U.S. SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549



FORM 10-KSB



[ X ]

ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXHANGE ACT OF 1934



For the Fiscal Year ended December 31, 2004



[   ]

TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXHANGE ACT OF 1934

for the transition period from  _____ to _____



Commission File No. 333-51918



FULLCIRCLE REGISTRY, INC.

(Exact name of small business issuer as specified in its charter)



| | Nevada
(State or other jurisdiction of
incorporation or organization) | 87-0653761
(IRS Employer Identification No.)
| | --------------------------------------------------------------------- | --------------------------------------------



500 West Jefferson Street, PNC Plaza, Suite 2310

Louisville, KY 40202

(Address of principal executive offices)



(Issuers telephone number): 502-540-5112

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

Securities registered under Section 12(g) of the Exchange Act:None



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



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



The issuers common stock is listed on the Over the Counter Bulletin Board under the symbol FLCR. The aggregate market value of the issuers common stock held by non-affiliates at December 31, 2004 is deemed to be $2,820,718. At December 31, 2004 there were 69,390,242 shares of common stock of the registrant outstanding, par value $.001.



The issuers revenue for its most recent fiscal year was: $58,640.



Documents Incorporated by Reference: None.

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



1









FORM 10-KSB

FULLCIRCLE REGISTRY, INC.

INDEX

|         |                                                                                                                                                                                                                                                                                                                                                                                              | Page                  
|-------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------
|PART I   | Item 1.  Description of Business

Item 2.  Description of Property

Item 3.  Legal Proceedings

Item 4.  Submission of Matters to a Vote of Security Holders                                                                                                                                                                                                                                 | 3

6

6

6            
|PART II  | Item 5.  Market for Common Equity and Related Stockholder Matters

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

Item 7.  Financial Statements

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

Item 8A.  Controls and Procedures                                                                                       | 6

10

12


12

12    
|PART III | Item 9.  Directors, Executive Officers, Promoters and Control Persons; Compliance with Section 16(a) of the Exchange Act

Item 10.  Executive Compensation

Item 11.  Security Ownership of Certain Beneficial Owners and Management

Item 12.  Certain Relationships and Related Transactions

Item 13.  Exhibits and Reports on Form 8-K

Item 14.  Principal Accountant Fees and Services | 13

14

16

16

17

17
|         | Signatures                                                                                                                                                                                                                                                                                                                                                                                   | 18                    



(Inapplicable items have been omitted)



2







PART I





Item 1. Description of Business



Forward-Looking Statement Notice



When used in this report, the words may, will, expect, anticipate, continue, estimate, project, intend, and similar expressions are intended to identify forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 regarding events, conditions, and financial trends that may affect the Companys future plans of operations, business strategy, operating results, and financial position.  Persons reviewing this report are cautioned that any forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties and that actual results may differ materially from those included within the forward-looking statements as a result of various factors.



History



Our current business began with the formation of FullCircle Registry, Inc., a Nevada corporation, in 1991. Founder Steven Whitten (who resigned as Chief Executive Officer and Director in 2003) conceived of a company that would provide customers with secure storage and immediate access to their critical medical records, wishes (living will, do not resuscitate, etc.) and emergency contact information. FullCircle would obtain the customers' information, providing them with a user identification and PIN that is required to access the information. Customers can contact FullCircle's Emergency Response Personnel, who can make the information available to the consumer electronically through the internet, by mail, fax, and even courier, anywhere in the world, 24 hours a day, 7 days a week.



Our Subsidiaries



In December 2002, we acquired AskPhysicians.com, Inc, a Florida corporation.  AskPhysicians.com operates a website whereby visitors can get basic medical health information and, for a nominal fee, pose questions to board-certified physicians.  While this service does not replace traditional medical care, it offers an efficient way to inform consumers of treatment options.  AskPhysicians.com is currently in development.



Spoken Data is another subsidiary that is currently in development.  Spoken Data is a text-to-voice service that will allow emergency personnel to access medical information in the event of an emergency. Medical conditions, drug allergies, blood type, family contact information, current medications or any other pertinent information can be made available via telephone to assist emergency personnel in their efforts to treat our registry members.



We did not expend any resources on our Spoken Data or Askphysicians.com subsidiaries during 2003.



Our Business



FullCircle Registry is a technology-based company that provides emergency document and information retrieval services.  We provide these services directly to subscribers and also offer our services through strategic alliances with health care providers.



Subscribers join FullCircle by completing a simple, one page enrollment form that includes the primary subscriber's name and address, along with the names of his or her spouse and children to be included if a family membership is purchased, and payment information. Payment options include payroll deduction, if FullCircle is offered by an employer, and no payment information is requested if it is an included prepaid benefit. When FullCircle receives the enrollment form, unique User ID's and Personal Identification Numbers ("PIN's") are assigned to each subscriber together with unique User ID's and PIN's for each family member. A complete membership package is generated and immediately mailed directly to the subscriber. This package contains a wallet-size ID Card for each member with the unique User ID and PIN for that member and all instructions and all forms needed for membership including medical history and emergency contact questionnaires, the BrightStar emergency identification tools and forms to create the appropriate advanced directives (such as living wills) for the applicable state. The subscriber and/or family members complete the documents and return them in the postage paid envelopes provided to them.



3









When the completed documents are received by FullCircle, they are immediately scanned into a secure electronic database, linked to the customer's assigned User ID and PIN, and the service is activated. In addition, customers may store legal and other documents using the Company's "Electronic Safe Deposit Box" feature. These additional documents are also linked to the member's User ID and PIN, but require an additional password, known only to the member, to be accessed. Once activation occurs, members or emergency medical personnel acting in an emergency can access the appropriate information and documents by using the customer's ID Card directly via the internet or by calling FullCircle's Emergency Response Personnel 24-hours a day. Upon security verification, our Emergency Response Personnel can provide direction to the FullCircle website and/or immediately send the documents via fax, mail or courier. Members accessing personal information and stored documents in their "Electronic Safe Deposit Box" must use their assigned User ID and PIN along with their password.



Our registry stores digital copies of subscribers emergency documents and medical information to make them instantly available to the client or to emergency personnel.  Our system is designed to allow medical personnel to quickly obtain critical information including special medical needs, treatment preferences and emergency contact information.  Our registry has live customer support accessible by phone, fax or secure Internet connection twenty-four hours a day.



Other services we provide include the Collar ID pet registry for missing pets and the BrightStar Photo ID Kit.  By using BrightStar, parents may digitally store photographs and physical information about their children on our database so it may be rapidly distributed to law enforcement and the media in the event a child is abducted or missing.



Call Center



Our call center operates 24 hours a day, seven days a week to process emergency calls and provides access to information and documents to members, emergency personnel, or the authorities as applicable. FullCircle personnel handle all calls between 9:00 AM and 5:00 PM Monday through Friday. We contract with Answer Xact to handle all after-hours and weekend calls. The contract with Answer Xact is on a 30 day basis, renewable from month to month. We provide extensive training for all call center staff and have implemented a strict protocol that must be followed.



Security



Our security system includes designs, methodology and systems to prevent intrusion both to the physical space where documents, records and systems are stored as well as the virtual space where images and other data are stored. In each case, the system balances reasonable access against appropriate levels of security so that the system can be claimed to be virtually impenetrable while still allowing reasonably convenient access in fulfillment of the promise of making emergency information immediately accessible to the needs of our customers. Customer information is stored in both paper and digital form in an ultra-secure, access controlled environment with 24-hour video surveillance, motion detectors, and numerous other security measures. Visitors to our operations center have to pass five video cameras, with the last video camera requiring identification by a staff member, prior to being granted access to the outer office. Direct access to the further secured document storage and retrieval area is limited to only a few individuals. Hardcopies and originals of all documents are catalogued and stored for immediate access as a backup in the event the computer system goes down.



FullCircle's computer system is contained in its own autonomous network behind multiple layers of hardware-based and software-based firewalls allowing only authorized Internet traffic to access the system. The system utilizes multiple layering of passwords and all transmissions use the high level of 128 bit Secure Socket Layer encryption. Access to the network is routed through the firewalls into one of the primary processing computers set up with multiple processors, redundant services including RAID 5 hard drive arrays, redundant power, auto-loading backups, and multi-homed internet connectivity. The computers and network are monitored offsite, 24 hours a day to insure accessibility.





4







Brightstar Photo ID Registry



In the event of a missing or abducted person or child, FullCircle Registry's BrightStar Photo ID Kit provides police and other authorities with instant access to key identification data. This critical information is stored on a secure server and aids police in properly identifying missing or abducted persons, especially during the most critical first minutes.



The BrightStar Photo ID Kit incorporates all five identification elements as recommended by the National Center for Missing and Exploited Children and includes: member data; descriptive information, a color photograph (which can be updated on our system as necessary); an identifying marks chart, fingerprint chart, dental records, as well as friend and family contact information.



FullCircle Registry makes this information available immediately worldwide, 24 hours a day, 7 days a week, via access through its website or toll-free telephone number.



