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

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

                                   FORM 10-KSB

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


         (Mark One)
         [X] Annual Report Pursuant to Section 13 or 15(d) of the Securities
                               Exchange Act of 1934

         [ ] Transitional Report Under Section 13 or 15(d) of the Securities
                               Exchange Act of 1934

                   For the fiscal year ended December 31, 2002

                         Commission file number: 0-28031

                             PACIFIC FUEL CELL CORP.
                             -----------------------
             (Exact name of registrant as specified in its charter)

             Nevada                                              91-1921581
             ------                                              ----------
 (State or other jurisdiction of                              (I.R.S. Employer
 incorporation or organization)                              Identification No.)

                               131 N. Tustin Ave.
                                    Suite 100
                                Tustin, CA 92780
                                 (714) 564-1693
                                 --------------
        (Address, including zip code and telephone number, including area
                    code, of registrant's executive offices)

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

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

                                  Common Stock
                                  ------------
                                (Title of class)

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Securities  Exchange  Act of 1934  during the  preceding  12
months (or for such  shorter  period that the Company 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 disclosure  of delinquent  filers in response to Item 405 of Regulation
S-B is not contained in this form, and no disclosure  will be contained,  to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated  by reference  in Part III of this Form 10-KSB or any  amendment to
this Form 10-KSB.
                 ---

                          (Continued on Following Page)

<PAGE>

State issuer's revenues for its most recent fiscal year. $0.00.

State the aggregate market value of the voting and non-voting common equity held
by non-affiliates  computed by reference to the price at which the common equity
was sold,  or the average bid and asked  price of such  common  equity,  as of a
specified date within the past 60 days: $1,367,000 as of April 11, 2003.

State the number of shares outstanding of each of the issuer's classes of common
equity,  as of the latest  practicable  date:  As of April 11, 2003:  63,440,000
shares of common stock.

Documents incorporated by reference:  None




                                                                               2

<PAGE>



                                TABLE OF CONTENTS

                            FORM 10-KSB ANNUAL REPORT

                             PACIFIC FUEL CELL CORP.

                                                                            PAGE
                                                                            ----

Facing Page
Index

PART I
Item 1.       Description of Business..........................................4
Item 2.       Description of Property..........................................8
Item 3.       Legal Proceedings................................................8
Item 4.       Submission of Matters to a Vote of Security Holders..............9

PART II
Item 5.       Market for the Registrant's Common Equity and
                  Related Stockholder Matters..................................9
Item 6.       Management's Discussion and Analysis of Financial Condition
                  and Results of Operations...................................10
Item 7.       Financial Statements............................................13
Item 8.       Changes in and Disagreements on Accounting
                  and Financial Disclosure....................................29

PART III
Item 9.       Directors, Executive Officers, Promoters and Control Persons;
                  Compliance with Section 16(a) of the Exchange Act...........29
Item 10.      Executive Compensation..........................................30
Item 11.      Security Ownership of Certain Beneficial Owners and Management..31
Item 12.      Certain Relationships and Related Transactions..................31

PART IV
Item 13.      Exhibits and Reports on Form 8-K................................32
Item 14.      Controls and Procedures.........................................33

SIGNATURES....................................................................34


                                                                               3

<PAGE>

                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS.

History

     Pacific  Fuel  Cell  Corp.   ("we,  "us,"  "our,"  or  the  "Company")  was
incorporated  under the laws of the State of  Nevada on May 5,  1998,  under the
original  name  "Magnum  Ventures  Inc." We changed  our name on May 18, 1999 to
"RadioTower.com,  Inc."  Thereafter,  in August 2001, we changed our name to our
current  name. We were  originally  in the mining  business and on June 4, 1998,
acquired an option to purchase  certain  mineral claims.  However,  this was the
extent of our operation as a mining  company and our  involvement  in the mining
industry.  We did not do any testing on or developing of the mineral claims.  In
March 1999, our board of directors  decided to abandon our rights to the mineral
claims and not to make any further option payments, resulting in the termination
of the option.  We ceased all mining  industry  activities  at that time and our
board of directors decided to enter into the radio Internet business.

     In March 1999,  we acquired  the right to the domain name  "Radiotower.com"
and the name "Radio  Tower  Interactive"  in exchange  for issuance of 9,750,000
shares of our common  stock,  which was  valued at  $65,000,  approximately  the
predecessor's cost. We became an Internet company  (www.radiotower.com) and were
one of the first companies  online with a live radio directory and audio portal.
The  directory  was a free  television  guide-like  listing of over 1,000  radio
stations worldwide, which allowed listeners to link to and listen to these radio
stations.  Our web site only  contained  listings for those radio  stations that
already  broadcast  their signals over the Internet using  RealAudio(TM)  and/or
Windows Media Player(TM).

     As a result of our inability to generate  profits,  we elected to cease our
aforesaid Internet operations in August 2001. On July 2, 2001, we entered into a
definitive   agreement  with  Fullerene  which  contained   various   conditions
subsequent  prior  to  effectiveness,  including  completion  of  due  diligence
activities and other matters.  These  conditions  were  subsequently  satisfied.
Effective August 28, 2001, we closed an acquisition of certain assets previously
owned by Fullerene USA, Inc. ("Fullerene"), a privately held Nevada corporation.
The terms of the  Fullerene  Agreement  provide  for the  Company  to acquire an
exclusive  worldwide license (except for Japan) in Fullerene's  proprietary fuel
cell technology,  including certain future acquired intellectual  property,  for
use in  transportation  applications  (the  "Assets").  The licensing  agreement
expires upon the expiration of the underlying  patent  application,  which is 17
years  following  the  approval  of the  patent by the US Patent  and  Trademark
Office. As of the date of this Report,  the relevant patent  application has not
yet been approved.  In exchange for the Assets,  we issued  30,100,000 shares of
our "restricted"  common stock,  equal to ownership of approximately  51% of our
then  outstanding  stock.  In  conjunction  with  our  new  business  plan,  our
shareholders approved an amendment to our Articles of Incorporation, changed our
name to "Pacific Fuel Cell Corp.".  The number of our  authorized  common shares
was also increased to 200,000,000.

Description of Current Business

     The need for electric  power is constantly  increasing in our society every
year.  At the same  time,  the  burning  of fossil  fuel is  creating a negative
environmental impact, which includes global warming

                                                                               4

<PAGE>

and pollution.  Our management  believes that fuel cells can provide affordable,
environmentally friendly energy, alleviating both shortages and pollution.

     Our  initial  business  plan was to develop and produce low cost fuel cells
for  transportation.  During 2002, we revised our business plan to emphasize the
development  and  production of low cost fuel cells for personal  electronics or
other applications  requiring small size and longevity of use. We believe that a
fuel  cell  unit can  replace  conventional  batteries  because a fuel cell unit
should  provide  longer usage at lower  consumer  cost.  We revised our original
business plan as a result of the costs associated with developing transportation
related fuel cells, which exceeded our available capital.  We may reinstate this
original business plan if our current business plan proves successful,  of which
there can be no assurance.

     We intend to use our proprietary technology to severely reduce or eliminate
the need for  platinum  as a  catalyst.  Current  technology  uses  platinum,  a
precious  metal,  as the  catalyst  for  hydrogen to separate  into a proton and
electron. Since platinum is a high cost metal in very limited production,  it is
cost  prohibitive,  preventing fuel cells from coming down in price even at high
volume  production.  Our proposed  method of producing fuel cells is expected to
minimize or eliminate the use of platinum. If successful, the result will be low
cost  fuel  cells at high  volume  production  levels.  Our  licensed  fuel cell
technology   gives  us  exclusive   worldwide  rights  (except  Japan)  for  all
transportation  uses. Our intention is to build a prototype  which,  if it meets
expectations,  will be  placed  in  production.  This  will  require  additional
capital,  either  debt or  equity.  As of the  date of this  Report,  we have no
agreement  with any third party to provide us with this  additional  capital and
there can be no assurances  that we will be able to obtain such capital on terms
favorable to us, or at all.

     We have also  investigated  the possibility of using our  proprietary  fuel
cell technology to provide  electricity for small commercial  establishments and
households.  Although  we do not  currently  have the rights to utilize our fuel
cell  technology  in this market,  we believe  that, if we decide to pursue this
market,  we can acquire  such  rights  from  Fullerene  on  advantageous  terms.
However,  there can be no assurances that we will be able to acquire such rights
in the future.

     Fuel  cell  acceptance   appears  to  be  accelerating.   Large  and  small
corporations,  as well as the United States government,  all appear convinced of
the value of fuel cell technology.  Despite all this activity, we have still not
seen a commercial  product that, in our opinion,  was competitively  priced with
other forms of energy.  We believe that,  while fuel cell products will begin to
proliferate,  market  acceptance  will come only when prices fall to competitive
levels.

     As of the date of this Report,  in order to bring about  commercialization,
we are focused on building a prototype, enhancing product performance,  reducing
product costs, designing market-ready products, developing  volume-manufacturing
capability, and building customer and supplier relationships.

     In this regard,  on August 21, 2002, we entered into an agreement  with the
University of California at Riverside to develop a commercially viable fuel cell
prototype.  The initial term of this  agreement  ran through  February  2003. In
February  2003,  we  entered  into  an  amendment,  extending  the  term of this
agreement  through  August 2003. We have agreed to reimburse the  University for
all costs and expenses incurred,  both direct and indirect,  in an amount not to
exceed $131,266,  pursuant to a budget agreed to by the parties.  We tendered an
initial payment of $70,000 upon execution of the

                                                                               5

<PAGE>

agreement,  with a second  advance  payment of $61,266  tendered  in March 2003,
pursuant to our  exercise of our option to extend  this  agreement.  In order to
allow us to undertake this  arrangement,  we borrowed funds from Fullerene.  See
"Part II, Item, 6,  Management's  Discussion - Liquidity and Capital  Resources"
below  for the terms  applicable  to this  obligation.  We  anticipate  that the
initial  prototype will be completed before the end of 2003. If this endeavor is
successful,  we  expect  that we will  file for  patent  protection,  filing  an
application with the US Patent and Trademark Office all documentation  necessary
to patent any new technologies arising out of this relationship.

     While the  University  has reserved all rights to any data and  information
received or  developed  pursuant to the  agreement,  we have the right to obtain
either an exclusive or non-exclusive  license to such data and  information,  on
terms to be  negotiated.  Provisions  also  exist  in the  agreement  for  joint
ownership of such data and information.  All information which we provide to the
University  has been  deemed  confidential  for a period  of one (1) year  after
expiration or termination of the agreement.

