
|Notes to the Financial Statements | F-7

**ANDERSEN ANDERSEN & STRONG, L.C.**                                           941 East 3300****South, Suite 202

**Certified Public Accountants and Business Consultants**Salt Lake City, Utah 84106

Member SEC Practice Section of the AICPA                                                                          Telephone 801 486-0096

Fax 801 486-0098

Board of Directors

Reddi Brake Supply Corporation

Salt Lake City, Utah

**REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS**

We have audited the accompanying balance sheet of Reddi Brake Supply Corporation (development stage company)  at
June  30, 2002   and the related statements of operations, stockholders' equity, and cash flows for the years ended June 30,
2002 and 2001 and for the period July 1, 1997 (date of inception of development stage) to June 30, 2002.  These financial
statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.

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

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of
Reddi Brake Supply Corporation  at June 30, 2002  and the results of  operations, and  cash flows for the years ended June
30, 2002 and 2001 and the period July 1, 1997 to June 30, 2002 in conformity with accounting principles generally
accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.
The Company  does not have the necessary working capital to   service its debt and for its planned activity ,  which  raises
substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are
described in Note 7. These financial statements do not include any adjustments that might result from the outcome of this
uncertainty.

Salt Lake City, Utah

October 2, 2002                                         s/Andersen Andersen and Strong L.C.

**REDDI  BRAKE  SUPPLY  CORPORATION**

**(Development Stage Company)**

**BALANCE SHEET**

**June 30, 2002**

****                                                                      ****

|**ASSETS**                                                                                    |             
|--------------------------------------------------------------------------------------------- | ------------
|**CURRENT ASSETS**                                                                            |             
|Cash                                                                                          | $   16      
|                                                                                              | ___________ 
|Total Current Assets                                                                          | $   16      
|                                                                                              | ==========  
|**LIABILITIES AND STOCKHOLDERS' EQUITY**                                                      |             
|**CURRENT LIABILITIES**                                                                       |             
|Accounts payable - affiliate - Note 6                                                         | $   26,235  
|Accounts payable                                                                              | 171,026     
|                                                                                              | ___________ 
|Total Current Liabilities       ****                                                          | 197,261     
|                                                                                              | ___________ 
|**CONTINGENT LIABILITIES -** Note 8                                                           | -           
|                                                                                              | ___________ 
|**STOCKHOLDERS' DEFICIENCY**                                                                  |             
|****Preferred stock - Note 4                                                                  |             
|****2,500,000 shares authorized at $0.0001 par value;
2,000,000 shares issued and outstanding | 200         
|Common stock                                                                                  |             
|100,000,000 shares authorized  at $0.0001 par value;
84,615,220 shares issued and outstanding | 8,462       
|Capital in excess of par value                                                                | 37,260,182  
|Accumulated deficit                                                                           | (37,466,089)
|                                                                                              | ___________ 
|Total Stockholders'  Deficiency                                                               | (197,245)   
|                                                                                              | ___________ 
|                                                                                              | $    16     
|                                                                                              | ==========  

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

**REDDI  BRAKE  SUPPLY  CORPORATION**

**(Development Stage Company)**

**STATEMENTS OF OPERATIONS**

**For the  Years Ended June 30, 2002 and 2001 and the period**

**July 1, 1997 (date of inception of development stage) to June 30, 2002**

******
**June 30, 2002**
**June 30, 2001**
**July 1, 1997 to June 30,
2002****REVENUES**
$            -
$             -
$              -___________
___________
___________**EXPENSES**Administrative
128,937
19,701
370,338Interest
287,959
1,092,002
4,036,995___________
___________
___________**NET OPERATING  LOSS
-**before other income (losses)
(416,896)
(1,111,703)
(4,407,333)**OTHER INCOME
(LOSSES)**Loss on liquidation of
assets and liabilities****
-
-
(25,223,711)****Gain on payment and
settlement of debt - Notes 3
& 5
12,416,934
-
12,416,934___________
___________
___________**NET INCOME (LOSS)**
$ 12,000,038
$ (1,111,703)
$ (17,214,110)==========
==========
==========**NET LOSS PER
COMMON  SHARE******   Basic ****
$   .15
$   (.02)Diluted
$   .15
$   (.02)**AVERAGE
OUTSTANDING** **SHARES
-**stated in 1,000,sBasic
79,808
71,055Diluted
81,808
73,055The accompanying notes are an integral part of these financial statements.