Business Strategy



During 2003, Chris Whitten resigned as Chief Executive Officer and Director.  One of our directors, Mr. Isaac Boutwell, was named Chief Executive Officer.  Our current management is focused on streamlining operations and consolidating our debts.  We intend to reemphasize increasing subscriptions, promoting our digital registry services and expanding our existing operations.



Competition



There are numerous companies, both large and small, who address, with a wide range of methodology, the need to access certain information in the event of an emergency. These companies provide services that range from printing information on bracelets to smart cards and implanted chips and tracking devices. FullCircle believes that they have shortcomings compared to our product, such as the limited amount of medical information that can be printed on a bracelet and the lack of support infrastructure (primarily device readers) that render higher technology solutions ineffective. Other companies offer telephonic and/or online access to certain data with various levels of security and efficiency. Each of these represents a form of competition. However, we do not believe that there are currently any competing businesses that provide the full range of services, flexibility, security and support infrastructure provided by FullCircle.



Intellectual Property



On December 10, 2002, the United States Patent and Trademark Office issued us a registered trademark for FullCircle. The registration number is 2658050.



We have developed proprietary software for the administrative support of health reimbursement plans, billing, commissions, general corporate accounting, and client-firm payroll integration. We have proprietary information, including internal marketing plans and methodology and trade secrets, and we claim copyrights on all published materials, developed for both internal and external distribution. We enter into confidentiality agreements with employees, consultants and sales agents who might have access to proprietary information. We have taken steps to enforce our intellectual property rights including prosecution of legal action where disclosure and/or misuse of confidential information was threatened.



Research and Development



FullCircle Registry owns Spoken Data technology, which can be used by FullCircle Registry members and health care expense reimbursement participants, as well as purchasers of other lines of business. It is not anticipated that we will expend any funds to implement Spoken Data technology to enhance consumer value in the near term.



Continuing website maintenance and development is necessary for FullCircle's website in the short-term.  We intend to enhance our website by including the full array of member services and updating information for investors.



We do not anticipate expending any resources on our Spoken Data or Askphysicians.com subsidiaries in the near future.



5







Employees



We currently have 2 full-time employees working for us, and 8 independent sales representatives.



Item 2. Description of Property



Our principal executive offices are located at 2350 PNC Plaza, Louisville, Kentucky 40202, and our telephone number is (502) 540-5112. The facility is utilized in the following manner:



§

administrative offices;

§

professional offices;

§

storage and warehousing; and

§

product development.



The facility consists of approximately 1,730 square feet of office and warehouse space, leased for $2,739.17 per month in 2003 and $3,003.00 per month in 2004. The lease expired on December 31, 2004. In January 2005, we negotiated a new lease for the same space at $2,306.67 per month on a monthly basis.  We believe that our existing facilities are adequate for our current use.



We currently have 3 new websites that we anticipate will generate revenues in the future.  These websites are:

1.

ENCglobal.com

2.

MyBrightstarKids.com

3.

MyClubcard.com



Item 3.  Legal Proceedings



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



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



None.

PART II



Item 5.  Market for Common Equity and Related Stockholder Matters



CLOSING BID

CLOSING ASK

High

Low

High

Low



2004

First Quarter

.44

.19

.45

.204

Second Quarter

.38

.08

.40

.085

Third Quarter

.12

.051

.13

.058

Fourth Quarter

.12

.065

.13

.075



2003

First Quarter

2.12

.60

2.15

.64

Second Quarter

.59

.05

.64

.055

Third Quarter

.12

.026

.13

.033

Fourth Quarter

.19

.031

.21

.037



The above quotations, as provided by Pink Sheets, LLC, represent prices between dealers and do not include retail markup, markdown or commission.  In addition, these quotations do not represent actual transactions.



6









The Company has not paid, nor declared, any dividends since its inception and does not intend to declare any such dividends in the foreseeable future. The Company's ability to pay dividends is subject to limitations imposed by Nevada law. Under Nevada law, dividends may be paid to the extent that the corporation's assets exceed its liabilities and it is able to pay its debts as they become due in the usual course of business.



Recent Sales of Unregistered Securities



Unless otherwise noted, the following shares were issued to an accredited investor in a private transaction exempt under Rule 506 of Regulation D promulgated under Section 4(2) of the Securities Act of 1933, as amended.



In April 2002, a reverse merger adjustment of 753,360 shares of common stock was recorded.



In April 2002, 53,330 shares of common stock were cancelled.



In May 2002, the Company issued 1,400,000 shares of common stock at $0.50 share

for services provided.



On July 26, 2002, the Company issued 75,000 shares of its common stock in exchange for 1,000,000 shares of Electro-Luminescent Technologies, Inc.



On August 1, 2002, the Company issued to one entity consultant of the Company as consideration for consulting services 30,000 shares of its common stock.



On August 15, 2002, the Company sold 210,750 shares of Series A Preferred stock to several private investors.



On September 16, 2002, the Company issued to one entity consultant of the Company as consideration for consulting services 25,000 shares of its common stock.



In October 2002, the Company issued 120,000 shares of common stock at $0.72 per share for services provided.



On October 24, 2002, the Company issued 6,000,000 shares of its common stock in exchange for all of the issued and outstanding shares of Paradigm Solutions Group, LLC.



On October 24, 2002, the Company issued 210,000 shares of its common stock in exchange for all of the issued and outstanding shares of Spoken Data.



In October 2002, the Company issued 970,000 shares of common stock as incentive for preferred shareholders.



On December 18, 2002, the Company issued 414,000 shares of its common stock upon the exercise of a warrant at an exercise price of $0.01 per share. The holder of the warrant used cash as consideration for the exercise price. The issuance was exempt from registration under Section 4(2) of the Securities Act of 1933, as amended. The individual to whom the shares were issued had a pre-existing relationship with the Company, was the president, chief executive officer, and director of the Company, and had access to the same information as would be included in a registration statement prepared by the Company.



On December 20, 2002, the Company sold 20,000 shares of its common stock, at a price of $0.25 per share, to a private investor. The investor was an accredited investor.



In December 2002, the Company issued 50,000 shares of common stock at $1.05 per share for services provided.



On December 20, 2002, the Company issued to 2 individual consultants of the Company as consideration for lobbying services 25,000 shares of its common stock at $1.13 per share.



On December 20, 2002, the Company issued 462,000 shares of its common stock in exchange for all of the issued and outstanding shares of AskPhysician.com, Inc.



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In December 2002, the Company sold 76,666 shares of common stock at $0.30 per share for cash.



During April 2003, the Company issued 65,000 shares of common stock for notes payable and interest of $23,155.



Under an arrangement whereby FullCircle Registry, Inc. received $200,000 in gross funding in February 2003 and another $400,000 in April 2003, which is secured by convertible debentures, certain holders exercised a portion of their conversion privilege in April 2003 resulting in the issuance of 258,181 shares in free-trading common stock.



Under an arrangement whereby FullCircle Registry, Inc. received $200,000 in gross funding in February 2003 and another $400,000 in April 2003, which is secured by convertible debentures, certain holders exercised a portion of their conversion privilege in May 2003 resulting in the issuance of 980,000 shares in free-trading common stock.



During May 2003, the Company issued 877,112 shares of common stock for notes payable and accrued interest at  $0.16 per share.



During May 2003, the Company issued 220,279 shares of common stock as compensation for services valued at $38,000.



During the May 2003 meeting of the FullCircle Registry, Inc.'s board of directors, the board unanimously approved resolutions authorizing the issuance of common stock under a Stock Incentive Plan for employees, directors and independent contractors. The Company filed a Registration Statement on Form S-8 to register those shares on May 22, 2003.



During May 2003, the Company issued 225,689 shares of common stock for notes payable and accrued interest at  $0.16 per share.



Under an arrangement whereby FullCircle Registry, Inc. received $200,000 in gross funding in February 2003 and another $400,000 in April 2003, which is secured by convertible debentures, certain holders exercised a portion of their conversion privilege in May 2003 resulting in the issuance of 1,192,886 shares in free-trading common stock at $0.03 per share.



Under an arrangement whereby FullCircle Registry, Inc. received $200,000 in gross funding in February 2003 and another $400,000 in April 2003, which is secured by convertible debentures, certain holders exercised a portion of their conversion privilege in June 2003 resulting in the issuance of 714,608 shares in free-trading common stock at $0.03 per share.



Under an arrangement whereby FullCircle Registry, Inc. received $200,000 in gross funding in February 2003 and another $400,000 in April 2003, which is secured by convertible debentures, certain holders exercised a portion of their conversion privilege in June 2003 resulting in the issuance of 734,550 shares in free-trading common stock at $0.04 per share.



During June 2003, we issued 666,623 shares of common stock for services valued at $82,921.



During June 2003, the Board of Directors and shareholders approved an increase in the number of authorized shares of common stock to 200,000,000.



During July 2003, the Company issued 20,000 shares of common stock for settlement of accounts payable at $0.09 per share.



