UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                               AMENDMENT NO. 2 TO

                                   FORM 10-KSB/A

     (Mark  One)

     [ X ] Annual  report under Section 13 or 15(d) of the  Securities  Exchange
Act of 1934

     For the fiscal year ended December 31, 2001

     [ ] Transition report under Section 13 or 15(d) of the Securities  Exchange
Act of 1934

     For the transition period from _________ to _________

     Commission File No. 0-23845

                         GO ONLINE NETWORKS CORPORATION
             (Exact name of registrant as specified in Its charter)
<TABLE>
<CAPTION>

<S>                                                       <C>
        DELAWARE                                          33-0873993
  (State  or  other  jurisdiction  of                   (IRS  Employer
 incorporation  or  organization)                    Identification  Number)
</TABLE>


                       5681 BEACH BOULEVARD, SUITE 101/100
                          BUENA PARK, CALIFORNIA 90621
              (Address of principal executive offices) (Zip Code)

        REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE (714) 523-1648

     Indicate  by  check  mark  whether the registrant (1) has filed all reports
required  to  be  filed by Section 13 or 15(d) of the Securities Exchange Act of
1934  during  the  preceding  12  months  (or  for  such shorter period that the
registrant  was required to file such reports), and (2) has been subject to such
filing  requirements  for  the  past  90  days.     Yes  [X  ]     No  [   ].

     Check  if  there is no disclosure of delinquent filers pursuant 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.  [  X  ]

     State  issuer's  revenues  for  its most recent fiscal year.     $6,128,555

     State  the  aggregate  market  value of 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 prices of such common equity, as
of  a  specified  date within the past 60 days.  (See definition of affiliate in
rule  12b-2  of  the  Exchange  Act.)

     $2,270,187  based  on  the  closing price for the common stock on March 28,
2001.

<PAGE>
     Indicate  the  number of shares outstanding of each of the issuer's classes
of  common  stock,  as  of  the  latest  practicable  date.

As of December 31, 2001, there were 99,560,116 shares of common stock, par value
$0.001,  issued  and  outstanding.

                     DOCUMENTS  INCORPORATED  BY  REFERENCE

     If  the following documents are incorporated by reference, briefly describe
them  and  identify  the  part of the form 10-KSB (e.g., Part I, Part II, etc. )
into  which  the  document  is  incorporated:  (1) any annual report to security
holders;  (2)  any  proxy or information statement; and (3) any prospectus filed
pursuant to rule 424(b) or (c) of the Securities Act of 1933 ("Securities Act").
The  listed  documents  should  be clearly described for identification purposes
(e.g.,  annual  report  to  security  holders for fiscal year ended December 24,
1990).

None.

     Transitional  Small  Business  Disclosure  Format  (check  one):

     Yes  No   X
            ----

<PAGE>

Item  7          Financial  Statements.


<PAGE>
                                   SIGNATURES

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


Dated: September 9, 2002              Go Online Networks Corporation

                                      /s/  Joseph  M.  Naughton

                                      Joseph M. Naughton,
                                      Chief Executive Officer and Director



<PAGE>

                          INDEX TO FINANCIAL STATEMENTS

                         GO ONLINE NETWORKS CORPORATION
                          AND CONSOLIDATED SUBSIDIARIES

                              FINANCIAL STATEMENTS

                                      with

               REPORTS OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
<TABLE>
<CAPTION>


                                                                                              Page

<S>                                                                                             <C>
   Report of Independent Certified Public Accountants                                         F-2

   Financial Statements:

            Balance Sheets                                                                    F-3

            Statements of Operations                                                          F-4

            Statement of Stockholders' (Deficit)                                           F-5 to F-6

            Statements of Cash Flows                                                          F-7

            Notes to Financial Statements                                                 F-8 to F-20

</TABLE>

<PAGE>

                         Independent Accountants' Report




Board of Directors
Go Online Networks, Inc.

         We have audited the accompanying consolidated balance sheets of Go
Online Networks, Inc. as of December 31, 2001 and December 31, 2000, and the
related consolidated statements of operations, stockholders' equity, and cash
flows for the years ended December 31, 2001 and December 31, 2000. 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 audit.

         We conducted our audit in accordance with generally accepted auditing
standards in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the account principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentations. 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 consolidated financial position of Go
Online Networks, Inc. as of December 31, 2001 and December 31, 2000 and the
consolidated results of its operations, stockholders' equity, and its cash flows
for the years ended December 31, 2001 and December 31, 2000, 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 described in Note 1, the
Company has suffered recurring losses from operations and has a net capital
deficiency that raise substantial doubts about its ability to continue as a
going concern. Management's plan to continue in operations is contained in Note
1 to the financial statements. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty.

/s/ Miller and McCollom

MILLER AND MCCOLLOM
Certified Public Accountants
4350 Wadsworth Boulevard, Suite 300
Wheat Ridge, Colorado 80033


March 2, 2002, except for Note 13,which is as of April 24, 2002.


                                       F-2
<PAGE>
                         GO ONLINE NETWORKS CORPORATION
                          AND CONSOLIDATED SUBSIDIARIES
                           Consolidated Balance Sheets

                                     ASSETS
<TABLE>
<CAPTION>
                                                                                                    December 31,
                                                                                      ------------------- -- -------------------
                                                                                             2001                   2000
                                                                                      -------------------    -------------------
Current assets
<S>                                                                                           <C>         <C>
   Cash and cash equivalents                                                                  179,918     $           43,332
   Accounts receivable, net of allowance for doubtful accounts
     of $5,652 in 2001 and $1,703 in 2000                                                     233,434                 61,241
   Inventories                                                                                916,817                127,961
   Prepaid expenses and other current items                                                     2,757                  7,370
   Deferred refurbishing expenses                                                              53,882                     --
   Accounts receivable-Retronics, Inc. (Note 7)                                                    --                     --
                                                                                      -------------------    -------------------

         Total current assets                                                               1,386,808                239,904

Designs and trademarks - net of accumulated amortization
   of $30,536 in 2000                                                                              --                 19,464
Property and equipment, net of accumulated depreciation of
   $297,860 in 2001 and $814,253 in 2000                                                      140,066                652,017
Other assets - deposits                                                                        32,711                 22,485
Goodwill - net of amortization of  $83,393 in 2000 (Note 6)                                        --                938,047
Deferred financing costs                                                                      138,556                     --
                                                                                      -------------------    -------------------