**REDDI  BRAKE  SUPPLY  CORPORATION**

**(Development Stage Company)**

**STATEMENT OF CHANGES  IN STOCKHOLDERS' EQUITY**

**Period July 1, 1997 (date of inception of development stage)  to June 30, 2002**

****                                                                                                                                                              ****

********Preferred Stock**

**Common Stock**

**Capital in
Excess of Par
Value**
**Accumulated
Deficit****Shares**
**Amount**
**Shares**
**Amount****Balance July 1,
1997**
130,000
$13
50,186,949
$5,018
$ 37,093,672
$ (20,251,979)Issuance of
common stock
for retirement of
preferred stock
(70,000)
(7)
8,038,003
804
(797)
-Net  loss for the
year ended June
30, 1998
-
-
-
-
-
(26,091,096)Net  loss for the
year ended June
30, 1999
-
-
-
-
-
(902,293)Preferred stock
dividends
-
-
-
-
82,856
(82,856)___________
___________
___________
___________
___________
___________**Balance June
30, 1999**
60,000
6
58,224,952
5,822
37,175,731
(47,328,224)Issuance of
common stock
for settlement of
legal action at
$.0042 -
October 1999
-
-
1,000,000
100
4,100
-Issuance of
class C
preferred stock
for expenses -
June 14, 2000 at
$.005 - related
parties
2,000,000
200
-
-
9,800
-Preferred stock
dividends
-
-
-
-
27,727
(27,727)Net  loss for the
year ended June
30, 2000
-
-
-
-
-
(991,576)___________
___________
___________
___________
___________
___________**Balance June
30, 2000**
2,060,000
206
59,224,952
5,922
37,217,358
(48,347,527)Preferred stock
dividends
-
-
-
-
6,897
(6,897)Issuance of
common stock
for retirement of
preferred stock
and accrued
dividends -
September 2000
(60,000)
(6)
15,775,048
1,578
(1,572)
-Net  loss for the
year ended June
30, 2001
-
-
-
-
-
(1,111,703)___________
___________
___________
___________
___________
___________**Balance June
30, 2001**
2,000,000
200
75,000,000
7,500
37,222,683
(49,466,127)Issuance of
common stock
for payment and
settlement of
debt  at  $004 -
Oct 2001
-
-
9,615,220
962
37,499
-Net  profit for
the year ended
June 30, 2002
-
-
-
-
-
12,000,038___________
___________
___________
___________
___________
___________**Balance June
30, 2002**
2,000,000
$ 200
84,615,220
$8,462
$ 37,260,182
$(37,466,089)==========
==========
==========
==========
==========
==========The accompanying notes are an integral part of these financial statements.

**REDDI  BRAKE  SUPPLY  CORPORATION**

**(Development Stage Company)**

**STATEMENT OF CASH FLOWS**

**For the  Years Ended June 30, 2002  and 2001 and the Period**

**July 1, 1997 (date of inception of development stage) to June 30, 2002****June 30, 2002**
**June 30, 2001**
**July 1, 1997 to June 30,
2002****CASH FLOWS FROM
OPERATING
ACTIVITIES**Net profit (loss)
$ 12,000,038
$(1,111,703)
$(17,214,110)Adjustments to reconcile net
loss to net cash provided by
operating activitiesChanges in accounts
receivable
-
-
12,756Changes in accounts
payable
126,903
15,491
310,709Loss of assets
-
-
25,223,711Accrued interest -
convertible debt
287,959
1,092,002
4,036,995Issuance common stock
for settlement of legal action
-
-
4,200Issuance of preferred stock
for expenses
-
-
10,000Issuance of common stock
for payment and settlement of
debt
(12,416,934)
-
(12,416,934)___________
___________
___________Net Cash Used in Operations
(2,034)
(4,210)
(32,673)___________
___________
___________**CASH FLOWS FROM
INVESTING ACTIVITIES**Net - sale of securities
2,034
-
2,034___________
___________
___________**CASH FLOWS FROM
FINANCING ACTIVITIES**-
-
-___________
___________
___________Net Increase (Decrease) in
Cash
-
(4,210)
(30,639)Cash at Beginning of Period
16
4,226
30,655___________
___________
___________Cash at End of Period
$    16
$   16
$    16==========
==========
==========**NON CASH FLOWS FROM OPERATING
ACTIVITIES**Issuance of 1,000,000 shares common stock for expenses -
1999
$  4,200Issuance of 2,000,000 shares class C preferred stock for
expenses - 2000
10,000Issuance of  9,615,220 shares common stock for payment
and settlement of debt -2001
38,461The accompanying notes are an integral part of these financial statements.