     We have also entered into discussions with potential  strategic partners to
transform our current  technology  position into market leadership in our target
markets.  In this regard,  we would welcome the opportunity to engage in a joint
venture or other  relationship with a fuel cell manufacturer or battery company,
but as of the date of this  Report,  no  discussions  have  taken  place in this
regard and there are no assurances  that such  discussions or any such agreement
will occur in the foreseeable future.

     There are currently  several  different  technologies  in use for fuel cell
power generation. Each of these processes differ in methodology,  suitable scale
and efficiency. Our interest (and patent applications) is in the Proton Exchange
Membrane (PEM) method which is very suitable for low temperature operation.

     We  also  intend  to  acquire  additional  related  intellectual  property.
However, as of the date of this Report, no definitive  agreements to acquire the
same have been reached with any third party, other than previously reported.

     We had initially planned to acquire a traditional  generator  manufacturing
company with sales in the $5 to $15 million range during the year ended December
31, 2002, in order to enable the commercialization of our proprietary technology
while  concurrently  introducing  our  products  to  what we  consider  to be an
important market segment.  However,  we have elected to abandon this endeavor at
this time due primarily to lack of available  capital.  We believe that investor
capital  is  difficult  to  obtain  in the  current  economic  climate.  Our new
direction  related to the micro fuel cell  market is ready and we do not believe
that significant capital investment to sustain research and development of micro
fuel cells will be required.  Further,  we also believe that if the results from
the University of California at Riverside  project are positive and subsequently
announced, investment capital may be more easily obtained at that time.

     On September  13, 2001,  we entered into an agreement  with WINZ Co.,  Ltd.
("WINZ"),  of Japan to acquire an exclusive  worldwide license (excluding Japan)
in all of WINZ'  intellectual  property,  including any and all future  acquired
surrounding intellectual property. WINZ manufactures state of the art inverters,
which convert direct current into  alternating  current,  thereby  allowing fuel
cells to power standard household appliances. In consideration for this license,
we authorized the issuance of a common stock purchase  warrant in favor of WINZ,
granting them the right to purchase up to

                                                                               6

<PAGE>

1,000,000  shares of our common  stock at an  exercise  price of $.10 per share.
This warrant expires September 13, 2003.

     In order to implement our business plan, we require  additional funding and
there is no assurance that adequate  funds,  whether  through equity  financing,
debt  financing  or other  sources,  will be  available  when needed or on terms
acceptable to us. As of the date of this Report, we have no definitive agreement
with any investment  banking firm,  venture  capital firm or any other source of
funds who has made any  commitment  to us to provide any funding.  Further,  any
such funding may result in significant  dilution to existing  stockholders.  The
inability to obtain sufficient funds from external sources when needed will have
a material adverse affect on our results of operations and financial condition.

     In December  2002,  we issued  2,000,000  shares of our common stock to two
foreign  investors at an offering price of $.05 per share.  Our common stock was
trading at $0.025 at the time of this investment.

Competition

     Our major competitors and their respective  products  include,  but are not
limited to, the following:

         COMPANY                       PRODUCT(S)
         ----------------------------  -----------------------------------------

         Anuvu Incorporated            "Carbon-X" PEMs
         Avista Labs                   Residential and small commercial
         Ballard Power Systems         Pressurized PEM's for vehicles, up to
                                                85kw, portable and stationary
         Casio                         PEM fuel cell for PDA
         DCH Technology, Inc.          12W-5kw fuel cell
         Energy Partners, L.C.         Stationary applications
         Hydrogenics                   Back-up power for cellular towers
         H Power                       PEM fuel cell for small portable system
         Hitachi                       PEM fuel cell for notebook computer
         Lynntech                      Direct methanol fuel cell
         Manhattan Science             Portable fuel cells
         MTI Micro Fuel Cells          Micro fuel cells
         NU Element, Inc.              1 kw - 200kw fuel cell
         Nuvera Fuel Cells             0.7kw - 60 kw fuel cell
         Plug Power                    Residential
         Proton Energy Systems, Inc.   Electrolyzers and regenerative
                                                fuel cell systems
         Schatz Energy Research        Automotive, portable
         Superior MicroPowders         Micro MEA

     This group of companies  specializes in Proton Exchange Membrane (PEM) Fuel
Cells and are therefore direct technology competitors.

     We have not included  automobile  companies  such as Mitsubishi and General
Motors since their focus is directed  towards  transportation.  Likewise,  large
industrial companies such as Siemans AG, UTC

                                                                               7

<PAGE>

Fuel Cells (a United Technologies  Company) and Teledyne Energy Systems were not
included since their main focus appears to be larger power systems. However, UTC
Fuel  Cells does have a major push on  residential  fuel cell use and  therefore
must be considered a future competitor.  Any major company listed here should be
considered a potential, if not actual, competitor because of its size.

     We are a relative  newcomer to this group,  but, while no assurances can be
provided,  we  believe  that  our R&D  strategy  positions  us to  leapfrog  the
competition  and produce a commercially  viable  prototype by the second half of
2003 provided  that we can raise the  necessary  capital to allow us to continue
our research and development efforts.

Trademarks/Tradenames

     We currently do not have any registered trademarks or tradenames,  although
we  expect  this to  change  as we move  towards  the  commercialization  of our
technology.

Government Regulations

     We are not subject to any extraordinary  governmental  regulations relating
to our business.

Employees

     As of the date of this Report,  we have 2 employees,  our current officers.
Our  operations  are  non-union.  There has been no history of labor  strikes or
unrest  at any of our  facilities.  We  believe  that  our  relations  with  our
employees  remains  satisfactory.  In  addition,  management  believes  that the
available  labor force in the geographic  areas where our facilities are located
are sufficient to support the expansion  anticipated over the next 12 months. If
and when we are in the financial position to do so, we intend to hire additional
employees in the areas of research and development and marketing.

ITEM 2.  DESCRIPTION OF PROPERTY.

     We operate  from our  principal  executive  offices at 131 N. Tustin  Ave.,
Suite  100,  Tustin,  CA 92780,  which  space is  provided  on a rent free basis
pursuant to a verbal,  month to month lease, by George Suzuki, our President and
a director.  This space  consists of 700 square feet of executive  office space.
See "Part III, Item 12, Certain Relationships and Related Transactions." We have
no other properties.  In the event we are able to obtain the necessary  funding,
we expect  that we will move our  offices to an  expanded  location in or around
Tustin,  California.  We believe there is an adequate supply of available office
space should the need arise.

ITEM 3.  LEGAL PROCEEDINGS

     We are not a party to any pending legal proceedings.



                                                                               8

<PAGE>

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     No matters were submitted to our shareholders during the three month period
ended December 31, 2002, or subsequent thereto.

                                     PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS

     On August 25, 2000, our common stock  commenced  trading on the OTC BB. Our
common stock was  previously  quoted on the pink sheets under the symbol "RDOT."
Prior to our 3:2 stock split  effective  June 20, 2000,  our common stock traded
under the symbol "RTOW." It now trades under the symbol "PFCE."

     The table  below  sets forth the  reported  high and low bid prices for the
periods  indicated.  The bid prices shown reflect  quotations  between  dealers,
without adjustment for markups, markdowns or commissions,  and may not represent
actual transactions in the Company's securities.

                                               Bid Price
                                         ---------------------
         Quarter Ended                     High          Low
         -------------                   --------      -------

         March 2002                      $0.126        $0.025
         June 30, 2002                   $0.05         $0.013
         September 2002                  $0.185        $0.013
         December 2002                   $0.145        $0.02

         March 2001                      $0.35         $0.025
         June 2001                       $0.285        $0.03
         September 2001                  $0.23         $0.041
         December 2001                   $0.085        $0.017

     As of April 11, 2002, the closing bid price of our common stock was $0.05.

     (b) Holders. We have approximately 30 holders of record of our common stock
as of April 11, 2003, not including those shares held in "street name.".

     (c) Dividends.  We did not pay any dividends on our Common Stock during the
two years ended December 31, 2002.  Pursuant to the laws of the State of Nevada,
a  corporation  may not issue a  distribution  if, after giving its effect,  the
corporation  would not be able to pay its debts as they  became due in the usual
course of business,  or such  corporation's  total assets would be less than the
sum of their  total  liabilities  plus the amount  that would be needed,  if the
corporation were to be dissolved at the time of the distribution, to satisfy the
preferential  rights upon dissolution of shareholders whose preferential  rights
are superior to those receiving the distribution.  As a result,  management does
not foresee  that we will have the ability to pay a dividend on our Common Stock
in the fiscal year ended  December  31,  2003.  See "Part II, Item 7,  Financial
Statements."


                                                                               9

<PAGE>

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

     The following  discussion  should be read in  conjunction  with our audited
financial  statements and notes thereto included herein. In connection with, and
because we desire to take  advantage  of, the "safe  harbor"  provisions  of the
Private  Securities  Litigation Reform Act of 1995, we caution readers regarding
certain forward looking statements in the following  discussion and elsewhere in
this report and in any other statement made by, or on our behalf, whether or not
in future filings with the Securities and Exchange  Commission.  Forward looking
statements are statements not based on historical  information  and which relate
to future  operations,  strategies,  financial  results  or other  developments.
Forward looking  statements are necessarily based upon estimates and assumptions
that are inherently  subject to significant  business,  economic and competitive
uncertainties and  contingencies,  many of which are beyond our control and many
of which,  with  respect to future  business  decisions,  are subject to change.
These  uncertainties and contingencies can affect actual results and could cause
actual results to differ  materially from those expressed in any forward looking
statements  made by, or on our behalf.  We  disclaim  any  obligation  to update
forward looking statements.

     We did not generate any revenues during our fiscal years ended December 31,
2002 and 2001 and  generated  nominal  revenues  during  the  fiscal  year ended
December 31, 2000.  During our fiscal years ended December 31, 2002 and 2001, we
incurred costs and expenses totaling $578,673 and $256,250,  respectively, which
included  $45,000 and  $184,000 in stock  based  compensation  in 2002 and 2001,
respectively,   as  well  as  $82,673  and  $68,859  in  selling,   general  and
administrative  expense in 2002 and 2001,  respectively.  Also during our fiscal
year ended December 31, 2002, we incurred a loss on asset impairment of $451,000
relevant to a determination  by our management  that our license  agreement with
Fullerene was  impaired.  This  decision was based upon the  uncertainty  of our
ability to raise sufficient capital in a timely manner to develop a commercially
viable fuel cell technology.

