|1. | NATURE OF OPERATIONS & GOING CONCERN                                                                                                                                                                                                                                                                                                                                                                                                                                              |  |  |  | 
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  |  | 
|   | Stream Communications Network, Inc. (Stream or the Company) mainly provides cable television services and high-speed internet access. Previous business plans of the implementation and commercialization of animal-waste rendering technologies changed to incineration of animal waste and is available for sale, see note 5 - Discontinued operations. All of its operations are located in Poland.                                                                       
|   | The Company was incorporated on March 28, 1979  by registration of its Memorandum and Articles under the Company Act of British Columbia, Canada.  On October 19, 2001 the Company changed its name from Trooper Technologies Inc. to Stream Communications Network, Inc.                                                                                                                                                                                                        
|   | These financial statements have been prepared on a going concern basis which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future.  The continuing operations of the Company are dependent upon its ability to continue to raise adequate financing and to commence profitable operations in the future.                                                                        
|   | For the year ended December 31, 2002, the Company had a loss of $5,989,202, an accumulated deficit of $23,770,392 and a working capital deficiency of $4,203,632.                                                                                                                                                                                                                                                                                                                
|   | The Company is actively pursuing additional funding to continue its current projects (note 16). Management continues to develop the Companys operating capabilities in order to improve cash flow from operations.                                                                                                                                                                                                                                                              
|   | Although there is no assurance that the Company will be successful in these actions, management is confident that it will be able to continue as a going concern. Accordingly, these financial statements do not reflect adjustments to the carrying value of assets and liabilities, the reported revenues and expenses and balance sheet classifications used that would be necessary if the going concern assumption were not appropriate. Such adjustments could be material.



