ANNUAL REPORT FOR SMALL BUSINESS ISSUERS SUBJECT
                     TO THE 1934 ACT REPORTING REQUIREMENTS

                    U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                  FORM 10-QSB

(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

    For the quarterly period ended September 30, 2001

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

    For the transition period from _______ to _______.

                          Commission File No. 001-15407


                                  XXIS, CORP.
             (Exact name of registrant as specified in its charter)

    DELAWARE                                      22-3622272
(State or other jurisdiction of               (I.R.S. Employer
 incorporation or organization)                 Identification No.)

        601 JEFFERSON DAVIS HIGHWAY, SUITE 201, FREDERICKSBURG, VA 22401
                    (Address of principal executive offices)

                                 (540) 361-7870
              (Registrant's telephone number, including area code)
                          ---------------------------
              (Former name, former address and former fiscal year,
                         if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

(X)Yes    ( )No

APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable date:
As of March 23, 2001, the Company had 7,221,691 shares of Common Stock issued
and outstanding.






                          INDEX TO FINANCIAL STATEMENTS



Part 1 - Financial Information

                                                                           Page

Item 1 - Financial Statements

Balance Sheets as of September 30, 2001 (unaudited)
and December 31, 2000                                                        F-2

Statements of Operations for the nine and three months
ended September 30,2001 and 2000, and Cumulative from
January 13, 1998 (date of inception) through
September 30, 2001 (unaudited)                                            F-3-F4

Statement of Stockholders Equity (Deficit) for the nine
months ended September 30, 2001 (unaudited)                                  F-5

Statements of Cash Flows for the nine months ended
September 30, 2001 and 2000, and Cumulative from January 13, 1998
(date of inception)through September 30, 2001 (unaudited)                    F-6

Notes to Financial Statements                                         F-8 - F-15



REPORT OF INDEPENDENT ACCOUNTANTS


To  the   Shareholders  and  Directors  of  XXIS  Corp.   (formally   Streamedia
Communications,   Inc.).(a  development  stage  company)

I  have  reviewed  the  accompanying  balance  sheet  of  XXIS  Corp.  (formally
Streamedia  Communications,  Inc.) (a development stage company) as of September
30, 2001, and the related statements of operations,  stockholders  equity and of
cash  flows  for the nine  months  ended  September  30,  2000 and  2001.  These
financial statements are the responsibility of the Company's management.

I have  conducted my review in  accordance  with  standards  established  by the
American  Institute  of  Certified  Public  Accountants.  A  review  of  interim
financial  information consists principally of applying analytical procedures to
financial  data and making  inquiries of persons  responsible  for financial and
accounting matters. It is substantially less in scope than an audit conducted in
accordance with auditing standards  generally accepted in the United States, the
objective  of which is the  expression  of an opinion  regarding  the  financial
statements taken as a whole. Accordingly, I do not express such an opinion.

Based on my review, I am not aware of any material  modifications that should be
made to the accompanying  consolidated  interim financial statements referred to
above  for  them  to  be  in  conformity  with  generally  accepted   accounting
principles.

The  accompanying  financial  statements  have been prepared  assuming that will
continue as a going concern.  As more fully described in Note B, the Company has
incurred  operating  losses since the date of inception and requires  additional
capital to continue  operations.  These conditions raise substantial doubt about
the Company's ability to continue as a going concern.  Management's  plans as to
these matters are  described in Note B. The financial  statements do not include
any  adjustments  to reflect  the  possible  effects on the  recoverability  and
classification of assets or the amounts and  classifications of liabilities that
may  result  from the  possible  inability  of XXIS Corp.  (formally  Streamedia
Communications,  Inc.) (a  development  stage  company)  to  continue as a going
concern.

S/Thomas Monahan CPA
-------------------------------------
Thomas Monahan Certified Public Accountant
Paterson, New Jersey
January  30, 2002





                                       F-4
                                   XXIS CORP.
                   (Formally Streamedia Communications, Inc.)
                          (A Development Stage Company)

                                 BALANCE SHEETS

                                                  Unaudited
                                                 September 30,      December 31,
                                    ASSETS         2001                   2000

CURRENT ASSETS
Cash and cash equivalents                          $42,283              $104,142
Restricted cash                                          0                88,891
Accounts receivable, net of allowance
for doubtful accounts of $67,500 and $114,000
at Sept. 30, 2001 and December 31,2000,
respectively                                       667,924                57,179
Licenses, net of accumulated amortization of
$451,940 and $376,000 at September 30, 2001 and
December 31, 2000, respectively                          0                72,422
Inventory                                        1,328,271                     0
Prepaid Expenses                                     2,801               138,477

Total current assets                             2,041,279               461,111

PROPERTY AND EQUIPMENT, net                      3,023,013             1,760,309


OTHER                                            6,262,487                     0
ASSETS


                       TOTAL ASSETS            $ 11,326,779          $ 2,221,420




         LIABILITIES AND STOCKHOLDERS EQUITY

CURRENT LIABILITIES
Accounts payable and accrued expenses             $2,334,424            $805,919
Current maturities of capital lease obligations       31,449              59,320
Subordinated convertible promissory note                   0             250,208
Other Accrued Expenses                                     0             134,212

            Total current liabilities              2,365,873           1,249,659


CAPITALIZED LEASE OBLIGATIONS, less current
maturities                                            54,006               8,931
LONG-TERM LIABILITIES                              1,173,281                   0

STOCKHOLDERS EQUITY
Preferred stock, $.001 par value; authorized - 100,000
shares; 0 issued and outstanding at Sept. 30, 2001 and
December 31 2000, respectively
Common stock, $.001 par value; authorized - 50,000,000
shares;issued and outstanding  266,667 and 5,880,044
shares at Sept. 30, 2001 and December 31, 2000,
respectively                                              267              5,880
Additional paid-in capital                         21,364,220         12,538,898
Deficit accumulated during development stage      (13,630,868)      (11,581,948)

         Total stockholders equity                  7,733,619            962,830

 TOTAL LIABILITIES AND STOCKHOLDERS EQUITY       $  11,326,779       $ 2,221,420



The accompanying notes are an integral part of these statements.



                                       F-9
                                    XXIS CORP
                   (Formally Streamedia Communications, Inc.)
                          (A Development Stage Company)

                            STATEMENTS OF OPERATIONS
                                   (unaudited)



                                                                     Cumulative
                                                                 from January 13
                                                                   1998 (date of
                             Nine months ended September 30        inception) to
                               2001                 2000           Sept. 30,2001

Revenue                      $164,977            $ 501,289              $872,332
Cost of goods sold
Direct cost                    65,990                    0               348,933

Gross margin                   98,987               501,289              523,399

Operating expenses
General and administrative   1,030,033            3,090,212            5,509,137
Payroll and related expenses   399,429            2,877,896            5,540,052
Product development                  0               23,024              614,848
Depreciation and amortization  715,344                    0            1,952,869

Total operating expenses      2,144,806            5,991,132          13,616,906

       Operating loss        (2,045,819)          (5,489,843)       (13,093,507)

Other income (expense)
    Interest expense             (3,335)             (10,599)          (671,149)
    Interest income                 235              130,533             133,78

Total other income (expense)     (3,100)             119,934           (537,361)

Net loss                      $(2,048,919)       $(5,369,909)      $(13,630,868)



Basic and diluted loss
per common share               $ (  .34)              $(1.12)           $( 2.85)

Weighted average shares
outstanding, basic and diluted   6,045,774           4,791,616         4,786,184








The accompanying notes are an integral part of these statements.



                                    XXIS CORP
                   (Formally Streamedia Communications, Inc.)
                          (A Development Stage Company)


                            STATEMENTS OF OPERATIONS
                                   (unaudited)



                                                Three months ended September, 30
                                                      2001                  2000

Revenue                                              $    0           $  370,459

Cost of goods sold
Direct cost                                               0                    0

Gross margin                                                             370,459

Operating expenses
General and administrative                             75,000            983,230
Payroll and related expenses                                0          1,016,782
Product development                                         0                  0
Depreciation and amortization                         209,991                  0

       Total operating expenses                       284,991          2,000,012

       Operating loss                                (284,991)       (1,629,553)

Other income (expense)
    Interest expense                                                     (1,579)
    Interest income                                                       14,396

       Total other income (expense)                                       12,817

       Net loss                                  $ (284,991)        $(1,616,736)


Basic and diluted loss per common share          $  (  .04)               $(.32)

Weighted average shares outstanding,
basic and diluted                                  6,505,044           4,976,155




The accompanying notes are an integral part of these statements.


