UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                   FORM 10-KSB

       [X] ANNUAL REPORT UNDER OR OF THE SECURITIES EXCHANGE ACT OF 1934

                  For the fiscal year ended December 31, 2004
                                            -----------------

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
    EXCHANGE ACT OF 1934

    For the transition period from _______________________ to _____________


                        Commission file number 000-17746
                                    ---------
                      Safe Technologies International, Inc.
                      -------------------------------------
                 (Name of small business issuer in its charter)

         Delaware                                        22-2824492
         --------                                        ----------
(State or other jurisdiction                            (IRS Employer
of incorporation or organization)                     Identification No.)

   2875 S. Ocean Blvd., Suite 104, Palm Beach, FL          33480
   ----------------------------------------------          -----
     (Address of principal executive offices)            (Zip Code)


Issuer's telephone number, including area code: (561) 832-2700

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

         Title of each class        Name of each exchange on which registered

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

                    Common Stock, par value $.00001 per share
                     ---------------------------------------
                                (Title of class)

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

Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B contained in this form, and no disclosure will be contained, to
the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [X]

The issuer's revenues for its most recent fiscal year were $50,646.

The aggregate market value of the voting and non-voting common equity held by
non-affiliates computed by reference to the average bid and asked price of such
common equity, as of March 25, 2005, was approximately $937,000.


<PAGE>


The number of shares outstanding of the issuer's common stock, as of March 15,
2005, was 927,381,602.

Transitional Small Business Disclosure Format (Check one): Yes [ ]; No [X]

PART I

Item 1. Business

Business Development. We were incorporated in Delaware on August 1, 1987 as Safe
Aid Products Incorporated. On February 9, 1998, we acquired Intelligence Network
International, Inc., pursuant to a reverse merger and changed our name to Safe
Technologies International, Inc. After the merger, our business consisted of a
broad range of internet and technology based services and products, operated
through various subsidiaries.

From 1998 through 2001, we focused on developing and acquiring, as subsidiaries,
companies operating in the e-commerce industry. Acquisitions included Internet
Associates International, Inc. ("IAI"), which remains an active subsidiary, and
three related companies known as Connect.ad, Inc., Connect.ad Services, Inc.,
and Connect.ad of South Florida, Inc., which are no longer active. All
acquisitions were purchased with our stock. As competition intensified in the
e-commerce industry, we turned our efforts toward acquisitions in other
technological and related industries. We entered into several agreements with
foreign consultants in order to increase the number of business candidates that
might result in potential acquisitions.

In March 2002, we merged one of our wholly owned subsidiaries, Internet
Commerce, Inc. ("ICI") with ProCon Systems, ApS, which provided information
technologies services to the global travel industry. As a result of the merger,
we owned eight percent of ProCon. However, ProCon's funding commitment was not
fulfilled, its business foundered, and we have written off our investment in
ProCon.

In May 2002, we merged another of our wholly owned subsidiaries, Connect.Ad of
South Florida, Inc., with Agenesis, Inc., which intended to create a public
trading market for its business. As a result of the merger, we owned eight
percent of Agenesis. Pursuant to the Merger Agreement, Agenesis filed a
Registration Statement to register the issuance of shares in the merger and the
distribution to our shareholders of one half of our eight percent interest.
However, during the last quarter of 2003, Agenesis notified us that they had
decided not to proceed with their plans to become a publicly trading company. As
a result, the other stockholders of Agenesis have returned to us 100% ownership
of Agenesis.

In August 2003, we entered into a Stock Purchase Agreement with a Bruce Ross,
dba Express Air, to acquire a 60% ownership interest in Express Air in return
for common stock. Express Air operated a same-day air delivery service for time
sensitive items in Southern California. However, Express Air was not able to
deliver to us the audited financial statements required under the Stock Purchase
Agreement and, as a result, we did not complete the transaction.

On December 30, 2003, we entered into a Stock Purchase Agreement with Time Bytes
LTD, a British company, for 60% ownership of Time Bytes and its affiliates, Time
Bytes International, Inc., and Sports Profile LTD. Our purchase price was

                                       2

<PAGE>

payable in common stock. Time Bytes offered a unique DVD product containing
specialized content that was researched, selected, and produced onto a DVD. The
transaction closed in January 2004, when we received their audited financial
statements, and we made our initial stock payments to the sellers. However,
additional due diligence brought to light additional facts which we found to be
unacceptable. As a result, we terminated the acquisition, made no further
payments and demanded the return of our initial payment. We have received the
return of only a portion of our initial payment.

Current Business. We are now a holding company with one active and three
inactive wholly-owned subsidiaries. Our active subsidiary is Internet Associates
International, Inc. ("IAI"). IAI is a website development and hosting company.

We are seeking to acquire controlling or minority ownership positions in growing
companies which could benefit from affiliation with us, as a publicly traded
company.

Competition. The market for internet products and services is highly
competitive. There are no substantial barriers to entry in these markets, and
the Company expects that competition will continue to intensify. Internet
commerce competes for customers and advertisers with other content providers,
advertisers and traditional merchants, as well as with thousands of web sites
operated by individuals, the government and educational institutions. As a
result, we are no longer focused on acquiring e-commerce related businesses.

Employees. As of March 15, 2005, we have no employees. Our administrative
functions are fulfilled through contractual services provided by our Secretary
and acting Chief Executive Officer.

Item 2. Description of Property

Our executive offices are located to 2875 S. Ocean Blvd., Suite 104, Palm Beach,
Florida, where we sublease approximately 1,500 square feet of office space. IAI
currently shares our office space. We pay rent of $1,500 per month.

Item 3. Legal Proceedings

The company is not a party to any legal proceedings.

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

No matters were submitted to a vote by security holders during 2004.


                                       3

<PAGE>



                                    PART II

Item 5. Market for Common Equity and Related Stockholder Matters.

Our common stock is traded in the over-the-counter market under the symbol
"SFAD". The following table sets forth the high and low bid, as reported by
Stockwatch, for our common stock for the calendar periods indicated.

                                                        Bid
                           Period                    High/Low
                           ------                    --------
                           2003
                  1st Quarter                        .0025/.002
                  2nd Quarter                        .0023/.002
                  3rd Quarter                        .028/.007
                  4th Quarter                        .145/.01

                           2004
                  1st Quarter                        .011/.005
                  2nd Quarter                        .008/.0031
                  3rd Quarter                        .009/.0042
                  4th Quarter                        .007/.0025

The average of the bid and ask price of our common stock in the over-the-counter
market as of the most recent available date, March 25, 2005 was $.002 per share.
The above quotations do not include retail mark-ups, mark-downs or commissions
and represents prices between dealers and not necessarily actual transactions.
The past performance of our securities is not necessarily indicative of future
performance.

Holders of Record

As of March 15, 2005, there were approximately 15,000 shareholders of record of
our common stock, including beneficial owners holding shares through nominee
name.