|2. | SIGNIFICANT ACCOUNTING POLICIES                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                              |           |        |        |                         
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------ | --------- | ------ | ------ | ------------------------
|   | Basis of presentation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                              |           |        |        |                         
|   | These consolidated financial statements have been prepared in accordance with Canadian generally accepted accounting principles. A summary of the significant accounting policies are as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   | Consolidation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                              |           |        |        |                         
|   | These consolidated financial statements include the accounts of the Company and the following subsidiaries. All intercompany transactions and balances have been eliminated.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                              |           |        |        | Country of Incorporation
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | EES Waste Solutions Limited                                  | Cyprus    | 100.0% | 100.0%
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | International Eco-Waste Systems S.A. ("Eco-Waste") -(note 5) | Poland    | -      | 100.0%
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Stream Communications Sp. z o.o. ("Stream")                  | Poland    | 100.0% | 100.0%
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Gimsat Sp. z o.o. ("Gimsat") - (note 4)                      |           |        | Poland | 100.0%                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Polvoice.com Sp. z o.o. ("PolVoice") -(note 5)               | Poland    | -      | 95.5% 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Bielsat.com Sp. z o.o. ("Bielsat")                           | Poland    | 51.0%  | 51.0% 
|   | Use of estimates                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                              |           |        |        |                         
|   | The preparation of financial statements in conformity with Canadian generally accepted accounting principles requires management to make estimates and assumptions which affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and expenses for the periods reported. Actual results could differ from those estimates.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | Cash and cash equivalents                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                              |           |        |        |                         
|   | Cash and cash equivalents consist of cash and highly liquid investments with maturities of less than three months.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   | Inventory                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                              |           |        |        |                         
|   | Inventory is valued at the lower of cost and net realizable value, determined on a first-in, first-out basis.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   | Deferred charges                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                              |           |        |        |                         
|   | Costs, such as legal, accounting, due diligence, sponsorship and filing fees relating to potential business acquisitions are deferred and applied towards the cost of the acquisition when completed.  Such costs are expensed if the potential acquisition is no longer considered viable by management.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | Charges relating to the start-up of the Companys activities regarding animal-waste rendering had been deferred and amortized on a straight-line basis over a period of five years. These charges have been written-off in the year ended October 31, 2001 as this business is considered discontinued operations (note 5).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   | Property, plant and equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                              |           |        |        |                         
|   | Property, plant and equipment are stated at cost less accumulated amortization. Amortization is provided for using the declining-balance method at the following rates per annum:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                              |           |        |        |                         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Automobiles                                                  |           |        |        | 20% - 30%               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Buildings, offices                                           |           |        |        | 3%                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Computer software                                            |           |        |        | 20% - 100%              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Cable television network equipment                           | 5% - 45%  |        |       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Furniture, fixtures and equipment                            | 20% - 30% |        |       
|   | Plant construction-in-progress consists of assets not yet in use and accordingly no amortization is recorded.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   | Revenue recognition                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                              |           |        |        |                         
|   | Substantially all revenues are derived from cable TV subscriber fees. Subscriber fees are recorded as revenue in the period the service is provided. Funds received in advance are deferred.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | Foreign currency translation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                              |           |        |        |                         
|   | The Companys significant assets, revenues and expenses are in Poland; accordingly, the Companys functional currency is the Polish Zloty. The Company follows the current rate method of translation which translates foreign assets and liabilities, into Canadian dollar equivalents, at the rate of exchange at the balance sheet date.  Revenues and expenses are translated into Canadian dollar equivalents at the average rate of exchange throughout the period.  Gains and losses arising from translation of the financial statements are disclosed as a separate component of shareholders' equity.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | Transactions that are denominated in foreign currency are initially recorded at the rate of exchange prevailing at the date of the transaction.  Thereafter, monetary assets and liabilities are adjusted to reflect the exchange rate in effect at the balance sheet dates.  Gains and losses resulting from the adjustment are included in earnings.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | Loss per share                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                              |           |        |        |                         
|   | The Company uses the treasury stock method to compute the dilutive effect of options, warrants and similar instruments.  Under this method the dilutive effect on loss per share is recognized on the use of the proceeds that could be obtained upon exercise of options, warrants and similar instruments.  It assumes that the proceeds would be used to purchase common shares at the average market price during the period. For all periods presented, the effect of the assumed conversion of stock options and warrants was anti-dilutive.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   | Basic loss per share is calculated using the weighted-average number of shares outstanding during the period.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   | Income taxes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                              |           |        |        |                         
|   | The Company follows the asset and liability method of accounting for income taxes whereby future income taxes are recognized for the future income tax consequences attributable to differences between the financial statement carrying values and their respective income tax bases (temporary differences).  Future income tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years in which temporary differences are expected to be recovered or settled.  The effect on future income tax assets and liabilities of a change in tax rates is included in income in the period in which the change occurs.  The amount of future income tax assets recognized is limited to the amount that is more likely than not to be realized.                                                                                                                                                                                                                                                                                                                                                
|   | Acquisitions, intangible assets and goodwill                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                              |           |        |       
|   | The Company has adopted the recent recommendations of the Canadian Institute of Chartered Accountants ("CICA") with regards to the approved new Handbook section 1581, Business Combinations, replacing section 1580 that will require all business combinations to use the purchase method of accounting.  Also, in accordance with the recent recommendations of the CICA, the Company follows an impairment-only approach for the accounting for goodwill and other intangible assets that have an indefinite life.  Under the new recommendations the Company is required to perform an initial benchmark test of impairment within six months of adoption, and annual tests of impairment at the reporting unit level.  If the carrying value of goodwill and other intangible assets of a reporting unit exceeds the fair value of the reporting unit, the carrying value of the asset must be written down to fair value.                                                                                                                                                                                                                     
|   | The adoption of these new standards is not expected to have any material effect on the Companys financial position, results of operations or its cash flows.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|   | The Company has determined that the cable TV licences have an indefinite life.  The Company has evaluated its existing intangible assets and goodwill and concluded that no provisions for impairment were required, except for goodwill from the acquisition of PolVoice, now part of discontinued operations (note 5). Subscriber base is amortized using the straight-line method at a rate of 5%.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|   | Stock-based Compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | The Company has adopted the recommendations of the new CICA Handbook section 3870, Stock-Based Compensation and Other Stock-Based Payments, effective January 1, 2002. This section establishes standards for the recognition, measurement and disclosure of stock-based compensation and other stock-based payments made in exchange for goods and services. The standard requires that all stock-based awards made to non-employees be measured and recognized using a fair value based method. The standard encourages the use of a fair value based method for all awards granted to employees, but only requires the use of a fair value based method for direct awards of stock, stock appreciation rights, and awards that call for settlement in cash or other assets. When the fair value method is not used, disclosure is required of the pro forma impact of using the fair value of stock options on the reported results of operations. Awards that a company has the ability to settle in stock are recorded as equity, whereas awards that the entity is required to or has a practice of settling in cash are recorded as liabilities.
|   | Compensation expense is recognized when stock options are issued to employees and directors for the excess, if any, of the quoted market price at the date of grant over the exercise price. Any consideration paid by employees and directors on exercise of stock options is credited to capital stock. If stock options are repurchased the excess of consideration paid over the carrying amount of the stock option is charged to deficit. The effect of applying this new standard to stock options issued to employees and directors is not material.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | Effective 2000, the Company adopted the recommendations with respect to grants of options to non-employees whereby compensation expense is determined when stock options are issued and is recognized over the vesting period of the option. The compensation expense is determined as the fair value of the option at the date of grant using an option pricing model.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|   | Comparative figures                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                              |           |        |        |                         
|   | Some of the comparative figures have been reclassified to conform with the presentation adopted in the current period.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 



|3. | SUPPLEMENTAL CASH FLOW INFORMATION                       |                                                              |   |   |                 
|-- | -------------------------------------------------------- | ------------------------------------------------------------ | - | - | ----------------
|   |                                                          |                                                              |   |   |                 
|   |                                                          |                                                              |   |   |                 
|   | Supplemental non-cash investing and financing activities |                                                              |   |   |                 
|   |                                                          | Private placement issue costs                                |   |   | $              -
|   |                                                          | Conversion of intercompany balance to investment in PolVoice | - | - | 698,139         
|   |                                                          | Cash paid for interest                                       |   |   |                 
|   |                                                          | Cash paid for income taxes                                   |   |   | -               