         Total assets                                                                       1,698,141     $        1,871,917
                                                                                      ===================    ===================

LIABILITIES AND STOCKHOLDERS' (DEFICIT)

Current liabilities
   Accounts payable and accrued expenses                                                    1,916,919     $          705,987
   Accrued interest payable                                                                   403,738                154,188
   Notes payable (Note 9)                                                                     154,356                143,643
   Advances from and accrued expenses due to officer (Note 2)                                 407,388                388,144
   Accrued lease obligations                                                                   14,479                 35,794
   Current portion of convertible notes and debentures                                        784,118              1,000,000
   Advances payable                                                                           950,000                950,000
                                                                                      -------------------    -------------------

         Total current liabilities                                                          4,630,998              3,377,756

Convertible notes and debentures net of current portion (Note 10 and 11)                    1,770,882                550,000
                                                                                      -------------------    -------------------

         Total liabilities                                                                  6,401,880              3,927,756
                                                                                      -------------------    -------------------

Commitments and contingencies
   (Notes 1,6,7,9,10,11,13,14,15,17 and 18)                                                        --                     --

Stockholders' (deficit): (Notes 1,3,4 and 18)
   Series A Convertible Preferred Stock, $0.001 par value,
     10,000,000 shares authorized, 663,333 outstanding                                            663                    663
   Series B Convertible Preferred Stock, $100 par value,
     2,000 shares authorized, 2,000 shares issued and
     outstanding                                                                              200,000                200,000
   Common stock $0.001 par value, 200,000,000 shares authorized,
     99,560,116 and 86,260,393 shares issued at December 31, 2001,
     and 2000 respectively                                                                     99,560                 86,260
   Outstanding common stock warrants                                                           30,000                 30,000
   Paid in capital                                                                         10,671,749              9,925,554
   Accumulated (deficit)                                                                  (15,705,711)           (12,298,316)
                                                                                      -------------------    -------------------

         Total stockholders' (deficit)                                                     (4,703,739)            (2,055,839)
                                                                                      -------------------    -------------------

                  Total liabilities and stockholders' (deficit)                             1,698,141     $        1,871,917
                                                                                      ===================    ===================
</TABLE>

                 The accompanying notes are an integral part of
                                these statements.

                                       F-3

<PAGE>
                      Consolidated Statements of Operations
<TABLE>
<CAPTION>
                                                                                          Year Ended December 31,
                                                                                -------------------- -- --------------------
                                                                                       2001                    2000
                                                                                                        (Restated - Note 1)
                                                                                --------------------    --------------------

<S>                                                                                     <C>          <C>
Sales and other revenues                                                                5,425,391    $          725,664
Refurbishing fee income                                                                   703,164                72,932
                                                                                --------------------    --------------------
                                                                                        6,128,555               798,596
                                                                                --------------------    --------------------

     Less:  Cost of goods sold                                                          4,890,953               653,097
     Less:  Cost of refurbishing                                                          760,739                80,225
                                                                                --------------------    --------------------
                                                                                        5,651,692               733,322
                                                                                --------------------    --------------------
Gross Profit                                                                              476,863                65,274
                                                                                --------------------    --------------------
Expenses:
     Amortization                                                                         188,991                83,393
     Depreciation                                                                          95,372                21,422
     Rent                                                                                 148,222                85,375
     Legal and professional fees                                                          269,178               469,994
     Contract services, salaries and payroll taxes                                        710,157               729,271
     Other                                                                                492,362               170,291
                                                                                --------------------    --------------------
          Total expenses                                                                1,904,282             1,559,746
                                                                                --------------------    --------------------
(Loss) from continuing operations                                                      (1,427,419)           (1,494,472)

Other income and expense:
     Interest income                                                                           --                     4
     Interest expense                                                                    (323,834)             (165,122)
     Write off of goodwill (Note 6)                                                      (749,055)                   --
     Expense for public reporting                                                              --              (450,000)
     Debenture financing expenses                                                         (42,628)                   --
                                                                                --------------------    --------------------

(Loss) from continuing operations                                                      (2,542,936)           (2,109,590)
                                                                                --------------------    --------------------

Discontinued operations: (Note 16)
     (Loss) from discontinued operations                                                 (544,939)           (1,288,490)
     (Loss) on disposal of discontinued operations                                       (319,520)                   --
                                                                                --------------------    --------------------

Net (loss)                                                                   $         (3,407,395)   $       (3,398,080)
                                                                                ====================    ====================

(Loss) per common share from continuing operations                           $                       $                (.03)
                                                                                (.03)
                                                                                ====================    ====================
(Loss) per common share from discontinued operations                         $                       $                (.01)
                                                                                (.01)
                                                                                ====================    ====================
Total (loss) per common share                                                $                       $                (.04)
                                                                                (.04)
                                                                                ====================    ====================
Weighted number of shares outstanding                                                  92,910,230            83,621,312
                                                                                ====================    ====================

</TABLE>

                 The accompanying notes are an integral part of
                                these statements.

                                       F-4

<PAGE>
                         GO ONLINE NETWORKS CORPORATION
                          AND CONSOLIDATED SUBSIDIARIES
                Consolidated Statement of Stockholders' (Deficit)
<TABLE>
<CAPTION>

                                                   Series A Convertible         Series B Convertible
                                                     Preferred Stock               Preferred Stock              Common Stock
                                              -----------    -----------    -----------   -----------   -----------    -----------
                                                   Shares       Amount          Shares       Amount       Shares          Amount
                                              -----------    -----------    -----------   -----------   -----------    -----------
<S>                 <C> <C>                       <C>        <C>                          <C>            <C>           <C>
Balance at December 31, 1999 (Restated) ...       499,333    $       499           --     $      --      75,181,843    $    75,182
Common stock issued for the ...............          --             --             --            --
   acquisition of Westlake Capital
   Corporation and related services .......          --             --             --            --       4,275,000          4,275
Common stock issued for cash ..............          --             --             --            --       2,500,000          2,500
Common stock issued for consulting services       150,000            150           --            --       1,735,000          1,735
Common stock issued to company officer
   in lieu of salary ......................          --             --             --            --       2,740,000          2,740
Common stock issued to settle lawsuit .....        30,000             30           --            --            --             --
Common stock returned in connection with
   sale of Auctionomics, Inc. .............          --             --             --            --        (937,500)          (938)
Issuance of warrants ......................          --             --             --            --            --             --
Preferred stock conversion ................       (16,000)           (16)          --            --          16,000             16
Common stock issued for the acquisition
   of Digital West ........................          --             --            2,000       200,000       750,000            750
Loss for the year ended December 31, 2000 .          --             --             --            --            --             --
                                              -----------    -----------    -----------   -----------   -----------    -----------