**REDDI  BRAKE  SUPPLY  CORPORATION**

**NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION**

The Company was incorporated under the laws of the State of Nevada on July 12, 1990 with name "Franklin Capital, Inc"
with authorized common stock of 35,000,000 shares with a par value of $0.0001 and preferred stock of 2,500,000 shares
with a par value of $0.0001. On October 24, 1996   the authorized common stock was increased to 75,000,000 shares and
on January 12, 2001 to 100,000,000 shares with the same par value. The Company had several name changes and on April
21, 1994 changed its name to "Reddi Brake Supply Corporation."

The principal business activity of the corporation through its subsidiary, Reddi Brake Supply Company, Inc., has been the
sale of auto parts, mainly to professional installers, through several warehouses located throughout the United States.

On March 17, 1997 an involuntary petition in bankruptcy was filed against the subsidiary, which resulted in the loss of the
business and the warehouses and  as a result of  the bankruptcy the Company sustained substantial losses.  After July 1,
1997 the Company  had no operations and is considered to be a development stage company since that date.

**2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

Accounting Methods

The Company recognizes income and expenses based on the accrual method of accounting.

Dividend Policy

The Company has not  adopted a policy regarding payment of dividends.

Income Taxes

On June 30, 2002  the Company did not have a  net  loss available for carry forward.

Basic and Diluted Net Income (Loss) Per Share

Basic net income (loss) per share amounts are computed based on the weighted average number of shares actually
outstanding. Diluted net income (loss) per share amounts are computed using the weighted average number of common
shares and common equivalent shares outstanding as if shares had been issued on the exercise of the preferred share rights
unless the  exercise becomes antidilutive and then only the basic per share amounts are shown in the report.

**REDDI  BRAKE  SUPPLY  CORPORATION**

**NOTES TO FINANCIAL STATEMENTS (Continued)
2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**(continued)

Financial Instruments

The carrying amounts of financial instruments, including cash and accounts payable,  are considered by management to be
their estimated fair values.

Other Recent Accounting Pronouncements

The Company does not expect that the adoption of other recent accounting pronouncements will have a material impact on
its  financial statements.

Estimates and Assumptions

Management uses estimates and assumptions in preparing financial statements in accordance with accounting principles
generally accepted in the United States of America.  Those estimates and assumptions affect the reported amounts of the
assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses.  Actual
results could vary from the estimates that were assumed in preparing these financial statements.

**3.  SUBORDINATED  CONVERTIBLE  DEBT**

On February 9, 1995, the Company completed a private placement  of 9% adjustable convertible subordinated debentures
due 2005  in the   amount of $6.9 million. Interest on the unpaid principal is payable quarterly.  The Company may call the
Debentures after January 17, 1998.  The debentures are subordinated to all of the obligations due to the Company's  bank
and suppliers and are convertible into shares of the Company's common stock, at the option of the holders, at a conversion
price of $6.27 per share.  The conversion price  is also subject to the antidilution adjustments.

During October 2001 the Company paid the debenture holders, including all of the unpaid interest,  by the issuance of
common capital stock.  Note 5.

**REDDI  BRAKE  SUPPLY  CORPORATION**

**NOTES TO FINANCIAL STATEMENTS (Continued)
4.  PREFERRED STOCK**

On March 25, 1996 and April 23, 1996, the Company authorized the issuance of 400,000 shares of Class A preferred stock
at $10 issue price and 550,000 shares of Class B preferred stock at $10 issue price.  Subsequent to the authorization of the
preferred stock, the Company completed private placements of the 950,000 shares of preferred stock.

The Company received approximately $8.3 million in net proceeds from the placements of the preferred shares. The
offerings and sale of the securities in the placement were not registered under the Securities Act of 1933, in reliance upon
the exemption from registration provided by Regulation S.