|4. | ACQUISITIONS                                                                                                                                                                                                                                                                                                                                                             |                                                |  |  |  |           |                
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ---------------------------------------------- |  |  |  | --------- | ---------------
|   | The Company has substantially completed the acquisition of Gimsat. The acquisition was accounted for by the purchase method.  The effective date of the acquisition was January 1, 2002,  after which the operations of Gimsat are included in these consolidated financial statements. Gimsat has cable TV networks in Jaslo, Sanok and Brzozow, all located in Poland.
|   | At the time of acquisition the fair value of the assets and liabilities of Gimsat were:                                                                                                                                                                                                                                                                                  |                                                | 
|   |                                                                                                                                                                                                                                                                                                                                                                          | Cash and cash equivalents                      |  |  |  |           | $        10,154
|   |                                                                                                                                                                                                                                                                                                                                                                          | Accounts receivable                            |  |  |  |           |                
|   |                                                                                                                                                                                                                                                                                                                                                                          | Inventory                                      |  |  |  |           |                
|   |                                                                                                                                                                                                                                                                                                                                                                          | Prepaids                                       |  |  |  |           |                
|   |                                                                                                                                                                                                                                                                                                                                                                          | Property, plant and equipment                  |  |  |  |           | 2,163,860      
|   |                                                                                                                                                                                                                                                                                                                                                                          | Intangible assets (subscriber base)            |  |  |  |           | 3,340,649      
|   |                                                                                                                                                                                                                                                                                                                                                                          | Long-term debt                                 |  |  |  |           |                
|   |                                                                                                                                                                                                                                                                                                                                                                          | Accounts payable and accrued liabilities       |  |  |  | (6,194)  
|   |                                                                                                                                                                                                                                                                                                                                                                          | Purchase price                                 |  |  |  |           |                
|   | Consideration consisted of:                                                                                                                                                                                                                                                                                                                                              |                                                |  |  |  |           |                
|   |                                                                                                                                                                                                                                                                                                                                                                          | Cash                                           |  |  |  |           |                
|   |                                                                                                                                                                                                                                                                                                                                                                          | Amounts owing to former shareholders of Gimsat |  |  |  | 1,637,715
|   |                                                                                                                                                                                                                                                                                                                                                                          | Total                                          |  |  |  |           |                



|5. | DISCONTINUED OPERATIONS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                   |           |                  |                  |                 
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------- | --------- | ---------------- | ---------------- | ----------------
|   | During 2001, the Company commenced planned operations of providing cable TV and related cable services. The previous business of Eco-Waste was meat waste rendering which was interrupted when  the European Commission imposed a ban on meat and bone meal products due to the risk of Bovine Spongiform Encephalopathy ("BSE"). The Company changed direction with regards to the meat waste rendering business to avoid liability and uncertainty from the fallout from BSE and applied to change its hazardous waste licence to an incinerator licence. The Company intended to utilize this licence to start operations in the hazardous waste business, but the Company decided to sell this business, as it did not fit with its cable service business.
|   | On September 30, 2002 Eco-Waste was sold to an arms length buyer. The terms of the agreement included a nominal down payment and payments due of $500,000 USD of which $250,000 USD is due on each of December 31, 2003 and December 31, 2004. Due to the uncertainty in this sector of the market, these payments due in 2003 and 2004 are valued at $nil.                                                                                                                                                                                                                                                                                                                                                                                                   
|   | In view of the Companys main business and objectives being directed towards cable TV, it was decided to discontinue the operations of a second subsidiary, PolVoice, a company that developed software for internet services in Poland. In this manner, the Company is focused on one business objective. The operations of PolVoice were discontinued and the company is being liquidated.                                                                                                                                                                                                                                                                                                                                                                   
|   | The statements of operations for the discontinued business operations are:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|   | December 31, 2002                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | PolVoice                          | Eco-Waste | Total           
|   | Sales                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                   |           |                  | $              - | $              -
|   | Expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                   |           |                  | -                | -               
|   | Amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                   |           |                  | -                | -               
|   | Write-down of net assets to net realizable value                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                   | -         | (2,362,877)      | (2,362,877)     
|   | Foreign exchange loss                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                   |           |                  | -                | -               
|   | Loss from discontinued operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                   |           | $              - | $  (2,362,877)   | $  (2,362,877)  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                   |           |                  |                  |                 
|   | Two months ended December 31, 2001                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | PolVoice                          | Eco-Waste | Total           
|   | Sales                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                   |           |                  | $        10,347  | $              -
|   | Expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                   |           |                  | (112,905)        | (124,182)       
|   | Interest expense                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                   |           |                  | (120)            | (24)            
|   | Amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                   |           |                  | -                | -               
|   | Write-down of net assets to net realizable value                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                   | (40,789)  | -                | (40,789)        
|   | Foreign exchange gain                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                   |           |                  | 4                | 471             
|   | Loss from discontinued operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                   |           | $     (143,463)  | $     (123,735)  | $     (267,198) 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                   |           |                  |                  |                 
|   | Year ended October 31, 2001                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | PolVoice                          | Eco-Waste | Total           
|   | Sales                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                   |           |                  | $        14,614  | $              -
|   | Expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                   |           |                  | (374,359)        | (407,582)       
|   | Interest expense                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |                                   |           |                  | (714)            | (701)           
|   | Amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                   |           |                  | -                | (101,786)       
|   | Interest income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                   |           |                  | 7,953            | 6,227           
|   | Write-down of assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |                                   |           |                  | -                | (241,343)       
|   | Write-off start-up costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                   |           |                  | -                | (1,134,250)     
|   | Loss from discontinued operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                   |           | $     (352,506)  | $  (1,879,435)   | $  (2,231,941)  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                   |           |                  |                  |                 
|   | The balance sheets for the discontinued business operations are:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | December 31, 2002                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                   |           |                  | PolVoice         | Eco-Waste       
|   | Total assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |                                   |           |                  | $              - | $              -
|   | Total liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                   |           |                  | -                | -               
|   | Net assets of discontinued operations before net realizable value provision                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | -                                 | -         | -               
|   | Net realizable value provision                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                   |           | -                | -                | -               
|   | Net assets of discontinued operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                   |           | $              - | $              - | $              -
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |                                   |           |                  |                  |                 
|   | December 31, 2001                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                   |           |                  | PolVoice         | Eco-Waste       
|   | Current assets                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                   |           |                  | $      142,728   | $            123
|   | Property, plant and equipment                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                   |           |                  |                  |                 
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | Land                              |           |                  |                  | -               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | Buildings                         |           |                  |                  | -               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | Automotive                        |           |                  |                  | -               
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | Equipment, furniture and fixtures |           |                  | -                | 222,657         
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | Plant construction in progress    |           |                  | -                | 1,427,891       
|   | Goodwill                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                   |           |                  | 31,055           | -               
|   | VAT receivable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                   |           |                  | -                | 29,308          
|   | Current liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |                                   |           |                  | (132,994)        | (389,386)       
|   | Net assets of discontinued operations before net realizable value provision                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | 40,789                            | 2,270,958 | 2,311,747       
|   | Net realizable value provision                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                                   |           | (40,789)         | -                | (40,789)        
|   | Net assets of discontinued operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                   |           | $              - | $   2,270,958    | $   2,270,958   