Balance at December 31, 2000 ..............       663,333            663          2,000       200,000    86,260,393         86,260

Common stock issued for debt conversion ...          --             --             --            --       2,527,767          2,527
Common stock issued for services ..........          --             --             --            --      10,771,956         10,773
Issuance of warrants for financing ........          --             --             --            --            --             --
Issuance of warrants to employee ..........          --             --             --            --            --             --
Loss for the year ended December 31, 2001 .          --             --             --            --            --             --
                                              -----------    -----------    -----------   -----------   -----------    -----------

Balance December 31, 2001 .................       663,333    $       663          2,000   $   200,000    99,560,116    $    99,560
                                              ===========    ===========    ===========   ===========   ===========    ===========
</TABLE>

                 The accompanying notes are an integral part of
                                these statements.

                                       F-5

<PAGE>
                         GO ONLINE NETWORKS CORPORATION
                          AND CONSOLIDATED SUBSIDIARIES
                Consolidated Statement of Stockholders' (Deficit)
<TABLE>
<CAPTION>

                                                        Common Stock                                            Total
                                                          Warrants              Paid-in                     Stockholders'
                                                    Shares        Amount        Capital       (Deficit)       (Deficit)
                                              ------------   ------------   ------------   ------------    ------------
<S>                 <C> <C>                                  <C>            <C>            <C>             <C>
Balance at December 31, 1999 (Restated) ...           --     $       --     $  7,860,891   $ (8,900,236)   $   (963,664)
Common stock issued for the ...............           --             --
   acquisition of Westlake Capital
   Corporation and related services .......           --             --          698,225           --           702,500
Common stock issued for cash ..............           --             --          247,500           --           250,000
Common stock issued for consulting services           --             --          614,620           --           616,505
Common stock issued to company officer
   in lieu of salary ......................           --             --          298,660           --           301,400
Common stock issued to settle lawsuit .....           --             --           10,470           --            10,500
Common stock returned in connection with
   sale of Auctionomics, Inc. .............           --             --              938           --              --
Issuance of warrants ......................        750,000         30,000           --             --            30,000
Preferred stock conversion ................           --             --             --             --              --
Common stock issued for the acquisition
   of Digital West ........................           --             --          194,250           --           395,000
Loss for the year ended December 31, 2000 .           --             --             --       (3,398,080)     (3,398,080)
                                              ------------   ------------   ------------   ------------    ------------

Balance at December 31, 2000 ..............        750,000         30,000      9,925,554    (12,298,316)     (2,055,839)

Common stock issued for debt conversion ...           --             --          117,473           --           120,000
Common stock issued for services ..........           --             --          529,578           --           540,351
Issuance of warrants for financing ........           --             --           79,144           --            79,144
Issuance of warrants to employee ..........           --             --           20,000           --            20,000
Loss for the year ended December 31, 2001 .           --             --             --       (3,407,395)     (3,407,395)
                                              ------------   ------------   ------------   ------------    ------------
                                              ------------   ------------   ------------   ------------    ------------

Balance December 31, 2001 .................        750,000   $     30,000   $ 10,671,749   $(15,705,711)   $ (4,703,739)
                                              ============   ============   ============   ============    ============
</TABLE>

                 The accompanying notes are an integral part of
                                these statements.

                                       F-6


<PAGE>
                         GO ONLINE NETWORKS CORPORATION
                          AND CONSOLIDATED SUBSIDIARIES
                      Consolidated Statements of Cash Flows
<TABLE>
<CAPTION>
                                                                                        Year Ended December 31,
                                                                                        -----------------------
                                                                                    2001                        2000
                                                                                                        (Restated - Note 1)
                                                                           -----------------------     -----------------------
Operating activities:
<S>                                                                    <C>                         <C>
   Net loss                                                            $            (3,407,395)    $           (3,398,080)
   Adjustments to reconcile net (loss) to
     net cash provided by (used in) operations:
       Depreciation and amortization                                                   473,355                    719,056
       Write off of goodwill                                                           749,055                         --
       Loss on disposition of kiosk division                                           319,520                         --
       Loss on sale of property                                                          6,643                         --
       (Increase) in accounts receivable                                              (172,193)                   (62,944)
       (Increase) in inventory & deferred refurbishing                                (842,738)                  (127,961)
       Increase in accounts payable                                                  1,458,411                    200,588
       Increase (decrease) in unearned revenue                                              --                   (120,000)
       Common stock issued for services                                                639,495                    928,405
       Other                                                                            15,638                      9,642
                                                                           -----------------------     -----------------------

Net cash (used in) operating activities                                               (760,209)                (1,824,509)
                                                                           -----------------------     -----------------------

Investing activities:
   Investment in designs, trademarks and equipment                                        (862)                  (610,892)
   Investment in goodwill and other assets                                                  --                   (955,250)
   Proceeds from sale of assets                                                            500                         --
   Investment in note receivable                                                      (100,000)                        --
                                                                           -----------------------     -----------------------

Net cash (used in) investing activities                                               (100,362)                (1,566,142)
                                                                           -----------------------     -----------------------

Financing activities:
   Repayment of notes and advances                                                          --                   (277,841)
   Proceeds from notes and advances payable                                            997,157                  3,400,303
   Common stock issued for cash                                                             --                    250,000
   Other                                                                                    --                     35,600
                                                                           -----------------------     -----------------------

Net cash provided by financing activities                                              997,157                  3,408,062
                                                                           -----------------------     -----------------------

Net increase in cash and cash equivalents                                              136,586                     17,411

Cash and cash equivalents, beginning of year                                            43,332                     25,921
                                                                           -----------------------     -----------------------

Cash and cash equivalents, end of year                                 $               179,918     $               43,332
                                                                           =======================     =======================

Interest paid                                                          $                61,000     $              165,122
Income taxes paid                                                                           --                         --

Non-cash financing and investing activities:
   Conversion of preferred stock to common stock                                            --                         16
   Conversion of debentures to common stock                            $               120,000     $                   --
   Warrants received for sale of assets                                                133,333                         --
</TABLE>

                 The accompanying notes are an integral part of
                                these statements.