Under an arrangement whereby FullCircle Registry, Inc. received $200,000 in gross funding in February 2003 and another $400,000 in April 2003, which is secured by convertible debentures, certain holders exercised a portion of their conversion privilege in July 2003 resulting in the issuance of 834,373 shares in free-trading common stock at $0.04 per share.





8







Under an arrangement whereby FullCircle Registry, Inc. received $200,000 in gross funding in February 2003 and another $400,000 in April 2003, which is secured by convertible debentures, certain holders exercised a portion of their conversion privilege in July 2003 resulting in the issuance of 1,170,523 shares in free-trading common stock at $0.03 per share.



During July 2003, the Company sold 3,750,000 shares of common stock for cash at $0.04 per share.



During July 2003, The Company received and cancelled the 6,000,000 shares of common stock that had been used to purchase its Paradigm subsidiary.



During July 2003, the Company issued 40,000 shares of common stock for services at $0.06 per share.



During August 2003, The Company issued 2,103,736 shares of common stock for convertible debentures and accrued interest at $0.02 per share.



During August 2003, the Company issued 500,081 shares of common stock for services performed at $0.04 per share.



In September of 2003, we issued 1,516,207 shares of common stock in exchange for the cancellation of convertible debentures and accrued interest at $0.02 per share.



In September of 2003, we issued 2,812,498 shares of common stock in exchange for the cancellation of convertible debentures and accrued interest at $0.01 per share.



In September of 2003, we issued 112,000 shares of common stock in exchange for services valued at $6,720.



In September 2003, we issued 3,117,498 shares of common stock in exchange for services at $0.04 per share.



In October 2003, the Company issued 1,406,249 shares of common stock for convertible debentures and interest at $0.01 per share.



In November 2003, the Company issued 2,715,187 shares of common stock as payment of a penalty on a default of convertible debentures at $0.05 per share.



In November 2003, the Company issued warrants for $13,343 in common stock.



In November 2003, the Company issued 431,000 shares of common stock as compensation for services performed at $0.05 per share.



In November 2003, the Company issued 10,000 shares of common stock for services performed at $0.05 per share.



In December 2003, the Company issued 9,037,500 shares of common stock for 180,750 shares of preferred stock.



In December 2003, the Company issued 39,000 shares of common stock for services performed at $0.15 per share.



In February 2004, the Company issued 85,000 shares of common stock for services performed at $0.26 per share.



In March 2004, the Company issued 500,000 shares of common stock pursuant to conversion of Preferred shares.



In April 2004, the Company issued  86,500 shares of common stock for services performed at $.28 per share.



In April 2004, the Company issued 60,000 shares of common stock in exchange for certain technology at $0.29 per share.



In June 2004, the Company issued 97,500 shares of common stock for services performed at $0.21 per share.



In July 2004, the Company issued 24,000 shares of common stock for services performed at $0.09 per share.



9







In August 2004, the Company issued 24,000 shares of common stock for services performed at $0.07 per share.



In September 2004, the Company issued 24,000 shares of common stock for services performed at $0.09 per share.



In October 2004, the Company issued 24,000 shares of common stock for services performed at $0.10 per share.



In November 2004, the Company issued 19,329,725 shares of common stock for notes payable at $0.04 per share.



In November 2004, the Company issued 44,000 shares of common stock for services performed at $0.09 per share.



In December 2004, the Company cancelled 840,959 shares of common stock that was returned in settlement of a lawsuit.



In December 2004, the Company issued 29,000 shares of common stock for services performed at $0.08 per share.



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



Results of Operations for the Years Ended December 31, 2004 and 2003



The Company had revenues of $58,640 for the year ended December 31, 2004 compared to $110,119 for the year ended December 31, 2003.  Cost of sales was $59,127 for a gross loss of $487 for the year ended 2004 compared to $126,779 cost of sales and gross loss of $16,660 for the year ended December 31, 2003.  Operating expenses were $407,319 for the year ended December 31, 2004 compared to $1,611,611 for the year ended 2003.  $219,629 was recognized as a gain on debt settlement in 2004 compared to $43,848 in 2003.  Interest expense was $52,556 for the year ended December 31, 2004 compared to $38,423 in 2003.  Net loss for the year ended December 31, 2004 was $240,733 compared to $1,671,911 for the same period in 2003.



Management believes it has significantly reduced its expenses during 2004 although revenues were about 50% of the prior year.  Operating expenses consisted of legal, audit and consulting fees combined with general and administrative costs.



Results of Operations for the Years Ended December 31, 2003 and 2002



Fullcircle had revenues of $110,119 during the year ended December 31, 2003 compared to revenues of only $8,936 during 2002. The significant increase in revenues during fiscal 2003 is largely due to increased sales by our parent company, FullCircle.  We also generated approximately $2,000 in revenue from ongoing operations of our subsidiary AskPhysicians.com. None of our other subsidiaries had any operations or generated any revenues during 2003. A cost of sales in 2003 of $126,779 yielded a gross loss before operating expenses of $16,660. In 2002, the Company had cost of sales of $2,286 and showed a gross profit of $6,650 before operating expenses. Operating expenses during 2003 were $1,611,611 and interest expenses were $38,423. As a result of these factors the Company realized an operating loss of $1,628,271 and a net loss of $1,671,911 for 2003. During the year ended December 31, 2002, operating expenses were $2,856,575, expenses associated with reorganization were $310,000, and interest expenses were $34,341 resulting in a net loss for the Company of $3,321,402.



The approximately 50% decrease in net loss, year to year, during 2003 is attributable to higher expenses during 2002. During 2002, $1,839,625 of our general and administrative expenses were attributable to stock issuances.  This represented more than 50% of our total expenses during 2002. Issuances of stock to investors, along with compensation to starting salespeople, development of marketing and other strategic partnerships, and the marketing of our product, all resulted in higher expenses during the early stages of our business model in 2002.





10







Liquidity and Capital Resources



At December 31, 2004, our total assets were $159,146 compared to total assets of $439,804 at December 31, 2003.  The reduction in assets is attributed to depreciation and only $29,795 in investments available for sale compared in 2004 to $279,330 in investments available for sale in 2003.



Our assets at December 31, 2004 consisted of $7,963 in cash compared to $479 in cash on December 31, 2003.  Property and equipment less accumulated depreciation at December 31, 2004 was $120,388 at December 31, 2004 compared to $158,995 at December 31, 2003.  Other assets at December 31, 2004 were $29,795 in investments available for sale and $1,000 in deposits compared to $279,330 in investments available for sale and $1,000 in deposits for the year ended December 31, 2003.



Our liabilities decreased from $779,290 for the year ended December 31, 2003 to $209,706 for the year ended December 31, 2004.



Net cash provided from financing activities was $356,391for the year ended December 31, 2004 with the majority of the cash coming from a note payable to a related party.



From February 2003 through April 2003 we conducted a private placement of $600,000 in convertible debentures and warrants to buy 1,800,000 shares of our common stock.  The debentures bear interest at 12% and mature one year from the date of issuance.  The debentures may be converted for either $0.75 per share or 50% of the average three lowest trading prices for our common during the 20 trading days before the conversion date, whichever is lower.



The warrants are exercisable until seven years from the date of issuance at a purchase price of $0.075. In addition, the exercise price of the warrants will be adjusted in the event we issue common stock at a price below market, with the exception of any securities issued as of the date of the warrant.



The full principal amount of the convertible debentures are due upon default under the terms of convertible debentures. The investors hold a security interest in substantially all of our assets, intellectual property and registration rights with respect to the shares underlying the debentures and warrants.  As of December 31, 2004, none of the warrants have been exercised.



During 2003, we have been negotiating to reduce these convertible debentures and warrants through issuances of common stock.  Through December 31, 2003 we have continued to reduce notes payable, convertible debentures and associated interest.  During 2003, we issued stock for the conversion of debentures and related interest.  Through the twelve months ended December 31, we have settled $203,015 in notes payable and $369,307 in convertible debentures through the issuance of stock. In November 2003, we defaulted on the convertible debenture agreement and a new note was signed pursuant to a settlement agreement. The balance of the new note was $345,533 at December 31, 2003 and was due in November 2004.   We settled the outstanding balance for $150,000 during 2004.  The warrants remain outstanding.



Our material funding requirements include operating debt, salaries, professional fees, and the maintenance of our office and equipment leases.  We will also have ongoing operating costs related to maintaining our emergency data retrieval services, enhancing our registry, and hardware and software upgrades.  During the second quarter of 2003, we executed a contract to provide a significant portion of these services in exchange for our common stock.



As of December 31, 2004 we had no capital commitments.  We are currently focused on increasing revenues from our registry operations and reducing debt through converting debentures and notes payable to common stock.  We may also seek funding from unencumbered securities purchases or from lenders offering favorable terms.  At this time, we have no contracts, agreements, or understandings for additional funding, nor can any assurance be given that we will be able to obtain this capital on acceptable terms, if at all.  In such an event, this may have a materially adverse effect on our business, operating results and financial condition. If the need arises, we may offer a private placement or attempt to obtain funding through the use of various types of short term funding, loans or working capital financing arrangements from financial institutions.