                                   XXIS CORP.
                   (Formally Streamedia Communications, Inc.)
                          (A Development Stage Company)

                   STATEMENT OF STOCKHOLDERS EQUITY (DEFICIT)
                                   (unaudited)



                                                            Deficit
                                                          accumulated
                                              Additional    during
         Preferred stock    Common stock      paid-in     development
         Shares Amount      Shares  Amount    capital      stage           Total

Balance at
January 1,
 2001             $      $5,880,044  $5,880  $12,538,898 $(11,581,949)  $962,829


Issuance of
common stock
for services               913,687     914      350,029                  350,943
(Jan. 9, 2001)

Issuance of common
stock pursuant to
the exercise of stock
options (Jan. 9, 2001)      625,000    625       249,375                 250,000


Issuance of common
stock for business
Acquisition
(Jan. 9, 2001)              540,000    540       365,568                 366,108

Stock Purchase
Business
Combination               72,000,000  72,000    7,955,471              8,027,471
(Sept. 30, 2001)
Reverse stock split
(Oct. 26, 2001) 300      -79,692,064  -79,692                            -79,692
to 1

Net loss for the
period      ____    ____        _       ____      ____   (2,048,919) (2,048,919)

Balance at
September
30, 2001    ____    $____  $266,667   $267 $21,459,341 $(13,630,868)  $7,828,740





The accompanying notes are an integral part of this statement.


                                   XXIS CORP.
                   (Formally Streamedia Communications, Inc.)
                          (A Development Stage Company)

                            STATEMENTS OF CASH FLOWS
                                    Unaudited
                                                                     Cumulative
                                                                 from January 13
                                                                   1998 (date of
                                 Nine months ended Sept.30         inception) to
                                 2001                2000      September 30,2001

Cash flows from operating
activities
Net loss                        $(2,048,919)      $(5,369,909)     $(13,630,868)
Adjustments to reconcile net
loss to net cash used in
operating activities
Common stock issued for
services                                              53,173             382,473
Stock option granted for
services                                              17,226             873,547
Compensatory stock option expense                     146,686            413,381

Amortization of debt discount                                            272,500
Amortization and write-off of
deferred financing costs                                                 231,500
Depreciation and amortization       715,344           687,568          1,952,869
Changes in operating assets and
liabilities
Prepaid expenses and other
current assets                    (1,642,027)         (353,178)      (1,905,756)
Other assets                      (6,291,637)          (23,793)      (6,284,637)
Accounts payable and accrued
expenses                           1,510,234          (890,586)        1,983,389
Write-off property-equip
 .-theft loss                        493,561                              493,561
                                    _______
Net cash used in operating
activities                        (7,263,444)        (5,732,813)    (15,218,041)
Cash flows from investing
activities
Purchase of property and
equipment                         (1,472,695)        (1,339,937)     (3,940,280)
Net cash used in investing
activities                       (1,472,695)         (1,339,937)      3,940,280)
Cash flows from financing
activities
Issuance of common stock, net
of associated costs                7,707,229            299,200        8,678,192
Issuance of common stock in
Offering, net of associated
Costs/Private Placement, net
of assoc. cost                                                         9,045,497
Proceeds from the exercise of
stock options                        350,943              75,000         758,743
Acquisition of eLeaders, Inc.
in exchange of stock                 366,108                             366,108
Proceeds of notes payable and
common stock warrants, net
of associated costs                                                    1,583,500
Repayments of notes payable                                          (1,815,000)
Deferred offering costs                                                   75,000
Conversion of loans into capital     250,000                             552,189
Principal payments on capital
lease obligations                                       (15,930)        (43,625)

Net cash provided by financing
   activities                        8,674,280          1,289,790     19,200,604

Net (decrease) increase in cash      (61,859)          (5,782,960)        42,283

Cash and cash equivalents at
beginning of period                   104,142           6,693,061
Cash and cash equivalents at end
of period                             $42,283           $910,101         $42,283





The accompanying notes are an integral part of these statements.






                                      F-30
                                   XXIS CORP.
                   (Formally Streamedia Communications, Inc.)
                          (A Development Stage Company)

                          NOTES TO FINANCIAL STATEMENTS

                               September 30, 2001
                                   (unaudited)



NOTE A - BASIS OF PRESENTATION


The accompanying unaudited financial statements have been prepared in accordance
with  generally   accepted   principles  for  interim   financial   information.
Accordingly,  they do not include all of the information and footnotes  required
by generally accepted accounting  principles for complete financial  statements.
In the opinion of management,  all necessary  adjustments  (consisting of normal
recurring  accruals)  considered  necessary  for a fair  presentation  have been
included.  Operating results of XXIS CORP., formally (Streamedia Communications,
Inc.) (the  Company) for the nine months ended September 30, 2000 and 2001 are
not  necessarily  indicative  of the results that may be expected for the fiscal
year ending  December 31, 2001.  (Date of name change to XXIS Corp.  was October
26, 2001.)

The  balance  sheet as of  September  30,  2001 and the  related  statements  of
operations  for the  nine-month  periods ended  September 30, 2001 and 2000, and
cumulative  from January 13, 1998 (date of  inception)  to  September  30, 2001,
stockholders equity for the nine-month period ended September 30, 2001 and cash
flows  for the  nine-month  periods  ended  September  30,  2001 and  2000,  and
cumulative from January 13, 1998 (date of inception) to September 30, 2001, have
been prepared by the Company  without audit.  In the opinion of management,  all
adjustments (which include only normal, recurring accrual adjustments) necessary
to present  fairly the  financial  position as of September 30, 2001 and for all
periods presented have been made.

Certain  information and footnote  disclosures,  normally  included in financial
statements prepared in accordance with accounting  principles generally accepted
in the United States of America have been condensed or omitted.  These financial
statements should be read in conjunction with the financial statements and notes
thereto included in the Annual Report on Form 10-KSB for the year ended December
31, 2000.  Results of operations for the period ended September 30, 2001 are not
necessarily indicative of the operating results expected for the full year.

NOTE B - NATURE OF OPERATIONS

XXIS CORP.,  (the Company) was  incorporated in the State of Delaware in 1998.
The Companys two divisions are The Streamedia  Networks and Business  Services.
In  December  1999,  the Company  completed  its initial  public  offering  (the
Offering). The net proceeds from the Offering were approximately $8,447,000.


                                   XXIS CORP.
                   (Formally Streamedia Communications, Inc.)
                          (A Development Stage Company)

                    NOTES TO FINANCIAL STATEMENTS (continued)

                               September 30, 2001
                                   (unaudited)



NOTE B (continued)

The Company is in the development stage. The Company provides website owners and
content publishers with services and tools for streaming, or broadcasting,  live
and  on-demand  video and audio  content  over the  Internet.  The Company  also
operates a broadcast content website, Bijou Cafe.com.

The  Streamedia   Business  Services  division  markets  Internet  and  intranet
broadcasting  services  to a wide  spectrum  of  enterprises,  such as,  but not
limited to, businesses, associations, electronic publishers and off-line media
generators, which are attempting to obtain an Internet broadcast presence.

The Company offers consulting services to businesses, corporations, and agencies
that wish to broadcast or otherwise  transmit  high-quality video and audio over
the Internet.  It also offers broader  digital  solutions.  Streamedia  provides
end-to-end solutions which integrate into the clients existing  infrastructure.
Streamedia  Digital  Solutions  is a suite of business  solutions  that  utilize
digital  technologies  to improve  communications  between its clients and their
customers, employees and others.