                                       F-7

<PAGE>
                         GO ONLINE NETWORKS CORPORATION
                          AND CONSOLIDATED SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 2001 and 2000


Note 1 - Summary of Significant Accounting Policies

Organization and Principles of Consolidation

The consolidated financial statements of Go Online Networks Corporation (the
"Company") (formerly Jones Naughton Entertainment, Inc.) and consolidated
subsidiaries include the accounts of Go Online Networks Corporation,
incorporated in Colorado on October 20, 1987, and reincorporated in Delaware
effective September 14, 1999, and its subsidiaries AMS Acquisition Corp.
("AMS"), incorporated in Nevada on June 2, 1998; and Digital West Marketing,
Inc., ("Digital") which was acquired by the Company on August 31, 2000, and
Westlake Capital Corp. (Westlake) acquired January 20, 2000 for the purpose of
facilitating the Company becoming a reporting company with the Securities and
Exchange Commission. No assets were acquired as part of the Westlake
transaction. The acquisition of Westlake was accounted for as a purchase and as
a "reverse acquisition." The Company's investment in Auctionomics, Inc., which
was incorporated on June 8, 1999, was sold during May 2000. The Internet sales
and consulting businesses of AMS were terminated during 2001. During December
2001, the computer kiosk business was disposed of as disclosed in Note 16. AMS
and Auctionomics were 75% owned subsidiaries of Go Online Networks Corporation.
The Company is principally in the computer and related product refurbishing
businesses. All material inter-company accounts have been eliminated in the
consolidation. The Company has selected December 31 as its year-end.

Restatement of Financial Statements as of December 31, 1999 and 2000

The balance of deficit and total stockholders' deficit included in the
Consolidated Statement of Stockholders' (Deficit) at December 31, 1999 has been
increased by $890,000 from that disclosed in prior published financial
statements due to an increase in stock-based compensation which had not been
accounted for previously.

The statements of operations and cash flows for the year ending December 31,
2000 have been restated from prior published statements resulting from the
discontinuance of the Company's internet sales and consulting business, and
computer kiosk business. Accordingly, revenues, growth profit, and expenses have
been significantly reduced in the statement of operations and now reflect
principally the computer refurbishing business only. The net results of those
discontinued operations have been summarized separately in the statements of
operations. Similarly, the statement of cash flows for the year ended December
31, 2000 has been restated to give effect to changes in classification of
certain items.

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenue and expenses during the reporting period. Actual
results could differ from those estimates.

                                      F-8
<PAGE>
                         GO ONLINE NETWORKS CORPORATION
                          AND CONSOLIDATED SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 2001 and 2000


Note 1 - Summary of Significant Accounting Policies (continued)

Basis of Presentation - Going Concern

The accompanying financial statements have been prepared in conformity with
principles generally accepted in the United States, which contemplates
continuation of the Company as a going concern. However, the Company has
suffered recurring losses from operation has a net capital deficiency, that
raise substantial doubts about its ability to continue as a going concern. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty. Management's plan to continue in operations is to
raise additional debt or equity capital until such time the Company is able to
generate sufficient operating revenue.

In view of these matters, realization of certain of the assets in the
accompanying financial statements is dependent upon continued operations of the
Company, which in turn is dependent upon the Company's ability to meet its
financial requirements, raise additional capital, and the success of its future
operations. Management believes that its ability to raise additional capital
provides the opportunity for the Company to continue as a going concern.

Cash and Cash Equivalents

The Company considers cash on hand, cash in banks, certificates of deposit, time
deposits, and U.S. government and other short-term securities with maturities of
three months or less when purchased as cash and cash equivalents.

Fair Value of Financial Instruments

Financial Accounting Standards Board ("FASB") issued Statement of Financial
Accounting Standards No. 107 ("SFAS 107"), Disclosure About Fair Value of
Financial Instruments. SFAS 107 requires disclosure of fair value information
about financial instruments when it is practicable to estimate that value. The
carrying amount of the Company's cash and cash equivalents, accounts receivable,
prepaid expenses and other current expenses, deferred refurbishing cost, and the
current portions of notes and debentures payable approximate their estimated
fair values due to their short-term maturities.

Earnings Per Share

Basic earnings per share is computed by dividing net income (loss) available to
common stockholders by weighted average number of common shares outstanding.
Diluted earnings per share is not shown because it would be anti-dilutive.

Inventories

Inventories are stated at the lower of cost or market. Cost is determined using
the specific identification method for computer systems and average cost for all
other types on inventory.

Costs incurred to refurbish unsold computer systems, including parts and labor,
are shown as deferred refurbishing costs.

                                      F-9
<PAGE>
                         GO ONLINE NETWORKS CORPORATION
                          AND CONSOLIDATED SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 2001 and 2000


Note 1 - Summary of Significant Accounting Policies (continued)

Equipment

The Company carries its investment in equipment, consisting principally of
office equipment and computer refurbishing equipment, at cost net of accumulated
depreciation. Depreciation is computed based on the useful life of the equipment
over a period of three to ten years on a straight-line basis for both financial
reporting and income tax purposes. Equipment at December 31, 2000 included
computer access kiosks that were sold during 2001.

Segment Information

The Company's business is organized, managed and internally reported as a single
segment. All revenues except of immaterial amounts are derived from computer
refurbishment in the United States.

Goodwill

The Company recorded goodwill in connection with the acquisition of Digital.
During the fourth quarter of 2001, the Company wrote off the balance of the
carrying value of the goodwill. (See note 6)

Stock Issued for Services

The Company has issued stock to certain individuals and companies for services.
The market value of the shares issued was recorded as an expense in the
accompanying financial statements.

Stock-Based Compensation Plans

The Company accounts for stock-based compensation using the intrinsic value
method prescribed in Accounting Principles Board Opinion No. 25, "Accounting for
Stock Issued to Employees" and related Interpretations and elects the disclosure
option of SFAS No. 123 "Accounting for Stock-Based Compensation". Accordingly,
compensation cost for stock options is measured as the excess, if any, of the
fair value of the Company's stock at the date of the grant over the amount an
employee must pay to acquire the stock. The Company also records stock
compensation expense for any options issued to non-employees using the fair
value method prescribed in SFAS 123.

Income Taxes

The Company, as of December 31, 2001, had approximately $15,600,000 of net
operating loss carryovers that expire in years through 2021. A change in
ownership of more than 50% of the Company may result in the inability of the
company to utilize the carryovers. As of December 31, 2001, the Company had
deferred tax assets of approximately $4,710,000 related to the net operating
loss carryovers. A valuation allowance has been provided for the total amount
since the amounts, if any, of future revenues necessary to be able to utilize
the carryovers are uncertain.