11







We will also continue to explore resale agreements, whereby other organizations bundle FullCircle Registry memberships into the consumer-driven products they are already selling.  If successful, this will reduce sales expenses and broaden our client base.  In addition, our overhead should not increase significantly since we will not have additional data entry expenses and will be able to negotiate and enter into agreements with multiple competitors within any given arena.  Our resellers typically collect retail from their customers and remit wholesale to FullCircle, as a result, we will save the costs associated with billing and paying commissions.  Finally, we can customize our services to provide components that augment the vendors existing product, while still enabling the vendor to meet a competitive price point. We intend to continue exploring resale agreements and cross-marketing opportunities.



FullCircle is able to sell medical care expense reimbursement models on a fee-for-service basis and our members are automatically included for participants in these plans.  Recent guidance promulgated by the Internal Revenue Service provides us a proper framework in which to offer our, health reimbursement arrangements to the public.  FullCircle intends to use only licensed, bonded and insured third party administrators to review and authorize reimbursements.  Participants will have the convenience of an employer-funded debit cards to purchase health care products and services that are not reimbursable by their group health plan.



We require additional capital to supplement our anticipated revenues and fund our continuing operations. We have relied upon advances from officers and shareholders and we have issued stock to finance our operations to this point. Fullcirlce currently owes $53,985 in notes payable to related parties. There are no agreements or understandings that additional funding will be forthcoming. Our auditors have expressed concern that the Company has experienced losses from operations and negative cash flows from operations since inception. We have negative working capital and a capital deficiency at December 31, 2004. These conditions raise substantial doubt about our ability to continue as a going concern.



The Company has adopted a code of ethics that applies to the Companys principal executive officer, principal financial officer, principal accounting officer or controller.  The Code of Ethics is attached as an exhibit to this report.



Item 7. Financial Statements



The financial statements of the Company appear on Page 19.



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



None.



Item 8A.  Controls and Procedures



(a)

Evaluation of Disclosure Controls and Procedures.  The Company's management, with the participation of the chief executive officer and the chief financial officer, carried out an evaluation of the effectiveness of the Company's "disclosure, controls and procedures" (as defined in the Securities Exchange Act of 1934 (the "Exchange Act") Rules 13a-15(3) and 15-d-15(3) as of the end of the period covered by this annual report (the "Evaluation Date").  Based upon that evaluation, the chief executive officer and the chief financial officer concluded that, as of the Evaluation Date, the Company's disclosure, controls and procedures are effective, providing them with material information relating to the Company as required to be disclosed in the reports the Company files or submits under the Exchange Act on a timely basis.



(b)

Changes in Internal Control over Financial Reporting.  There were no changes in the Company's internal controls over financial reporting, known to the chief executive officer or the chief financial officer, that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.



Item 8B. Other Information



There are no further disclosures. All information that was required to be disclosed in a Form 8-K during the fourth quarter, 2004 has been disclosed.



12







PART III

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



The following table sets forth the name, age, position and office term of each executive officer and director of the Company.



|Name

Isaac Boutwell

Trent Oakley

David E. Allen

Alec Stone

Toby G. Wolcott | Age

72

46

51

63

60 | Positions

Chief Executive Officer and Director

Chief Financial Officer and Director

Director

Chairman of the Board

Director | Since

2002

2003

2003

2003

2003
|------------------------------------------------------------------------------- | ----------------------- | -------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------





The Company has no audit committee financial expert, as defined under Section 228.401, serving on its audit committee because it has no audit committee and is not required to have an audit committee because it is not a listed security as defined in Section 240.10A-3.



Issac M. Boutwell, Chief Executive Officer and Director. Mr. Boutwell was elected a director of FullCircle Registry in October 2002. Subsequent to the resignation of our former CEO, Chris Whitten in 2003, Mr. Boutwell was named Chief Executive Officer of FullCircle. Mr. Boutwell is the sole owner of two movie theatres in Kentucky, The Movie Palace in Elizabethtown, and The Dixie Dozen in Louisville, and has been an owner since 1980. Mr. Boutwell has also owned an 1800 acre commercial cattle ranch in Kentucky since 1982.



Trent Oakley, Chief Financial Officer and Director. Mr. Oakley has been the Chief Financial Officer of FullCircle since 2003 and a Director since April 2003. Prior to joining FullCircle, Mr. Oakley was an independent marketing agent and sales manager for 10 years, contracting his services to various insurance companies including Transamerica Life, American United Life, and Guarantee Reserve Life. Mr. Oakley has also been a sales manager with John Hancock Financial Services from 1985 to 1992 and a marketing representative with Prudential Financial Services from 1993 to 1995.



David E. Allen,Director. Mr. Allen was appointed a director of FullCircle Registry in April 2003. Since 1978, Mr. Allen has been the owner and general manager of Allen Air Conditioning and Heating.



Alec Stone,Chairman of the Board of directors. Alec Stone was born on September 28, 1941.  Mr. Stone has been an attorney in private practice since 1968 and currently serves as Chairman of the Board for FullCircle Registry, Inc.  Mr. Stone is not currently serving on the Board of any other public company.



Toby G. Wolcott, Director. Mr. Wolcott was elected a director of FullCircle Registry in April 2003. Mr. Wolcott currently is a sales representative for Business Technology solutions, a position he has held since July 2002. From August 2001 until July 2002, Mr. Wolcott was a sales representative for Tom Sexton & Assoc. From August 2000 until August 2001, Mr. Wolcott was a sales representative for Central School Supply. Mr. Wolcott has also been a sales representative for Panax from August 1998 until August 2000 and for Worldwide Visioneering from June 1996 until August 1998.





13







Item 10. Executive Compensation



Compensation of Directors



Directors receive 2,000 shares of common stock for each Board meeting that they attend in person. During 2004 Directors received the following shares of common stock for attending Board meetings:



Name

Number of Shares

Reason



David Allen

8,000

Attendance of  4 Board meetings



Isaac Boutwell

8,000

Attendance of  4 Board meetings



Trent Oakley

8,000

Attendance of  4 Board meetings



Alec Stone

8,000

Attendance of  4 Board meetings



Toby Wolcott

8,000

Attendance of  4 Board meetings



Compensation of Officers



The following table lists the compensation received by our former and current officers over the last three years.



SUMMARY COMPENSATION TABLE



|Name and
Principal Position
Of Former Officers.                                                                                                | Year
Ended                                                | Annual Compensation                   | Long Term Compensation      | All Other Compen-
sation
($)           
|---------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------- | ------------------------------------- | --------------------------- | ---------------------------------------
|Awards                                                                                                                                         | Payouts                                                  
|Salary
($)                                                                                                                                     | Bonus($)                                                  | Other Annual
Compen-
sation ($)       | Restricted Stock Awards
($) | Securities Underlying Options/
SARs (#)
|Jim Reskin
Former CEO, resigned 4/9/03

Steve Whitten(12)
Former CEO, resigned 9/30/03

Garriott Baker(13)
Former President, resigned 10/01/03 | 12/31/03
12/31/02


12/31/03
12/31/02


12/31/03
12/31/02 | 0
120,000


0
0


70,307.63
72,000(7) |                             | 0
0


0
0


37,153.74(4)
87,000        
|Isaac Boutwell(14)
CEO and Director since
10/01/03

Trent Oakley(15)
CFO, Executive VP and CMO since June 2003                                 | 12/31/04
12/31/03
12/31/02

12/31/04
12/31/03
12/31/02    | 0
0
0

0
40,250
0                     |                             | 0
0
0

40,400(10)
37,553.06(8)
0       



(1)

Jim Reskin received 225,689 shares worth $35,245 as compensation during 2003.



(2)

Mr. Reskin's employment contract granted him options to purchase five percent (5%) of the then-outstanding shares of common stock at the time of execution, at an exercise price of $0.01 a share. On April 17, 2002, Mr. Reskin exercised his option for 3% of the then-outstanding shares of common stock of the company, for a total of 384,000 shares of common stock, for a total exercise price of $3,840. On December 18, 2002, Mr. Reskin exercised his option for the remaining 2% of the then-outstanding shares of common stock of the company, for a total of 414,000 shares of common stock, for a total exercise price of $4,140.



14









(3)

Steve Whitten received 115,000 shares worth $18,580 as compensation during 2003.



(4)

B-Advisors, an entity controlled by Garrriott Baker, received payments totaling $37,153.74 in 2003.



(5)

Mr Baker received 80,000 shares worth $7,950 as compensation during 2003.



(6)

Mr. Baker exercised 200,000 stock options at a price of $0.001 per share for a total of $200.