|6. | PROPERTY, PLANT AND EQUIPMENT |                                    |  |  |           |               
|-- | ----------------------------- | ---------------------------------- |  |  | --------- | --------------
|   |                               | December 31, 2002                  |  |  |           | Cost          
|   |                               | Automobiles                        |  |  |           | $      331,814
|   |                               | Buildings, offices                 |  |  |           | 2,520,229     
|   |                               | Cable television network equipment |  |  | 8,770,650 | 2,056,039     
|   |                               | Furniture and fixtures             |  |  |           | 375,344       
|   |                               | Computer software                  |  |  |           | 85,828        
|   |                               | Plant construction-in-progress     |  |  | 124,430   | -             
|   |                               |                                    |  |  |           | $ 12,208,295  
|   |                               |                                    |  |  |           |               
|   |                               | December 31, 2001                  |  |  |           | Cost          
|   |                               | Automobiles                        |  |  |           | $      134,110
|   |                               | Buildings, offices                 |  |  |           | 2,454,962     
|   |                               | Cable television network equipment |  |  | 5,066,785 | 500,031       
|   |                               | Furniture and fixtures             |  |  |           | 377,487       
|   |                               | Computer software                  |  |  |           | 73,885        
|   |                               | Plant construction-in-progress     |  |  | 240,736   | -             
|   |                               |                                    |  |  |           | $   8,347,965 
|   |                               |                                    |  |  |           |               



|7. | INTANGIBLE ASSETS |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |   |   |                                       |                                   
|-- | ----------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | - | - | ------------------------------------- | ----------------------------------
|   |                   | December 31, 2002                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |   |   | Cost                                  | Accumulated amortization          
|   |                   | Cable TV licences                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |   |   | $      116,217                        | $        23,335                   
|   |                   | Subscriber base                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |   |   | 5,565,072                             | 330,465                           
|   |                   | Goodwill                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |   |   | 147,671                               | 5,806                             
|   |                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |   |   | $   5,828,960                         | $      359,606                    
|   |                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |   |   |                                       |                                   
|   |                   | December 31, 2001                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |   |   | Cost                                  | Accumulated amortization          
|   |                   | Cable TV licences                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |   |   | $        80,508                       | $        17,524                   
|   |                   | Subscriber base                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |   |   | 2,129,157                             | 52,211                            
|   |                   | Goodwill                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |   |   | 147,671                               | 5,806                             
|   |                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |   |   | $   2,357,336                         | $        75,541                   
|   |                   | Transitional disclosures                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  |   |   |                                       |                                   
|   |                   | Paragraph 3062.69 require of the CICA Handbook requires disclosure of what reported income before extraordinary items and net income would have been in all periods presented exclusive of amortization expense (including any related tax effects) recognized in those periods related to goodwill, intangible assets that will no longer be amortized, any deferred credit related to an excess over cost, and equity method goodwill (including any related tax effects).  Adjusted per-share amounts also are required to be disclosed for all periods presented.  The Company initially applied CICA Handbook Section 3062 on November 1, 2001.  The effect of amortization expense on the loss of the Company for the year of adoption of Section 3062 and the prior year follow:
|   |                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |   |   | For the year ended December 31,  2002 | Two months ended December 31, 2001
|   |                   | Reported  loss                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |   |   | $  (5,989,202)                        | $  (1,040,689)                    
|   |                   | Add back: Cable TV licences amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |  | - | - | 3,892                                
|   |                   | Add back: Goodwill amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |   | - | -                                     | 7,402                             
|   |                   | Adjusted loss                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |  |   |   | $  (5,989,202)                        | $  (1,040,689)                    
|   |                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |   |   |                                       |                                   
|   |                   | Basic loss per share:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |   |   |                                       |                                   
|   |                   | Reported net loss                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |   |   | $          (0.21)                     | $          (0.05)                 
|   |                   | Cable TV licences amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |  |   | - | -                                     | -                                 
|   |                   | Goodwill amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |  |   | - | -                                     | -                                 
|   |                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |   |   |                                       |                                   