     As a result,  we incurred a net loss of  $(219,441)  during our fiscal year
ended  December  31,  2001  ($0.01  per  share),  as  compared  to a net loss of
$(579,912)  during our fiscal  year ended  December  31, 2002 ($0.01 per share).
Because we did not  generate any  revenues  during the years ended  December 31,
2002 and 2001,  following is our Plan of Operation,  rather than a comparison of
results of operations.

Plan of Operation

     Our  initial  business  plan was to develop and produce low cost fuel cells
for  transportation.  During 2002, we revised our business plan to emphasize the
development  and  production of low cost fuel cells for personal  electronics or
other applications  requiring small size and longevity of use. We believe that a
fuel  cell  unit can  replace  conventional  batteries  because a fuel cell unit
should  provide  longer usage at lower  consumer  cost.  We revised our original
business plan as a result of the costs associated with developing transportation
related fuel cells, which exceeded our available capital.  We may reinstate this
original business plan if our current business plan proves successful,  of which
there can be no assurance.

     We intend to use our proprietary technology to severely reduce or eliminate
the need for  platinum  as a  catalyst.  Current  technology  uses  platinum,  a
precious  metal,  as the  catalyst  for  hydrogen to separate  into a proton and
electron. Since platinum is a high cost metal in very limited production,

                                                                              10

<PAGE>



it is cost prohibitive,  preventing fuel cells from coming down in price even at
high volume production.  Our proposed method of producing fuel cells is expected
to minimize or eliminate the use of platinum. If successful,  the result will be
low cost fuel cells at high volume  production  levels.  Our licensed  fuel cell
technology   gives  us  exclusive   worldwide  rights  (except  Japan)  for  all
transportation  uses. Our intention is to build a prototype  which,  if it meets
expectations,  will be  placed  in  production.  This  will  require  additional
capital,  either  debt or  equity.  As of the  date of this  Report,  we have no
agreement  with any third party to provide us with this  additional  capital and
there can be no assurances  that we will be able to obtain such capital on terms
favorable to us, or at all.

     We have also  investigated  the possibility of using our  proprietary  fuel
cell technology to provide  electricity for small commercial  establishments and
households.  Although  we do not  currently  have the rights to utilize our fuel
cell  technology  in this market,  we believe  that, if we decide to pursue this
market,  we can acquire  such  rights  from  Fullerene  on  advantageous  terms.
However,  there can be no assurances that we will be able to acquire such rights
in the future.

     Fuel  cell  acceptance   appears  to  be  accelerating.   Large  and  small
corporations,  as well as the United States government,  all appear convinced of
the value of fuel cell technology.  Despite all this activity, we have still not
seen a commercial  product that, in our opinion,  was competitively  priced with
other forms of energy.  We believe that,  while fuel cell products will begin to
proliferate,  market  acceptance  will come only when prices fall to competitive
levels.

     As of the date of this Report,  in order to bring about  commercialization,
we are focused on building a prototype, enhancing product performance,  reducing
product costs, designing market-ready products, developing  volume-manufacturing
capability, and building customer and supplier relationships.

     In this regard,  on August 21, 2002, we entered into an agreement  with the
University of California at Riverside to develop a commercially viable fuel cell
prototype.  The initial term of this  agreement  ran through  February  2003. In
February  2003,  we  entered  into  an  amendment,  extending  the  term of this
agreement  through  August 2003. We have agreed to reimburse the  University for
all costs and expenses incurred,  both direct and indirect,  in an amount not to
exceed $131,266,  pursuant to a budget agreed to by the parties.  We tendered an
initial  payment of  $70,000  upon  execution  of the  agreement,  with a second
advance payment of $61,266  tendered in March 2003,  pursuant to our exercise of
our option to extend  this  agreement.  In order to allow us to  undertake  this
arrangement,   we  borrowed  funds  from  Fullerene.  See  "Part  II,  Item,  6,
Management's  Discussion - Liquidity and Capital  Resources" below for the terms
applicable to this obligation.  We anticipate that the initial prototype will be
completed before the end of 2003. If this endeavor is successful, we expect that
we will file for patent protection, filing an application with the US Patent and
Trademark  Office all  documentation  necessary  to patent any new  technologies
arising out of this relationship.

     While the  University  has reserved all rights to any data and  information
received or  developed  pursuant to the  agreement,  we have the right to obtain
either an exclusive or non-exclusive  license to such data and  information,  on
terms to be  negotiated.  Provisions  also  exist  in the  agreement  for  joint
ownership of such data and information.  All information which we provide to the
University  has been  deemed  confidential  for a period  of one (1) year  after
expiration or termination of the agreement.


                                                                              11

<PAGE>

     We have also entered into discussions with potential  strategic partners to
transform our current  technology  position into market leadership in our target
markets.  In this regard,  we would welcome the opportunity to engage in a joint
venture or other  relationship with a fuel cell manufacturer or battery company,
but as of the date of this  Report,  no  discussions  have  taken  place in this
regard and there are no assurances  that such  discussions or any such agreement
will occur in the foreseeable future.

     There are currently  several  different  technologies  in use for fuel cell
power generation. Each of these processes differ in methodology,  suitable scale
and efficiency. Our interest (and patent applications) is in the Proton Exchange
Membrane (PEM) method which is very suitable for low temperature operation.

     We  also  intend  to  acquire  additional  related  intellectual  property.
However, as of the date of this Report, no definitive  agreements to acquire the
same have been reached with any third party, other than previously reported.

     We had initially planned to acquire a traditional  generator  manufacturing
company with sales in the $5 to $15 million range during the year ended December
31, 2002, in order to enable the commercialization of our proprietary technology
while  concurrently  introducing  our  products  to  what we  consider  to be an
important market segment.  However,  we have elected to abandon this endeavor at
this time due primarily to lack of available  capital.  We believe that investor
capital  is  difficult  to  obtain  in the  current  economic  climate.  Our new
direction  related to the micro fuel cell  market is ready and we do not believe
that significant capital investment to sustain research and development of micro
fuel cells will be required.  Further,  we also believe that if the results from
the University of California at Riverside  project are positive and subsequently
announced, investment capital may be more easily obtained at that time.

     On September  13, 2001,  we entered into an agreement  with WINZ Co.,  Ltd.
("WINZ"),  of Japan to acquire an exclusive  worldwide license (excluding Japan)
in all of WINZ'  intellectual  property,  including any and all future  acquired
surrounding intellectual property. WINZ manufactures state of the art inverters,
which convert direct current into  alternating  current,  thereby  allowing fuel
cells to power standard household appliances. In consideration for this license,
we authorized the issuance of a common stock purchase  warrant in favor of WINZ,
granting  them the right to purchase up to 1,000,000  shares of our common stock
at an exercise price of $.10 per share. This warrant expires September 13, 2003.

     In order to implement our business plan, we require  additional funding and
there is no assurance that adequate  funds,  whether  through equity  financing,
debt  financing  or other  sources,  will be  available  when needed or on terms
acceptable to us. As of the date of this Report, we have no definitive agreement
with any investment  banking firm,  venture  capital firm or any other source of
funds who has made any  commitment  to us to provide any funding.  Further,  any
such funding may result in significant  dilution to existing  stockholders.  The
inability to obtain sufficient funds from external sources when needed will have
a material adverse affect on our results of operations and financial condition.



                                                                              12

<PAGE>



Liquidity and Capital Resources

     At December  31, 2002,  we had $100,822 in cash.  We had $3,785 in accounts
payable,  plus  $4,495  in  accounts  payable  to an  affiliate.  We also had an
outstanding  loan in the amount of $53,100,  due to Fullerene,  USA,  Inc.,  our
majority  stockholder.  In  regard  to this  loan,  we  originally  received  an
unsecured,  non-interest  bearing loan for $60,000  which was due  September 14,
2002. On December 5, 2002, this note was cancelled with the consent of Fullerene
and replaced with a note extending the due date to August 14, 2004.

     In order to implement our business plan, we currently estimate that we will
require  additional  funding of approximately $5 million.  We anticipate that we
will  require the balance of $2.5  million for fuel cell  development,  with the
balance of $2.5  million to be  utilized  for  application  of fuel cells to the
transportation  application and working capital.  There can be no assurance that
or estimates of this necessary capital will be accurate, or that we will be able
to raise these funds, whether through equity financing,  debt financing or other
sources, or that such funds will be available when needed or on terms acceptable
to us. As of the date of this Report,  we have no definitive  agreement with any
investment  banking firm,  venture capital firm or any other source of funds who
has made any commitment to us to provide any funding.  Further, any such funding
may result in significant  dilution to existing  stockholders.  The inability to
obtain  sufficient  funds from external sources when needed will have a material
adverse affect on our, results of operations and financial condition.

Trends

     We believe that fuel cell  development is accelerating in all areas, due to
the  advantages  of low  pollution and  independence  from fossil  fuels.  Major
automobile,  industrial  and power  supply  companies  are  heavily  involved in
research  and  development  activities  of fuel  cell  technology  and many have
announced prototypes and commercial models.  However, there has not been a major
commercial breakthrough, which we attribute to the high cost of the products and
the lack of consumer proven reliability.

     We expect that interest in fuel cells by the general public, government and
the private  sector will  continue to grow,  leading to increased  acceptance of
fuel cells, along with increased  competition.  However, while no assurances can
be provided,  we believe that the anticipated  increased acceptance of fuel cell
technology may make it easier for us to raise the additional  capital  necessary
for us to implement our business plan and develop our prototype.

Inflation

     Although our operations are influenced by general economic  conditions,  we
do not believe that inflation had a material affect on our results of operations
during 2002.

ITEM 7.  FINANCIAL STATEMENTS

                                                                              13
<PAGE>


                             PACIFIC FUEL CELL CORP.
                          (A DEVELOPMENT STAGE COMPANY)
                                TABLE OF CONTENTS

                                                                            Page

         Report of Independent Auditors                                        1

         Balance Sheet                                                         2

         Statements of Operations                                              3

         Statement of Changes in Stockholders' Equity                          4

         Statements of Cash Flows                                              5

         Notes to Financial Statements                                      6-14



























                                                                              14

<PAGE>












                         REPORT OF INDEPENDENT AUDITORS

Shareholders and Board of Directors
Pacific Fuel Cell Corp.