Dividend Policy

We have never paid cash dividends on our common stock. Payment of dividends will
be within the sole discretion of our Board of Directors and will depend, among
other factors, upon earnings, capital requirements and the operating and
financial condition of the Company. At the present time, our anticipated
financial capital requirements are such that we intend to retain any earnings in
order to finance the development of our business.

Recent Sales of Unregistered Securities.

In January 2004 we issued 4,000,000 shares of our common stock to the
shareholders of Time Bytes LTD as partial payment for a 60% ownership interest
in Time Bytes, Time Bytes International, Inc. and Sports Profile LTD. Each of
the Time Bytes shareholders was an accredited investor as defined in Securities
and Exchange Commission Regulation D. The issuance of the shares was exempt from
registration under Regulation D and Section 4(2) of the Securities Act of 1933.

In January 2004 we issued 20,000,000 shares of our common stock to Bradford L.
Tolley, one of our executive officers for services rendered to the company. As
an executive officer, Mr. Tolley was an accredited investor as defined in
Securities and Exchange Commission Regulation D. The issuance of the shares was
exempt from registration under Regulation D and Section 4(2) of the Securities
Act of 1933.

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


                                       4

<PAGE>

CAUTION REGARDING FORWARD-LOOKING INFORMATION

Certain statements contained in this annual filing, including, without
limitation, statements containing the words "believes", "anticipates", "expects"
and words of similar import, constitute forward-looking statements. Such
forward-looking statements involve known and unknown risks, uncertainties and
other factors that may cause the actual results, performance or achievements of
the Company, or industry results, to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements.

Such factors include, among others, the following: international, national and
local general economic and market conditions: demographic changes; the ability
of the Company to sustain, manage or forecast its growth; the ability of the
Company to successfully make and integrate acquisitions; raw material costs and
availability; new product development and introduction; existing government
regulations and changes in, or the failure to comply with, government
regulations; adverse publicity; competition; the loss of significant customers
or suppliers; fluctuations and difficulty in forecasting operating results;
changes in business strategy or development plans; business disruptions; the
ability to attract and retain qualified personnel; the ability to protect
technology; and other factors referenced in this and previous filings.

Given these uncertainties, readers of this Form 10-KSB and investors are
cautioned not to place undue reliance on such forward-looking statements. The
Company disclaims any obligation to update any such factors or to publicly
announce the result of any revisions to any of the forward-looking statements
contained herein to reflect future events or developments.

RESULTS OF OPERATIONS FOR THE YEARS ENDED DECEMBER 31, 2004 & 2003

For the years ended December 31, 2004 and 2003, the Company recorded revenues of
$50,646 and $79,118 respectively. The decrease from 2003 to 2004 is due to
declining revenues from IAI, our operating subsidiary, as a result of
competitive pressures. Operational costs increased from $14,851 in 2003 to
$18,068 in 2004, because of increased travel and entertainment expenses during
the first half of 2004, when we increased our efforts to locate acquisition
candidates. As a result of the above factors, our gross profit decreased from
$64,267 in 2003 to $32,578 in 2004.

Our sales and marketing expense increased from $2,348 in 2003, to $12,370 in
2004, because of our increased use of consultants during the first quarter of
2004 in an effort to locate suitable acquisition candidates. Our general and
administrative expenses decreased from $370,658 in 2003 to $314,288 in 2004,
primarily because of a reduction in consulting expenses following a change in
control of the company in July, 2004. In large part because we took substantial
write-downs of intangible assets in 2003, which were not repeated in 2004, our
net loss for 2004 decreased to $392,237 from $578,736 in 2003.

At December 31, 2003, the Company had assets totaling $88,528 and a net loss of
$543,058.

LIQUIDITY/WORKING CAPITAL

At December 31, 2004, the company had total assets of $76,865, and a working
capital deficit of $959,658 compared to $770,876 as of December 31, 2003. The
increase in working capital deficit is the result of the losses we incurred in
2004, which were funded by loans from our major shareholders.

                                       5
<PAGE>

There can be no assurance that our financial condition will improve. We continue
to evaluate our options for raising additional working capital, but in order to
do so we must increase our base of business operations. Meanwhile, we are
dependant upon funding from one of our major shareholders to meet expenses.

NET OPERATING LOSS CARRY-FORWARDS

We have net operating loss carry-forwards of approximately $8,363,000 which
expire $578,000 $445,000, $589,200, $3,016,100 and $920,000 on December 31,
2018, 2017, 2016, 2015 and 2014, respectively. The Company has a $2,800,000
deferred tax asset resulting from the loss carry-forwards, for which it has
established a one hundred percent (100%) valuation allowance. The Company may
not be able to utilize such carry-forwards as the Company has no history of
profitable operations.

GOING CONCERN

We are the subject of a "going concern" audit opinion. Such qualification was
issued because we have incurred continuing losses from operations. As of
December 31, 2004, we had negative working capital of $959,658, which raises
substantial doubt about our ability to continue as a going concern.

In addition, there is no assurance that we will be able to successfully raise
the funds necessary to fund operations through any means available. Further,
there is no assurance that we will be able to successfully grow operations even
if we are successful in acquiring the funds necessary, which may have a material
impact on our financial position and results of operations. The accompanying
financial statements do not include any adjustments relating to the
recoverability and classification of asset carrying amounts or the amount and
classification of liabilities that might result should we be unable to continue
as a going concern.

OFF-BALANCE SHEET ARRANGEMENTS

We do not have any off-balance sheet arrangements.

RECENT ACCOUNTING PRONOUNCEMENTS

In December 1999, the Securities and Exchange Commission issued Staff Accounting
Bulletin (SAB) No. 101, "Revenue Recognition in Financial Statements"
summarizing the SEC's views in applying generally accepted accounting principles
to various revenue recognition issues. Management believes that its revenue
recognition practices are in conformity with SAB No. 101.

In April 2000, the FASB issued FASB Interpretation No. 44 ("FIN No. 44"),
"Accounting for Certain Transactions Involving Stock Compensation: An
Interpretation of APB No. 25." We have adopted the provisions of FIN No. 44, and
such adoption did not impact our results of operations.

In September 2000, the FASB issued SFAS No. 140 "Accounting for Transfers and
Servicing of Financial Asset and Extinguishment of Liabilities", a replacement
of SFAS No. 125. Management does not expect the standard to have any effect on
our financial position or results of operations.

                                       6
<PAGE>

In July 2001, the FASB issued SFAS No. 141 "Business Combinations" and SFAS No.
142 "Goodwill and Other Intangible Assets." We have adopted the provisions of
SFAS No. 141 and 142, and such adoption did not impact our results of
operations.

In July 2001, the SEC issued SAB 102 "Selected Loan Loss Allowance Methodology
and Documentation Issues." We do not expect this SAB to have any effect on our
financial position or results of operations.

In August 2001, the FASB issued SFAS No. 143, "Accounting for Asset Retirement
Obligations." Management does not expect the standard to have any effect on our
financial position or results of operations.