|8. | DEFERRED CHARGES |                                                      |  |  |               |                  | December 31, 2002 | December 31, 2001
|-- | ---------------- | ---------------------------------------------------- |  |  | ------------- | ---------------- | ----------------- | -----------------
|   |                  | Direct and incremental costs of prospectus (note 16) |  |  | $   1,841,855 | $              -
|   |                  | Due diligence costs of acquisition targets           |  |  | 177,406       | 265,616         
|   |                  |                                                      |  |  |               |                  | $   2,019,261     | $      265,616   



|9. | ACCOUNTS PAYABLE AND ACCRUED LIABILITIES                                                                                                                                                                                 |  |  |  | 
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  |  |  | 
|   | Included in accounts payable and accrued liabilities is approximately $1,637,715 (2001 - $nil) owed on the acquisition of GimSat (Note 4), and $616,812 (2001 - $nil) owed for fees related to the prospectus (Note 16).



|10. | LONG-TERM DEBT                                                                                                                                                                                                                                                                                                                       |                                  |      |               |  |                |                  
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | -------------------------------- | ---- | ------------- |  | -------------- | -----------------
|    |                                                                                                                                                                                                                                                                                                                                      |                                  |      |               |  |                | December 31, 2002
|    |                                                                                                                                                                                                                                                                                                                                      | Loan balances, current portion   |      |               |  | $      108,825 | $      104,653   
|    |                                                                                                                                                                                                                                                                                                                                      | Loan balances, long term portion |      |               |  | 52,975         | 146,195          
|    |                                                                                                                                                                                                                                                                                                                                      | Total                            |      |               |  |                | $      161,800   
|    | Long-term debt consist of loans secured by the property, plant and equipment of the Company repayable monthly at a rate of approximately $10,890 per month, until August 2003 when the payments reduce to $5,376 per month. Interest is charged at the prime rate in Poland plus 1⁄2% .  The payments due in the next three years are:
|    |                                                                                                                                                                                                                                                                                                                                      |                                  | 2003 | $     108,825 |  |                |                  
|    |                                                                                                                                                                                                                                                                                                                                      |                                  | 2004 | 52,975        |  |                |                  
|    |                                                                                                                                                                                                                                                                                                                                      |                                  | 2005 | -             |  |                |                  