We have audited the  accompanying  balance  sheet of Pacific Fuel Cell Corp.  (a
development  stage company) as of December 31, 2002, and the related  statements
of operations,  changes in  stockholders'  equity,  and cash flows for the years
ended December 31, 2002 and 2001, and the period from May 5, 1998 (inception) to
December 31, 2002.  These  financial  statements are the  responsibility  of the
Company's  management.  Our  responsibility  is to  express  an opinion on these
financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the  United  States of  America.  Those  standards  require  that we plan and
perform the audits to obtain  reasonable  assurance  about whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant estimates 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 financial  statements  referred to above present fairly, in
all material  respects,  the  financial  position of Pacific Fuel Cell Corp.  (a
development  stage  company) as of  December  31,  2002,  and the results of its
operations,  and its cash flows for the years ended  December 31, 2002 and 2001,
and the period from May 5, 1998  (inception)  to December 31, 2002 in conformity
with accounting principles generally accepted in the United States of America.

The  accompanying  financial  statements  have been  prepared  assuming that the
Company  will  continue  as a  going  concern.  As  discussed  in  Note 2 to the
financial   statements,   the  Company  has  incurred  significant  losses  from
operations  and is reliant on raising  capital to initiate  its  business  plan.
These factors raise substantial doubt about the Company's ability to continue as
a going  concern.  Management's  plans  in  regard  to  these  matters  are also
discussed in Note 2. The  financial  statements  do not include any  adjustments
that might result from the outcome of this uncertainty.

s/Stark Winter Schenkein & Co., LLP

Denver, Colorado
March 26, 2003

                                        1


                                                                              15

<PAGE>

                             PACIFIC FUEL CELL CORP.
                         (A DEVELOPMENT STAGE COMPANY)
                                  BALANCE SHEET
                                DECEMBER 31, 2002

                                     ASSETS

CURRENT ASSETS
  Cash                                                              $   100,822
  Prepaid expense                                                        20,000
                                                                    -----------
                      Total current assets                              120,822
                                                                    -----------

  LICENSE                                                                   500
                                                                    -----------

                                                                    $   121,322
                                                                    ===========


                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
  Accounts payable                                                  $     3,785
  Accounts payable - related party                                        4,495
                                                                    -----------

                      Total current liabilities                           8,280
                                                                    -----------

LOAN PAYABLE - RELATED PARTY                                             53,100
                                                                    -----------

STOCKHOLDERS' EQUITY
  Preferred stock, $0.01 par value,
     1,000,000 shares authorized, none outstanding                           --
  Common stock, $0.001 par value, 200,000,000
    shares authorized, 63,440,000 shares issued                          63,440
  Additional paid in capital                                          1,261,957
  (Deficit) accumulated during the development stage                 (1,265,455)
                                                                    -----------
                                                                         59,942
                                                                    -----------

                                                                    $   121,322
                                                                    ===========

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

                                       2

                                                                              16

<PAGE>

<TABLE>
                            PACIFIC FUEL CELL CORP.
                          (A DEVELOPMENT STAGE COMPANY)
                            STATEMENTS OF OPERATIONS

<CAPTION>
                                                                                           FOR THE PERIOD
                                                           YEAR ENDED     YEAR ENDED         MAY 5, 1998
                                                          DECEMBER 31,    DECEMBER 31,     (INCEPTION) TO
                                                              2002           2001         DECEMBER 31, 2002
                                                          ------------    ------------    -----------------
<S>                                                       <C>             <C>             <C>
REVENUE                                                   $         --    $      1,309    $           6,172
                                                          ------------    ------------    -----------------
COSTS AND EXPENSES
  General and administrative                                    82,673          68,859              525,808
  Stock compensation                                            45,000         184,000              240,000
  Amortization                                                      --              --               11,645
  Loss on asset impairment                                     451,000              --              510,167
  Loss on disposal of property and equipment                        --           3,391                3,391
                                                          ------------    ------------    -----------------
                                                               578,673         256,250            1,291,011
                                                          ------------    ------------    -----------------

OPERATING (LOSS)                                              (578,673)       (254,941)          (1,284,839)
                                                          ------------    ------------    -----------------

OTHER INCOME (EXPENSE)
  Interest expense                                              (1,400)             --              (14,762)
  Foreign currency transaction gain (loss)                          --              --                 (168)
  Other                                                            161              --               (1,186)
                                                          ------------    ------------    -----------------
                                                                (1,239)             --              (16,116)
                                                          ------------    ------------    -----------------

NET (LOSS) BEFORE EXTRAORDINARY ITEM                          (579,912)       (254,941)          (1,300,955)

EXTRAORDINARY ITEM, Gain on forgiveness of debt, net of
   income taxes of $12,070                                          --          23,430               23,430
                                                          ------------    ------------    -----------------

NET (LOSS) BEFORE INCOME TAX EXPENSE (BENEFIT)                (579,912)       (231,511)          (1,277,525)

INCOME TAXES (BENEFIT)                                              --         (12,070)             (12,070)
                                                          ------------    ------------    -----------------

NET (LOSS)                                                $   (579,912)   $   (219,441)   $      (1,265,455)
                                                          ============    ============    =================

PER SHARE INFORMATION

WEIGHTED AVERAGE SHARES OUTSTANDING -
        BASIC AND DILUTED                                   60,756,438      35,506,181           18,649,030
                                                          ============    ============    =================

NET (LOSS) PER COMMON SHARE
         (Loss) from operations                           $      (0.01)   $      (0.01)   $           (0.07)
         Extraordinary item                                         --           (0.00)               (0.00)
                                                          ------------    ------------    -----------------
                                                          $      (0.01)   $      (0.01)   $           (0.07)
                                                          ============    ============    =================
</TABLE>

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

                                       3

                                                                              17
<PAGE>
<TABLE>

                            PACIFIC FUEL CELL CORP.
                          (A DEVELOPMENT STAGE COMPANY)
                  STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
                MAY 5, 1998 (INCEPTION) THROUGH DECEMBER 31, 2002


<CAPTION>
                                                                                                           (Deficit)
                                                      Common Stock                          Common        Accumulated
                                                  --------------------    Additional         Stock         During the
                                                     Shares     Amount  Paid in Capital  Subscriptions  Development Stage    Total
                                                  -----------  -------  ---------------  -------------  -----------------  ---------
<S>                                                 <C>        <C>      <C>              <C>            <C>                <C>
Issuance of stock for cash at $0.006 per share
  (net of issuance costs)                           3,000,000  $ 3,000  $        15,118  $          --  $              --  $ 18,118

Issuance of stock for repayment of advances
  at $0.007 per share                               2,250,000    2,250           12,750             --                 --    15,000

Net (loss) for the period                                  --       --               --             --            (31,065)  (31,065)
                                                  -----------  -------  ---------------  -------------  -----------------  --------
Balance at December 31, 1998                        5,250,000    5,250           27,868             --            (31,065)    2,053
                                                  -----------  -------  ---------------  -------------  -----------------  --------
Issuance of stock for purchase of domain
  name at $0.007 per share                          9,750,000    9,750           55,250             --                 --    65,000

Issuance of stock for
  cash at $0.007 per share                          3,750,000    3,750           21,250             --                 --    25,000

Issuance of stock subscriptions for
  cash at $0.007 per share                                 --       --               --         19,000                 --    19,000

Issuance of stock subscriptions as
  payment of wages at $0.007 per share                     --       --               --         11,000                 --    11,000

Net (loss) for the year                                    --       --               --             --           (156,309) (156,309)
                                                  -----------  -------  ---------------  -------------  -----------------  --------
Balance at December 31, 1999                       18,750,000   18,750          104,368         30,000           (187,374)  (34,256)
                                                  -----------  -------  ---------------  -------------  -----------------  --------
Issuance of stock pursuant to stock
   subscriptions                                    4,500,000    4,500           25,500        (30,000)                --        --

Net (loss) for the year                                    --       --               --             --           (278,728) (278,728)
                                                  -----------  -------  ---------------  -------------  -----------------  --------
Balance at December 31, 2000                       23,250,000   23,250          129,868             --           (466,102) (312,984)
                                                  -----------  -------  ---------------  -------------  -----------------  --------
Issuance of stock for license                      30,100,000   30,100          421,400             --                 --   451,500
   agreement at $0.015 per share

Cancellation of common stock as
  condition of license agreement                   (2,000,000)  (2,000)              --             --                 --    (2,000)

Issuance of stock for cash at $0.001 per share      6,000,000    6,000               --             --                 --     6,000

Stock compensation related to issuance
  of stock below fair market value                         --       --           84,000             --                 --    84,000

Stock compensation related to issuance
  of stock warrant to acquire license                      --       --          100,000             --                 --   100,000
Issuance of stock for cash at  $0.10 per share        520,000      520           51,480             --                 --    52,000

Issuance of stock for debt forgiveness
  from shareholders at $0.094 per share             1,070,000    1,070           99,980             --                 --   101,050

Liabilities converted into contributed
  capital                                                  --       --          179,610             --                 --   179,610

Net (loss) for the year                                    --       --               --             --           (219,441) (219,441)
                                                  -----------  -------  ---------------  -------------  -----------------  --------
Balance at December 31, 2001                       58,940,000   58,940        1,066,338             --           (685,543)  439,735
                                                  -----------  -------  ---------------  -------------  -----------------  --------
Issuance of stock for cash at $0.047 per share      1,000,000    1,000           45,819             --                 --    46,819

Issuance of stock for services at $0.03 per share   1,500,000    1,500           43,500             --                 --    45,000

Issuance of stock for cash at $0.05 per share       2,000,000    2,000           98,000             --                 --   100,000

Discount on loan payable - related party
  recorded as contributed capital                          --       --            8,300             --                 --     8,300

Net (loss) for the year                                    --       --               --             --           (579,912) (579,912)
                                                  -----------  -------  ---------------  -------------  -----------------  --------
Balance at December 31, 2002                       63,440,000  $63,440  $     1,261,957  $          --  $      (1,265,455) $ 59,942
                                                  ===========  =======  ===============  =============  =================  ========

</TABLE>

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

                                       4

                                                                              18

<PAGE>

<TABLE>
                            PACIFIC FUEL CELL CORP.
                          (A DEVELOPMENT STAGE COMPANY)
                            STATEMENTS OF CASH FLOWS