In October 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment of
Long-Lived Assets." We have adopted the provisions of SFAS No. 144 and 142, and
such adoption did not impact our results of operations.

In April 2002, the FASB issued SFAS No. 145, "Rescission of SFAS's 4, 44 and 64,
Amendment of SFAS No. 13 and Technical Corrections." Management does not expect
the standard to have any effect on our financial position or results of
operations.

In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs Associated
with Exit or Disposal Activities." Management does not expect the standard to
have any effect on our financial position or results of operations.

In October 2002, the FASB issued SFAS No. 147, "Acquisition of Certain Financial
Institutions." Management does not expect the standard to have any effect on our
financial position or results of operations.

RISK FACTORS

OUR OPERATING SUBSIDIARY, IAI, IS ENGAGED IN PROVIDING SUPPORT TO THOSE INVOLVED
IN COMMERCE ON THE INTERNET platform. The viability of IAI's customers is
dependent upon their success in e-commerce. Customers unable to compete in
e-commerce may fail, and as a result, we would lose a customer.

WE EXPECT TO CONTINUE TO INCUR NET LOSSES AND NEGATIVE CASH FLOWS FOR THE
FORESEEABLE FUTURE, AND THERE CAN BE NO ASSURANCE THAT WE WILL EVER ACHIEVE
PROFITABILITY OR GENERATE POSITIVE CASH FLOWS. We expect to incur significant
operating expenses as we search for suitable businesses in which to become
involved. If our revenues do not grow as expected, or if our actual expenses
exceed our budgeted expenses, there could be a material adverse effect on our
business, operating results and financial condition. We may need to raise
additional funds through the issuance of equity, equity-related or debt
securities.

OUR BUSINESS STRATEGY OF GROWTH THROUGH BUSINESS COMBINATIONS LEADS TO UNKNOWN
AND UNQUANTIFIABLE RISKS. We are attempting to expand our operations and market
presence by entering into business combinations, investments, joint ventures or
other strategic alliances with third parties. Any such transaction would be
accompanied by risks commonly encountered in such transactions, which could
include, among others, the difficulty of assimilating the operations, technology
and personnel of the combined companies, the potential for disruption of ongoing
business, the inability to retain key technical and managerial personnel, the
inability of management to maximize our financial and strategic position through
the successful integration of acquired businesses, additional expenses

                                       7
<PAGE>

associated with amortization of acquired intangible assets, the maintenance of
uniform standards, control and policies and the impairment of relationships with
existing employees and customers. There can be no assurance that we will be
successful in overcoming these risks or any other problems encountered in
connection with such business combinations, investments, joint ventures or other
strategic alliances.

OUR SUCCESS DEPENDS IN LARGE PART UPON THE EFFORTS OF THE FEW INDIVIDUALS WHO
SERVE ON OUR BOARD AND AS MANAGEMENT, NONE OF WHOM ARE FULL TIME EMPLOYEES.
These individuals may not be able to fulfill their responsibilities adequately
and may not remain with us. The loss of the services of any of our directors and
officers could hurt our business.

OUR SHARES ARE CLASSIFIED AS "PENNY STOCK," WHICH WILL MAKE IT MORE DIFFICULT TO
SELL THAN EXCHANGE-TRADED STOCK. Our common stock is subject to the Securities
and Exchange Commission rule that imposes special sales practice requirements
upon broker-dealers that sell such securities to other than established
customers or accredited investors. For purposes of the rule, the phrase
"accredited investors" means, in general terms, institutions with assets
exceeding $5,000,000 or individuals having a net worth in excess of $1,000,000
or having an annual income that exceeds $200,000 (or that, combined with a
spouse's income, exceeds $300,000). For transactions covered by the rule, the
broker-dealer must make a special suitability determination for the purchaser
and receive the purchaser's written agreement to the transaction prior to the
sale. Consequently, the rule may affect the ability of purchasers of our
securities to buy or sell in any market that may develop.

In addition, the Securities and Exchange Commission has adopted a number of
rules to regulate "penny stocks". A "penny stock" is any equity security that
has a market price of less than $5.00 per share or with an exercise price of
less than $5.00 per share, subject to certain exceptions. Such rules include
Rules 3a51-1, 15g-1, 15g-2, 15g-3, 15g-4, 15g-5, 15g-6 and 15g-7 under the
Securities and Exchange Act of 1934, as amended. The rules may further affect
the ability of owners of our shares to sell their securities in any market that
may develop for them. Shareholders should be aware that, according to the
Securities and Exchange Commission Release No. 34-29093, the market for penny
stocks has suffered in recent years from patterns of fraud and abuse. Such
patterns include:

        o   control of the market for the security by one or a few
            broker-dealers that are often related to the promoter or issuer;

        o   manipulation of prices through prearranged matching of purchases and
            sales and false and misleading press releases;

        o   "boiler room" practices involving high pressure sales tactics and
            unrealistic price projections by inexperienced sales persons;

        o   excessive and undisclosed bid-ask differentials and markups by
            selling broker-dealers; and

        o   the wholesale dumping of the same securities by promoters and
            broker-dealers after prices have been manipulated to a desired
            level, along with the inevitable collapse of those prices with
            consequent investor losses.


                                       8
<PAGE>

CONCENTRATION OF OWNERSHIP MAY REDUCE THE CONTROL BY OTHER SHAREHOLDERS. Our two
largest shareholders own approximately 50% of our voting stock. As a result,
other investors in our common stock may not have much influence on corporate
decision-making.

OUR ISSUANCE OF ADDITIONAL SHARES MAY HAVE THE EFFECT OF DILUTING THE INTEREST
OF SHAREHOLDERS. In connection with any acquisition, we may issue additional
shares. Any additional issuances of common stock by us from our authorized but
unissued shares will have the effect of diluting the percentage interest of
existing shareholders.

WE DO NOT ANTICIPATE PAYING DIVIDENDS TO COMMON STOCKHOLDERS IN THE FORESEEABLE
FUTURE, WHICH MAKES INVESTMENT IN OUR STOCK SPECULATIVE OR RISKY. We have not
paid dividends on our common stock and do not anticipate paying dividends on our
common stock in the foreseeable future. The board of directors has sole
authority to declare dividends payable to our stockholders. The fact that we
have not and do not plan to pay dividends indicates that we must use all of our
funds generated by operations for reinvestment in our operating activities.

IT IS POSSIBLE THAT WE MAY MAKE ONE OR MORE ACQUISITIONS IN THE INTERNATIONAL
MARKET. Any such acquisitions would expose us to political and economic
uncertainties, including, among other things, inflation , governmental
instability, transportation, tariffs, export controls, government regulation,
currency exchange rate fluctuations, foreign exchange restrictions that limit
the repatriation of investments and earnings, changes in taxation, hostilities
or confiscation of property. Changes related to these matters could have a
material adverse effect on the Company.