                                      F-10
<PAGE>
                         GO ONLINE NETWORKS CORPORATION
                          AND CONSOLIDATED SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 2001 and 2000

Note 1 - Summary of Significant Accounting Policies (continued)

Preferred Stock

The Company has outstanding 663,333 shares of Series A Preferred Stock. Each
share of Series A Preferred Stock is convertible into one share of Common Stock
at the option of the holder. The Series A Preferred Stock votes on equal per
share basis with the Common Stock, and is eligible to receive equivalent
dividends to the shares of Common Stock. In the event of a liquidation of the
Company, the Series A Preferred Stock has a liquidation preference of the number
of shares plus 8% from the time of issuance.

The Company has outstanding 2000 shares of Series B $100 Principal Amount
Preferred Stock. Upon the event that Digital reports positive net income for one
calendar quarter, the Series B shareholder will become entitled to receive
dividends on the same per share basis as holders of Common Stock, have all
voting rights and liquidation rights as a share of Common Stock, and the right
to convert to Common Stock at a conversion price determined by an average
closing price of the Common Stock for a period preceding conversion date.

Valuation of Long-Lived Assets

The Company periodically analyzes its long-lived assets for potential
impairment, assessing the appropriateness of lives and recoverability of
unamortized balances through measurement of undiscounted operating cash flows on
a basis consistent with accounting principles generally accepted in the United
States of America.

Revenue Recognition and Warranties

Most of the Company's sales are of used products that are sold "as is" for a
fixed price, FOB shipping point. Accordingly, revenue is recognized at the time
of shipment and which are predominantly cash sales. Products are sold without
warranties except for manufacturers warranties.

Advertising

The Company expenses advertising costs as incurred and the total amounts for
2001 and 2000 were not material.

Dividends

The Company paid no dividends in 2000 or 2001.

Reclassifications

Certain reclassifications have been made to previously reported statements to
conform to the Company's current financial statement format.

                                      F-11
<PAGE>
                         GO ONLINE NETWORKS CORPORATION
                          AND CONSOLIDATED SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 2001 and 2000


Note 2 - Advances and Accrued Expenses - Related Party

The Company's chief executive officer has loaned various amounts to the Company,
and the officer has unpaid compensation due him. The balances, as of December
31, 2001, were $311,388 in loans and $96,000 in unpaid compensation. The
balances were $307,144 and $48,000, respectively, as of December 31, 2000.

On June 26, 2000, the Company issued 2,740,000 shares of its common stock to its
chief executive officer, valued at approximately $.11 per share and totaling
$301,485, representing his unpaid compensation through June 30, 2000. On July
13, 2000, the Company issued 480,000, at $.10 per share in payment of six months
compensation.

During 2000, the Company received cash in connection with loans payable
amounting to $250,000. The loans were guaranteed by the Company's chief
executive officer pledging 1,500,000 shares of the Company's common stock that
was given up by the officer in 2000 under a voluntary foreclosure.

Note 3 - Issuance of Common Stock

During 2000, in connection with the acquisition of Westlake described in Note 1,
the Company issued 3,000,000 shares to the shareholders of Westlake. An
additional 1,275,000 shares were issued as payment of legal and consulting
services in connection with the acquisition.

Additional shares were issued during the year ending December 31, 2000,
including 2,500,000 shares sold for cash, 1,735,000 shares issued for legal and
consulting services, 2,740,000 shares were issued to the Company's chief
executive officer as described in Note 2, 16,000 shares were issued by
conversion of 16,000 shares of the Company's Series A Convertible Preferred
Stock and 750,000 shares were issued in the acquisition of Digital. The Company
had 937,500 shares of its common stock returned to it in connection with the
sale of its interest in Auctionomics, Inc.

During 2001, the Company issued 2,527,767 shares in exchange for conversion of
convertible debentures and 10,771,956 shares for services.

A total of 2,528,930 shares were issued during 2001 to a person who was a
Company officer for a portion of the year. Of the amount issued to the former
officer, 1,368,930 shares were issued for consulting services accrued at
December 31, 2000 prior to the person becoming an officer.

Note 4 - Issuance of Series A Preferred Stock

During 2000, the Company issued 150,000 shares of its Series A Preferred Stock
to a group of individuals for consulting services.

The Company, in 2000, issued 30,000 shares of its stock in connection with a
settlement of an outstanding lawsuit, in which the Company paid $12,500 in
addition to the issuance of the Series A Preferred Stock.

                                      F-12
<PAGE>
                         GO ONLINE NETWORKS CORPORATION
                          AND CONSOLIDATED SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 2001 and 2000


Note 5 - Risks and Uncertainties, Concentration of Business

The Company's source of computers for the purpose of refurbishing represents in
excess of 95% of the Company's total revenue.

The Company's customers and vendors are principally in the U.S.A. and with a
significant concentration in California. Since the Company's business is
principally in computer related activities, this concentration of operations
results in an inherent risk and uncertainty.

Note 6 - Acquisition of Digital West Marketing, Inc.

On August 31, 2000, the Company acquired all of the outstanding stock of
Digital. Thereafter, Digital became a wholly owned subsidiary. The acquisition,
for accounting purposes, was treated as a purchase. In consideration for
acquiring the stock, the Company paid $825,000 and these monies were utilized to
pay prior indebtedness, accounts payable, and accrued expenses. In addition, the
Company issued 750,000 restricted shares of its common stock, a warrant to
purchase an aggregate of 750,000 shares of the Company's common stock for a
period of two years at $.022 per share. The restricted common stock issued was
recorded at 90% of the Company's direct market value as of the date of issuance.
The Company also issued 2,000 shares of its newly authorized Series B. $100
Principal Amount Preferred Stock. Subsequent to the acquisition date, the
parties modified the agreement to account for items including cash, inventory,
and accounts payable assumed to reflect a corrected interpretation of their
agreement.