|11. | CAPITAL STOCK                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                  |                                                   |                                                     |                                           |                                              |                                          
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ------------------------------------------------- | --------------------------------------------------- | ----------------------------------------- | -------------------------------------------- | -----------------------------------------
|    | (a) Authorized                                                                                                                                                                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                  |                                                   |                                                     |                                           |                                              |                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | 150,000,000 common shares of no par value                                                                                                                                                                                                                                                                                                        |                                                   |                                                     |                                           |                                             
|    | (b) Issued                                                                                                                                                                                                                                                                                                                                                                                                                              |                                                                                                                                                                                                                                                                                                                                                  |                                                   |                                                     |                                           | Number of Shares                             | Price                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Balance - October 31, 2001                                                                                                                                                                                                                                                                                                                       |                                                   |                                                     | 21,878,778                                | $              -                             | $ 21,310,084                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Private placement                                                                                                                                                                                                                                                                                                                                |                                                   |                                                     |                                           | 901,286                                      | 1.75                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Private placement                                                                                                                                                                                                                                                                                                                                |                                                   |                                                     |                                           | 4,740,875                                    | 1.60                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Private placement                                                                                                                                                                                                                                                                                                                                |                                                   |                                                     |                                           | 125,000                                      | 3.15                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | less share issuance costs                                                                                                                                                                                                                                                                                                                        |                                                   |                                                     |                                           |                                              | (130,863)                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Finders fee                                                                                                                                                                                                                                                                                                                                     |                                                   |                                                     |                                           | 20,440                                       | 1.75                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Fair value of warrants                                                                                                                                                                                                                                                                                                                           |                                                   |                                                     |                                           |                                              |                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Subscriptions receivable                                                                                                                                                                                                                                                                                                                         |                                                   |                                                     | (710,455)                                 | 1.60                                         | (1,136,728)                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Shares allotted for subscriptions receivable                                                                                                                                                                                                                                                                                                     |                                                   | 710,455                                             |                                           | -                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Balance - December 31, 2001                                                                                                                                                                                                                                                                                                                      |                                                   |                                                     | 27,666,379                                | $              -                             | 26,110,367                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Subscriptions received                                                                                                                                                                                                                                                                                                                           |                                                   |                                                     | -                                         |                                              | 1,136,728                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Shares issued for warrants exercised                                                                                                                                                                                                                                                                                                             |                                                   |                                                     | 200,000                                   | 2.85                                         | 570,000                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Shares issued for warrants exercised                                                                                                                                                                                                                                                                                                             |                                                   |                                                     | 100,000                                   | 2.00                                         | 200,000                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Shares issued for warrants exercised                                                                                                                                                                                                                                                                                                             |                                                   |                                                     | 1,036,770                                 | 1.80                                         | 1,866,186                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Fair value of warrants exercised                                                                                                                                                                                                                                                                                                                 |                                                   |                                                     | -                                         |                                              | 1,346,404                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Balance - December 31, 2002                                                                                                                                                                                                                                                                                                                      |                                                   |                                                     | 29,003,149                                |                                              | $ 31,229,685                             
|    | During the two month period ended December 31, 2001, warrants with a fair value of $3,524,348 were issued as part of a private placement and were reflected as a reduction in capital stock. During the year ended December 31, 2002, $1,346,401 of these warrants were exercised and accordingly were allocated from warrants to capital stock.                                                                                       
|    | (c) Options                                                                                                                                                                                                                                                                                                                                                                                                                             |                                                                                                                                                                                                                                                                                                                                                  |                                                   |                                                     |                                           |                                              |                                          
|    | At  the Annual General Meeting held on April 30, 2001,  the shareholders approved the creation of the "Stock Option Plan" pursuant to which the directors  are  authorized  to  issue  stock  options from time to time to employees,  officers, consultants and directors of the Company for up to 4,375,755 common shares of the Company,  at a minimum price allowed under the applicable securities laws.                          
|    | Common share purchase options are issued to directors, officers, employees and non-employees of the Company with exercise prices which approximate market values at the time the option is granted. Options granted previously vested immediately and have a term of five years. Options granted vest one-quarter every six months with the first quarter vesting immediately. Options are normally granted for a period of five years.
|    | Summary of directors' and employees' stock  options outstanding:                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                  |                                                   |                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                  |                                                   |                                                     |                                           |                                              |                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                  |                                                   |                                                     |                                           | Shares                                       | Weighted average         exercise  price 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Balance of options at October 31, 2001                                                                                                                                                                                                                                                                                                           |                                                   | 1,917,062                                           | $           2.43                          |                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Granted                                                                                                                                                                                                                                                                                                                                          |                                                   |                                                     |                                           | 2,807,938                                    | 1.60                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Forfeited                                                                                                                                                                                                                                                                                                                                        |                                                   |                                                     |                                           | (355,000)                                    | 2.65                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Balance of options at December 31, 2001                                                                                                                                                                                                                                                                                                          |                                                   | 4,370,000                                           | 1.88                                      |                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Granted                                                                                                                                                                                                                                                                                                                                          |                                                   |                                                     |                                           | -                                            | -                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Forfeited                                                                                                                                                                                                                                                                                                                                        |                                                   |                                                     |                                           | -                                            | -                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Balance of options at December 31, 2002                                                                                                                                                                                                                                                                                                          |                                                   |                                                     |                                           | 4,370,000                                    | $           1.88                         
|    | Stock-based compensation                                                                                                                                                                                                                                                                                                                                                                                                               
|    | Had compensation cost for the Company's stock option plan been determined based on the fair value at the grant date using the fair value method, the Company's loss and loss per share would have been increased to the pro forma amounts indicated below:                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                  |                                                   |                                                     |                                           | Year ended December 31, 2002                 | Two months ended December 31, 2001       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Loss for the period                                                                                                                                                                                                                                                                                                                              |                                                   |                                                     |                                           | $  (5,989,202)                               | $  (1,040,689)                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Additional stock-based compensation costs                                                                                                                                                                                                                                                                                                        |                                                   | -                                                   | (823,513)                                 | (322,773)                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Pro forma loss                                                                                                                                                                                                                                                                                                                                   |                                                   |                                                     |                                           | $  (5,989,202)                               | $  (1,864,202)                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Pro forma basic loss per share                                                                                                                                                                                                                                                                                                                   |                                                   |                                                     | $          (0.21)                         | $          (0.08)                            | $          (0.22)                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | These amounts were determined using Black Scholes option pricing model assuming no dividends were paid, a weighted average volatility of nil % (December 31, 2001 - 73.5%, October 31, 2001 -  74.6%) over an expected life of five years and a weighted average annual risk free rate of nil % (December 31, 2001 - 3%, October 31, 2001 - 3%).
|    | The following table summarizes information about stock options outstanding at December 31, 2002:                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                  |                                                   | Options Outstanding                                 | Options Exercisable                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Range of exercise prices                                                                                                                                                                                                                                                                                                                         | Number outstanding at December 31, 2002           | Weighted average remaining contractual life (years) | Weighted average    exercise        price | Number exercisable at December 31,      2002 | Weighted average    exercise        price
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | $ 1.41                                                                                                                                                                                                                                                                                                                                           |                                                   | 114,062                                             | 1.5                                       | $ 1.41                                       | 114,062                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | 1.60                                                                                                                                                                                                                                                                                                                                             |                                                   | 3,049,938                                           | 4.1                                       | 1.60                                         | 242,000                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | 2.62                                                                                                                                                                                                                                                                                                                                             |                                                   | 715,000                                             | 2.3                                       | 2.62                                         | 715,000                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | 2.65                                                                                                                                                                                                                                                                                                                                             |                                                   | 491,000                                             | 2.7                                       | 2.65                                         | 491,000                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                  |                                                   | 4,370,000                                           | 3.5                                       | $ 1.88                                       | 1,562,062                                
|    | (d) Warrants                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                                                                                                                                                                                                                                                                                                                  |                                                   |                                                     |                                           |                                              |                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                  |                                                   |                                                     |                                           |                                              |                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | The changes in warrants were as follows:                                                                                                                                                                                                                                                                                                         | Number of common shares permitted to be purchased |                                                     |                                           |                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                  |                                                   | Number of warrants                                  | Price per share                           | Expiry date                                  | Fair value of Warrants                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Balance October 31, 2001                                                                                                                                                                                                                                                                                                                         | 1,195,000                                         | 597,500                                             | $2.85                                     | 12-Jul-02                                    | $      562,722                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Issued                                                                                                                                                                                                                                                                                                                                           |                                                   | 901,286                                             | 450,643                                   | 2.00                                         | 28-Dec-03                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Issued                                                                                                                                                                                                                                                                                                                                           |                                                   | 300,000                                             | 150,000                                   | 1.80                                         | 28-Dec-03                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Issued                                                                                                                                                                                                                                                                                                                                           |                                                   | 4,440,875                                           | 4,440,875                                 | 1.80                                         | 28-Dec-03                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Issued                                                                                                                                                                                                                                                                                                                                           |                                                   | 125,000                                             | 125,000                                   | $2.25 USD                                    | 28-Dec-03                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Total balance December 31, 2001                                                                                                                                                                                                                                                                                                                  | 6,962,161                                         | 5,764,018                                           |                                           |                                              | $   4,087,070                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Activities:                                                                                                                                                                                                                                                                                                                                      |                                                   |                                                     |                                           |                                              |                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Expired                                                                                                                                                                                                                                                                                                                                          |                                                   | (795,000)                                           | (397,500)                                 | $ 2.85                                       | 12-Jul-02                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Exercised                                                                                                                                                                                                                                                                                                                                        |                                                   | (400,000)                                           | (200,000)                                 | 2.85                                         | 12-Jul-02                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Exercised                                                                                                                                                                                                                                                                                                                                        |                                                   | (200,000)                                           | (100,000)                                 | 2.00                                         | 28-Dec-03                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Exercised                                                                                                                                                                                                                                                                                                                                        |                                                   | (1,036,770)                                         | (1,036,770)                               | $1.80                                        | 28-Dec-03                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Total activities during 2002                                                                                                                                                                                                                                                                                                                     | (2,431,770)                                       | (1,734,270)                                         |                                           |                                              | $  (1,346,401)                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Outstanding                                                                                                                                                                                                                                                                                                                                      | 701,286                                           | 350,643                                             | $ 2.00                                    | 28-Dec-03                                    | $      228,318                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                  |                                                   | 300,000                                             | 150,000                                   | 1.80                                         | 28-Dec-03                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                  |                                                   | 3,404,105                                           | 3,404,105                                 | 1.80                                         | 28-Dec-03                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                  |                                                   | 125,000                                             | 125,000                                   | $ 2.25 USD                                   | 28-Dec-03                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                         | Total Balance December 31, 2002                                                                                                                                                                                                                                                                                                                  | 4,530,391                                         | 4,029,748                                           |                                           |                                              | $   2,740,669                            