WE MAY BE SUBJECT TO DELAYS BECAUSE OF INTENTIONAL, CRIMINAL THIRD PARTY
INTERVENTION. Though we have taken several precautions to prevent any
disruptions from terrorist attacks and hackers, we cannot guarantee that our
operations are completely invulnerable. A disruption can occur from numerous
sources, including damage to the company property, damage to one of our vendors,
suppliers or customers, or damages to third parties such that it restricts the
flow of commerce. Disruptions could materially adversely affect our revenues.

Item 7. Financial Statements

Financial statements and supplementary data are set forth on pages F-1 through
F-10.

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

There have been no disagreements with Accountants on Accounting and Financial
Disclosure in 2004.

Item 8A. Controls and Procedures.

The Company maintains disclosure controls and procedures that are designed to
ensure that information required to be disclosed in the Company's Exchange Act
reports is recorded, processed, summarized and reported within the time frames
specified in the SEC's rules and forms, and that such information is accumulated
and communicated to the Company's management, including its Chief Executive
Officer and its Chairman, who is currently serving as the Company's principal


                                       9
<PAGE>

financial officer, to allow timely decisions regarding required disclosure based
closely on the definition of "disclosure controls and procedures in Rule
13a-14(c). In designing and evaluating the disclosure controls and procedures,
management recognized that any controls and procedures, no matter how well
designed and operated, can provide only reasonable assurance of achieving the
desired control, objectives and management necessarily was required to apply its
judgment in evaluating the cost-benefit relationship of possible controls and
procedures.

Within 90 days prior to the date of this report, the Company carried out an
evaluation, under the supervision and within the participation of the Company's
management, including the Company's Chief Executive Officer and Chairman, of the
effectiveness of the design and operation of the Company's disclosure controls
and procedures. Based on the foregoing, the Company's Chief Executive Officer
and Chairman concluded that the Company's disclosure controls and procedures
were effective.

There have been no significant changes in the Company's internal controls or in
other factors that could significantly affect the internal controls subsequent
to the date the Company completed its evaluation.

                                       10
<PAGE>

                                    PART III

Item 9. Directors, Executive Officers and Control Persons

The executive officers and directors of the Company are listed below. Each
director was appointed for a term of one year and until their successor is duly
elected.

Name                       Age              Position Held with Registrant
-------------------        ---              -----------------------------
Valda Reinbergs            53               Director, Secretary
Randi Swatt                45               Director, acting Chief Executive
                                            Officer
Bruce E. Taylor            50               Director
Glenn Wistey                                Director

Valda Reinbergs has served as a Director and Secretary of the Company since
November 12, 2004. Ms. Reinbergs provides accounting services, on an independent
basis, to various small companies.

Randi Swatt has served as a Director and acting Chief Executive Officer of the
Company since August 13, 2004. Ms. Swatt is owner of EC Affiliates LLC, a
consultant to sales and marketing organizations. From March 2002 until November
2003, Ms. Swatt was Chief Operating Officer of The Chabrra Group, which provided
operational and management services for commonly owned companies. From February
2004 through July 2004 Ms. Swatt was a Director of Internet Logistix, GmhB
located in Germany. From May 2003 through February 2004, Ms. Swatt was a
Director of Chhabra International, Ltd., located in Dublin Ireland. Ms. Swatt
was President of Internet Associates International, Inc., a web site development
and hosting company, from its inception in 1998 until her resignation in March
2002. Internet Associates International was acquired by us in February 1999.

Bruce E. Taylor has served as a Director since August 2004. From 1996 to 1999,
when the company was sold, Mr. Taylor was President of Telesys, Inc., a
consultant to telecommunications companies. Since then, Mr. Taylor has been an
independent business consultant, primarily to the telecommunications industry.

Glenn Wistey has been a Director since August 2004. We have lost contact with
Mr. Wistey and, as a result, we are considering recommending shareholder action
to remove him from the Board.

AUDIT COMMITTEE AND CODE OF ETHICS.

We have not formally appointed an audit committee, and the entire Board of
Directors currently serves the function of an audit committee. Because of the
small number of persons involved in management of the Company, we do not have an
audit committee financial expert serving on our Board. We have not yet adopted a
code of ethics applicable to our chief executive officer and chief financial
officer, or persons performing those functions, because of the small number of
persons involved in management of the Company.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Our directors and executive officers, and beneficial owners of more than ten
percent of our stock, are required by Section 16(a) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), to report to the SEC their
transactions in, and beneficial ownership of, our common stock, including any
grants of options to purchase common stock.

In July 2004, Universal Equity Holdings LLC purchased 225,000,000 shares of our
common stock, representing approximately 24.3% of our outstanding stock. We have
made diligent efforts to contact Universal Equity, but to date it has not filed
any reports with the SEC.

None of our directors have yet filed with the SEC the Form 3 required of them as
a director. To our knowledge, none of them have bought or sold any of our stock
since their appointment as directors.

                                       11
<PAGE>

Item 10. Executive Compensation

The following table sets forth all compensation paid or earned for services
rendered to the Company in all capacities during the years ended December 31,
2004, 2003 and 2002, by our president (the "Named Officers"). No other executive
officer received total annual salary, bonus and other compensation in excess of
$100,000 in those periods.

<TABLE>
<CAPTION>
                                                      ------------------------------------------------------
                                                           ANNUAL COMPENSATION
------------------------------------------------------------------------------------------------------------
                                                                                           OTHER
                                                                                           ANNUAL COMPEN-
NAME AND PRINCIPAL POSITION                  YEAR       SALARY ($)        BONUS ($)         SATION ($)
------------------------------------------------------------------------------------------------------------
<S>                     <C>                  <C>                <C>              <C>              <C>
Randi Swatt (acting CEO)(1)                  2004               0                0                0
                                             2003               0                0                0
                                             2002               0                0                0
------------------------------------------------------------------------------------------------------------
Michael Posner (President)(2)                2004               0                0                0
                                             2003               0                0             9,000(4)
                                             2002               0                0            24,000(5)
------------------------------------------------------------------------------------------------------------
Bradford L. Tolley (Acting CEO)(3)           2004               0                0            100,000(6)
                                             2003               0                0            24,000(7)
                                             2002               0                0            30,000(8)
------------------------------------------------------------------------------------------------------------
</TABLE>


(1) Randi Swatt was appointed acting CEO on August 13, 2004

(2) Michael Posner served as President until his resignation on September 1,
2004.

(3) Bradford L. Tolley was acting CEO from August 2002 until his resignation on
August 4, 2004. Mr. Tolley also served as Vice President, Secretary and
Treasurer.

(4) Represents 3,000,000 shares of restricted common stock, valued at $.003 per
share.

(5) Represents 2,400,000 shares of restricted common stock, valued at $.01 per
share.

(6) Represents 20,000,000 shares of restricted common stock, valued at $.0035
per share, and 10,000,000 shares of unrestricted common stock valued at $.003
per share.