The  Companys  operations  are  subject  to  certain  risks  and  uncertainties,
including  actual and potential  competition by entities with greater  financial
resources, experience and market presence, risks associated with the development
of the Internet market, risks associated with consolidation in the industry, the
need to manage growth and expansion, certain technology and regulatory risks and
dependence upon sole and limited suppliers.

The accompanying  financial  statements have been prepared on the basis that the
Company will continue as a going concern which assumes the realization of assets
and settlement of liabilities in the normal course of business. Since inception,
the Company  has devoted  substantially  all of its  efforts to  developing  its
business.  The Company has therefore  incurred  substantial  losses and negative
cash flows from operating activities as reflected in these financial statements.
Accordingly,  the Company has relied primarily upon obtaining equity capital and
debt financing to support its operations. The Company does not expect revenue to
exceed  costs and  expenses  in 2001 and,  accordingly,  will  continue to incur
losses and negative cash flows from operating  activities.  To address financing
needs,  the  Company  is  pursuing  various  financing  and  other  alternatives
including  a Plan and  Agreement  of  Merger  with HOA  Networks  Corp.  and HOA
Acquisition  Corp.  described in Note C. These  circumstances  raise substantial
doubt  about  the  Companys  ability  to  continue  as  a  going  concern.  The
accompanying  financial  statements  do not include any  adjustments  that might
result from the outcome of this uncertainty.



                                   XXIS CORP.
                   (Formally Streamedia Communications, Inc.)
                          (A Development Stage Company)

                    NOTES TO FINANCIAL STATEMENTS (continued)

                               September 30, 2001
                                   (unaudited)

NOTE C - ACQUISITIONS

In January  2001,  the Company  completed  the  acquisition  of  eLeaders,  Inc.
(eLeaders) through a stock-for-stock, tax-free reorganization. Under the terms
of the  acquisition,  the  Company  exchanged  520,000  shares of the  Companys
unregistered common stock for all of eLeaders common stock. eLeaders provided a
warranty  that  liabilities  to be assumed would not exceed  $81,000.  eLeaders,
which  was  incorporated  in 1998,  designs  business-to-business  solutions  to
improve supply lines and internal  communications,  and aggregates  customers by
affinity interests or geographic location to amplify marketing results.

STOCK PURCHASE  BUSINESS  COMBINATION:  In April 2001, the Company signed a Plan
and Agreement of Merger (Merger  Agreement)  with HOA Networks Corp.  (HOAN)
and  HOA  Acquisition  Corp.  (HAC).  Pursuant  to the  terms  of  the  Merger
Agreement,  HOAN will merge with HAC, with HOAN being the surviving  company and
all of the capital  stock of HOAN will be canceled in exchange  for stock of the
Company.  HOAN will be the surviving corporation in such merger and the business
of the  surviving  company  will be  conducted  under  the  name  of  Streamedia
Communications,  Inc. Upon the effective  date of the merger,  each  outstanding
share of stock  beneficially owned by all shareholders  excluding  principals of
HOAN will be converted  into the common stock of the Company on a 9-for-1  share
basis. Each outstanding share of common stock  beneficially  owned by principals
will be converted  wherein 100% of HOAN shares will be exchanged  for 90% shares
of the Company. In September, the Company completed the merger and the following
table presents the allocation of the acquisition cost to the assets acquired and
liabilities assumed.
     Cash and cash equivalents                                       $    42,283
     Accounts receivable                                                 667,924
     Inventories                                                       1,328,271
     Other current assets                                                615,511
     Property, plant and equipment                                     2,020,236
     Other noncurrent assets                                           5,678,927
       Total assets                                                   10,353,152
     Amounts payable to banks and long-term
        debt due within one year and
        other current liabilities                                      1,460,131
     Long-term liabilities and debt                                    1,173,281
       Total liabilities                                               2,633,412
     Total acquisition cost                                          $ 7,719,740



                                   XXIS CORP.
                   (Formally Streamedia Communications, Inc.)
                          (A Development Stage Company)

                    NOTES TO FINANCIAL STATEMENTS (continued)


                               September 30, 2001
                                   (unaudited)


NOTE C  ACQUISITIONS  (continued) The allocation of the purchase price is based
on  preliminary  data and could  change  when  final  valuation  information  is
obtained. The following (unaudited) pro forma consolidated results of operations
have been prepared as if the acquisition of HOA Networks,  Corp. had occurred at
Januuary 1, 2000.




                                 September 30, 2001            December 31, 2000
Sales                               $4,368,938                    $13,001,525
Net loss                            $(1,907,982)                  $(7,106,065)
Net loss per share-basic            $(  .29)                      $(  1.21)

The pro forma  information is presented for  informational  purposes only and is
not necessarily indicative of the results of operations that actually would have
been achieved had the  acquisitions  been consummated as of that time, nor is it
intended to be a projection of future results.


NOTE D - LOSS PER SHARE

Basic and diluted  net loss per share is  computed  by dividing  net loss by the
weighted-average  number of common shares  outstanding  during each period.  The
incremental  shares from assumed exercises of stock options and warrants are not
included in the  calculation  of diluted loss per share since their effect would
be  anti-dilutive.  As  of  September  30,  2001  and  December  31,  2000,  the
calculation of diluted net loss per share excludes an aggregate 2,559,021 shares
of common stock issuable upon exercise of warrants and stock options.









                                   XXIS CORP.
                   (Formally Streamedia Communications, Inc.)
                          (A Development Stage Company)

                    NOTES TO FINANCIAL STATEMENTS (continued)

                               September 30, 2001
                                   (unaudited)


NOTE E - DEBT

Subordinated Convertible Promissory Note

On December 28, 2000, the Company issued a Subordinated  Convertible  Promissory
Note (the Note) for an aggregate principal amount of $250,000 bearing interest
at 10% per annum.  The outstanding  principal plus accrued  interest was due and
payable  forty-five  days  from  the date of the Note  (the  Original  Maturity
Date),  which  was  subject  to  extension.  The  note may be  extended  ninety
additional days by either party upon written notice no less than five days prior
to the Original Maturity Date.

On the  Original  Maturity  Date,  or any time  thereafter  if the Note had been
extended,  the lender could convert the unpaid principal plus accrued and unpaid
interest into the number of whole shares of  unregistered,  unrestricted  common
stock of the Company equal to the Voluntary  Conversion  Amount divided by $0.40
(the Conversion Price).

Upon maturity of the Note, either the Original Maturity Date or as extended, the
unpaid principal plus accrued interest (the Mandatory Conversion Amount) shall
automatically convert into the number of shares of conversion stock equal to the
Mandatory  Conversion  Amount divided by the Conversion Price ($0.40).  The Note
converted into 625,000 shares of common stock on February 12, 2001, which shares
were issued on March 21, 2001.

The party that arranged for this financing received a fee of $25,000,  which was
charged to operations during the year ended December 31, 2000.

Notes Payable

On March 2, 2001 and February  21, 2001,  the Company  issued  promissory  notes
aggregating approximately $50,000 and $97,879, respectively, bearing interest at
the rate of 10% per annum  from the date of the  promissory  note or before  the
sooner  of (i)  ninety  days  after  the  date  of the  promissory  note or (ii)
forty-five  days after written  demand is made by the holder of the note.  These
promissory  notes  are   collateralized  by  913,600  shares  of  the  Companys
unregistered, restricted common stock.





                                   XXIS CORP.
                   (Formally Streamedia Communications, Inc.)
                          (A Development Stage Company)

                    NOTES TO FINANCIAL STATEMENTS (continued)

                               September 30, 2001
                                   (unaudited)



NOTE F - STOCKHOLDERS EQUITY



On  January 9, 2001,  certain  officers  of the  Company  agreed to provide  the
proceeds from permissible  sales of their Company common stock to the Company as
bridge   financing.   As   consideration,   the  Company  issued  one  share  of
unregistered,  restricted  common  stock for each  share of stock  sold by these
officers.  In addition,  the Company issued  450,000  warrants to these officers
which  have an  exercise  price  equal to the last sale  price for the  Companys
common stock on January 9, 2001. Both the restricted stock and warrant shares to
be issued upon exercise of the warrants have  piggyback  registration  rights in
accordance with the Companys  customary  registration  rights agreement.  Total
proceeds to the Company in connection with this transaction  were  approximately
$400,000.