(7)

Mr. Baker signed an employment agreement on July 1, 2002 to be the President of Paradigm Solutions Group, LLC for an annual salary of $72,000. Mr. Baker also received an office allowance of $250 per month during 2002. Additionally, Mr. Baker was entitled to receive additional monthly compensation at a minimum of $7,000, based upon the number of active participants in the HealthIER Plan. Mr. Baker received $7,000 a month, and an additional $1.00 for each HealthIER Plan participant that exceeds $7,000.



(8)

Trent Oakley, Inc., an entitiy owned by Trent Oakley received $5,000 in payments for consulting services in 2003. Additionally, Progressive Management Solutions, an entity owned by Trent Oakley, received $32,553.06 in commissions and for consulting services in 2003.



(9)

Mr. Oakley received 95,000 shares worth $15,400 as compensation during 2003.



(10) Mr. Oakley received 20,000 shares worth $40,400 as compensation during 2004.



(11)Mr. Oakley exercised 200,000 stock options at a price of $0.001 per share for a total of $200.



(12)Steve Whitten received an additional 6,000 shares compensation for duties performed as a Director of the Company.



(13)Mr. Baker also received an additional 18,000 shares compensation for duties performed as a Director of the Company.



(14)Mr. Boutwell received 20,000 shares in 2003 and 8,000 shares in 2004 as compensation for duties performed as a Director of the Company.



(15)Mr. Oakley received 20,000 shares in 2003 and 8,000 shares in 2004 as compensation for duties performed as a Director of the Company.





15







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



The following table sets forth as of December 31, 2004, the name and shareholdings of each person known to us that either directly or beneficially holds more than 5% of our 71,615,242 issued and outstanding shares of common stock, par value $.001.  The table also lists the name and shareholdings of each director and of all officers and directors as a group.  Except as otherwise indicated, the persons named in the table have sole voting and dispositive power with respect to all shares beneficially owned, subject to community property laws where applicable.



|Name and Address



Isaac Boutwell (1)(2)(3)
1815 Cann School Lane
East View, KY 42732

Trent Oakley (1)(2)(4)
8210 Smithtown Rd.
Louisville, KY 40218

David E. Allen (1)
5350 Stiles Rd.
Howardstown, KY 40051

Alec Stone (1)
830 Lawrence St.
Brandenburg, KY 40108

Toby G. Wolcott (1)
7521 Newton Dr.
Louisville, KY 40228

George Harman(5)
3033 Ring Rd.
Elizabethtown, KY 42701 | Title of Class



Common



Common



Common



Common



Common



Common | Number of Shares Beneficially Owned

20,777,549



502,189



102,967



7,683,584



28,000



4,796,230 | % of Shares



29%



0.7%



0.14%



10.73%



.04%



6.7%
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------
|All Executive Officers and Directors as a group (5 people)                                                                                                                                                                                                                                                                                                                                | Common                                                                     | 29,094,289                                                                                                | 40.63%                                                       

All Executive Officers and Directors as a group (5 persons)

(1)

Director

(2)

Officer

(3)

Includes 390,000 shares held in the name of Rosewitha H. Boutwell, spouse of Issac M. Boutwell

(4)

Includes 1,486 shares held in the name of Lindsey Oakley and 1,703 shares held in the name of M. Jeannie Oakley

(5)

Includes 200,000 shares held in the name of Donna F. Harman, spouse of George Harman



Item 12. Certain Relationships and Related Transactions.



The Company entered into a lease agreement for office space whereby we make direct payments to the lessor although the lease is held in the name of a minority shareholder.  The monthly lease payment is $3,003 and the lease expires in December 2004.  Rent expense was approximately $44,000 for 2004 which included maintenance fees.  In January 2005, we negotiated a new lease for the same space at $2,306.67 per month on a monthly basis.



The Company has a note payable to a shareholder as of December 31, 2004 in the amount of $53,985.



16







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



a)

Exhibits



|Exhibit                 Title
Number                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               | Location                                                                                               
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------
|3(i)                         Articles of Incorporation*

3(ii)                        Bylaws*

14                           Code of Ethics

31.1                        Certification of the Principal Executive Officer pursuant to Section 302
of the Sarbanes-Oxley Act of 2002

31.2                        Certification of the Principal Financial Officer pursuant to Section 302
of the Sarbanes-Oxley Act of 2002

32.1                       Certification of the Principal Executive Officer pursuant to U.S.C. Section
1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002**

32.2                       Certification of the Principal Financial Officer pursuant to U.S.C. Section
1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002** | Form 10-SB filed 2/15/00

Form 10-SB filed 2/15/00

Attached

Attached


Attached


Attached


Attached



b)

Reports on Form 8-K

No reports on Form 8-K were filed during the quarter ended December 31, 2004.



* Incorporated by reference. Filed as exhibit to Form 10-SB filed February 15, 2000.



**The Exhibit attached to this Form 10-KSB shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to liability under that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.



Item 14. Principal Accountant Fees and Services



Audit Fee



The aggregate fees billed for each of the last two fiscal years for professional services rendered by the principal account for the audit of FullCircles annual financial statement and review of financial statements included in FullCircles 10-QSB reports and services normally provided by the accountant in connection with statutory and regulatory filings or engagements were $21,400 for fiscal year ended 2004 and $33,500 for fiscal year ended 2003.



Audit-Related Fees



There were no fees for other audit related services for fiscal years ended 2004 and 2003.



Tax Fees



There were no fees for tax compliance, tax advice and tax planning for the fiscal years 2004 and 2003.



17







All Other Fees



There were no other aggregate fees billed in either of the last two fiscal years for products and services provided by the principal accountant, other than the services reported above.



We do not have an audit committee currently serving and as a result our board of directors performs the duties of an audit committee.  Our board of directors will evaluate and approve in advance, the scope and cost of the engagement of an auditor before the auditor renders audit and non-audit services.  We do not rely on pre-approval policies and procedures.



SIGNATURES



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



FULLCIRCLE REGISTRY, INC.





Date: April 15, 2005



/s/Isaac Boutwell

Chief Executive Officer





Date: April 15, 2005



/s/Trent Oakley

Chief Financial Officer





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







Date: April 15, 2005

By: /s/ Isaac Boutwell

Isaac Boutwell

Director





Date: April 15, 2005

By: /s/ Trent Oakley

Trent Oakley

Director



Date: April 15, 2005

By: /s/ Alec Stone

Alec Stone

Director



Date: April 15, 2005

By: /s/ David E. Allen



David E. Allen

Director



Date: April 15, 2005

By: /s/ Toby G. Wolcott



Toby G. Wolcott

Director







18









































FULLCIRCLE REGISTRY, INC.



CONSOLIDATED FINANCIAL STATEMENTS



December 31, 2004 and 2003































19











C O N T E N T S





Independent Auditor=s Report

21



Consolidated Balance Sheets

22



Consolidated Statements of Operations

24



Consolidated Statements of Stockholders= Equity

25



Consolidated Statements of Cash Flows

28



Notes to the Consolidated Financial Statements

30



20















INDEPENDENT AUDITOR=S REPORT





To the Board of Directors and Stockholders of

FullCircle Registry, Inc.



We have audited the accompanying consolidated balance sheets of FullCircle Registry, Inc. and Subsidiaries as of December 31, 2004 and 2003 and the related consolidated statements of operations, stockholders= equity and comprehensive income and cash flows for the years then ended.  These consolidated financial statements are the responsibility of the Company=s management.  Our responsibility is to express an opinion on these consolidated financial statements based on our audits.



We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatements.  The Company has determined that it is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the  financial statements.  An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinion.



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



The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern.  As discussed in Note 2 to the consolidated financial statements, the Company has recurring operating losses, negative working capital and is dependent on financing to continue operations.  These factors raise substantial doubt about its ability to continue as a going concern.  Management=s plans in regard to these matters are also described in the Note 2.  The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.