The holders of class A and class B preferred stock are  entitled to a cumulative annual dividend  at the rate of four percent
of the initial issue price of $10.00 per share, to accrue quarterly. The dividends can be paid in cash or in common stock of
the Company at the option of the Company, at the conversion rates outlined below.

The holders of class A and class B preferred stock will be entitled to convert these shares into fully paid and non-assessable
shares of the Company's common stock.   The agreement provided for the automatic conversion of any preferred shares not
converted on December 31, 1997. During 1996 and 1997 all of  the  preferred A and part of  the preferred B shares were
converted into the Company's common stock  leaving a balance of 60,000 preferred B shares outstanding.

On September 29, 2000, by mutual agreement, the  remaining  60,000 shares of the preferred B stock was converted to
common shares at a conversion rate of  262,917 shares of common stock for one share of preferred stock which included
the accumulated and unpaid dividends.

On June 14, 2000 the Company  issued 2,000,000 class C preferred shares, to related parties, as reimbursement for
expenses paid for the Company.   The terms of the class C preferred shares carry voting rights of  50 votes for each share
and after 90 days from the issuance, conversion rights of one share of preferred C for one share of common, at the option of
the stockholder. On the date of this report the conversion rights had not been exercised.

**5.  COMMON CAPITAL STOCK**

During October 2001 the Company issued 9,615,220 shares as payment and settlement of the outstanding subordinated
convertible debt outlined in note 3.

**6.  SIGNIFICANT TRANSACTIONS WITH RELATED PARTIES**

Officers-directors and their controlled entities  have acquired  2,000,000 shares  of the Company's outstanding class C
preferred stock with voting rights shown in note 4 and have made  no interest, demand loans to the Company of $26,235.

**REDDI  BRAKE  SUPPLY  CORPORATION**

**NOTES TO FINANCIAL STATEMENTS (Continued)
7.  GOING CONCERN**

The Company  does not have the necessary working capital to  service its debt and for its  planned activity.

Continuation of the Company  as a going concern is dependent upon obtaining additional working capital and the
management of the Company has developed a strategy, which it believes will accomplish this objective through settlement
of its debt and additional equity funding and long term debt which will enable the Company to conduct operations for the
coming year.

**8.  CONTINGENT LIABILITIES - CONTINUING LEGAL ACTIONS**

**McCormick, et al., v. Reddi Brake Supply Corporation., et al.**

On November 6, 1997, a class action lawsuit was filed in the Los Angeles Superior Court on behalf of all persons or
entities who bought common stock of the defendant prior to March 23, 1996, and/or who bought or sold any shares
thereafter until August 13, 1996, excluding defendants, their families, employees, agents or assigns.  The complaint asserts
causes of action for breach of fiduciary duty by officers and directors and conspiracy to manipulate the price of the
common stock of the defendant.  The Reddi Brake Defendants have denied the claims.  In May 1999, the parties reached a
tentative settlement agreement, which was presented to the Court in June 1999 and in September 1999, preliminary
approval by the Superior Court as fair, reasonable and adequate to members of the settlement class.  In December 2000,
representatives of the named class members announced their intention to renegotiate certain provisions of the settlement. In
January 2001, defendants served notice of their withdrawal from the settlement. In June 2001, the Superior Court rejected
the proposed settlement, found the plaintiffs' counsel inadequate, decertified the settlement class, and ordered the class
action allegations stricken from the complaint.  On August 6, 2002, the California Court of Appeal rejected the plaintiffs'
former counsel's appeal of the Superior Court's June 2001 order.  The action currently is pending in the Superior Court and
the named plaintiffs' have stated their intention to amend the complaint to re-assert class action allegations.

The parties have been negotiating a settlement agreement which remains unresolved  at the report date.

**Sheerin, et al., v Reddi Brake Supply Corporation, Birin and McGorrian et al.**

On March 3, 1998, Allen J. Sheerin filed a lawsuit in the Los Angeles County Superior Court against the Company and
specifically against two former officer's and director's of the Company.  Mr. Sheerin alleges that these officers and directors
misrepresented the financial status of the Company during the time that he was negotiating  to buy shares in the Company
which resulted in a loss to him of $2,100,000.

The parties have been negotiating a settlement agreement which remains unresolved  at the report date.****