On May 14, 2001 the Company signed a letter of intent with River Logic,  Inc. of
Massachusetts.  The  intent is to form a joint  company to market  their  unique
educational  system.  River  Logic is owned in part by  Ebsco,  a multi  billion
dollar leading  educational  company and Intel. Their system is a building block
for schools and home schooling educational content and retrieval.

On June 5, 2001 an agreement was signed with Applied Digital  Technologies.  The
agreement calls for an influx of funding to Streamedia,  through Applied Digital
Technology.  The  agreement  states that  Applied  Digital  will  receive  fifty
thousand  dollars and Streamedia will receive two hundred  thousand dollars from
the  investor  Kenneth R.  McGurn.  This  agreement  also gives  Streamedia  the
marketing rights of a new technology  concerned with live insertion  advertising
on the internet.

On June 19, 2001  discussions  began with a UK public  company,  ABM,  Ltd.  The
proposed  venture  would enable  Streamedia  to control the large catalog of ABM
entertainment  product in the USA while allowing ABM to represent the Streamedia
entertainment  product in Europe. This will also allow Streamedia to utilize the
label names of ABM; namely Pickwick, Hallmark and Boadwalk.




                                   XXIS CORP.
                   (formally Streamedia Communications, Inc.)
                          (A Development Stage Company)

                    NOTES TO FINANCIAL STATEMENTS (continued)

                               September 30, 2001
                                   (unaudited)



NOTE G  INCOME TAXES

The  Company  provides  for the tax  effects  of  transactions  reported  in the
financial statements. The provision if any, consists of taxes currently due plus
deferred taxes related primarily to differences  between the basis of assets and
liabilities for financial and income tax reporting.  The deferred tax assets and
liabilities,  if any,  represent  the future tax  return  consequences  of those
differences,  which will  either be taxable  or  deductible  when the assets and
liabilities  are recovered or settled.  As of December 31, 2000, the Company had
no material current tax liability, deferred tax assets, or liabilities to impact
on the Companys  financial  position  because the deferred tax asset related to
the  Companys  net  operating  loss  carry  forward  and was fully  offset by a
valuation allowance.

At December  31, 2000,  the Company has net  operating  loss carry  forwards for
income tax purposes of $11,581,948.  These carry forward losses are available to
offset future taxable income, if any, and expire in the year 2010. The Companys
utilization  of this carry  forward  against  future  taxable  income may become
subject to an annual  limitation due to a cumulative  change in ownership of the
Company of more than 50 percent.

The  components  of the net  deferred  tax asset as of December  31, 2000 are as
follows:
        Deferred tax asset:
        Net operating loss carry forward $11,581,948
        Valuation allowance ($11,581,948)
        Net deferred tax asset $-0-

The Company  recognized  no income tax benefit  for the loss  generated  for the
period from  inception,  January 13, 1998,  to December  31, 2000.  SFAS No. 109
requires  that a valuation  allowance  be provided if it is more likely than not
that some  portion or all of a  deferred  tax asset  will not be  realized.  The
Companys  ability to realize  benefit of its  deferred tax asset will depend on
the  generation  of  future  taxable  income.  Because  the  Company  has yet to
recognize  significant  revenue  from  the  sale of its  products,  the  Company
believes that a full valuation allowance should be provided.










                                   XXIS CORP.
                   (Formally Streamedia Communications, Inc.)
                          (A Development Stage Company)

                          NOTES TO FINANCIAL STATEMENTS

                               September 30, 2001
                                   (unaudited)



NOTE H - COMMITMENTS AND CONTINGENCIES

     Legal Proceedings

The  Company  is subject to  various  claims and  proceedings  that occur in the
ordinary  course of business.  Based on  information  currently  available,  the
Company  believes  that  none of these  current  claims or  proceedings,  either
individually or in the aggregate, will have a material effect on the business.

On March  20,  2001,  the  Company  received  notice  from the  Nasdaq  Listings
Qualifications  Panel  that its  common  stock  would no longer be listed on the
Nasdaq SmallCap  Market  effective with the close of business on March 28, 2001.
The panels  action was based on the  Companys  inability to maintain a minimum
bid price of $1.00 over the previous  thirty  consecutive  trading days and also
due in part for late filing of 10Qs.

The Company has terminated all outstanding  agreements with management  prior to
June 15, 2001.




                                   XXIS CORP.
                   (Formally Streamedia Communications, Inc.)
                          (A Development Stage Company)

                          NOTES TO FINANCIAL STATEMENTS

                               September 30, 2001
                                   (unaudited)



NOTE H (continued)

During the second quarter of 2001, there have been several theft problems at the
New York office.  After  conducting  a thorough  observation  of assets,  it was
determined  equipment and software in the cost basis of $610,101 was missing and
the police  were  informed on July 27,  2001.  The net  write-off  in the second
quarter amounted to $493,561.

NOTE I - SUBSEQUENT EVENTS

World Skyline,  Inc. and XXIS,  Corp. have joined 3N, Inc. in filing  litigation
agianst the former  director Eric J. Adams in order to recover  information  and
protect the rights of World Skyline,  Inc. and XXIS, Corp. 3N, Inc. is a company
which has engaged  World  Skyline,  Inc.  and  Zentech,  Inc. ( a World  Skyline
Company)  to manage its  internet  business.  This suit is in its  investigative
stage.

The Company is presently  investigating all activity that Mr. Adams was involved
in on behalf of the Company or agianst the Company.

ITEM 2.

MANAGEMENT'S  DISCUSSION  AND  ANALYSIS OF  FINANCIAL  CONDITION  AND RESULTS OF
OPERATIONS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2000 AND 2001.

The following  discussion  relates to the results of our operations to date, and
our financial condition:

This prospectus  contains forward looking  statements  relating to our Company's
future  economic  performance,  plans and  objectives of  management  for future
operations,  projections of revenue mix and other financial items that are based
on the  beliefs of, as well as  assumptions  made by and  information  currently
known to, our management. The words "expects,  intends,  believes,  anticipates,
may, could,  should" and similar expressions and variations thereof are intended
to identify forward-looking  statements.  The cautionary statements set forth in
this section are intended to emphasize that actual results may differ materially
from those contained in any forward looking statement.

Securing financing to begin the operating phase

We completed  our Initial  Public  Offering on December 27, 1999.  Prior to this
date we completed only limited  build-out and  development of our  technological
infrastructure  and  recruited  only  a  select  few  technical  and  managerial
employees.  Subsequent  to the  completion of the offering we began an extensive
effort to develop an infrastructure for video and audio streaming and to recruit
and hire technical personnel to design,  implement,  and maintain these systems.
The initial phase of this  build-out was  substantially  completed in the second
quarter of 2000.

Building of streaming infrastructure

The  streaming  infrastructure  consists of various local and wide area networks
capable of streaming and storing large amounts of audio and video files. We have
implemented  networked   environments  for  development,   staging,  and  actual
broadcast to the public over the  Internet.  The system  combines  sophisticated
network  architecture  to develop and deliver our content as well as a system to
store files to be streamed.
Developing and refining our business model

We devoted  time to  refining  our  business  model prior to  commencing  actual
operations.  Our business model has been built around  multiple lines of product
and services with multiple  revenue  sources.  We originally  contemplated  four
business  lines,  which  have  since  been  consolidated  into two main  revenue
divisions  built around the types of clients that each  division  services.  The
first division, the Streamedia Networks division, consists of the Bijou Cafe and
targets the Internet user; the second, our Business Services division,  is aimed
at corporate clients.