(7) Represents 8,000,000 shares of restricted common stock valued at $.003 per
share.

(8) Represents 20,000,000 shares of restricted common stock valued at $.0015 per
share.

Options Granted and Options Exercised During 2004

The Company did not grant any options during the fiscal year ended December 31,
2003. None of the Company's directors or executive officers own any options to
purchase shares of the Company's common stock.

                                       12
<PAGE>

Item 11. Security Ownership of Certain Beneficial Owners and Management

The following table sets forth information with respect to the number of shares
of the Company's Common Stock that are beneficially owned by (i) each executive
officer of the Company, (ii) each director of the Company and (iii) each
shareholder of the Company who owns more than 5% of the Company's Common Stock
as of December 31, 2004. An asterisk indicates beneficial ownership of less than
1% of the Company's outstanding stock. Except as otherwise indicated, each of
the shareholders listed below has voting and investment power over the shares
beneficial owned and the address of each beneficial owner is c/o the Company at
2875 S. Ocean Blvd., Palm Beach, Florida 33480. As of December 31, 2004, there
were issued and outstanding 927,381,602 shares of the Company's common stock.

Name and Address of                 Shares                         Percent
Beneficial Owner                    Beneficially Owned             of Class
------------------------           --------------------           ----------
Ruth Deutsch(1)                        225,870,657                   24.4
2875 S. Ocean Blvd., Ste 104
Palm Beach FL 33480
Shareholder

Franklin Frank (1)                     225,870,657                   24.4
2875 S. Ocean Blvd., Ste 104
Palm Beach FL 33480
Shareholder

Universal Equity Holdings LLC          225,000,000                   24.3
4456 Bliss Road
Sarasota, FL 34233
Shareholder

Valda Reinbergs                          8,264,161(2)                 *
2875 S. Ocean Blvd., Ste 104
Palm Beach FL 33480
Director and Secretary

Randi Swatt                              3,040,370                    *
60 Edgewater Drive
Coral Gables, FL 33133
Director and acting CEO

Bruce E. Taylor                                  0                    *
523 Michigan Ave.
Lakeland, FL 33801
Director

Glenn Wistey                                     0(3)                 *
Address unknown

All Officers and Directors
as a group (4 persons)                  11,304,531                    1.2

----------
(1) Includes 34,000,000 shares held by LVDB, Inc., a corporation controlled by
Franklin Frank, Ms. Deutsch's husband, 34,000,000 shares held by Franklin Frank,
4,000,000 shares by Lenore Hardy, Mr. Frank's daughter, and 2,000,000 shares
owned by Charles Frank, Mr. Frank's son. Ms. Deutsch disclaims any beneficial
interest in the shares held by her husband.

(2) Represents shares held by Ms. Reinbergs' husband.

(3) This information is presented to the best of our knowledge, since we have
not been able to contact Mr. Wistey.

                                       13
<PAGE>

EQUITY COMPENSATION PLAN INFORMATION

In May, 2002, our Board of Directors adopted the Safe Technologies
International, Inc. - Year 2002 Stock Award Plan. This Plan is intended to
provide incentives to, and awards for, certain eligible employees, officers,
directors and consultants who have contributed and will continue to contribute
to the success of the Company. The Plan provides for the granting of up to 30
million stock awards and is administered by the Compensation Committee of the
Board of Directors. The issuance of stock under the Plan was registered with the
Securities and Exchange Commission in a Form S-8 Registration Statement.

The following table sets forth information regarding the stock available for
issuance under our Year 2002 Stock Award Plan as of the year ended December 31,
2004:

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------
                                            (A)                       (B)                           (C)
                                NUMBER OF SECURITIES TO BE     WEIGHTED-AVERAGE
                                  ISSUED UPON EXERCISE OF       EXERCISE PRICE OF         NUMBER OF SECURITIES
                                   OUTSTANDING OPTIONS,       OUTSTANDING OPTIONS,         REMAINING AVAILABLE
        PLAN CATEGORY               WARRANTS AND RIGHTS        WARRANTS AND RIGHTS         FOR FUTURE ISSUANCE
--------------------------------------------------------------------------------------------------------------
<S>                                          <C>                       <C>                       <C>
EQUITY COMPENSATION PLANS
APPROVED BY SECURITY HOLDERS                 0                         N/A                           0
--------------------------------------------------------------------------------------------------------------
EQUITY COMPENSATION PLANS NOT
APPROVED BY SECURITY HOLDERS                 0                         N/A                       6,950,000
--------------------------------------------------------------------------------------------------------------
TOTAL                                        0                         N/A                       6,950,000
--------------------------------------------------------------------------------------------------------------
</TABLE>

Item 12. Certain Relationships and Related Party Transactions

Franklin Frank and/or entities controlled by him have lent us money from time to
time in order to fund our operations. In addition, Mr. Frank and/or affiliates
purchased two notes given by us to former officers for loans to us. The total
amount we now owe to Mr. Frank and/or affiliates is $838,739 as of December 31,
2004.

Item 13. Exhibits and Reports on Form 8-K

(a) Exhibit Index

31.1     Rule 13a-14(a)/15d-14(a) Certification - acting Chief Executive Officer

31.2     Rule 13a-14(a)/15d-14(a) Certification - acting Chief Financial Officer

32       Section 1350 Certifications

(b) Reports on Form 8-K.

                                       14
<PAGE>

The Company filed no Reports on Form 8-K during the quarter ended December 31,
2004.

Item 14. Principal Accountant Fees and Services.

AUDIT FEES.


The aggregate fees billed to the Company for professional services rendered for
the audit of the Company's annual financial statements, review of the Company's
quarterly financial statements, and other services normally provided in
connection with statutory and regulatory filings or engagements was $16,875 in
2003 and $22,500 in 2004.

TAX FEES.

The aggregate fees billed to the Company for professional services rendered for
completion of the Company's tax returns was $750 in 2003 and $850 in 2004.

                                       15
<PAGE>




                                   SIGNATURES

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

SAFE TECHNOLOGIES INTERNATIONAL, INC.

By: /s/ Randi Swatt
-----------------------
Randi Swatt, acting Chief Executive Officer
Date: March 31, 2005

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

By: /s/ Randi Swatt
-----------------------
Randi Swatt, Director, acting Chief Executive Officer and acting Chief Financial
Officer (principal executive officer and principal financial officer) Date:
March 31, 2005

By: /s/Valda Reinbergs
-----------------------
Valda Reinbergs, Director
Date: March 31, 2005

By: /s/ Bruce E. Taylor
-----------------------
Bruce E. Taylor, Director
Date: March 31, 2005





                                       16
<PAGE>

                          INDEX TO FINANCIAL STATEMENTS



Independent Auditors' Report                                        F-2

Consolidated Balance Sheets                                         F-3

Consolidated Statements of Operations                               F-4

Consolidated Statements of Stockholders' Equity                     F-5

Consolidated Statements of Cash Flows                               F-6

Notes to Consolidated Financial Statements                        F-7-F-10


                                      F-1
<PAGE>
                              BAUM & COMPANY, P.A.
                          1515 UNIVERSITY DR. SUITE 209
                             CORAL SPRINGS FL 33071

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors
Safe Technologies International Inc.