The Company accounted for the acquisition of the common stock of Digital as a
purchase. The detailed accounting for the assets and liabilities included by the
acquisition reflecting Goodwill, as modified, as described in the preceding
paragraph, and is as follows:

Assets acquired:
     Inventory                                                    $    155,578
     Prepaid expenses                                                   15,435
     Deposits                                                           33,493
     Office furniture                                                   58,775
     Office equipment                                                   34,177
     Computer equipment                                                 55,699
     Lab furniture & fixtures                                            6,903
     Warehouse equipment                                                26,194
     Machinery & equipment                                              15,441
     Lab equipment                                                     256,294

     Accumulated depreciation                                         (200,088)
     Miscellaneous                                                       1,044
     Goodwill                                                        1,021,440
                                                                     ---------
              Total                                           $      1,480,385

                                      F-13
<PAGE>
                         GO ONLINE NETWORKS CORPORATION
                          AND CONSOLIDATED SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 2001 and 2000


Note 6 - Acquisition of Digital West Marketing, Inc. (continued)

Less liabilities assumed:
     Expenses assumed                                                   20,000
     Lease obligations assumed                                          43,846
     Accounts payable assumed                                           10,961
     Inventory accounts payable                                        155,578
                                                                       -------
              Total                                                    230,385
                                                                       -------
Net cost of acquisition                                       $      1,250,000
                                                                     =========



The acquisition payments are as follows:
     Common stock issued                                      $        195,000
     Series B preferred stock issued                                   200,000
     Warrants to buy common stock issued                                30,000
     Cash paid                                                         825,000
                                                                       -------

Total acquisition costs                                       $      1,250,000
                                                                     =========

The Company recorded goodwill in the acquisition of Digital of $1,021,440, which
was being amortized over five years.

During December 2001, the Company determined, in accordance with SFAS 121, that
the value of goodwill was impaired. Accordingly, the Company has written off the
unamortized portion. During November 2001, the Company terminated the employment
of Digital's president, and, the subsidiary has continued to show losses.
Certain portions of the subsidiary's business, prior to acquisition, has been
discontinued. In view of the Company's need to raise additional capital, to
continue as a going concern, management believes that there is no continuing
value to the goodwill recorded at the time of the subsidiary's acquisition.

Note 7 - Accounts Receivable - Retronics, Inc. - Related Party

The Company's subsidiary, Digital, has made sales to a company controlled by
Digital's former President, who was terminated in November 2001. Such sales,
made prior to termination, total $1,657,618 and $288,632 during 2001 and 2000,
respectively, represent approximately 31% and 36% of Digital's total sales. The
sales for 2001 represented the amounts sold to November 5, 2001 that represents
the sales made prior to Digital's former president prior to his termination.
Retronics, Inc. owes the Company for amounts paid by the Company that should
have been paid by Retronics, Inc. The accompanying financial statements include
a valuation reserve provision for the entire account receivable of approximately
$132,000.

                                      F-14
<PAGE>
                         GO ONLINE NETWORKS CORPORATION
                          AND CONSOLIDATED SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 2001 and 2000


Note 8 - Impairment of Long-Lived Assets

In accordance with SFAS 121, the Company has made an assessment that its
investments in Internet kiosk machines were impaired at December 31, 2000.
Consequently, the Company reduced its value as of December 31, 2000 to an
estimated net realizable value. A total of $311,493 has been included as an
expense in the accompanying statement of operation for the year ending December
31, 2000. During December 2001, the Company disposed of its kiosk machines and
is no longer in this segment of the business.

Note 9 - Notes Payable and Accrued Interest

The Company had two notes payable outstanding from loans made in 1995 for
$49,500 and $52,500 respectively bearing interest at 7% per annum. The lenders
have the right to demand payment in full on the notes and failure to pay on
demand would increase the interest rate to 18% per annum. The lenders have the
right to convert the notes to common stock at a rate of $.125 per share. The
balances payable, including interest, at December 31, 2001 are $79,412 and
$74,994, respectively. The balances payable, including interest, at December 31,
2000, were $73,899 and $69,744, respectively.

Note 10 - Issuance of Series 2000-A Eight Percent Convertible Notes

Effective January 10, 2000, the Company entered into a Securities Purchase
Agreement whereby the buyer agreed to buy from the Company $1,000,000 of its
Series 2000-A Eight Percent (8%) Convertible Notes, maturing January 1, 2002,
and payable in quarterly installments in arrears on March 31, June 30, September
30, and December 31, of each year during the term of the Note, with the first
such payment to be made March 31, 2000. Accrual of interest may be payable
either in cash or Common Stock at the holder's option. If interest is paid in
Common Stock, the number of shares to be delivered in payment will be determined
by taking the dollar amount of interest being paid divided by the average of the
closing bid prices for the Common Stock for the ten trading days prior to the
due date of such interest. The Notes are convertible into Common Stock, upon
certain Registration, and for prices determined at various dates as defined in
the agreement. The purchase price was $500,000 in cash and cancellation of the
$538,462 of the convertible debentures outstanding as of December 31, 1999.
During 2001, $120,000 of notes were converted to common stock.

The Company made interest payments of $61,000 during 2001. The unpaid accrued
interest is shown in the accompanying financial statements as a current
liability. The Company obtained an extension agreement for $645,882 of the
$880,000 in notes, extending the maturity to January 1, 2003, which is shown as
long term.

Note 11 - Convertible Debentures and Notes Payable

In September and November 2000, the Company sold an aggregate of $550,000 of
convertible debentures payable with interest at 10%. The debentures mature
during July 2002. The debentures are convertible into common stock of the
Company at the lower of 60% of the average market closing price for the ten days
prior to conversion or $.18 per share.

                                      F-15
<PAGE>
                         GO ONLINE NETWORKS CORPORATION
                          AND CONSOLIDATED SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 2001 and 2000

Note 11 - Convertible Debentures and Notes Payable (continued)

On January 12, 2001 the Company issued a convertible note for $375,000, due
January 12, 2003 with interest payable quarterly at 10% per annum. Interest is
payable in cash or in common stock at the holder's option and shall commence on
January 12, 2001, and continue until the outstanding principal amount has been
paid or duly provided for. The note is exchangeable in denominations of not less
than $50,000 amounts at such times as requested by the holder at a conversion
price for each share of common stock at $0.045 per share.