Planning and developing our Business Services

Our  business  services  are  designed  to  provide  technology  and  consulting
expertise and services to traditional  media companies,  traditional  businesses
with media assets,  and online businesses and web sites. Our Streamedia  Digital
Solutions  includes  encoding  services,   digital  security,   video  indexing,
broadcasting  production,   web  design  and  back-end  technical  services.  In
developing our business  services area, we have acquired and installed  hardware
and  software  that allows us to perform  these  services  for other  companies.
During the quarter  ended June 30,  2000,  we launched  the  Streamedia  Digital
Solutions,  and began producing revenues.  The Quarter ending September 30, 2000
was the first full  quarter of  operations.  The  Streamedia  Digital  Solutions
provides consulting and design services relating to the construction of websites
or Internet applications on the World Wide Web.

NATURE OF OPERATIONS

We  have  two  primary  lines  of  business:   Internet   Services,   and  media
distribution.  The latter is executed via  BijouCafe.com,  the  equivalent  of a
movie  theater  accessible  via the  World  Wide Web,  but which  also acts as a
distributor of films offline, such as to theaters, and to video retailers.

BijouCafe

BijouCafe.com is a digital entertainment destination site, among the web's first
and most  acclaimed  venues for  independent  and classic  films.  Bijou Cafe is
produced as an online version of an art-house cinema.

BijouCafe is a developing site for up-coming  directors,  producers,  actors and
small independent films via internet video streaming. The target audience is the
general public who are interested in merging talents in the film industry.

Revenue is based on  subscription  dues,  at this time the Company does not have
any income.

The Company is  presently  in a dispute  with David  Coleman the former owner of
BijouCafe.  The Company feels that the dispute will be resolved  within the near
future.

Business Services

XXIS  Business  Services  division  was aided by the business  combination  with
eLeaders,  Inc., an acquisition  made during the quarter.  This division markets
Internet and intranet  broadcasting  services to a wide spectrum of enterprises,
such as, but not limited to, businesses, associations, electronic publishers and
"off-line" media generators,  who are attempting to obtain an Internet broadcast
presence.   We  offer  Information   Technology  (IT)  consulting   services  to
businesses,  corporations,  and  agencies  that wish to  broadcast  or otherwise
transmit  high-quality  video and audio over the Internet.  Streamedia  provides
complete   IT   solutions,   which   integrate   with  the   client's   existing
infrastructure.  Streamedia  Digital Solutions are a suite of business solutions
that utilize digital technologies to improve  communications between its clients
and their customers,  employees,  and others.  The business  Services units also
market  web  design  services,  web site  hosting,  email  services,  e-commerce
solutions, dialup and broadband connectivity to the general public as well as to
other businesses.

Our operations are subject to certain risks and uncertainties,  including actual
and  potential   competition  by  entities  with  greater  financial  resources,
experience and market  presence,  risks  associated  with the development of the
Internet markets,  risks associated with consolidation in the industry, the need
to manage growth and  expansions,  certain  technology and regulatory  risks and
dependence upon sole and limited suppliers.

The  accompanying  financial  statements have been prepared on the basis that we
will continue as a going  concern,  which assumes tthe  realization of assets an
settlement of liabilities in the normal course of business. Since its inception,
we have been engaged in organizational and pre-operating activities. Further, we
have generated nominal revenues and incurred significant losses.

Continuation of our existence is dependent upon its ability to obtain additional
capital,   secure  and  execute  strategic  alliances  to  develop  and  sustain
profitable  operations.  The  uncertainty  related  to these  conditions  raises
substantial  doubt  about  our  ability  to  continue  as a going  concern.  The
accompanying  financial  statements  do not include any  adjustments  that might
result from the outcome of this uncertainty.

  BUSINESS COMBINATIONS

Acquisition of eLeaders, Inc.

In January, Streamedia acquired eLeaders, Inc. (WWW.ELEADERS.COM), headquartered
in Mineola, NY. Eleaders,  provides hosting, Internet access (DSL services), and
web site design as part of the core consulting  services and solutions  clients'
online  business.   eLeaders,   Inc.  was  founded  in  1998.  eLeaders  designs
business-to-business   solutions   to   improve   supply   lines  and   internal
communications,  and  aggregates  customers by affinity  interests or geographic
location to amplify marketing results. Its high-speed  connectivity services and
web design  capabilities  provide an important addition to Streamedia's  product
and service offerings.

The merger was a  stock-for-stock  exchange.  As such, both companies intend the
transaction  be  accounted  for  as  a  tax-free  organization  and  pooling  of
interests.  Streamedia  acquired  all of  eLeaders'  assets,  including  its web
hosting and streaming contracts and equipment,  DSL contracts and equipment, and
its Internet and information  technology  consulting business. As consideration,
Streamedia gave eLeaders  520,000 shares of Streamedia  common stock in exchange
for all issued and  outstanding  stock of eLeaders  subject to  adjustments.  An
adjustment  was made  regarding  the amount of shares  that Mr.  Mittasch  would
receive  from  520,000 to 380,000.  This  agreement  was the product of an arms'
length negotiation with Mr. Richard Mittasch,  the sole stockholder of eLeaders.
There was no material relationship between Streamedia and either eLeaders or Mr.
Mittasch prior to the acquisition.


Letter of Intent with River Logic, Inc.

On May 14,  2001,  we  signed a Letter of  Intent  with  River  Logic,  Inc.  of
Massachusetts.  The  intent is to form a joint  company to market  their  unique
educational  system.  River  Logic is owned in part by  Ebsco,  a multi  billion
dollar leading  educational  company and Intel. Their system is a building block
for schools and home schooling educational content and retrieval.


Agreement with Applied Digital Technologies

On June 5, 2001, an Agreement was signed with Applied Digital Technologies.  The
Agreement calls for an influx of funding to Streamedia,  through Applied Digital
Technology.  The  Agreement  states that  Applied  Digital  will  receive  Fifty
Thousand  ($50,000)  Dollars and  Streamedia  will  receive  Two  Hundred  Fifty
Thousand($250,000) Dollars from a private investor. This Agreement also gives us
the  marketing  rights  of  a  new  technology  concerned  with  live  insertion
advertising on the internet.

Merger with HOA Networks Corp.

On April 11, 2001, we signed a Plan and Agreement of Merger ("Merger Agreement")
with HOA Networks and HOA Acquisition Corp. ("HAC").  The contemplated merger is
between HOA Networks,  HOA Acquisition Corp. ("HAC"), and our Company.  Pursuant
to the terms of the Merger  Agreement,  HOAN will merge with HAC with HOAN being
the  surviving  company and all of the capital stock of HOAN will be canceled in
exchange for stock of the Company.  HOAN will be the  surviving  corporation  in
such merger and the business of the  surviving  company will be conducted  under
the name of  Streamedia  Communications,  Inc.  Upon the  effective  date of the
merger,  each outstanding share of stock  beneficially owned by all shareholders
excluding  principals  of HOAN will be  converted  into the common  stock of the
Company  on a 9 for 1 share  basis.  Each  outstanding  share  of  common  stock
beneficially  owned by  principals  will be converted  as follows:  100% of HOAN
shares will be exchanged for 90% shares of our Company.  It is anticipated  that
the effective date of the merger will be on or about May 21, 2001. As of January
22, 2002 the merger has been completed.

Streamedia  Communications,  Inc. held its Board of Director meeting on Thursday
June 14, 2001. At the meeting,  Mr. Henry Siegel resigned as Interim  President,
his resignation was accepted by the Board of Directors.  Mr. John  Velasco-Mills
was elected Interim-President of Streamedia Communications, Inc. for the purpose
of planning and completing the merger of the two companies.  Mr. James Rupp also
tendered his resignation as consultant.



HOA  Networks  Corp (HOAN) is  multi-faceted  communications  and  entertainment
Company.  HOAN has several subsidiaries.  Its primary division,  AMC Global. HOA
Networks is comprised of a group of wholly owned private  companies that benefit
from various  revenue  sources and,  working  together,  has become a "one-stop"
entertainment,  data and communications  solution for most end users, from small
to large businesses and individuals.

HOAN consists of six main subsidiaries:

AMC GLOBAL COMMUNICATIONS,  INC., (AMC) is an independent telephone company with
headquarters in Atlanta, Georgia, U.S.A., the operations were founded in July of
1986.  AMC,  which  sells and  services  a wide  variety  of  telecommunications
equipment.