We have audited the accompanying consolidated balance sheets of Safe
Technologies International Inc. as of December 31, 2004 and 2003, and the
related statements of operations, stockholders' deficiency and cash flows for
the years then ended. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on the
financial statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Safe Technologies
International Inc. as of December 31, 2004 and 2003 and the consolidated results
of its operations and its cash flows for the years then ended in conformity with
United States generally accepted accounting principles.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 6 to the
financial statements the Company has experience a loss in 2004 and 2003. The
Company's financial position and operating results raise substantial doubts
about its ability to continue a a going concern.. Management's plans concerning
these matters are also described in Note 6. The financial statements do not
include any adjustments that might result from the outcome of this uncertainty.

As discussed in Note 1 to the consolidated financial statements,, effective
January 1, 2002, the Company adopted Statement of Financial Standards No. 142
"Goodwill and Other Intangible Assets."


Coral Springs, Florida
January 20, 2005

                                      F-2
<PAGE>
                      SAFE TECHNOLOGIES INTERNATIONAL, INC.
                           CONSOLIDATED BALANCE SHEETS
                           DECEMBER 31, 2004 AND 2003
<TABLE>
<CAPTION>
                                                                            2004              2003
                                                                         -----------      -----------
<S>                                                                      <C>              <C>
                                   ASSETS
CURRENT ASSETS
   Cash                                                                  $    15,158      $     8,713
   Accounts receivable, net of allowance for doubtful accounts of
        $17,159 and $19,510 respectively                                       1,438            4,192

            Total current assets                                              16,596           12,905
                                                                         -----------      -----------

PROPERTY AND EQUIPMENT
    Furniture, fixtures and equipment                                         22,677           33,649

        Less: Accumulated depreciation                                       (17,242)         (14,246)
                                                                         -----------      -----------

            Total property and equipment                                       5,435           19,403
                                                                         -----------      -----------

OTHER ASSETS
    Deposits                                                                   2,889            2,889
    Other assets, net                                                         51,945           53,331
                                                                         -----------      -----------

            Total other assets                                                54,834           56,220
                                                                         -----------      -----------

Total Assets                                                             $    76,865      $    88,528
                                                                         ===========      ===========

               LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES
    Accounts payable                                                     $    22,239      $    71,099
    Accrued expenses                                                         112,255           88,218
    Notes and loans payable                                                  838,739          621,394
    Deferred revenue                                                           3,021            3,070
                                                                         -----------      -----------

            Total current liabilities                                        976,254          783,781
                                                                         -----------      -----------

Total Liabilities                                                            976,254          783,781
                                                                         -----------      -----------

STOCKHOLDERS' EQUITY (DEFICIT)
    Common stock, $0.00001 par value, 999,999,000 shares authorized;
    927,381,602  and  888,506.602 shares issued and outstanding at
    December 31, 2004 and 2003 respectively                                    9,274            8,885
    Additional paid-in capital                                             7,443,330        7,255,618
    Subscriptions received                                                    12,000           12,000
    Retained earnings (deficit)                                           (8,363,993)      (7,971,756)
                                                                         -----------      -----------

            Total stockholders' equity (deficit)                            (899,389)        (695,253)
                                                                         -----------      -----------

Total Liabilities and Stockholders' Equity (Deficit)                     $    76,865      $    88,528
                                                                         ===========      ===========
</TABLE>

     The accompanying notes are an integral part of the financial statements

                                      F-3
<PAGE>
                      SAFE TECHNOLOGIES INTERNATIONAL, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                      YEARS ENDED DECEMBER 31 2004 AND 2003

<TABLE>
<CAPTION>
                                                              2004               2003
                                                         -------------      -------------
<S>                                                      <C>                <C>
REVENUES

    Sales, net of customer returns                       $      50,646      $      79,118
                                                         -------------      -------------

          Net sales                                             50,646             79,118
                                                         -------------      -------------

COST OF OPERATIONS

    Cost of operations                                          18,068             14,851
                                                         -------------      -------------

          Total cost of operations                              18,068             14,851
                                                         -------------      -------------

Gross Profit                                                    32,578             64,267
                                                         -------------      -------------

OPERATING EXPENSES
    Sales and marketing expense                                 12,370              2,348
    General and administrative expenses                        314,288            370,658

                                                         -------------      -------------

          Total operating expenses                             326,658            373,006
                                                         -------------      -------------

Operating income (loss)                                       (294,080)          (308,739)
                                                         -------------      -------------

OTHER INCOME (EXPENSE)
    Interest expense                                           (87,185)           (80,344)
    Loss on Asset Retirement                                   (10,972)             - 0 -
    Loss on divestment                                           - 0 -              - 0 -
    Impairment of Goodwill and Intangible Asset                  - 0 -           (224,695)
    Other income                                                 - 0 -             35,042
                                                         -------------      -------------

          Total other income (expense)                         (98,157)          (269,997)
                                                         -------------      -------------

Loss before provision for income taxes                        (392,237)          (578,736)
Income taxes                                                       -0-                -0-
                                                         -------------      -------------

Net income (loss)                                        $    (392,237)     $    (578,736)
                                                         =============      =============

Net income (loss) per common share, basic                $        0.00      $        0.00
                                                         =============      =============

Weighted average number of common shares outstanding       916,634,349        875,317,588
                                                         =============      =============
</TABLE>

     The accompanying notes are an integral part of the financial statements

                                      F-4
<PAGE>

                      SAFE TECHNOLOGIES INTERNATIONAL, INC.
            CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
<TABLE>
<CAPTION>
                                                                                                               TOTAL
                                        NUMBER                   ADDITIONAL                                 STOCKHOLDERS'
                                          OF         COMMON       PAID-IN          SUBS.     ACCUMULATED        EQUITY
                                        SHARES       STOCK        CAPITAL        RECEIVED      DEFICIT        (DEFICIT)
                                     -----------     ------     -----------      -------     -----------      ---------
<S>                                  <C>             <C>        <C>              <C>         <C>              <C>
BALANCE, December 31, 2002           871,826,599     $8,718     $ 7,150,380      $12,000     $(7,393,020)     $(221,922)

Prior year share adjustment              680,003          7              (7)           0               0              0
Shares for services and expenses       6,000,000         60          45,945            0               0         46,005
Stock based compensation              10,000,000        100          59,300            0               0         59,400
Net loss                                      --         --              --           --        (578,736)      (578,736)
                                     -----------     ------     -----------      -------     -----------      ---------