|12. | COMMITMENTS                                                                                                                                |  |  |  |      |                 | 
|--- | ------------------------------------------------------------------------------------------------------------------------------------------ |  |  |  | ---- | --------------- | 
|    | As at December 31, 2002, the Company is committed under leases for cable networks,  office space and automobiles in the following amounts:
|    |                                                                                                                                            |  |  |  | 2003 | $        94,096 | 
|    |                                                                                                                                            |  |  |  | 2004 | $        51,066 | 
|    |                                                                                                                                            |  |  |  | 2005 | $        58,538 | 
|    |                                                                                                                                            |  |  |  | 2006 | $        58,538 | 
|    |                                                                                                                                            |  |  |  | 2007 | $        58,538 | 



|13. | SEGMENTED INFORMATION                                                                                                            |                                                                    |  |        |                   |                             
|--- | -------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------ |  | ------ | ----------------- | ----------------------------
|    | The Company operates primarily in one segment, being cable TV services and in two geographic locations, being Canada and Poland.
|    | Geographic information                                                                                                           |                                                                    |  |        |                   |                             
|    |                                                                                                                                  | Revenues are attributed to countries based on location of customer |  |        |                  
|    |                                                                                                                                  | Revenues                                                           |  |        |                   | Year ended December 31, 2002
|    |                                                                                                                                  |                                                                    |  |        |                   |                             
|    |                                                                                                                                  |                                                                    |  | Canada |                   | $              -            
|    |                                                                                                                                  |                                                                    |  | Poland |                   | 3,736,716                   
|    |                                                                                                                                  |                                                                    |  |        |                   | $   3,736,716               
|    |                                                                                                                                  |                                                                    |  |        |                   |                             
|    |                                                                                                                                  | Property, plant, equipment and intangibles                         |  |        | December 31, 2002 | December 31, 2001           
|    |                                                                                                                                  |                                                                    |  | Canada |                   |                             
|    |                                                                                                                                  |                                                                    |  | Poland |                   |                             
|    |                                                                                                                                  |                                                                    |  |        |                   |                             
|    |                                                                                                                                  |                                                                    |  |        |                   |                             