AMC  Global   Communications  has  taken  steps  to  dramatically  increase  its
involvement in video conferencing.  Since the marketplace has begun to express a
great  interest in video  conferencing,  in lieu of  traveling by air, AMC is in
negotiation  with a manufacturer  for private label product that will retail for
$6,995.00.

This  market is  expected  to exceed $2 billion in the next three  years.  As an
addition to a company's  telecommunications  system, it will enable face-to-face
conferences  and  meetings  at an  enormous  reduction  in cost,  as  opposed to
traveling  by air.  AMC will be able to  provide  video  conferencing  at a huge
reduction in cost with excellent motion and clarity.

The September 11th attack on the World Trade Center has heightened  dramatically
the  business  community's  awareness  of the dangers of air  travel,  given the
current  wartime-terrorist  climate.  This  environment  has moved the  business
community  with its huge  commitment to air travel,  to examine the use of video
conferencing  as a much more economical  solution for out-of-town  meetings that
might only last 1/2 hour to an hour.  As a result,  it has been  predicted  that
both the business and the education  community  will take steps to  dramatically
increase its use of this technology.

The post World Trade Center disaster has dramatically  impacted  business during
the following  months.  Since improvement is being seen now, more improvement is
expected as we move into  December and January of 2002. As a result of the World
Trade Center  disaster AMC Global expects  business to be spotty through the end
of 2001 and the first quarter of 2002.

WORLD SKYLINE,  INC. is a Northern  Virginia  (Washington D.C. Metro Area) based
Internet Technology Company founded in 1996, with additional offices in Atlanta,
Georgia.  World Skyline was founded to offer Internet  Solutions and information
technology  needs for both Business and  Residential  markets.  The company is a
full service,  one-stop,  Internet  Service Provider that can fulfill all of its
clients  Information  Technology (IT.) needs.  World Skyline offers a vast array
ofproducts ranging from Dial-Up access to Digital  Subscriber Lines,  E-Commerce
and Web Hosting solutions and Streaming Media services. World Skyline's one-stop
approach means support for a wide variety of products and services.

GLORI RECORDS, INC.


RESULTS OF OPERATIONS
REVENUES.

Revenues  decreased  by $336,312 or 67% to  $164,977  for the nine months  ended
September 30, 2001, as compared to $501,289 for the  comparable  period of 2000.
Revenues for the  nine-month  periods ended  September 30, 2001,  were primarily
generated from our performance of Internet  professional  services,  launched in
May 2000.

OPERATING EXPENSES.

Total  operating  expenses  decreased by $3,846,326 or 64% to $2,144,806 for the
nine  months  ended  September  30,  2001,  as compared  to  $5,991,132  for the
comparable period of 2000. The decreases in operating expenses for the three and
nine month periods ended  September 30, 2001,  were due to salaries,  consultant
fees and other general and administrative expenses.

LIQUIDITY AND CAPITAL RESOURCES

The  company's  cash  position  decreased  $61859  from a balance of $104,142 at
December 31, 2000 to $42,283 at September 30, 2001.  Working capital at December
31,  2000  and  September  30,  2001  was  negative  at  $788,548  and  $468,614
respectively.  The  company  continued  to be  funded  in part  through  the net
proceeds of the exercise of options aggregating $350,943.

We incurred net losses every  quarter since our  inception.  For the nine months
ended  September 30, 2001, we incurred a net loss of  $2,048,919,  a decrease of
62% as compared to a net loss of $5,369,909 for the nine months ended  September
30, 2000.  We have  financed our  operations  primarily  through sales of equity
securities and the private placement of debt instruments.  On September 6, 2000,
Streamedia  Communications,  Inc.  sold 940,000  Shares of Common Stock with net
aggregate  proceeds to us of  $931,520  pursuant  to a private  placement  under
Regulation D, Rule 506 of the Securities Act of 1933, as amended.

From January 13, 1998 (the date of our inception) to September 30, 2000, we have
raised a total of  approximately  $14 million  from the sale of common stock and
the placement of debt (before  underwriting  discounts and offering  costs).  We
completed  our  initial  public  offering  on  December  27,  1999,  and  repaid
$1,878,125 in debt and interest.  On September 30, 2000, our principal source of
liquidity is $910,101 of cash and cash equivalents.

During this fiscal year,  we intend to focus our efforts on the expansion of our
professional  services since we believe that it represents  our best  short-term
path to profitability. Bijou Cafe or the Content portion of the business will be
built  out more  gradually,  as our  resources  will be  expended  on the  areas
representing the potential for greatest return.

To accomplish these objectives, we may need to:

o Make  substantial  investments  in  capital  equipment,  such as web  servers,
storage devices,  and other specialized  computer and communications  equipment,
and

o Hire or  otherwise  contract  with highly  specialized  personnel  to develop,
configure,   administer,   and  operate  Web  sites,   broadcast  equipment  and
infrastructure for our company and our corporate clients.

We plan to acquire  additional  content that will be broadcast on the World Wide
Web.

Current industry  conditions render it difficult to secure "exclusive" rights to
numerous classes of content suitable for broadcasting over the Internet.  To the
extent to which we cannot  capture  exclusive  broadcast  rights,  we will be in
competition  with other web sites  attempting  to attract  audiences by offering
some of the same programming.

We anticipate that any rise in our industry stature, such as by selling business
to business  services,  and supplying third party sites with  programming,  will
assist us to further  market  business to business  professional  services,  and
thereby proportionately  increase our revenue. We expect expenditures to rise in
proportion  to each  phase  of our  build  out.  While we  anticipate  increased
revenues  concurrent  with the build out,  delays in product  development or the
institution of marketing  programs could result in the risk of prolonged absence
of revenues, profits, or working capital.

Nevertheless, we believe that to accomplish our business objectives we will have
to continue to expand our operations.  However,  our limited  operating  history
makes  predictions of our future results of operations  difficult to access.  To
date,  although we are  beginning  to generate  revenues,  we may never  achieve
profitable operations.  Our history of net losses raises doubt about our ability
to continue operations.

We will need to obtain sufficient  additional financing or other working capital
to fund our  operations.  If we do not obtain  additional  financing  or working
capital,  our cash  and cash  equivalents  will  not be  sufficient  to meet our
working capital and capital expenditure requirements going forward. We will need
to sell additional equity or debt securities to continue as a going concern.

FACTORS THAT MAY AFFECT OUR  BUSINESS,  FUTURE  OPERATING  RESULTS AND FINANCIAL
CONDITION

You should carefully consider the risks described below together with all of the
other information  included in this quarterly report on Form 10-Q. The risks and
uncertainties  described below are not the only ones facing our company.  If any
of the following risks actually  occurs,  our business,  financial  condition or
operating results could be harmed. In such case, the trading price of our common
stock could decline, and you could lose all or part of your investment.

THE STREAMING MEDIA HAS A LIMITED OPERATING HISTORY

We were  incorporated  in 1998 and have a  limited  operating  history.  We have
limited  financial  results  on which you can assess  our  future  success.  Our
prospects  must be considered in light of the risks,  expenses and  difficulties
frequently encountered by growing companies in new and rapidly evolving markets,
such  as  streaming  media  software,  media  delivery  systems  and  electronic
commerce. To address the risks and uncertainties faced by our business, we must:
Establish and maintain broad market  acceptance of our products and services and
convert that acceptance into direct and indirect  sources of revenues;  Maintain
and  enhance our brand name;  Continue  to timely and  successfully  develop new
products,  product  features and services  and  increase the  functionality  and
features of existing products;  Develop and maintain strategic  relationships to
enhance the distribution, features and utility of our products and services. Our
business  strategy may be unsuccessful and we may be unable to address the risks
we face in a cost-effective  manner, if at all. If we are unable to successfully
address these risks our business will be harmed.

WE HAVE A HISTORY OF LOSSES

We have incurred  significant losses since our inception.  We devote significant
resources  to  developing,  enhancing,  selling and  marketing  our products and
services.  As a result,  we will need to  generate  significant  revenues  to be
profitable in the future.