<CAPTION>
                                                                                                   FOR THE PERIOD
                                                                         YEAR ENDED  YEAR ENDED      MAY 5, 1998
                                                                        DECEMBER 31, DECEMBER 31,  (INCEPTION) TO
                                                                            2002         2001     DECEMBER 31, 2002
                                                                        -----------  -----------  -----------------
<S>                                                                     <C>          <C>          <C>
OPERATING ACTIVITIES
      Net (loss)                                                        $  (579,912) $  (219,441) $      (1,265,455)
      Adjustments to reconcile net (loss) to net cash
         (used) in operating activities:
             Stock compensation                                              45,000      184,000            240,000
             (Loss) on asset impairment                                     451,000           --            510,167
             Amortization of discount on loan payable - related party         1,400           --              1,400
             Gain on the settlement of debt                                      --       35,500             35,500
             (Loss) on disposal of property and equipment                        --        3,391              3,391
             Amortization and depreciation                                       --           --             12,461
             Interest expense converted to loan payable                          --           --             12,684
      Changes in:
         Prepaid expense                                                    (20,000)          --            (20,000)
         Accounts receivable                                                     --          193                 --
         Accounts payable                                                    (6,375)     (65,358)            34,754
         Accounts payable - related party                                     4,495           --              4,495
                                                                        -----------  -----------  -----------------
              Net cash (used in) operating activities                      (104,392)     (61,715)          (430,603)
                                                                        -----------  -----------  -----------------
INVESTING ACTIVITIES
  Purchase of fixed assets                                                       --           --             (4,891)
  Investment in mineral claims                                                   --           --             (5,000)
                                                                        -----------  -----------  -----------------
              Net cash (used in) investing activities                            --           --             (9,891)
                                                                        -----------  -----------  -----------------
FINANCING ACTIVITIES
  Proceeds from loan payable - related parties                               60,000       12,732            285,462
  Payments on loan payable - related parties                                 (2,083)      (9,000)           (11,083)
  Proceeds from stock sales, net of issuance costs                          146,819       58,000            266,937
                                                                        -----------  -----------  -----------------
              Net cash provided by financing activities                     204,736       61,732            541,316
                                                                        -----------  -----------  -----------------

                       Net increase in cash                                 100,344           17            100,822

CASH AT BEGINNING OF YEAR                                                       478          461                 --

                                                                        -----------  -----------  -----------------
CASH AT END OF YEAR                                                     $   100,822  $       478  $         100,822
                                                                        ===========  ===========  =================
SUPPLEMENTAL CASH FLOW INFORMATION
  Cash paid for interest                                                $        --  $        --  $              --
                                                                        ===========  ===========  =================
  Cash paid for income taxes                                            $        --  $        --  $              --
                                                                        ===========  ===========  =================
SUPPLEMENTAL DISCLOSURE OF SIGNIFICANT NON-CASH
FINANCING AND INVESTING ACTIVITIES

  Discount on loan payable - related party                              $     8,300  $        --  $           8,300
                                                                        ===========  ===========  =================
  Issuance of stock for purchase of license agreement                   $        --  $   451,500  $         451,500
                                                                        ===========  ===========  =================
  Conversion of loans payable, shareholders into contributed capital    $        --  $   179,610  $         179,610
                                                                        ===========  ===========  =================
  Cancellation of 2,000,000 shares at par value                         $        --  $     2,000  $           2,000
                                                                        ===========  ===========  =================
  Issuance of stock for repayment of advances                           $        --  $   101,050  $         116,050
                                                                        ===========  ===========  =================
  Conversion of accrued interest into promissory notes                  $        --  $        --  $          12,684
                                                                        ===========  ===========  =================
  Issuance of stock for purchase of domain asset                        $        --  $        --  $          65,000
                                                                        ===========  ===========  =================
</TABLE>

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

                                       5

                                                                              19

<PAGE>

                             PACIFIC FUEL CELL CORP.
                          (A DEVELOPMENT STAGE COMPANY)
                        NOTES TO THE FINANCIAL STATEMENTS
                                DECEMBER 31, 2002


Note 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization

Pacific Fuel Cell Corp. (the "Company") was  incorporated in the State of Nevada
on  May  5,  1998.   During   1999  the  Company   purchased   the  domain  name
"Radiotower.com"  to  use  as an  internet  portal  that  provided  free  online
directories of radio stations.  During 2001 the Company  abandoned this business
plan.

Effective August 3, 2001 the Company acquired a license from Fullerene USA, Inc.
("Fullerene") in exchange for 30,100,000  shares of common stock.  Subsequent to
this  acquisition  the Company  changed its name to Pacific Fuel Cell Corp.  The
Company's new business plan entails the  development,  manufacture,  and sale of
proton exchange membrane fuel cell technology.

Use of estimates

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States of America requires  management to make
estimates  and  assumptions  that affect the amounts  reported in the  financial
statements  and  accompanying  notes.  Actual  results  could  differ from those
estimates.

Cash and cash equivalents

For purposes of balance sheet  classification  and the statements of cash flows,
the Company considers all highly liquid  investments  purchased with an original
maturity of three months or less to be cash equivalents.

Revenue recognition

The  Company's  recognizes  revenue  when  earned.  To date the  Company has not
generated significant operating revenues.

Research and development

Research and  development  costs are charged to operations when incurred and are
included in general and  administrative  expenses.  For the years ended December
31, 2002 and 2001, and the period May 5, 1998  (inception) to December 31, 2002,
the Company incurred research and development costs of $50,000, $-, and $50,000.

Stock-based compensation

The Company  accounts for equity  instruments  issued to employees  for services
based on the fair value of the equity instruments issued and accounts for equity
instruments  issued  to other  than  employees  based  on the fair  value of the
consideration received or

                                       6

                                                                              20
<PAGE>

                             PACIFIC FUEL CELL CORP.
                          (A DEVELOPMENT STAGE COMPANY)
                        NOTES TO THE FINANCIAL STATEMENTS
                                DECEMBER 31, 2002


the fair value of the equity instruments, whichever is more reliably measurable.

The Company  accounts for stock based  compensation in accordance with Statement
of Financial  Accounting  Standards  ("SFAS") 123,  "Accounting  for Stock-Based
Compensation."  The provisions of SFAS 123 allow companies to either expense the
estimated  fair value of stock  options or to continue  to follow the  intrinsic
value method set forth in Accounting  Principles  Board Opinion 25,  "Accounting
for Stock Issued to Employees"  ("APB 25") but disclose the pro forma effects on
net income (loss) had the fair value of the options been  expensed.  The Company
has  elected to  continue  to apply APB 25 in  accounting  for its stock  option
incentive plans.

Fair value of financial instruments

Fair value estimates  discussed herein are based upon certain market assumptions
and pertinent  information  available to management as of December 31, 2002. The
respective  carrying  value of certain  on-balance-sheet  financial  instruments
approximated  their fair  values.  These  financial  instruments  include  cash,
accounts  payable,  and loan payable.  Fair values of cash and accounts  payable
were assumed to approximate  carrying values for financial  instruments  because
they are short term in nature,  their carrying amounts  approximate fair values,
and they are payable on demand.  The fair value of the Company's  long-term debt
is estimated  based upon the quoted market prices for the same or similar issues
or on the current rates  available to the Company for debt of the same remaining
maturities.

Net (loss) per common share

The Company  follows SFAS 128,  "Earnings Per Share".  Basic earnings (loss) per
common share  calculations  are  determined by dividing net income (loss) by the
weighted average number of shares of common stock  outstanding  during the year.
Diluted earnings (loss) per common share calculations are determined by dividing
net income (loss) by the weighted  average  number of common shares and dilutive
common  share  equivalents  outstanding.   During  the  periods  when  they  are
anti-dilutive,  common  stock  equivalents,  if any, are not  considered  in the
computation.

Segment information

The Company  follows SFAS 131,  "Disclosure  about Segments of an Enterprise and
Related Information".  Certain information is disclosed,  per SFAS 131, based on
the  way  management  organizes  financial   information  for  making  operating
decisions  and  assessing  performance.  The Company  currently  operates in one
business segment and will evaluate additional segment disclosure requirements as
it expands operations.

                                       7

                                                                              21
<PAGE>
                             PACIFIC FUEL CELL CORP.
                          (A DEVELOPMENT STAGE COMPANY)
                        NOTES TO THE FINANCIAL STATEMENTS
                                DECEMBER 31, 2002


Impairment of long-lived assets

The  Company  periodically  reviews  the  carrying  amount  of its  identifiable
intangible assets to determine  whether current events or circumstances  warrant
adjustments  to such carrying  amounts.  If an  impairment  adjustment is deemed
necessary,  such loss is measured by the amount that the carrying  value of such
assets exceeds their fair value.  Considerable  management judgment is necessary
to estimate the fair value of assets;  accordingly,  actual  results  could vary
significantly  from such estimates.  Assets to be disposed of are carried at the
lower of their financial  statement  carrying amount or fair value less costs to
sell.

Recent Pronouncements

In December 2002, the Financial  Accounting Standards Board ("FASB") issued SFAS
148  "Accounting  for Stock-Based  Compensation--Transition  and  Disclosure--an
amendment of SFAS 123." SFAS 148 provides  alternative methods of transition for
a voluntary  change to the fair value based method of accounting for stock-based
employee  compensation  from the  intrinsic  value-based  method  of  accounting
prescribed  by APB 25. As  allowed  by SFAS 123,  the  Company  has  elected  to
continue  to apply  the  intrinsic  value-based  method of  accounting,  and has
adopted the disclosure  requirements of SFAS 123. The Company currently does not
anticipate adopting the provisions of SFAS 148.

In July 2002, the FASB issued SFAS 146,  "Accounting  for Costs  Associated with
Exit or Disposal  Activities." SFAS 146 provides new guidance on the recognition
of costs  associated  with exit or disposal  activities.  The standard  requires
companies to recognize costs  associated  with exit or disposal  activities when
they are incurred  rather than at the date of  commitment to an exit or disposal
plan.  SFAS 146 supercedes  previous  accounting  guidance  provided by the EITF
Issue No. 94-3 "Liability  Recognition for Certain Employee Termination Benefits
and Other  Costs to Exit an  Activity  (including  Certain  Costs  Incurred in a
Restructuring)."  EITF Issue No. 94-3 required  recognition of costs at the date
of  commitment  to an  exit  or  disposal  plan.  SFAS  146  is  to  be  applied
prospectively to exit or disposal activities  initiated after December 31, 2002.
Early  application is permitted.  The adoption of SFAS 146 by the Company is not
expected to have a material impact on the Company's financial position,  results
of operations, or cash flows.