|14. | INCOME TAXES                                                                                                                                                                                                                                                                                                                                                                                               |                                                |        |                  |                  |                                      
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------- | ------ | ---------------- | ---------------- | -------------------------------------
|    | The Company has tax losses available for offset against future taxable income in various jurisdictions for the following approximate amounts:                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                            |                                                | Canada |                  |                  |                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                            |                                                | Poland |                  |                  |                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                            |                                                |        |                  |                  |                                      
|    | The income tax losses in Poland can be carried forward and deducted from taxable income in the next five years, but not exceeding 50% of the loss in any of these years. The incomes taxes in Canada begin to expire from 2003 to 2009.  The potential tax benefits of the losses in Canada and Poland have not been recognized in the financial statements and have been offset by a valuation allowance.
|    | The following is a reconciliation of income taxes:                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                            |                                                |        |                  |                  | For the year ended December 31,  2002
|    |                                                                                                                                                                                                                                                                                                                                                                                                            |                                                |        |                  |                  |                                      
|    | Statutory rates in Canada                                                                                                                                                                                                                                                                                                                                                                                  |                                                |        | 39.62%           | 44.62%           | 44.62%                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                            | Income taxes at Canadian statutory rates       |        | $   2,372,922    | $     (464,355)  | $  (2,022,874)                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                            | Difference in tax rates in other jurisdictions |        | (1,676,977)      | 176,290          | 610,352                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                            | Non-deductible expenses for tax purposes       |        | 21,495           | 32,473           | 11,553                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                            |                                                |        |                  |                  | 717,440                              
|    | Tax effect of tax losses not recognized                                                                                                                                                                                                                                                                                                                                                                    |                                                |        | (717,440)        | 255,592          | 760,278                              
|    | Current and future tax expense (recovery)                                                                                                                                                                                                                                                                                                                                                                  |                                                |        | $              - | $              - | $     (640,691)                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                            |                                                |        |                  |                  |                                      
|    | Future income taxes                                                                                                                                                                                                                                                                                                                                                                                        |                                                |        |                  |                  |                                      
|    | Future income tax assets                                                                                                                                                                                                                                                                                                                                                                                   |                                                |        |                  |                  |                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                            | Tax losses                                     |        |                  |                  | $   4,797,813                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                            | Property, plant and equipment                  |        |                  | (56,450)         | (64,307)                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                            | Intangible assets                              |        |                  |                  | (39,998)                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                            | Start-up costs                                 |        |                  |                  | -                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                            | Share issuance costs                           |        |                  |                  | 811,440                              
|    | Future income tax assets                                                                                                                                                                                                                                                                                                                                                                                   |                                                |        |                  | $   5,512,805    | $   4,312,185                        
|    | Valuation allowance                                                                                                                                                                                                                                                                                                                                                                                        |                                                |        |                  | (5,512,805)      | (4,312,185)                          
|    | Net future income tax assets                                                                                                                                                                                                                                                                                                                                                                               |                                                |        | $              - | $              - | $              -                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                            |                                                |        |                  |                  |                                      



|15. | FINANCIAL INSTRUMENTS                                                                                                                                                                                                                                                                                    |  |  |  |  | 
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  |  |  | 
|    | (a) Fair Value                                                                                                                                                                                                                                                                                           |  |  |  |  | 
|    | Financial instruments consist of cash and cash equivalents, accounts receivable, deposits, accounts payable and accrued liabilities, and long term debt, the fair value of which are considered to approximate their carrying value due to their short-term maturities or ability of prompt liquidation.
|    | (b) Credit Risk                                                                                                                                                                                                                                                                                          |  |  |  |  | 
|    | The Company is exposed to credit risk only with respect to uncertainties as the timing and amount of collectibility of accounts receivable.  The Company mitigates credit risk through standard credit and reference checks.                                                                            
|    | (c) Currency Risk                                                                                                                                                                                                                                                                                        |  |  |  |  | 
|    | The Company is exposed to financial risk arising from fluctuations in foreign exchange rates and the degree of volatility of these rates.  The Company does not use derivative instruments to reduce its exposure to foreign currency risk.                                                             



|16. | SUBSEQUENT EVENT                                                                                                                                                                                                                                                                                                               |  |  |  |  |  | 
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  |  |  |  |  | 
|    | The Company is currently preparing a prospectus in conjunction with an application to list on the Warsaw Stock Exchange.  The Company plans to use proceeds from the offering to further develop its cable television services. The listing on the Warsaw Stock Exchange and the prospectus is subject to regulatory approval.