BALANCE, December 31, 2003           888,506,602      8,885       7,255,618       12,000      (7,971,756)      (695,253)

Restricted shares issued for          20,000,000        200          69,800            0               0         70,000
compensation
Shares for services and expenses      18,875,000        189         117,912            0               0        118,101

Net loss                                      --         --              --           --        (392,237)      (392,237)
                                     -----------     ------     -----------      -------     -----------      ---------

BALANCE, December 31, 2004           927,381,602      9,274       7,443,330       12,000      (8,363,993)      (899,389)
                                     ===========     ======     ===========      =======     ===========      =========
</TABLE>

     The accompanying notes are an integral part of the financial statements


                                      F-5
<PAGE>
                      SAFE TECHNOLOGIES INTERNATIONAL, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                      YEARS ENDED DECEMBER 31 2004 AND 2003
<TABLE>
<CAPTION>
                                                                            2004            2003
                                                                          ---------      ---------

<S>                                                                       <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)                                                         $(392,237)     $(578,736)
Adjustments to reconcile net income to net cash provided by operating
activities:
    Depreciation and amortization                                             2,996         57,131
    Bad debt expense                                                          6,894          2,025
    Impairment of goodwill and intangible assets                              - 0 -        224,695
    Loss on asset retirement                                                 10,972          - 0 -
    Writeoff  of note payable                                                 - 0 -        (35,142)
    Stock based compensation                                                 70,000         59,400
    Expenses paid by common stock                                           118,101         46,005
Changes in operating assets and liabilities:
    (Increase) decrease in accounts receivable                               (2,754)        (5,446)
    (Increase) decrease in deposits                                           - 0 -          4,403
    Increase (decrease) in accounts payable                                 (48,860)       (10,511)
    Increase (decrease) in accrued expenses                                  24,037         76,128
    Increase (decrease) in deferred revenue                                     (49)         3,070

                                                                          ---------      ---------

Net cash provided (used) by operating activities                           (210,900)      (156,978)
                                                                          ---------      ---------

CASH FLOWS FROM INVESTING ACTIVITIES:
                                                                                  0              0
                                                                          ---------      ---------

Net cash provided (used) by investing activities                                  0              0
                                                                          ---------      ---------

CASH FLOWS FROM FINANCING ACTIVITIES:
    Increases of  Shareholders Loans                                        217,345        163,751

                                                                          ---------      ---------

Net cash provided (used) by financing activities                            217,345        163,751
                                                                          ---------      ---------

Net increase (decrease) in cash                                               6,445          6,773

CASH and equivalents, beginning of period                                     8,713          1,940
                                                                          ---------      ---------

CASH and equivalents, end of period                                       $  15,158      $   8,713
                                                                          =========      =========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW
INFORMATION:
Payment of taxes  in cash                                                 $       0      $       0
                                                                          =========      =========
Payment of interest in cash                                               $       0      $       0
                                                                          =========      =========
</TABLE>

     The accompanying notes are an integral part of the financial statements

                                      F-6
<PAGE>
                      SAFE TECHNOLOGIES INTERNATIONAL, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         The Company was incorporated under the laws of the State of
         Delaware on May 21, 1987 as Safe Aid Products, Inc. On February 9,
         1998, the Company changed its name to Safe Technologies International,
         Inc. Safe Technologies International, Inc. ("Safe Tech") is a
         multi-faceted company specializing in Internet services and products.

         A) PRINCIPLES OF CONSOLIDATION The consolidated financial statements
         include the accounts of Safe Technologies International, Inc. and its
         subsidiaries, Total Micro Computers, Inc., Connect.ad, Inc., Connect.ad
         Services, Inc. and Internet Associates International, Inc. All material
         intercompany transactions and balances have been eliminated in the
         consolidated financial statements.

         B) USE OF ESTIMATES The financial statements have been prepared in
         conformity with accounting principles generally accepted in the United
         States. In preparing the financial statements, management is required
         to make estimates and assumptions that effect the reported amounts of
         assets and liabilities and disclosure of contingent assets and
         liabilities as of the dates of the balance sheets and statements of
         operations for the years then ended. Actual results may differ from
         these estimates. Estimates are used when accounting for allowance for
         bad debts, collectibility of accounts receivable, amounts due to
         service providers, depreciation, litigation contingencies, among
         others.

         C) REVENUE RECOGNITION Revenues of Safe Technologies International,
         Inc. are recognized at the time the services are rendered to customers.
         Services are rendered when the Company's representatives receive the
         customer's requests and completes the customer's orders.

         D) NET LOSS PER SHARE, BASIC Net income per share is computed by
         dividing the net income by the weighted average number of shares
         outstanding during the period. Net income per share, diluted, is not
         presented as no potentially dilutive securities are outstanding.

         E) CASH EQUIVALENTS The Company considers all highly liquid debt
         instruments with an original maturity of three months or less to be
         cash equivalents. Cash and cash equivalents, accounts receivable and
         accounts payable are short-term in nature and the net values at which
         they are recorded are considered to be reasonable estimates of their
         fair values. The carrying values of notes payable are deemed to be
         reasonable estimates of their fair values.

         F) CONCENTRATION RISKS The Company's sources of revenue and accounts
         receivable are comprised primarily of customers in the Internet
         industry. The Company requires no collateral from its customers since,
         in many cases, it has written contracts with them.

         G) FIXED ASSETS Fixed assets are recorded at cost. Depreciation is
         computed on the straight-line method, based on the estimated useful
         lives of the assets of generally five or ten years. Expenditures for
         maintenance and repairs are charged to operations as incurred.
         Depreciation expense was $2,996 and $42,188 for the years ended
         December 31, 2004 and 2003, respectively.

         H) INTANGIBLE ASSETS The Company continually evaluates the carrying
         value of goodwill and other intangible assets to determine whether
         there are any impairment losses. If indicators of impairment are
         present in intangible assets used in operations and future cash flows
         are not expected to be sufficient to recover the assets' carrying
         amount, an impairment loss would be charged to expense in the period
         identified.

                                      F-7
<PAGE>

                      SAFE TECHNOLOGIES INTERNATIONAL, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

         H) INTANGIBLE ASSETS (CONTINUED) Management has determined that the
         goodwill, copyrights and trademarks reflected on the Company's balance
         sheet at December 31, 2003 have been impaired by approximately
         $225,000 in value due to lack of viable cash flows that can be
         generated in the foreseeable future, will generate sufficient cash
         flows to recover their carrying amounts.

         I) ADVERTISING Advertising costs, which are included in selling,
         general and administrative expenses, are expensed as costs are
         incurred. Advertising expense was $ 1820 and $ 2,330 for the years
         ended December 31, 2004 and 2003, respectively.

?????    J) DEFERRED REVENUE Deferred income arises in the normal course of
         business from the development of new web site contracts. Deferred
         income at December 31, 2004 and 2003 was $3,021 and $ 3,070 ,
         respectively.