OUR OPERATING RESULTS ARE LIKELY TO FLUCTUATE SIGNIFICANTLY,  WHICH WOULD LIKELY
CAUSE OUR STOCK PRICE TO FLUCTUATE

As a result of our  limited  operating  history  and the  rapidly  changing  and
uncertain  nature of the markets in which we compete,  our  quarterly and annual
revenues and operating  results are likely to fluctuate  from  period-to-period,
and  period-to-period  comparisons  are  not  likely  to  be  meaningful.  These
fluctuations  are  caused by a number of  factors,  many of which are beyond our
control.  Our future  operating  results  could fall below the  expectations  of
public market analysts or investors, which would likely significantly reduce the
market price of our common stock.  Fluctuations  in our  operating  results will
likely increase the volatility of our stock price.  Our research and development
and sales and marketing efforts, and other business expenditures generally,  are
partially based on predictions regarding certain developments for media delivery
and  digital  media  distribution.  To the extent that these  predictions  prove
inaccurate, our revenues may not be sufficient to offset these expenditures, and
our operating  results may be harmed. In recent periods,  many  Internet-related
companies have experienced financial difficulties,  in part as a result of their
inability  to access  capital  from  financial  markets.  This has  directly  or
indirectly  impacted our current and prospective  customers.  The result is that
some  of  these  companies  have  ceased  operations,  some  are  continuing  to
experience financial difficulty,  and sales cycles for some of our customers and
potential  customers  have taken longer to close than in the past.  In the event
that a  substantial  number of our  current or  potential  customers  experience
financial  difficulties in the future, our ability to increase or maintain sales
to such  customers  will be  adversely  affected  and our  ability  to  generate
revenues from these companies will also be adversely impacted.

WE MAY BE UNABLE TO SUCCESSFULLY COMPETE IN PARTS OF OUR BUSINESS MEDIA HOSTING.

Our media  hosting  service  competes  with a variety of companies  that provide
streaming media hosting and broadcast  services.  These companies include Yahoo!
Broadcast Services (formerly Broadcast.com), Akamai and other emerging broadcast
networks.  Some of these  competitors offer other services that we do not offer.
We may not establish or sustain our competitive position in this market segment.

OUR INDUSTRY IS EXPERIENCING  CONSOLIDATION  THAT MAY INTENSIFY  COMPETITION.

The  Internet  and  media  distribution  industries  have  recently  experienced
substantial  consolidation  and a proliferation  of strategic  transactions.  We
expect this consolidation and strategic partnering to continue.  Acquisitions or
strategic  relationships  could  harm  us in a  number  of  ways.  For  example:
Competitors could acquire or enter into  relationships with companies with which
we have strategic  relationships and discontinue our relationship,  resulting in
the loss of distribution opportunities for our products and services or the loss
of certain enhancements or value-added features to our products and services;

Suppliers  of  important  or  emerging  technologies  could  be  acquired  by  a
competitor or other companies, which could prevent us from being able to utilize
such technologies in our offerings,  and disadvantage our offerings  relative to
those of competitors;

A  competitor  could be  acquired  by a party  with  significant  resources  and
experience that could increase the ability of the competitor to compete with our
products and services;  and Other companies with related interests could combine
to form new,  formidable  competition,  which could  preclude us from  obtaining
access to certain  markets or content,  or which could  dramatically  change the
market for our products and services.


WE DEPEND ON KEY PERSONNEL WHO MAY NOT CONTINUE TO WORK FOR US

Our success  substantially  depends on the continued employment of our executive
officers  and key  employees.  The  loss  of the  services  of any of our  other
executive  officers or key employees  could harm our  business.  If any of these
individuals  were to leave us, we could face  substantial  difficulty  in hiring
qualified  successors and could experience a loss in productivity while any such
successor obtains the necessary  training and experience.  None of our executive
officers has a contract  that  guarantees  employment.  We do not maintain  "key
person"  life  insurance  policies.  If we  do  not  succeed  in  retaining  and
motivating existing personnel, our business could be harmed.

OUR FAILURE TO ATTRACT,  TRAIN OR RETAIN HIGHLY  QUALIFIED  PERSONNEL COULD HARM
OUR BUSINESS
Our success also depends on our ability to attract,  train and retain  qualified
personnel in all areas, especially those with management and product development
skills. In particular,  we must hire additional experienced management personnel
to help us  continue  to grow and  manage our  business,  and  skilled  software
engineers.  At times, we have experienced  difficulties in hiring personnel with
the proper training or experience, particularly in technical areas. If we do not
succeed in  attracting  new personnel or retaining  and  motivating  our current
personnel,  our  business  could be  harmed.  In  making  employment  decisions,
particularly in the Internet and high-technology  industries, job candidates and
even our current  personnel  often  consider the value of stock options they may
receive in connection with their employment. As a result of recent volatility in
our stock price, we may be  disadvantaged  in competing with companies that have
not  experienced  similar  volatility  or that  have  not yet sold  their  stock
publicly.

POTENTIAL  ACQUISITIONS  INVOLVE RISKS WE MAY NOT ADEQUATELY  ADDRESS

As part of our business strategy,  we have acquired  technologies and businesses
in the past,  and intend to  continue  to do so in the  future.  The  failure to
adequately  address  the  financial,  legal  and  operational  risks  raised  by
acquisitions of technology and businesses  could harm our business.  Acquisition
or business combination  transactions are accompanied by a number of significant
risks.  Financial risks related to acquisitions may harm our financial position,
reported  operating  results or stock price, and include:  Potentially  dilutive
issuances  of  equity  securities;  Use of cash  resources;  The  incurrence  of
additional debt and contingent liabilities; Large write-offs and difficulties in
assessment of the relative  percentages of in-process  research and  development
expense that can be immediately written off as compared to the amount which must
be amortized over the appropriate life of the asset;  and Amortization  expenses
related to goodwill and other intangible assets.

Acquisitions  also  involve  operational  risks  that  could  harm our  existing
operations or prevent  realization of anticipated  benefits from an acquisition.
These  operational  risks include:  Difficulties in assimilating the operations,
products, technology, information systems and personnel of the acquired company;
Diversion  of  management's  attention  from  other  business  concerns  and the
potential  disruption of our ongoing  business;  The difficulty of incorporating
acquired  technology  or content and rights into our  products  and services and
unanticipated expenses related to such integrations; Impairment of relationships
with  our  employees,   affiliates,   advertisers  and  content  providers;  The
assumption of known and unknown  liabilities of the acquired  company;  Entrance
into  markets  in  which we have no  direct  prior  experience;  and Loss of key
employees of the acquired company.

THE GROWTH OF OUR  BUSINESS  DEPENDS ON THE  INCREASED  USE OF THE  INTERNET FOR
COMMUNICATIONS, ELECTRONIC COMMERCE AND ADVERTISING

The growth of our business  depends on the continued growth of the Internet as a
medium for  communications,  electronic  commerce and advertising.  Our business
will be harmed if Internet  usage does not continue to grow,  particularly  as a
source of media  information and  entertainment and as a vehicle for commerce in
goods and services.  Our success also depends on the efforts of third parties to
develop the infrastructure and complementary  products and services necessary to
maintain and expand the Internet as a viable commercial  medium. We believe that
other Internet-related  issues, such as security,  privacy,  reliability,  cost,
speed,  ease of use and access,  quality of service and  necessary  increases in
bandwidth availability,  remain largely unresolved and may affect the amount and
type of business that is conducted over the Internet,  and impact our ability to
sell our products and services and ultimately  impact our business  results.  If
Internet usage grows, the Internet infrastructure may not be able to support the
demands  placed on it by such  growth,  specifically  the demands of  delivering
high-quality  media content.  As a result,  its  performance and reliability may
decline

OUR DIRECTORS AND EXECUTIVE OFFICERS  BENEFICIALLY OWN A LARGE PERCENTAGE OF OUR
STOCK;  THEIR  INTERESTS COULD CONFLICT WITH YOURS;  SIGNIFICANT  SALES OF STOCK
HELD BY THEM COULD HAVE A NEGATIVE EFFECT ON OUR STOCK PRICE; SHAREHOLDERS MAYBE
UNABLE TO EXERCISE CONTROL

Our executive  officers,  directors and affiliated persons will have significant
influence to:

Elect or defeat the election of our directors; Amend or prevent amendment of our
articles of incorporation or bylaws;  Effect or prevent a merger, sale of assets
or other  corporate  transaction;  and Control  the outcome of any other  matter
submitted to the shareholders for vote.