In April 2002, the FASB issued SFAS 145,  "Rescission of FASB  Statements No. 4,
44, and 64,  Amendment of FASB  Statement  No. 13, and  Technical  Corrections."
Among other things,  this statement  rescinds FASB  Statement No. 4,  "Reporting
Gains and Losses  from  Extinguishment  of Debt"  which  required  all gains and
losses from extinguishment of debt to be aggregated and, if material, classified
as an  extraordinary  item, net of related income tax effect.  As a result,  the
criteria  in APB  Opinion  No.  30,  "Reporting  the  Results of  Operations  --
Reporting the Effects of Disposal of a Segment of a Business, and Extraordinary,
Unusual and Infrequently Occurring Events and

                                       8

                                                                              22
<PAGE>
                             PACIFIC FUEL CELL CORP.
                          (A DEVELOPMENT STAGE COMPANY)
                        NOTES TO THE FINANCIAL STATEMENTS
                                DECEMBER 31, 2002

Transactions,"  will  now be  used to  classify  those  gains  and  losses.  The
provisions of SFAS 145 related to the classification of debt  extinguishment are
effective for years beginning after May 15, 2002. The Company's adoption of SFAS
145 by the Company is not  expected to have a material  impact on the  Company's
financial position, results of operations, or cash flows.

In  November  2001,  the EITF of the  FASB  issued  EITF  01-9  "Accounting  for
Consideration  Given by a Vendor to a  Subscriber  (Including  a Reseller of the
Vendor's  Products)."  EITF 01-9 provides  guidance on when a sales incentive or
other consideration given should be a reduction of revenue or an expense and the
timing of such recognition.  The guidance provided in EITF 01-9 is effective for
financial  statements for interim or annual periods beginning after December 15,
2001. The adoption of EITF 01-9 by the Company did not have a material impact on
the Company's financial statements.

In August 2001,  the FASB issued SFAS 144,  "Accounting  for the  Impairment  or
Disposal  of  Long-Lived   Assets."  SFAS  144  provides  new  guidance  on  the
recognition of impairment  losses on long-lived assets with definite lives to be
held and  used or to be  disposed  of and also  issued  the  definition  of what
constitutes  a  discontinued  operation  and how the  results of a  discontinued
operation  are to be measured and  presented.  SFAS 144 is effective  for fiscal
years beginning after December 15, 2001. The adoption of SFAS 144 did not have a
material impact on the Company's financial position,  results of operations,  or
cash flows.

In June  2001,  the FASB  issued  SFAS 143,  "Accounting  for  Asset  Retirement
Obligations."  SFAS 143  requires  the fair  value of a  liability  for an asset
retirement  obligation  to be  recognized in the period that it is incurred if a
reasonable  estimate of fair value can be made. The associated  asset retirement
costs are  capitalized as part of the carrying  amount of the long-lived  asset.
SFAS 143 is  effective  for fiscal  years  beginning  after June 15,  2002.  The
adoption of SFAS 143 is not expected to have a material  impact on the Company's
financial position, results of operations or cash flows.

In June 2001, the FASB issued SFAS 142, "Goodwill and Other Intangible  Assets,"
which provides for  non-amortization of goodwill and intangible assets that have
indefinite useful lives, annual tests of impairments of those assets and interim
tests of  impairment  when an event occurs that more likely than not has reduced
the fair value of such assets.  The statement  also provides  specific  guidance
about how to determine and measure goodwill impairments, and requires additional
disclosure  of  information  about  goodwill and other  intangible  assets.  The
provisions  of this  statement  are required to be applied  starting with fiscal
years  beginning  after December 15, 2001, and applied to all goodwill and other
intangible assets recognized in the financial  statements at that date. Goodwill
and  intangible  assets  acquired  after  June 30,  2001 will be  subject to the
non-amortization provisions of the statement. Early application is permitted for
entities  with fiscal years  beginning  after March 15, 2001,  provided that the
first interim financial statements had not been issued previously. The Company's
adoption  of the  provisions

                                       9

                                                                              23

<PAGE>
                             PACIFIC FUEL CELL CORP.
                          (A DEVELOPMENT STAGE COMPANY)
                        NOTES TO THE FINANCIAL STATEMENTS
                                DECEMBER 31, 2002

23 of  SFAS  142 did not  have a  material  impact  on the  Company's  financial
position, results of operations or cash flows.

In June  2001,  the FASB  issued  SFAS 141,  "Business  Combinations,"  which is
effective for all business combinations  initiated after June 30, 2001. SFAS 141
requires  companies to account for all business  combinations using the purchase
method of accounting,  recognize  intangible assets if certain criteria are met,
as well as provide additional  disclosures  regarding business  combinations and
allocation of purchase  price.  The adoption of SFAS 141 did not have a material
impact on the Company's financial position, results of operations or cash flows.


Note 2.  GOING CONCERN

The  accompanying  financial  statements  have been prepared in conformity  with
accounting principles generally accepted in the United States of America,  which
contemplates  continuation  of the Company as a going  concern.  The Company has
incurred  losses since inception of $1,264,455 and is reliant on raising capital
to  initiate  their  business  plan.  In  addition,  the  Company has no revenue
generating operations.

The Company has been under new management since August 3, 2001, is participating
in a  research  and  development  program  with the  University  of  California,
Riverside,  and is in the process of raising  additional  funds through sales of
common stock;  however,  the Company has no commitment from any party to provide
additional capital and there is no assurance that such funding will be available
when needed, or if available,  that its terms will be favorable or acceptable to
the Company.

The financial  statements do not include any adjustments to reflect the possible
future effects on the recoverability and classification of assets or the amounts
and classification of liabilities that may result from the possible inability of
the Company to continue as a going concern.


Note 3.  LICENSE

The Company signed a licensing agreement on August 28, 2001 with Fullerene for a
exclusive  worldwide license (excluding Japan) to make, use, and sell fuel cells
solely for use in transportation  applications.  The licensing agreement expires
upon the expiration of the underlying patent application, which is 17 years upon
the approval of the patent by the United States Patent and Trademark  Office. As
of the date of the audit report the patent application had not been approved. In
exchange, the Company issued 30,100,000 shares of common stock to Fullerene. The
asset was recorded at the fair market value of the shares of $451,500  (See Note
7).

On  September  13,  2001 the  Company  signed  an  exclusive  worldwide  license
(excluding

                                       10

                                                                              24
<PAGE>
                             PACIFIC FUEL CELL CORP.
                          (A DEVELOPMENT STAGE COMPANY)
                        NOTES TO THE FINANCIAL STATEMENTS
                                DECEMBER 31, 2002

Japan) to acquire all intellectual  property,  present and future,  of Winz Co.,
Ltd. in exchange for a stock purchase  warrant (See Note 6). The  acquisition of
these  rights  was  recorded  as stock  compensation  expense  since the  rights
acquired had no readily determinable fair market value.


Note 4.  RESEARCH AND DEVELOPMENT AGREEMENT

On August 21,  2002 the Company  entered  into an  one-year  agreement  with the
University of California  (the  "University")  to develop a commercially  viable
fuel cell exploiting the Company's proprietary technology.  The Company advanced
the University  $70,000 for the first phase, which was completed during February
2003.  The Company has charged  $50,000 to operations and has recorded a prepaid
expense of $20,000 as of December 31, 2002 for research and development services
to be provided through February 26, 2003.

During March 2003 the Company  advanced the University  $61,266 to begin work on
the second phase of the research and development agreement.


Note 5.  LOAN PAYABLE - RELATED PARTY

On August 14, 2002 the Company received an unsecured  non-interest  bearing loan
from a related  party for $60,000 due  September  14, 2002.  On December 5, 2002
this note was cancelled and replaced with note  extending the due date to August
14,  2004.  Due to the fact  that the loan was  non-interest  bearing  and has a
maturity  greater  than  one  year,  the loan has  been  discounted  at 7%.  The
unamortized discount at December 31, 2002 is $6,900.


Note 6.  STOCKHOLDERS' EQUITY

Common stock
------------

During the period May 5, 1998  (inception)  to December  31, 1998 the  following
equity transactions occurred:

     o    Issued 3,000,000 shares of common stock to various  investors for cash
          of $20,000 in a private placement  pursuant to Regulation D, Rule 504.
          Issuance costs were $1,882.

     o    Issued  2,250,000  shares of common  stock for  repayment  of advances
          aggregating $15,000.

During  the year ended  December  31,  1999 the  following  equity  transactions
occurred:

                                       11

                                                                              25
<PAGE>
                             PACIFIC FUEL CELL CORP.
                          (A DEVELOPMENT STAGE COMPANY)
                        NOTES TO THE FINANCIAL STATEMENTS
                                DECEMBER 31, 2002


     o    Issued  9,750,000  shares of  common  stock in  consideration  for the
          domain asset and domain name RadioTower.com.  These shares were valued
          at $65,000,  which was the fair market value of the shares on the date
          the shares were issued.

     o    Issued 3,750,000 shares of common stock to various  investors for cash
          of $25,000 in a private placement  pursuant to Regulation D, Rule 504.

     o    Stock subscriptions for 2,850,000 shares of common stock were accepted
          for cash of $19,000 pursuant to Regulation S. These shares were issued
          during February 2000.

     o    Stock subscriptions for 1,650,000 shares of common stock were accepted
          in exchange  for unpaid  wages of $11,000  pursuant to  Regulation  S.
          These shares were issued during February 2000.

During  the year ended  December  31,  2001 the  following  equity  transactions
occurred:

     o    Issued  30,100,000  shares of common  stock in exchange  for a license
          agreement (Note 3). One of the conditions in the license agreement was
          that certain  shareholders had to surrender 2,000,000 shares of common
          stock for cancellation.

     o    Issued  6,000,000  shares  of  common  stock  for cash of  $6,000 to a
          related  party.  Because  the stock was issued  below its fair  market
          value on the date the  agreement  was reached  the Company  recognized
          compensation expense of $84,000.

     o    Issued  520,000  shares of  common  stock at $0.10 a share for cash of
          $52,000. o Recorded stock compensation  expense of $100,000 related to
          a licensing agreement (Note 3).

     o    Issued   1,070,000  shares  of  common  stock  in  exchange  for  debt
          forgiveness of $101,050.

     o    Shareholders  of the Company  converted  $179,610 of liabilities  into
          contributed capital.