(2) INCOME TAXES

         Deferred income taxes (benefits) are provided for certain income and
         expenses which are recognized in different periods for tax and
         financial reporting purposes. The Company had net operating loss carry-
         forwards for income tax purposes of approximately $8,363,000 with the
         latest expiring $ 578,000 $445,000, $589,200, $3,016,100 and $920,000
         at December 31, 2018, 2017, 2016, 2015 and 2014, respectively. The
         amount recorded as deferred tax asset as of December 31, 2003 is
         approximately $2,800,000, which represents the amount of tax benefit of
         the loss carry-forward. The Company has established a 100% valuation
         allowance against this deferred tax asset, as the Company has no
         history of profitable operations.

(3) STOCKHOLDERS' EQUITY

         The Company has authorized 999,999,000 shares of $.00001 par value
         common stock, with 927,381,602 shares issued and outstanding. Rights
         and privileges of the preferred stock are to be determined by the Board
         of Directors prior to issuance.

         In 2003, the Company issued 10,000,000 shares of restricted common
         stock to company officers for services valued at $ 59,400. In 2003, the
         Company issued 6,000,000 shares of common stock for services valued at
         $46,005 of $.008 per share.

         In 2004, the company issed 20,000,000 shares of restricted stock ,
         valued at $ 70,000 for officers compensation and 18,875,000 of stock
         for services valued at 118,101.

                                      F-8
<PAGE>
                      SAFE TECHNOLOGIES INTERNATIONAL, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(4) COMMITMENTS AND CONTINGENCIES

         The Company rents office space in Palm Beach, Florida under a lease
         that commenced December 2003 and expires November 2005. The total rent
         fo 2004 and 2003 was $16,850 and $ 15,380 respectively..Future lease
         expenses are $14,135 in 2005.

(5) SHORT-TERM DEBT

         At December 31, 2004 and 2003, short-term debt consisted of the
         following:

<TABLE>
<CAPTION>
                                                                2003          2004
                                                              ---------    ---------
<S>                                                           <C>          <C>
12% note payable to a former officer, unsecured, due on
demand.  Upon any default, the note becomes due
immediately at an interest rate of 18% per annum.             $ 352,321    $    - 0-

12 % Notes and loans payable to a shareholder, and
related affiliates , unsecured, due on demand.  Upon any
default, the note becomes due immediately at an interest        204,986      838,739
rate of 18% per annum.

12% note payable to a former officer, unsecured, due on
demand.  Upon any default, the note becomes due
immediately at an interest rate of 18% per annum.                64,087            0

                                                              ---------    ---------

Total short-term debt                                         $ 621,394    $ 838,739
                                                              =========    =========
</TABLE>

         The shareholder purchased directly the notes payable from the former
officers of the company.

(6) GOING CONCERN

         The accompanying financial statements have been prepared assuming that
         the Company will continue as a going concern. The Company's financial
         position and operating results raise substantial doubt about the
         Company's ability to continue as a going concern, as reflected by the
         net loss of $ 392,237 and $5578,736 for the years ended December 31,
         2004 and 2003, respectively, for a total cumulative loss of $8,363,993.
         The ability of the Company to continue as a going concern is dependent
         upon developing sales and obtaining additional capital and financing.
         The financial statements do not include any adjustments that might be
         necessary if the Company is unable to continue as a going concern. The
         Company is currently pursuing acquisitions of viable business's in
         conjunction with seeking additional capital to fund its planned
         operations.

(7) RELATED PARTY TRANSACTIONS

         In 2003, the Company paid rent and purchased services from and made
         reimbursements to a related party company owned by an officer and major
         shareholder. The services purchased were primarily secretarial and
         reimbursements which include telephone expenses, courier charges and
         postage. Total payments made to this company during the year ended
         December 31, 2003 were 20,500

(8) ACQUISITIONS RESCINDED

         In January 2004, the Company consummated an agreement for 60% equity
         positions in Time Bytes Limited (a U.K. company) and affiliates Time
         Bytes International Inc. (a Delaware company ) and Sports Profile Ltd.
         (a U.K. company) The acquisition was executed pursuant to a stock
         purchase agreement dated December 30, 2003 between the Company and the
         major shareholder of Time Bytes Limited. This acquisition was
         subsequently rescinded. The company has issued 5,700,000 shares of
         common stock, valued at $ 39,900 for related services.

         In August 2003, the Company entered into an acquisition agreement with
         Express Air Inc. (a California company). Due to the inability of
         Express Air, Inc. to meet the terms of the acquisition agreement, the
         agreement has been rescinded.


                                      F-9
<PAGE>
                      SAFE TECHNOLOGIES INTERNATIONAL, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(9) INCOME TAX

         The principle temporary differences that will result in deferred tax
         assets and liabilities are certain expenses and losses accrued for
         financial reporting purposes not deductible for tax purposes until
         paid. The differences between Federal income tax rate and the effective
         income tax rate as reflected in the accompanying statement of
         operations are:

                                        December 31, 2004   December 31, 2003
                                        -----------------   -----------------
Statutory federal income tax rate             34%                  34%
Valuation allowance                           (34)                 (34)
Effective tax rate                             -%                   -%

(10) RECENT ACCOUNTING PRONOUNCEMENTS

         In November 2004, the FASB issued Statement of Financial Accounting
         Standards (SFAS) No. 151, Inventory Costs, which clarifies the
         accounting for abnormal amounts of idle facility expense, freight,
         handling costs, and wasted material. SFAS No. 151 will be effective for
         inventory costs incurred during fiscal years beginning after June 15,
         2005. We do not believe the adoption of SFAS No. 151 will have a
         material impact on our financial statements.

         In December 2004, the FASB issued SFAS No. 153, Exchanges of
         Nonmonetary Assets, which eliminates the exception for nonmonetary
         exchanges of similar productive assets and replaces it with a general
         exception for exchanges of nonmonetary assets that do not have
         commercial substance. SFAS No. 153 will be effective for nonmonetary
         asset exchanges occurring in fiscal periods beginning after June 15,
         2005. We do not believe the adoption of SFAS No. 153 will have a
         material impact on our financial statements.

          In December 2004, the FASB issued SFAS No. 123(R), Share-Based
         Payment, which establishes standards for transactions in which an
         entity exchanges its equity instruments for goods or services. This
         standard requires a public entity to measure the cost of employee
         services received in exchange for an award of equity instruments based
         on the grant-date fair value of the award. This eliminates the
         exception to account for such awards using the intrinsic method
         previously allowable under APB Opinion No. 25. SFAS No. 123(R) will be
         effective for interim or annual reporting periods beginning on or after
         June 15, 2005. We previously adopted the fair value recognition
         provisions of SFAS No. 123, Accounting for Stock-Based Compensation, on
         July 1, 2003 and have accounted for all awards granted to employees in
         recent years using the fair value recognition method.. Accordingly we
         believe SFAS No. 123(R) will not have a material impact on financial
         statements.

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