On May 3, 2001, the Company issued $500,000, eight percent convertible
debentures due May 3, 2003. The debentures are convertible at the lower of
eighty percent of the average of the ten lowest closing prices for the Company's
common stock for the thirty trading days prior to the closing date of the
issuance of the debentures (which was $0.0439 per share) or eighty percent of
the average of the ten lowest closing bid prices for the Company's common stock
for the sixty trading days prior to the conversion dates. Any individual holder
of the convertible debentures cannot convert if the conversion would result in
their holding more than 4.99 percent of the Company's issued and outstanding
common stock. The convertible debenture is collateralized by 2,000,000 shares of
the Company's common stock owned by the Company's president. In addition to the
convertible debenture, the Company issued the holder a warrant to purchase
1,000,000 shares of common stock at 110 percent of the average of the three
lowest closing bid prices of the ten closing bid prices of the Company's common
stock, prior to closing on May 3, 2001. The warrant exercise is $0.06196 per
share and are exercisable until May 3, 2006. The Company paid a $750 escrow fee,
legal fees of $8,000 and a fee of $52,500 to a Fund Manager of the Fund
acquiring the debentures.

On December 18, 2001, the Company issued a $250,000, 8% convertible note due
December 18, 2003. The note is convertible into the common stock of the Company
at a purchase price of $0.0344. In addition, the Company was given a common
stock purchase warrant to purchase 600,000 shares of the Company's common stock
at an adjustable purchase price, currently $0.34 per share.

The debentures and notes included herein and the Series 2000-A 8% convertible
notes described in the preceding Note 10 are summarized as follows:

Series 2000-A Convertible debenture 8%, due January 1, 2003 and
    March 2, 2002 .............................................   $  880,000
Convertible debenture payable, 10%, due July 2002 .............      550,000
Convertible note payable 10%, due January 12, 2003 ............      375,000
Convertible note payable, 8%, due May 3, 2003 .................      500,000
Convertible note payable, 8%, due December 18, 2003 ...........      250,000
                                                                  ----------
             Total ............................................   $2,555,000
Less current portion ..........................................      784,118
                                                                  ----------
             Total long term notes and debentures .............   $1,770,882
                                                                  ==========


                                      F-16
<PAGE>
                         GO ONLINE NETWORKS CORPORATION
                          AND CONSOLIDATED SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 2001 and 2000


Note 12 - Sale of Auctionomics, Inc.

Effective June 10, 1999, the Company entered into a stock purchase agreement
whereby the Company acquired 75% ownership of Auctionomics, Inc. a Nevada
corporation, by issuing common stock of the Company and warrants for the
purchase of the Company's common stock. Auctionomics, Inc. did not become an
operating company, and during 2000 the Company sold its interest by receiving
back certain of its common stock and $140,000 in cash. The Company recorded a
gain of $139,280 based upon the cash consideration only. The statement of
operations for the year ending December 31, 2000 have been restated to include
the gain from the sale as a reduction in the loss from discontinued operations.

Note 13 - Stock-Based Compensation and Stock Option Plan

Stock Option Plan

The company has a Nonstatutory Stock Option Plan and an Incentive Stock Option
Plan, effective November 15, 2000 through December 31, 2009. The plan is
administered by the board of directors. Under the plans, the company may grant
options up to 5% of the outstanding stock at December 31 of the preceding year
(4,313,020 for 2001). The exercise price is 50% to 110% of the fair market value
of the company's stock on the date of grant. The board of directors, with
certain additional restrictions, may fix terms and vesting.

Stock options

As permitted by FASB Statement No. 123, Accounting for Stock-Based Compensation,
the Company has elected to follow Accounting Principles Board Opinion No. 25,
Accounting for Stock Issued to Employees (APB 25) and related interpretations in
accounting for its employee option plans. Under APB 25, compensation expenses
are recognized at the time of option grant if the exercise price of the
Company's employee stock option is below the fair market value of the underlying
common stock on the date of the grant.

The Company's Board of Directors has granted non-qualified stock options and
warrants to officers, directors, employees and investors of the Company. The
following is a summary of activity under these stock option plans for the years
ended December 31, 2001 and 2000.
<TABLE>
<CAPTION>

                                                                                 Non-employee              Weighted
                                                                                    Options                Average
                                                            Employee                  and                  Exercise
                                                            Options                Warrants                 Price
                                                       -------------------    ---------------------    -----------------
<S>                              <C> <C>                     <C>                        <C>         <C>
   Options Outstanding, December 31, 1999                    1,250,000                  126,560     $              .28
      Granted                                                  650,000                       --     $              .45
      Exercised                                                     --                       --                  --
      Cancelled                                               (100,000)                      --     $             (.32)
                                                       -------------------    ---------------------    -----------------

   Options Outstanding, December 31, 2000                    1,800,000                  126,560     $              .36
      Granted                                                  250,000                1,600,000     $              .07
      Exercised                                                     --                       --                  --
      Cancelled                                             (1,800,000)                (126,560)    $             (.36)
                                                       -------------------    ---------------------    -----------------
   Options Outstanding, December 31, 2001                      250,000                1,600,000     $              .07
                                                       ===================    =====================    =================
</TABLE>

                                      F-17
<PAGE>
                         GO ONLINE NETWORKS CORPORATION
                          AND CONSOLIDATED SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 2001 and 2000


Note 13 - Stock Based Compensation - Stock Options (continued)

For all options granted during 2000, the weighted average fair value of the
grants at market was $.30. The fair value of the 650,000 options issued above
and below market was calculated to be $156,251. For all options and warrants
granted in 2001, the weighted average fair value of the grants at market was
$.05. The fair value of the 1,850,000 options and warrants issued above market
was calculated to be $86,154. The weighted average remaining life of all options
and warrants as of December 31, 2001, was approximately 2.8 years. At December
31, 2001, all options were fully vested and exercisable.

If not previously exercised, options outstanding at December 31, 2001, will
expire as follows:
<TABLE>
<CAPTION>

                                      Range of Exercise Prices          Weighted Average            Number of
            Year ending                                                  Exercise Price              Shares
          December 31,
                                     High                Low
   ---------------------------     ------------      --------------    --------------------       --------------
<S>           <C>               <C>                <C>                 <C>                            <C>
              2003              $     .22          $     .22           $     .22                      250,000
              2004              $     .03          $     .03           $     .03                      600,000
           Thereafter           $     .06          $     .06           $     .06                    1,000,000
                                                                                                  --------------
                                                                                                   1,850,000
                                                                                                  ==============
</TABLE>

Pro Forma Stock-Based Compensation Disclosures

The Company applies APB Opinion 25 and related interpretations in accounting for
its stock options and warrants which are granted to employees. Accordingly,
compensation cost of $20,000 has been recognized for grants of options to
employees since the exercise prices were less than the fair value of the
Company's common stock on the grant dates. Had compensation cost been determined
based on an estimate of the fair value consistent with the method of SFAS No.
123 at the grant dates for awards under those plans, the Company's net loss and
loss per share would have been increased to the pro forma amounts indicated
below.
<TABLE>
<CAPTION>

                                                                            Year Ended December 31,
                                                                            -----------------------
                                                                         2001                     2000
                                                                  --------------------     -------------------
   Net loss applicable to common stockholders
<S>                                                            <C>                      <C>
        As reported                                            $      (3,407,395)       $     (3,398,080)
        Pro forma                                                     (3,458,563)             (3,398,080)
   Net loss share applicable to common stockholders
        As reported                                            $         (.04)          $        (.05)
        Pro forma                                                        (.04)                   (.05)
</TABLE>

The pro forma net loss is restated from previously published financial
statements resulting from a reduction of the pro forma adjustment of $146,710.
The reduction gives effect to a decrease of outstanding options for 4,000,000
shares of stock previously shown as granted in 2001. The options were recorded
in error because the board of directors had not approved their issuance.