/s/ Chisolm, Bierwolf & Nilson, LLC



Chisholm, Bierwolf & Nilson, LLC

Bountiful, Utah

February 23, 2005



21









|FullCircle Registry, Inc.         
|----------------------------------
|Consolidated Balance Sheets       
|                                  
|                                  
|ASSETS                            
|                                  
|                                  
|                                  
|                                  
|CURRENT ASSETS:                   
|Cash                              
|                                  
|Total Current Assets              
|                                  
|PROPERTY AND EQUIPMENT:           
|Computers and equipment           
|Office furniture and fixtures     
|Software                          
|                                  
|                                  
|Less:                             
|Accumulated depreciaton - software
|Accumulated depreciaton           
|                                  
|Total Property and Equipment      
|                                  
|OTHER ASSETS:                     
|Investments available for sale    
|Deposits                          
|                                  
|Total Other Assets                
|                                  
|TOTAL ASSETS                      
|                                  

The accompanying notes are an integral part of these financial statements



22









|FullCircle Registry, Inc.                                            
|---------------------------------------------------------------------
|Consolidated Balance Sheets (Continued)                              
|                                                                     
|                                                                     
|LIABILITIES AND STOCKHOLDERS' EQUITY                                 
|                                                                     
|                                                                     
|                                                                     
|CURRENT LIABILITIES:                                                 
|Accounts payable                                                     
|Accrued expenses                                                     
|Current protion of long-term liabilities                             
|                                                                     
|Total Current Liabilities                                            
|                                                                     
|LONG-TERM LIABILITIES:                                               
|Notes payable                                                        
|Notes payable-related party                                          
|Capital lease                                                        
|Less: current portion of long-term liabilities                       
|                                                                     
|Total Long Term Liabilities                                          
|                                                                     
|Total Liabilities                                                    
|                                                                     
|                                                                     
|STOCKHOLDERS' EQUITY:                                                
|Preferred stock, authorized 5,000,000 shares of $.001 par value,     
|issued and outstanding 20,000 and 30,000 shares, respectively        
|Common stock, authorized 200,000,000 shares of $.001 par value,      
|issued and outstanding 71,615,242 and 52,128,476 shares, respectively
|Additional paid in capital                                           
|Accumulated other comprehensive income                               
|Retained earnings (deficit)                                          
|                                                                     
|Total Stockholders' Equity                                           
|                                                                     
|TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                           
|                                                                     



The accompanying notes are an integral part of these financial statements



23









|FullCircle Registry, Inc.                              
|-------------------------------------------------------
|Consolidated Statements of Operations                  
|                                                       
|                                                       
|                                                       
|                                                       
|                                                       
|                                                       
|Revenues                                               
|                                                       
|Cost of sales                                          
|                                                       
|Gross Profit                                           
|                                                       
|Operating Expenses                                     
|Selling, general & administrative                      
|                                                       
|Total Operating Expenses                               
|                                                       
|Operating Income (Loss)                                
|                                                       
|Other Income (Expense)                                 
|Gain on settlement of debt                             
|Interest expense                                       
|                                                       
|Total Other Income (Expense)                           
|                                                       
|Net Income (Loss) from Continuing Operations           
|                                                       
|Discontinued Operations                                
|Gain (loss) from operations (net of income taxes of $0)
|Gain (loss) on disposal (net of income taxes of $0)    
|                                                       
|Total Gain (Loss) From Discontinued Operations         
|                                                       
|Net Income (Loss)                                      
|                                                       
|Net Income (Loss) Per Share                            
|                                                       
|Weighted Average Shares Outstanding                    
|                                                       



The accompanying notes are an integral part of these financial statements



24







FullCircle Registry, Inc. and Subsidiaries

Consolidated Statements of Stockholders' Equity (Deficit) and Comprehensive Income





Accumulated

Additional

Retained

Other

Preferred Stock

Common Stock

Paid-In

Earnings

Comprehensive

Shares

Amount

Shares

Amount

Capital

(Deficit)

Income



Balance, December 31, 2002

210,750

$        211

22,577,696

$       22,578

$   8,420,213

(4,465,853)

-



April 2003- stock issued for notes payable and

Accrued interest at $0.36 per share

-

-

65,000

65

23,155

-

-



April 2003- stock issued for convertible debentures

And accrued interest at $0.11 per share

-

-

258,181

258

28,916

-

-



May 2003- stock issued for convertible debentures

And accrued interest at $0.08 per share

-

-

980,000

980

72,520

-

-



May 2003- stock issued for notes payable and

Accrued interest at $0.16 per share

-

-

877,112

877

142,809

-

-



May 2003- stock issued for deferred compensation

At $0.16 per share

-

-

220,279

220

37,780

-

-



May 2003- stock issued for notes payable at $0.16

Per share

-

-

225,689

226

35,884

-

-



May 2003- stock issued for convertible debentures

And accrued interest at $0.03 per share

-

-

1,192,886

1,193

28,807

-

-



June 2003- stock issued for convertible debentures

And accrued interest at $0.03 per share

-

-

714,608

715

17,150

-

-



June 2003- stock issued for convertible debentures

And accrued interest at $0.04 per share

-

-

734,550

735

31,806

-

-



June 2003- stock issued for service at $.12 per share

-

-

666,623

667

79,328

-

-



July 2003- stock issued for settlement of accounts

Payable at $0.09 per share

-

-

20,000

20

1,780

-

-



July 2003- stock issued for convertible debentures

And accrued interest at $0.04 per share

-

-

834,373

834

31,707

-

-



July 2003- stock issued for convertible debentures

And accrued interest at $0.03 per share

-

-

1,170,523

1,171

31,370

-

-



July 2003- stock issued for cash at $0.04 per share

-

-

3,750,000

3,750

146,250

-

-



July 2003- stock received and canceled from sales

of subsidiary

-

-

(6,000,000)

(6,000)

(3,973,246)

-

-



July 2003- stock issued for services at $0.06 per share

-

-

40,000

40

2,360

-

-



August 2003- stock issued for convertible debentures

And accrued interest at $0.02 per share

-

-

2,103,736

2,103

42,298

-

-



The accompanying notes are an integral part of these financial statements





25







FullCircle Registry, Inc. and Subsidiaries

Consolidated Statements of Stockholders' Equity (Deficit) and Comprehensive Income (Continued)





Accumulated

Additional

Retained

Other

Preferred Stock

Common Stock

Paid-In

Earnings

Comprehensive

Shares

Amount

Shares

Amount

Capital

(Deficit)

Income



August 2003- stock issued for service at $0.04

Per share

-

-

500,081

500

19,503

-

-



September 2003- stock issued for convertible

Debentures and accrued interest at $0.02 per share

-

-

1,516,207

1,516

21,227

-

-



September 2003- stock issued for convertible

Debentures and accrued interest at $0.01 per share

-

-

2,812,498

2,812

33,188

-

-



September 2003- stock issued for service at $0.06

Per share

-

-

112,000

112

6,608

-

-



September 2003- stock issued for services at $0.04

Per share

-

-

3,117,498

3,117

121,583

-

-



October 2003- stock issued for convertible debentures

And accrued interest at $0.01 per share

-

-

1,406,249

1,406

16,594

-

-





November 2003- stock issued for penalty on default

Of convertible debentures at $0.05 per share

-

-

2,715,187

2,715

133,044

-

-





November 2003- warrants issued

-

-

-

-

13,343

-

-



November 2003- stock issued for services at $0.05

Per share

-

-

431,000

431

21,119

-

-



December 2003- stock issued for services at $0.05

Per share

-

-

10,000

10

490

-

-



December 2003- stock issued for preferred stock

(180,750)

(181)

9,037,500

9,038

(8,857)

-

-



December 2003- stock issued for services at $0.15

Per share

-

-

39,000

39

5,811

-

-



Net changes in unrealized gain (loss) on available for

Sale investments

-

-

-

-

-

-

161,580



Net income (loss) for the year ended

December 31, 2003

-

-

-

-

-

(1,671,911)

-



Balance, December 31, 2003

30,000

$             30

52,128,476

$         52,128

$ 5,584,540

$ (6,137,764)

$        161,580





26







FullCircle Registry, Inc. and Subsidiaries

Consolidated Statements of Stockholders' Equity (Deficit) and Comprehensive Income (Continued)







Accumulated

Additional

Retained

Other

Preferred Stock

Common Stock

Paid-In

Earnings

Comprehensive

Shares

Amount

Shares

Amount

Capital

(Deficit)

Income



February 2004- stock issued for service at $0.26

Per share

-

-

85,000

85

22,015

-

-



March 2004- stock issued for conversion of preferred

Stock

(10,000)

(10)

500,000

500

(490)

-

-



April 2004- stock issued for services at $0.28

Per share

-

-

86,500

87

24,134

-

-



April 2004- stock issued for technology at $0.29

Per share

-

-

60,000

60

17,340

-

-



June 2004- stock issued for services at $0.21 Per share

-

-

97,500

98

11,602

-

-



July 2004- stock issued for services at $.09 per share

-

-

24,000

24

2,136

-

-



August 2004- stock issued for services at $0.07

Per share

-

-

24,000

24

1,656

-

-



September 2004- stock issued for services at $0.09

Per share

-

-

24,000

24

2,136

-

-



October 2004- stock issued for services at 0.10

Per share

-

-

24,000

24

2,376

-

-



November 2004- stock issued for notes payable at $0.04

Per share

-

-

19,329,725

19,330

753,859

-

-



November 2004- stock issued for services at $0.09

Per share

-

-

44,000

44

3,916

-

-



December 2004- stock retuned in settlement of a lawsuit

-

-

(840,959)

(841)

(83,255)

-

-





December 2004- stock issued for services at $0.08 per share

-

-

29,000

29

2,291

-

-



Net charge in unrealized gain (loss) on available for

Sale investments

-

-

-

-

-

-

(249,535)



Net income (loss) for the year ended

December 31, 2004

-

-

-

-

-

(240,733)

-



Balance, December 31, 2004

20,000

$          20

71,615,242

$    71,616

$  6,344,256

$  (6,378,256)

$  (87,955)