Management's  stock ownership may discourage a potential  acquirer from making a
tender offer or otherwise  attempting to obtain conntrol of Streamedia,  which I
turn could reduce our stock price or prevent our  shareholders  from realizing a
premium over our stock price.

OUR STOCK PRICE HAS BEEN AND MAY  CONTINUE TO BE VOLATILE  The trading  price of
our common stock has been and is likely to continue to be highly  volatile.  Our
stock price could be subject to wide  fluctuations  in response to factors  such
as:
Actual or anticipated  variations in quarterly operating results;  Announcements
of technological innovations, new products or services by our competitors; or us
Changes in financial  estimates or recommendations by securities  analysts;  The
addition  or loss of  strategic  relationships  or  relationships  with  our key
customers; Conditions or trends in the Internet, streaming media, media delivery
and online commerce markets; Changes in the market valuations of other Internet,
online service or software companies;  Announcements by us or our competitors of
significant  acquisitions,  strategic  partnerships,  joint  ventures or capital
commitments;   Legal,  regulatory  or  political   developments;   Additions  or
departures of key personnel; Sales of our common stock; and You should note that
an investment in our common stock involves certain risks and uncertainties  that
could  affect  our future  business  success or  financial  results.  Our actual
results could differ materially from those anticipated in these  forward-looking
statements as a result of certain factors, including those set forth in "Factors
That May Affect Our Business,  Future Operating Results and Financial Condition"
and elsewhere in this Quarterly Report on Form 10-Q.

We  believe  that  it is  important  to  communicate  our  expectations  to  our
investors.  However,  there may be events in the future  that we are not able to
predict  accurately  or over which we have no control.  Before you invest in our
common stock, you should be aware that the occurrence of the events described in
the  "Factors  That May  Affect  Our  Business,  Future  Operating  Results  and
Financial  Condition" and elsewhere in this Quarterly  Report on Form 10-Q could
materially and adversely affect our business,  financial condition and operating
results.  We  undertake no  obligation  to publicly  update any  forward-looking
statements for any reason,  even if new information  becomes  available or other
events occur in the future.

OTHER INFORMATION


LEGAL PROCEEDINGS

From  time to time,  we have been  threatened  with or named as a  defendant  in
lawsuits.  From  time to time  we  receive  communications  from  third  parties
asserting breach of agreements and other claims.  Our Company currently has been
named in two such events that are required to be disclosed  under the securities
laws. There can be no assurance that litigation will not be commenced  regarding
these or other matters. The two legal events are as follows:

Dynax  Solutions,  Inc.,  has filed suit against our Company,  alleging  that we
breached a service contract and owe Dynax  approximmately  $56,000. We have file
an answer;  generally  denying the  allegations  made by Dynax,  and has filed a
counterclaim,  alleging damages against Dynax in excess of $150,000. Our Company
believes that the suit, as alleged in the complaint that Dynax filed, is without
merit and our Company intends to defend the action vigorously.

Vignette Corporation  ("Vignette") has filed suit against our Company,  alleging
that we entered into an agreement for Vignette to provide  certain  products and
services to the Company.  Vignette alleges that we refused to pay  approximately
$114,000 that Vignette claims is owed to it. Our Company,  without admitting any
liability regarding the claim by Vignette, currently is attempting to settle the
matter.

On March 20, 2001, we received  notice from the NASDAQ  Listings  Qualifications
Panel that its  common  stock  would no longer be listed on the NASDAQ  SmallCap
Market  effective  with the close of  business  on March 28,  2001.  The panel's
action was based on our  inability to maintain a minimum bid price of $1.00 over
the previous 30 consecutive trading days.

On May 4, 2001,  we announced  that we had been notified  that,  besides its bid
price  deficiency,  we currently do not  currently  comply with the net tangible
assets/market   capitalization/income   requirement   as  set  forth  in  NASDAQ
Marketplace Rule  4310(c)(2)(B).  We had a hearing before the NASDAQ listing and
qualification  staff on May 10,  2001.  Our  Company  was not  delisted  at that
hearing.  The Listing  Qualification  Panel will  continue to review our listing
qualifications.  On June 8, 2001, we were delisted from The NASDAQ Stock Market,
due in part to late filings of the 10Q's.

Mark F. Backhaus,  On behalf of himself and all others similarly  situated,  has
filed  against our  Company  and prior  directors,  James  Rupp,  Gayle  Essary,
Nicholas  Malino,  Walter C.  Hollenberg,  Henry Siegel,  Robert Wussler,  David
Simonetti,  et al. in the United States District Court, Southern District of New
York, and additional  defendants  alleging  various  violations under securities
laws while the initial public  offering was filed December 22, 1999. The Company
is defending this complaint.

The Company has not received  service of this  complaint  to date,  but has been
advised by counsel that the Plaintiff may have served the Secretary of State and
prior attorneys.

The Company is presently in direct contact with the plaintiff's  attorney and is
negotiating in order to resolve any issues the Company may have.

The Company is presently  negotiating,  defending  and/or  settling 10 different
legal  disputes  of which none  individually  or  collectively  are  material in
nature.

We are not involved in any other legal matters that our Company  believes would,
if adversely  determined,  have a material  adverse  effect upon its business or
results of operations.  There can be no assurance  whether these matters will be
determined  in a manner  that is  favorable  to our  Company  or,  if  adversely
determined, whether such determination would have a material adverse effect upon
our business, financial condition or results of operations.

CHANGES  IN  SECURITIES  AND  USE  OF  PROCEEDS  RECENT  SALES  OF  UNREGISTERED
SECURITIES

NOTES PAYABLE

On March 2, 2001 and February 21, 2001, we issued  promissory notes  aggregating
approximately $50,000 and $97,879, respectively, bearing interest at the rate of
10% per annum from the date of the  promissory  note or before the sooner of (i)
ninety days after the date of the promissory  note or (ii) forty-five days after
written  demand is made by the holder of the note.  These  promissory  notes are
collateralized  by  913,600  shares of our  Company's  unregistered,  restricted
common stock. The proceeds were used for working capital purposes.

OTHER INFORMATION


EXHIBITS AND REPORTS ON FORM 8-K

On January 9, 2001, we filed an 8-K reflecting that we acquired  eLeaders,  Inc.
(www.eleaders.com)  ("eLeaders"),  of Minneola,  NY. eLeaders  provides hosting,
Internet access (DSL services), and web site design services.

The filing also noted that Streamedia  signed a letter of intent to merge eSynch
Corp. ("eSynch"). eSynch offers media infrastructure delivery tools and services
for the streaming video marketplace. According to terms of the letter of intent,
eSynch would have become a wholly owned subsidiary of Streamedia.  The intent to
this transaction was subsequently mutually rescinded.

A Form 8-K filed on March 14,  2001 noted  that,  based on the  analysis  of the
available financial information concerning eLeaders, Inc. (eLeaders),  the Board
of Directors  determined that the acquisition of eLeaders does not constitute an
acquisition  of a  significant  amount of  assets.  Upon  further  review of the
acquisition,  we did not at that time decide whether to treat the transaction as
a pooling or a purchase.

On March 9, 2001, Streamedia Communications, Inc., held a special meeting of the
board of directors.  At that meeting,  by a majority  vote,  the board agreed to
remove  Gayle  Essary from his  position  as a director  and Vice  President  of
Streamedia Communications, Inc.



SIGNATURES

In accordance with the  requirements of the Exchange Act, the registrant  caused
this  report  to  be  signed  on  its  behalf  by  undersigned,  thereunto  duly
authorized.

                                      XXIS, CORP.
  Date: January 31, 2002              By: /s/ Walter H.C. Drakeford

                                    Walter H.C. Drakeford, Interim President