                                      F-18
<PAGE>
                         GO ONLINE NETWORKS CORPORATION
                          AND CONSOLIDATED SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 2001 and 2000

Note 13 - Stock Based Compensation (continued)

The fair value of each employee option and warrant granted in 2001 and 2000 was
estimated on the date of grant using the Black-Scholes option-pricing model with
the following weighted average assumptions:
<TABLE>
<CAPTION>

                                                                Year Ended December 31,
                                                                -----------------------
                                                           2001                          2000
                                                 --------------------------    --------------------------
<S>                                                        <C>                           <C>
            Expected volatility                            199%                          215%
            Risk-free interest rate                        2.96%                         5.75%
            Expected dividends                              --                            --
            Expected terms (in years)                       2.9                           2.0
</TABLE>

Note 14 - Recent Accounting Pronouncements

In June of 1999, the FASB issued Statement of Accounting Standards No. 133
("SFAS 133"), "Accounting for Derivative Instruments and Hedging Activities."
SFAS 133 establishes accounting and reporting standards for derivative
instruments, including certain derivative instruments embedded in other
contracts, and for hedging activities. It requires that an entity recognize as
derivatives as either assets or liabilities on the balance sheet at their value.
This statement, as amended by SFAS 137, is effective for financial statements
for all fiscal quarters to all fiscal years beginning after June 15, 2000. The
Company does not expect the adoption of this standard to have a material impact
on its results of operations, financial position or cash flows, as the Company
currently does not engage in any derivative or hedging activities.

In December 1999, the Securities and Exchange Commission (the "SEC") issued
Staff Accounting Bulletin No. 101 ("SAB 101"), "Revenue Recognition in Financial
Statements" which provides additional guidance in applying generally accepted
accounting principles to revenue recognition in financial statements.
Subsequently, the SEC issued SAB 101B which delayed the implementation date of
SAB 101 for registrants with fiscal years that begin between December 16, 1999
and March 15, 2000, which required the Company to be in conformity with the
provisions of SAB 101, as amended by SAB 101B, no later than the fourth quarter
of the year 2000. The Company adopted SAB 101 during the fourth quarter of 2000.
The Company believes that the adoption of SAB 101, as amended by SAB 101B, has
not had material effect on the financial position, results of operations or cash
flows of the Company for the years ended December 31, 2001 and 2000.

 Note 15 - Lease Obligations

The Company and its subsidiaries have entered into various office and facility
leases. The leases are generally subject to a base rent with varying increase
provisions as provided for in the leases. Future base rent commitments, during
the years ended December 31 under the leases are as follows:

        2002     $  164,232
        2003        138,446

                                      F-19

<PAGE>
                         GO ONLINE NETWORKS CORPORATION
                          AND CONSOLIDATED SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           December 31, 2001 and 2000


Note 16 - Disposal of Kiosk Business and Related Assets

During December 2001, the Company sold its kiosk business and related assets.
Consideration received included a warrant in the amount of $100,000 allowing the
Company to convert the $100,000 warrant into common stock of the entity that
acquired the kiosk business and assets. The warrant is convertible into the
number of shares of common stock of the entity based on exchanging the $100,000
for common shares at 75% of market value at any time after December 18, 2001.
The Company recorded the value of the warrants at $133,333. In addition to
receiving the warrants, the Company loaned the buyer $100,000 and included a
financing charge of $50,000 for a total of $150,000. The loan is a convertible
note, convertible to common stock on the same basis as the warrants listed
above, with interest at 8% and matures June 30, 2002. Because of the financial
condition of the buyer, the Company has impaired the value of the warrants in
their entirety and provided an allowance for collectibility of the note for
$100,000. The remaining $50,000 financing charge has reduced the deferred
financing costs obtained in connection with the acquisition of the funds used to
make the loan. The $233,000 impairment and allowance have been included in the
accompanying Statement of Operations as a part of the loss on disposal of
discontinued operations.

Note 17 - Contingent Liability

During November 2001, the Company terminated the employment of Digital's
President. At the time of termination, there were approximately 22 months
remaining on his employment agreement. The former President of Digital has,
subsequent to December 31, 2001, filed litigation against the Company and its
CEO for various matters related to his termination of employment. The complaint
does not specify alleged damages. The Company and its legal council believe that
there was substantial cause for termination and intends to aggressively defend
the litigation. A contingency exists with respect to this matter, the ultimate
resolution of which cannot presently be determined.

Note 18 - Subsequent Events

On January 9, 2002, the Company issued 925,000 shares of its common stock to an
employee in accordance with his employment agreement at $0.05 per share totaling
$46,500 representing his accrued compensation at December 31, 2001. On the same
date, the Company issued 466,896 shares of the Company's stock converting a
portion of Series A convertible debentures.

During January 2002, the Company issued 3,420,476 shares of its common stock for
services rendered which had been accrued at December 31, 2001.

During February 2002, the Company entered into a contract with an organization,
with which it had prior business experience, to provide investor relations
services. The Company agreed to issue a retainer for 2,500,000 shares of a
Series A preferred stock valued at $65,000. The agreement also provides that a
finder's fee of 5% shall be provided in connection with any capital raised by
the organization. The Series A preferred stock was issued March 1, 2002.

On February 27, 2002, the maturity date of $645,882 principal amount of Series A
Convertible Debentures was extended to January 1, 2003. In consideration for the
extension, the Company issued warrants for the purchase of 1,000,000 shares of
Company stock at $0.05 per share until February 22, 2007.

                                      F-20


<PAGE>