During  the year ended  December  31,  2002 the  following  equity  transactions
occurred:

     o    Issued  1,000,000  shares of its  common  stock  for cash  aggregating
          $46,819.

     o    Entered  into a  six-month  agreement  with a  former  officer  of the
          Company for  investor  relation  services in  exchange  for  1,500,000
          shares of its common  stock.  These  shares  were valued at their fair
          market  value of $45,000 on the date the  Company  agreed to issue the
          shares.

     o    Issued  2,000,000  shares of its  common  stock  for cash  aggregating
          $100,000.

     o    The Company  recorded the original  discount on loan payable - related
          party as a capital contribution of $8,300.

                                       12

                                                                              26
<PAGE>

                             PACIFIC FUEL CELL CORP.
                          (A DEVELOPMENT STAGE COMPANY)
                        NOTES TO THE FINANCIAL STATEMENTS
                                DECEMBER 31, 2002


Stock purchase warrant
----------------------

On  September  13,  2001 the Company  issued a 2-year  warrant to purchase up to
1,000,000  shares of common stock at a price of $0.10 per share.  The option was
valued at  $100,000,  which was the fair market value on the date the option was
issued.


Note 7.  LOSS ON ASSET IMPAIRMENT

The Company  entered into an Option to Purchase  agreement  on June 4, 1998,  to
acquire  the  rights to mineral  property  claims  located  in the Liard  Mining
Division, British Columbia. The investment of $5,000 was charged to expense as a
loss on asset impairment for the period ended December 31, 1998.

On March 12, 1999, the Company  entered into an agreement to purchase the domain
name  "RadioTower.com"  in exchange for 9,750,000  shares of  restricted  common
stock at a fair value of $65,000.  During the year ended  December 31, 2000, the
Company determined that the asset was impaired and, accordingly, recorded a loss
on impairment of $54,167.

During the year ended  December  31, 2002  management  determined  that  license
agreement with Fullerene was impaired and,  accordingly,  has recorded a loss on
impairment of $451,000.  The Company based their decision on the  uncertainty of
being  able to  raise  sufficient  capital  in a  timely  manner  to  develop  a
commercially viable fuel cell technology.


Note 8.  INCOME TAXES

The Company  accounts  for income taxes under SFAF 109,  "Accounting  for Income
Taxes",  which  requires use of the  liability  method.  SFAS 109 provides  that
deferred  tax assets  and  liabilities  are  recorded  based on the  differences
between the tax bases of assets and liabilities  and their carrying  amounts for
financial reporting purposes, referred to as temporary differences. Deferred tax
assets  and  liabilities  at the end of each  period  are  determined  using the
currently  enacted tax rates  applied to taxable  income in the periods in which
the deferred tax assets and liabilities are expected to be settled or realized.

The types of  temporary  differences  between  the tax basis of assets and their
financial  reporting  amounts  that give rise to a  significant  portion  of the
deferred  tax asset are as follows:

                                                Reconciling      Tax
                                                    Item        Effect
                                                -----------    --------
Net operating loss carryforward                   $500,000     $170,000
                                                  ========     ========

                                       13

                                                                              27
<PAGE>
                             PACIFIC FUEL CELL CORP.
                          (A DEVELOPMENT STAGE COMPANY)
                        NOTES TO THE FINANCIAL STATEMENTS
                                DECEMBER 31, 2002


The net operating loss carry forward will expire through 2022 and may be limited
due to a significant change in ownership during 2001. The deferred tax asset has
been fully reserved at December 31, 2002.

The change in the valuation allowance for the deferred tax asset during the year
ended December 31, 2002 was $28,000.


Note 9.  RELATED PARTY TRANSACTIONS

During the period from May 5, 1998  (inception)  to December 31, 1998,  business
associates  of the sole  officer and director of the Company  ("sole  officer"),
advanced the Company $15,000.  The funds were used to pay for management fees, a
legal  retainer  and to reduce the other  payable to a related  party.  The sole
officer's associates were repaid through the issuance of 2,250,000 shares.

During the period from May 5, 1998 (inception) to December 31, 2001 shareholders
of the Company  loaned to the Company an aggregate of $225,462.  During the year
ended December 31, 2000 the Company  converted  these  advances into  promissory
notes,  bearing  interest at 9% and due on June 30, 2001.  The face value of the
promissory notes includes accrued interest of $12,684.  During 2001 $101,050 was
converted into common stock and $179,610 was converted into contributed capital.


                                       14

                                                                              28
<PAGE>

ITEM  8.  CHANGES  IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON  ACCOUNTING  AND
FINANCIAL DISCLOSURE.

     None.

                                    PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
WITH SECTION 16(a) OF THE EXCHANGE ACT.

     Our directors and officers as of the date of this Report are as follows:

                Name           Age                    Position
           --------------      ---          -------------------------------

           George Suzuki        58          President, Director

           Ken K. Inouye        58          Secretary, Treasurer, Director

           William Potts        59          Director

     Directors are elected for one-year  terms or until the next annual  meeting
of shareholders and until their  successors are duly elected and qualified.  Our
officers are  appointed  by our Board of Directors  and serve at the pleasure of
the Board, subject to any rights under employment agreements.

     There are no family  relationships among the officers and directors.  There
is no  arrangement  or  understanding  between  us (or any of our  directors  or
officers)  and any other  person  pursuant  to which such person was or is to be
selected as a director or officer.

Resumes

     George  Suzuki,  assumed his positions  with us upon  effectiveness  of the
Fullerene  Agreement in August 2001. In addition to his positions with us, since
January 1991, Mr. Suzuki has been CEO of Beltec Industries,  Inc., Tustin, CA, a
privately held company engaged in the sale of air  purification  systems.  Also,
from August 1986 through  September  1996,  Mr.  Suzuki was President of Unibell
International Co. Ltd., Tustin, CA, a privately held real estate company engaged
in land development and investment.  Mr. Suzuki devotes approximately 90% of his
business time to our business affairs.

     Ken K. Inouye,  assumed his  positions  with us upon  effectiveness  of the
Fullerene  Agreement in August 2001. In addition to his positions with us, since
1979 Mr. Inouye has been CEO of Advanced American Technology, Inc., Los Angeles,
CA,  a  privately   held   technology   consulting   firm.  Mr.  Inouye  devotes
approximately 50% of his business time to our business affairs.

     William A. Potts,  assumed his positions with us upon  effectiveness of the
Fullerene  Agreement in August 2001.  Since  February  1995,  Mr. Potts has been
President and Chief  Operating  Officer of  Sungard/DML,  Inc.,  New York, NY, a
publicly  held  computer  software and services  company.  Mr. Potts  received a
Bachelor of Science  degree from the Rochester  Institute of Technology in 1967.
Mr.

                                                                              29

<PAGE>

Potts  devotes  only such time as  necessary  to our  business,  which time does
notexceed 5% of his business time.

     Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers,  directors  and person who own more than 10% of the  Company's  Common
Stock to file reports of ownership and changes in ownership  with the Securities
and  Exchange  Commission.  All of the  aforesaid  persons  are  required by SEC
regulation  to  furnish us with  copies of all  Section  16(a)  forms they file.
During the fiscal year ended  December  31,  2002,  there were no changes in the
securities holdings of any member of our management.

ITEM 10.  EXECUTIVE COMPENSATION.

Remuneration

     The following table reflects all forms of  compensation  for services to us
for the years ended December 31, 2002 and 2001 of our chief  executive  officer,
as  well as  those  persons  who  received  in  excess  of  $100,000  in  annual
compensation from us during the aforesaid time.

<TABLE>
                           SUMMARY COMPENSATION TABLE

<CAPTION>
                                                Long Term Compensation
                                          ---------------------------------
                    Annual Compensation            Awards           Payouts
                  ----------------------  ------------------------  -------
                                 Other
                                 Annual   Restricted  Securities             All Other
 Name and                        Compen-     Stock    Underlying      LTIP    Compen-
Principal         Salary  Bonus  sation     Award(s)  Options/SARs  Payouts   sation
 Position   Year   ($)     ($)     ($)        ($)         (#)          ($)      ($)
----------  ----  ------  -----  -------  ----------  ------------  -------  ---------
<S>         <C>   <C>     <C>    <C>      <C>              <C>      <C>      <C>
George      2002  $    0  $   0  $     0  $        0       0        $     0  $       0
Suzuki,(1)  2001  $    0  $   0  $     0  $        0       0        $     0  $       0
Chairman,
President,
Secretary/
Treasurer
-----------------
<FN>
(1)  Mr.  Suzuki  assumed his position as our  President in August 2001.  Prior,
     Michael Levine was our President.  Mr. Levine received no compensation  for
     his services to us during his tenure.
</FN>
</TABLE>

     We have adopted a policy  whereby we reimburse  officers and  directors for
out of pocket  expenses  incurred  by each of them in the  performance  of their
relevant duties.  However,  we did not reimburse any officer or director for any
such expenses during the fiscal year ended December 31, 2002.

     We have no stock plan for employees, but may adopt one in the future.


                                                                              30

<PAGE>



ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

     The table below lists the beneficial  ownership of our voting securities by
each  person  known by us to be the  beneficial  owner  of more  than 5% of such
securities,  as well as by all our directors and officers as of the date of this
Report. Unless otherwise indicated,  the shareholders listed possess sole voting
and investment power with respect to the shares shown.

                                                                     Percent
              Name and Address of           Amount and Nature of        of
                Beneficial Owner            Beneficial Ownership      Class
         -------------------------------    ---------------------    -------

         Fullerene USA, Inc.                    30,100,000(1)         47.4%
         120 N. Almont Drive
         Suite 3
         Beverly Hills, CA

         Stephen G. Godwin                       6,000,000(1)          9.5%
         120 N. Almont Drive
         Suite 3
         Beverly Hills, CA 90211

         All Directors and Executive            30,100,000(1)         47.4%
         Officers as a Group (3 persons)

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

(1)  Messrs.  Suzuki  and  Inouye,  two of our  officers  and  each of whom is a
     director,  each own 29.1% of  Fullerene's  issued  and  outstanding  common
     stock.  Further,  in addition to the 6 million  shares owned by Mr.  Godwin
     referenced  above,  he owns  approximately  9.1% interest in Fullerene USA,
     Inc.