The accompanying notes are an integral part of these financial statement



27









|FullCircle Registry, Inc.                                    
|-------------------------------------------------------------
|Consolidated Statements of Cash Flows                        
|                                                             
|                                                             
|                                                             
|Cash Flows from Operating Activities                         
|Net Income (Loss)                                            
|Less: Net Income (Loss) from Discontinued Operations         
|Net Income (Loss) from Continuing Operations                 
|Adjustments to Reconcile Net Loss to Net Cash                
|Provided by Operations:                                      
|Depreciation and amortization                                
|Stock issued for services                                    
|Stock issued for penalty on default of convertible debentures
|Note payable issued for finance charges                      
|Write off of goodwill                                        
|Warrants issued                                              
|Convertible debentures issued for services                   
|Gain on settlement of debt                                   
|Change in Assets and Liabilities                             
|(Increase) decrease in commission advances                   
|Increase (decrease) in bank overdraft                        
|Increase (decrease) in accounts payable                      
|Increase (decrease) in accrued expenses                      
|                                                             
|Net Cash Provided(Used) by Continuing Operating Activities   
|                                                             
|Cash Flows from Investing Activities                         
|Cash paid in sale of subsidiary                              
|Cash paid for notes receivable                               
|Cash paid for property and equipment                         
|                                                             
|Net Cash Provided (Used) by Investing Activities             
|                                                             
|Cash Flows from Financing Activities                         
|Cash received from convertible debentures                    
|Cash received from notes payable -related party              
|Cash paid for capital leases                                 
|Cash paid for notes payable -related party                   
|Cash received from issuance of stock                         
|                                                             
|Net Cash Provided(Used) by Financing Activities              
|                                                             
|Increase (Decrease) in Cash from Continuing Operations       
|                                                             
|Cash and Cash Equivalents at Beginning of Period             
|                                                             
|Cash and Cash Equivalents at End of Period                   

v

The accompanying notes are an integral part of these financial statements



28









|FullCircle Registry, Inc. (continued)
|-------------------------------------
|Consolidated Statements of Cash Flows
|                                     
|                                     
|                                     



|                                                              |                    |                    |                |                    |                |                    |                
|------------------------------------------------------------- | ------------------ | ------------------ | -------------- | ------------------ | -------------- | ------------------ | ---------------
|Cash Paid For:                                                |                    |                    |                |                    |                |                   
|Interest                                                      |                    |                    |                |                    |                |                    | $         5,724
|Income Taxes                                                  |                    |                    |                | $                - |                | $                -
|                                                              |                    |                    |                |                    |                |                    |                
|Non-Cash Activities:                                          |                    |                    |                |                    |                |                   
|Stock issued for services                                     |                    |                    | $       72,700 |                    | $      299,718
|Stock issued for accounts payable                             |                    | $                - |                | $       18,845    
|Stock issued for notes payable and interest                   |                    | $     773,189      |                | $      203,015    
|Stock issued for convertible debentures and interest          | $                - |                    | $      369,307
|Convertible debentures issued for services                    |                    | $                - |                | $      122,100    
|Warrants issued                                               |                    |                    |                | $                - |                | $       13,343    
|Stock issued for penalty on default of convertible debentures | $                - |                    | $      135,759
|Note payable issued for finance charges                       |                    | $                - |                | $      119,714    
|Forgiveness of note payable and accrued interest              | $     135,533      |                    | $       43,848
|                                                              |                    |                    |                |                    |                |                    |                



























The accompanying notes are an integral part of these financial statements



29







FULLCIRCLE REGISTRY, INC.

Notes to Consolidated Financial Statements

December 31, 2004 and 2003



NOTE 1 -  SIGNIFICANT ACCOUNTING POLICIES



a.  Organization



FullCircle Registry, Inc. (the Company), formerly Excel Publishing, Inc., (Excel) was incorporated on June 7, 2000 in the State of Nevada.  On April 10, 2002, the Company merged with FullCircle Registry, Inc. a private Delaware corporation (FullCircle).  Per the terms of the agreement, Excel agreed to deliver 12,000,000 shares of the Company=s common stock to the shareholders of FullCircle in exchange for 100% of FullCircle=s shares.  The merger was treated as a reverse merger with FullCircle being the accounting acquirer, therefore, all historical financial information prior to the acquisition date is that of FullCircle.  Pursuant to the merger, the Company changed their name from Excel Publishing, Inc. to FullCircle Registry, Inc.



FullCircle Registry, Inc.  was incorporated as WillRequest.com, Inc. under the laws of the State of Delaware on January 20, 2000.  In July 2000, the Company changed its name from WillRequest.com, Inc. to FullCircle Registry, Inc.  The Company was formed to provide a digital safe deposit box containing vital medical and legal information of its customers.  The Company is currently focusing on raising capital to develop its operations



In July of 2002, the Company issued 75,000 shares of common stock to acquire 100% of the shares of Electronic Luminescent Technologies, Inc. (AELTI@) a Florida Corporation. ELTI was in possession of a license agreement for a ABicycle Illumination System@. Subsequent to the merger, ELTI transfered its interest in the license for 1,000,000 shares (a 10% interest) in GloTech Industries. (See investments available for sale).



On October 10, 2002, the Company issued 210,000 shares of common stock for all issued and outstanding stock of Spoken Data Technologies, a Florida corporation (SDT). SDT is in possession of text-to-voice software technology developed by the University of New Brunswick. The Company intends to incorporate this technology with its digital medical and legal information database.



Also on October 10, 2002, the Company issued 6,000,000 shares of common stock and a note payable for $500,000 for all issued and outstanding shares of Paradigm Solutions Group, LLC. (Paradigm), a Delaware Limited Liability Company. Paradigm   promotes the HEalthier Plan, a medical reimbursement plan designed to assist employers to make use of qualified IRS tax free medical reimbursement programs.



On December 20, 2002, the Company issued 462,000 shares of common stock for all issued and outstanding shares of AskPhysicians.com, Inc. (APC) a Florida corporation. APC possesses a website where the public can ask questions of a physician and receive online advice.



On July 29, 2003, the Company entered into a sales agreement for its wholly-owned subsidiary, Paradigm.  Pursuant to the agreement, the 6,000,000 shares of common stock originally issued by the Company for the acquisition of Paradigm were returned to the Company and canceled.  The assets and liabilities of Paradigm have been presented on the financial statements as discontinued operations.  The Company has recorded the sale as a cost of treasury stock, therefore, the loss on discontinued operations for 2003 includes the net loss from operations of Paradigm from January 1, 2003 through July 29, 2003.



30







FULLCIRCLE REGISTRY, INC.

Notes to Consolidated Financial Statements

December 31, 2004 and 2003



NOTE 1 -  SIGNIFICANT ACCOUNTING POLICIES (Continued)



b.  Accounting Method



The Company recognizes income and expenses on the accrual basis of accounting.  The Company has chosen a fiscal year end of December 31.



c.  Earnings (Loss) Per Share



The computation of earnings per share of common stock is based on the weighted average number of shares outstanding at the date of the consolidated financial statements.  Common stock equivalents have not been included in the weighted average number of shares outstanding because of its anti-dilutive effects.

December 31,



2004

2003



Numerator - loss

$

(240,733)

$

(1,671,911)

Denominator - weighted average

of shares outstanding

56,086,875

31,529,839

Loss per share

$        (0.00)

$         (0.05)



d.  Cash and Cash Equivalents



The Company considers all highly liquid investments with maturities of three months or less to be cash equivalents.



e.  Provision for Income Taxes



No provision for income taxes has been recorded due to net operating loss carryforwards totaling approximately $6,400,000 that will be offset against future taxable income.  These NOL carryforwards begin to expire in the year 2020.  No tax benefit will be recorded until the Company generates taxable income.



Deferred tax assets and the valuation account is as follows at December 31, 2004 and 2003:

December 31,



2004

2003



Deferred tax asset:

NOL carryforward

$

2,176,000

$

2,261,346

Valuation allowance

(2,176,000)

(2,261,346)

Total

$           -

$             -



f.  Use of Estimates in the Preparation of Consolidated Financial Statements



The preparation of consolidated financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements and expenses during the reporting period.  In these Consolidated Financial Statements, assets, liabilities and expenses involve extensive reliance on management=s estimates.  Actual results could differ from those estimates.



31







FULLCIRCLE REGISTRY, INC.

Notes to Consolidated Financial Statements

December 31, 2004 and 2003



NOTE 1 -  SIGNIFICANT ACCOUNTING POLICIES (Continued)



g.  Property and Equipment



Expenditures for property and equipment and for renewals and betterments, which extend the originally estimated economic life of assets or convert the assets to a new use, are capitalized at cost.  Expenditures for maintenance, repairs and other renewals of items are charged to expense.  When items are disposed of, the cost and accumulated depreciations are eliminated from the accounts, and any gain or loss is included in the results of operations.