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     Effective August 2001, we acquired an exclusive  worldwide  license (except
for  Japan)  in  proprietary  fuel cell  technology  (including  certain  future
acquired  intellectual  property) for use in  transportation  applications  (the
"Assets")  from  Fullerene  USA,  Inc.("Fullerene"),  a  privately  held  Nevada
corporation,.  In exchange  for the Assets,  we issued  30,100,000  "restricted"
common shares, equal to ownership of approximately 51% of our outstanding shares
at the time of the acquisition. Messrs. Suzuki and Inouye, our two officers, are
principal shareholders of Fullerene.  They assumed their positions with us after
the closing of this acquisition. As part of the terms of this agreement,

                                                                              31

<PAGE>

certain  members of our  management  at that time  surrendered  an  aggregate of
2,000,000 shares of our common stock for cancellation.

     At December 31, 2002, we had an outstanding  loan in the amount of $53,100,
due to Fullerene,  USA, Inc., our majority stockholder.  In regard to this loan,
we  originally  received an unsecured,  non-  interest  bearing loan for $60,000
which was due September  14, 2002. On December 5, 2002,  this note was cancelled
with the consent of Fullerene and replaced with a note extending the due date to
August 14, 2004.

     In addition,  we operate  from our  principal  executive  offices at 131 N.
Tustin Ave., Suite 100, Tustin, CA 92780, which space is provided on a rent free
basis  pursuant  to a  verbal,  month to month  lease,  by  George  Suzuki,  our
President  and a director.  This space  consists of 700 square feet of executive
office space.

     During  the period  from May 5, 1998  (inception)  to  December  31,  2001,
certain of our shareholders loaned us an aggregate of $225,462.  During the year
ended  December 31, 2000, we converted  these  advances into  promissory  notes,
bearing  interest  at 9% and  due on  June  30,  2001.  The  face  value  of the
promissory notes included accrued interest of $12,684. During 2001, $101,050 was
converted into  1,070,000  shares of our common stock and $179,610 was converted
into contributed capital.

     Except as stated  above or as stated  elsewhere,  no member of  management,
executive  officer or security holder had any direct or indirect interest in any
other transaction with us.

                                     PART IV

Item 13.  EXHIBITS AND REPORTS ON FORM 8-K.

(a)   Exhibits   The following exhibit is attached to this Report
      --------
Exhibit No.       Description
-----------       -----------

    99.2          Certification of Financial Statements in Accordance with
                  Sarbanes-Oxley Act of 2002.

Following  are a list of exhibits  which we  previously  filed in other  reports
which we filed with the SEC,  including  the  exhibit  No.,  description  of the
exhibit and the identity of the Report where the exhibit was filed.

    2.1*          Corporate Charter
    2.2*          Articles of Incorporation


                                                                              32

<PAGE>



    2.3*          Amendment of Articles of Incorporation
    2.4*          Bylaws
    2.5**         Amendment to Articles of Incorporation
   10.1**         Agreement between the Company and Fullerene, USA, Inc.
-----------

* Filed with the  Securities  and  Exchange  Commission  in the Exhibits to Form
10-SB filed on November 10, 1999, and are incorporated by reference herein.

** Filed with the Securities and Exchange Commission in the Exhibits to Form 8-K
filed on September 6, 2001, and are incorporated by reference herein.

(b) Reports on Form 8-K

     In the last fiscal  quarter of the fiscal year ended  December 31, 2002, we
did not file any reports on Form 8-K.

ITEM 14.  CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures
------------------------------------------------

     Disclosure  controls and procedures are designed to ensure that information
required to be  disclosed in the reports  filed or submitted  under the Exchange
Act of 1934 is recorded,  processed,  summarized  and reported,  within the time
periods  specified  in the  rules  and  forms  of the  Securities  and  Exchange
Commission.  Disclosure  controls and procedures  include,  without  limitation,
controls  and  procedures  designed  to ensure that  information  required to be
disclosed  in the reports  filed under the  Securities  Exchange  Act of 1934 is
accumulated  and  communicated  to  management,  including  our Chief  Executive
Officer and Chief Financial Officer,  as appropriate,  to allow timely decisions
regarding required disclosure.

     Within the 90 days prior to the filing date of this report,  we carried out
an evaluation of the effectiveness of the design and operation of our disclosure
controls and procedures  pursuant to Exchange Act Rule 13a-14.  This  evaluation
was done  under the  supervision  and with the  participation  of our  Principal
Executive Officer, who is also our Principal Financial Officer.  Based upon that
evaluation,  they  concluded  that our  disclosure  controls and  procedures are
effective in gathering,  analyzing and disclosing  information needed to satisfy
our disclosure obligations under the Exchange Act.

Changes in Internal Controls
----------------------------

     There were no  significant  changes in our  internal  controls  or in other
factors that could  significantly  affect those  controls  since the most recent
evaluation of such controls.


                                                                              33

<PAGE>

                                   SIGNATURES

     In accordance  with Section 13 or 15(d) of the  Securities  Exchange Act of
1934,  the  Company  caused  this  report  to be  signed  on its  behalf  by the
undersigned, thereunto duly authorized, on April 14, 2003.

                                      PACIFIC FUEL CELL CORP.
                                      (Registrant)


                                      By:  s/George Suzuki
                                         --------------------------------------
                                         George Suzuki, President


     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
indicated on April 14, 2003.



                                         s/George Suzuki
                                       ----------------------------------------
                                       George Suzuki, Director


                                         s/Ken K. Inouye
                                       ----------------------------------------
                                       Ken K. Inouye, Director


                                       ----------------------------------------
                                       William Potts, Director




                                                                              34

<PAGE>

                                 CERTIFICATIONS

I, George Suzuki, certify that:

     1.   I have reviewed this annual report on Form 10-KSB of Pacific Fuel Cell
          Corp.;

     2.   Based on my knowledge,  this annual report does not contain any untrue
          statement  of a  material  fact  or  omit to  state  a  material  fact
          necessary  in  order  to make  the  statements  made,  in light of the
          circumstances  under which such  statements  were made, not misleading
          with respect to the period covered by this annual report;

     3.   Based on my knowledge,  the financial statements,  and other financial
          information  included in this  annual  report,  fairly  present in all
          material respects the financial  condition,  results of operations and
          cash flows of the Registrant as of, and for, the periods  presented in
          this annual report;

     4.   I am responsible for establishing and maintaining  disclosure controls
          and  procedures  (as defined in Exchange  Act Rules 13a-14 and 15d-14)
          for the Registrant and have:

          a.   designed such  disclosure  controls and procedures to ensure that
               material  information  relating to the Registrant,  including its
               consolidated  subsidiaries,  is made  known to  me/us  by  others
               within those  entities,  particularly  during the period in which
               this annual report is being prepared;

          b.   evaluated  the  effectiveness  of  the  Registrant's   disclosure
               controls and  procedures  as of a date within ninety (90) days of
               the filing date of this annual  report (the  "Evaluation  Date");
               and

          c.   presented  in  this  annual  report  my  conclusions   about  the
               effectiveness of the disclosure  controls and procedures based on
               our evaluation as of the Evaluation Date;

     5.   I  have  disclosed,  based  on  my  most  recent  evaluation,  to  the
          Registrant's  auditors  and the Audit  Committee  of the  Registrant's
          Board of Directors (or persons performing the equivalent function):

          a.   all  significant  deficiencies  in the  design  or  operation  of
               internal  controls which could adversely  affect the Registrant's
               ability to record,  process,  summarize and report financial data
               and have  identified for the  Registrant's  auditors any material
               weakness in internal controls; and

          b.   any fraud,  whether or not material,  that involves management or
               other  employees  who have a  significant  role in the  Company's
               internal controls; and

                                                                              35

<PAGE>



     6.   I have  indicated  in this  annual  report  whether  or not there were
          significant  changes in  internal  controls or in other  factors  that
          could significantly affect internal controls subsequent to the date of
          my most recent  evaluation,  including  any  corrective  actions  with
          regard to significant deficiencies and material weaknesses.

Dated: April 14, 2003                       s/George Suzuki
                                          --------------------------------------
                                          George Suzuki, Chief Executive Officer


I, Ken K. Inouye, certify that:

     1.   I have reviewed this annual report on Form 10-KSB of Pacific Fuel Cell
          Corp.;

     2.   Based on my knowledge,  this annual report does not contain any untrue
          statement  of a  material  fact  or  omit to  state  a  material  fact
          necessary  in  order  to make  the  statements  made,  in light of the
          circumstances  under which such  statements  were made, not misleading
          with respect to the period covered by this annual report;

     3.   Based on my knowledge,  the financial statements,  and other financial
          information  included in this  annual  report,  fairly  present in all
          material respects the financial  condition,  results of operations and
          cash flows of the Registrant as of, and for, the periods  presented in
          this annual report;

     4.   I am responsible for establishing and maintaining  disclosure controls
          and  procedures  (as defined in Exchange  Act Rules 13a-14 and 15d-14)
          for the Registrant and have:

          a.   designed such  disclosure  controls and procedures to ensure that
               material  information  relating to the Registrant,  including its
               consolidated  subsidiaries,  is made  known to  me/us  by  others
               within those  entities,  particularly  during the period in which
               this annual report is being prepared;

          b.   evaluated  the  effectiveness  of  the  Registrant's   disclosure
               controls and  procedures  as of a date within ninety (90) days of
               the filing date of this annual  report (the  "Evaluation  Date");
               and

          c.   presented  in  this  annual  report  my  conclusions   about  the
               effectiveness of the disclosure  controls and procedures based on
               our evaluation as of the Evaluation Date;

     5.   I  have  disclosed,  based  on  my  most  recent  evaluation,  to  the
          Registrant's  auditors  and the Audit  Committee  of the  Registrant's
          Board of Directors (or persons performing the equivalent function):


                                                                              36

<PAGE>

          a.   all  significant  deficiencies  in the  design  or  operation  of
               internal  controls which could adversely  affect the Registrant's
               ability to record,  process,  summarize and report financial data
               and have  identified for the  Registrant's  auditors any material
               weakness in internal controls; and

          b.   any fraud,  whether or not material,  that involves management or
               other  employees  who have a  significant  role in the  Company's
               internal controls; and

     6.   I have  indicated  in this  annual  report  whether  or not there were
          significant  changes in  internal  controls or in other  factors  that
          could significantly affect internal controls subsequent to the date of
          my most recent  evaluation,  including  any  corrective  actions  with
          regard to significant deficiencies and material weaknesses.


Dated: April 14, 2003                       s/Ken K. Inouye
                                          --------------------------------------
                                          Ken K. Inouye, Chief Financial Officer


                                                                              37