The provision for depreciation is calculated using the straight-line method over the estimated useful lives of the assets.  Depreciation expense for the periods ended December 31, 2004 and 2003 is $56,007 and $112,746, respectively.



h.  Principles of Consolidation



For the years ended December 31, 2004 and 2003, the consolidated financial statements include the books and records of FullCircle Registry, Inc., Electronic Luminescent Technologies, Inc., Spoken Data Technologies and AskPhysicians.com, Inc. All inter-company transactions and accounts have been eliminated in the consolidation.



NOTE 2 -  GOING CONCERN



The accompanying Consolidated Financial Statements have been prepared assuming that the Company will continue as a going concern.  The Company has suffered recurring losses negative working capital and is dependent upon raising capital to continue operations.  The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.  It is management=s plan to generate additional working capital by increasing revenue as a result of new sales and marketing initiatives and by raising additional capital from investors.



NOTE 3 -  LONG-TERM LIABILITIES



Long-term liabilities are detailed in the following schedules as of December 31, 2004 and 2003:

2004

2003



Notes Payable - Related Party:



Note payable to a shareholder pursuant to a

settlement agreement for default on convertible

debenture agreement, non interest bearing,

principal due as follows: 1 month at $15,000;

3 months at $20,000 per month; $40,000 per

month, thereafter, matures November 2004

$

-

$

345,533







32







FULLCIRCLE REGISTRY, INC.

Notes to Consolidated Financial Statements

December 31, 2004 and 2003



NOTE 3 -

LONG-TERM LIABILITIES (Continued)

2004

2003



Note payable to a shareholder bears interest at

8.0% per annum principal and interest due on

demand

$

53,985

$

53,985



Note payable to a shareholder, non-interest

bearing, principal due January 2004

-

50,000



Note payable to an officer, non-interest bearing,

principal due January 2004

-

50,000



Note payable to an officer, bears interest at 8%

per annum, principal and interest due on demand

-

76,072



Notes payable

53,985

575,590



Note payable to various individuals bears interest

at 7.0% per annum principal and interest due on

demand

40,000

26,250



Total Notes Payable

93,985

601,840



Capital Leases



Capital lease payable to a leasing company, bears

interest at 10% per annum, monthly payments due

of $515, matures June 2006, secured by equipment

$

8,458

$

13,514



Total Capital Leases

8,458

13,514



Total Long-Term Liabilities:

102,443

615,354



Less current portion:

(99,572)

(606,896)



Net Long-Term Liabilities

$

2,871

$

8,458



Future minimum principal payments on notes payable are as follows:



2005

$

99,572

2006

2,871

Total Long-Term Liabilities

$

102,443







33







FULLCIRCLE REGISTRY, INC.

Notes to Consolidated Financial Statements

December 31, 2004 and 2003



NOTE 4 -  RELATED PARTY



The Company entered into a lease agreement for office space with a shareholder.  The monthly lease payment is $3,003 and the lease expired in December 2004.  Rent expense was approximately $44,000 for 2004 and 2003, respectively.



The Company has notes payable due to an officer of $0 and $126,072 as of December 31, 2004 and 2003, respectively [see Note 3].



The Company has notes payable due to shareholders as of December 31, 2004 and 2003 of $53,985 and $449,518, respectively [See Note 3].



NOTE 5 - COMMITMENTS AND CONTINGENCIES



The Company leases office space on a monthly basis.



NOTE 6 -  GOODWILL/ACQUISITIONS



The Company has adopted Statement of Financial Accounting Standards (SFAS) No. 141 (SFAS 141), ABusiness Combinations@ and No. 142 (SFAS 142), AGoodwill and Other Intangible Assets@, which establishes new standards for the treatment of goodwill and other intangible assets.  SFAS 142 prescribes that amortization of goodwill will cease as of the adoption date (January 1, 2002).  Additionally, the Company will be required to perform an impairment test on goodwill and other intangible assets annually, and whenever events and circumstances occur that might affect the carrying value of such assets.  The Company has performed an internal impairment test of goodwill and has recorded impairments as described below.



In July of 2002, the Company issued 75,000 shares of common stock valued at $117,750 to acquire 100% of the shares of Electronic Luminescent Technologies, Inc. (AELTI@) a Florida Corporation.  As such, ELTI became a wholly owned subsidiary of the Company.  This transaction was accounted for on the purchase method of accounting using generally accepted accounting principles.  Goodwill was not recorded in this transaction and the asset was subsequently exchanged for 1,000,000 shares of GloTech stock. (see investments available-for-sale. There were no operations of this subsidiary during 2004 and 2003.



On October 10, 2002, the Company issued 210,000 shares of common stock valued at $140,700, for all issued and outstanding stock of Spoken Data Technologies, a Florida corporation (SDT)  As such, SDT became a wholly owned subsidiary of the Company.  This transaction was accounted for on the purchase method of accounting using generally accepted accounting principles.  Goodwill was not recorded in this transaction as the software assets acquired were valued at the market price of the stock issued. There were no operations of this subsidiary during 2004 and 2003.





34







FULLCIRCLE REGISTRY, INC.

Notes to Consolidated Financial Statements

December 31, 2004 and 2003



NOTE 6 - GOODWILL/ACQUISITIONS (Continued)



On October 10, 2002, the Company issued 6,000,000 shares of common stock valued at $4,020,000, and a note payable for $500,000 for all issued and outstanding shares of Paradigm Solutions Group, LLC. (Paradigm), a Delaware Limited Liability Company.  As such, Paradigm became a wholly owned subsidiary of the Company.  This transaction was accounted for on the purchase method of accounting using generally accepted accounting principles.  Goodwill was recorded of $4,296,608 upon acquisition, and was deemed by management to not be impaired as of December 31, 2002.  On July 29, 2003, Paradigm was sold and the original 6,000,000 shares issued by the Company were returned and cancelled.



On December 20, 2002, the Company issued 462,000 shares of common stock valued at $471,240, for all issued and outstanding shares of AskPhysicians.com, Inc. (APC) a Florida corporation.  As such, APC became a wholly owned subsidiary of the Company.  This transaction was accounted for on the purchase method of accounting using generally accepted accounting principles.  Goodwill was recorded of $468,110 upon acquisition.  The operations of this subsidiary have been included in the consolidated financial statements of the Company from the date of the acquisition and was subsequently deemed to be impaired during 2003 and 2002.  As of December 31, 2004, no goodwill has been recognized for APC.



NOTE 7 -  INVESTMENTS AVAILABLE-FOR-SALE



Management determines the appropriate classification of marketable equity security investments at the time of purchase and reevaluates such designation as of as of each balance sheet date.  Unrestricted marketable equity securities have been classified as available for sale.  Available for sale securities are carried at fair market value, with unrealized gains and losses, net of tax, reported as a net amount in accumulated comprehensive income.  Realized gains and losses and declines in value judged to be other than temporary on available for sale securities are included in investment income.  The cost of securities sold is based on the specific identification method.  Interest and dividends on securities classified as available for sale are included in investment income.



As of December 31, 2004 and 2003, the Company owns shares of a public company.   Investments in securities are summarized as follows at December 31, 2004 and 2003:



Unrealized

Realized

Fair

Cost

Gain/(Loss)

Gain/(Loss)

Value



Available-for-sale

securities

December 31, 2004

$     117,750

$      (87,955)

$            -

$        29,795

December 31, 2003

$     117,750

$     161,580

$            -



$      279,330



35







FULLCIRCLE REGISTRY, INC.

Notes to Consolidated Financial Statements

December 31, 2004 and 2003



NOTE 8 - WARRANTS



During the year ended December 31, 2003, the Company issued 1,800,000 warrants to purchase shares of common stock.  These warrants were issued at an exercise price of $0.075.  The following tables summarize the information regarding warrants outstanding at December 31, 2004.  All the warrants are exercisable at December 31, 2004.



| | Warrants outstanding at December 31, 2002                                    | -        
| | ---------------------------------------------------------------------------- | ---------
| | Warrants granted                                                             | 1,800,000
| | Warrants expired                                                             | -        
| | Warrants outstanding at December 31, 2003                                    | 1,800,000
| | Warrants granted                                                             | -        
| | Warrants expired                                                             | -        
| | Warrants outstanding at December 31, 2004                                    | 800,000  
| |                                                                              |          
| | Weighted average exercise price of warrants outstanding at December 31, 2004 | $ 0.075  







Number of

Weighted

Warrants

Average

Weighted

Outstanding at

Remaining

Average

December 31

Contractual

Exercise

Exercise Price

2004

Life

Price



$0.075

1,800,000

5 years

$0.075



The Company applies SFAS No. 123, for warrants issued, which requires the Company to estimate the fair value of each warrants issued at the grant date by using the Black-Scholes pricing model with the following assumptions:



Risk-free interest rate

4%

Life

7 years

Volatility

215%

Dividend Yield

0.0



As a results of applying SFAS No. 123, the Company has recognized an expense of $0 and $13,343 during the years ended December 31, 2004 and 2003, respectively.  The expense is included in the general and administrative amount in the statement of operations.





36