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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB
                     ANNUAL REPORT UNDER SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                  FOR THE FISCAL YEAR ENDED: DECEMBER 31, 1999
                           COMMISSION FILE NO. 0-25658

                             KALAN GOLD CORPORATION
                 (NAME OF SMALL BUSINESS ISSUER IN ITS CHARTER)

           COLORADO                                         84-1357927
(STATE OR OTHER JURISDICTION                              (IRS EMPLOYER
      OF INCORPORATION)                                 IDENTIFICATION NO.)

                               NO. 60A JALAN 19/3
                               46300 PETALING JAYA
                               SELANGOR, MALAYSIA
               (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

                               011 (603) 756-5082
                (ISSUER'S TELEPHONE NUMBER, INCLUDING AREA CODE)

       SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: _______

              SECURITIES REGISTERED UNDER SECTION 12(g) OF THE ACT:

                   COMMON STOCK, $0.00001 PER SHARE PAR VALUE

     Indicate by check mark whether the Company (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 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 there is no disclosure of delinquent filers in response to Item
405 of Regulation S-B contained in this form and no disclosure will be
contained, to the best of Company's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-KSB. [ ]

     Issuer's revenues for its most recent fiscal year: $1,782,749

     The aggregate market value of the voting stock of the Company held by
non-affiliates as of December 31, 1999 was approximately $9,269,582.

     The number of shares outstanding of the Company's common stock, as of April
12, 2000, was 97,290,999.

     Documents incorporated by reference: None

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PART I

ITEM 1.   DESCRIPTION OF BUSINESS.

HISTORICAL DEVELOPMENT

     Kalan Gold Corporation (the "Company"), is a Colorado corporation. The
principal business address of the Company is No. 60A Jalan 19/3 46300 Petaling
Jaya, Selangor, Malaysia. The Company was originally incorporated on September
19, 1985 as a gas exploration company under the name Knight Natural Gas, Inc.
The Company's name was changed to "Kalan Gold Corporation" in November 1996.

     On April 20, 1999, the Company acquired 100% of the issued and outstanding
common stock of Animated Electronic Industries Sdn Bhd, a private company
organized under the laws of Malaysia ("AEI"). Under the terms of the
acquisition, the Company was required to divest all of the assets and
liabilities of the Company. The acquisition was accomplished through a reverse
merger whereby the Company merged with and into AEI and AEI became a
wholly-owned subsidiary of the Company (the "Reverse Acquisition"). Under the
terms of the Reverse Acquisition, the Company issued an aggregate of 83,320,000
shares of its common stock to the former stockholders of AEI and an additional
3,680,000 shares of common stock to the financial advisor and the Company's
former legal counsel. Thus, as a result of the Reverse Acquisition, the former
AEI shareholders obtained ownership of approximately 88% of the Company's common
stock. AEI currently has two subsidiaries: Perwimas Telecommunications Sdn Bhd
("PTSB") and Vistel (Malaysia) Sdn Bhd.

     AEI was incorporated in October 1988 under the Malaysian Companies Act of
1965 (the "Malaysian Companies Act"). Prior to the Reverse Acquisition, AEI's
principal business was in the design, manufacturing and marketing of video
telecommunications and surveillance equipment.

     PTSB, a 70%-owned subsidiary of AEI, was incorporated in January 1993 under
the Malaysian Companies Act. In June 1997, PTSB obtained a 10-year
telecommunications license from the Malaysian Ministry of Energy Communications
& Multimedia to operate a national wireless broadband communication network in
Malaysia. The network is being designed to support high speed Internet Protocol
data transport services, interactive distance learning, live news coverage,
emergency field services, remote video surveillance, on-site progress
monitoring, energy conservation and building management. The license is
described in Part I of this 10-KSB under "Regulations" and "Effect of
Regulations on the Company".

     Vistel (Malaysia), a 51%-owned subsidiary of AEI, was incorporated in May
1995 under the Malaysian Companies Act. The company is principally an investment
holding company.

     As of December 31, 1999, the Company had a total of 94,990,999 shares of
common stock issued and outstanding. The Company has not been subject to any
bankruptcy, receivership or similar proceeding.

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BUSINESS

     The Company intends to provide the corporate and mass retail markets with
broadband multimedia communication services. The Company is in the process of
building a wireless broadband network, "VISIONET", in Malaysia and the Company
plans to seek to acquire additional broadband licenses and spectrum rights in
other markets in Asia. In an effort to provide flexibility and to reduce the
Company's operating costs, VISIONET will be deployed using the Local Multipoint
Distribution Service ("LMDS") technology. The LMDS technology is described in
Part I of this 10-KSB under "VISIONET - the Broadband Network"

The Company's business plans involve the creation of a network that will consist
of:

     -    a fixed wireless spectrum in the 24.0 to 29.5 GHz frequency band; and

     -    roof access to numerous buildings in major cities in Malaysia for the
          installation of transceivers and antennas for its wireless broadband
          network.

     To that end, in addition to building its own network, the Company hopes to
enter into a strategic alliance with a company in Malaysia which owns a national
fiber optic network that can be integrated with the Company's broadband network.

     The Company is currently developing a portal called www.visionetwork.com to
host applications and services developed by the Company and third parties. The
Company plans to be able to offer such content both to broadband users in
Malaysia and the rest of the world .

     The Company is also developing customer-specific content for its broadband
network. For example, the Company has been commissioned to develop web sites
with multimedia applications, which include e-commerce capabilities, for a
discount retailer. The Company has commenced discussions with a U.S. company to
produce multimedia content for the global market. The Company hopes to undertake
other initiatives in content development, including setting up a complete
multimedia content production facility, back lot support services, and other
ancillary facilities.

     In the long term, the Company intends to enter into strategic alliances
with broadband equipment manufacturers to assemble set-top boxes, transceivers
and wireless modems. The Company expects that equipment manufacturers, primarily
from the United States, will provide the Company with technology and expertise
to set up contract manufacturing assembly lines. The Company also intends to
seek to enter into distribution agreements with equipment manufacturers to act
as their sole distributor in the majority of countries in Asia.

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SERVICES

     The Company hopes that its broadband network will allow the Company to
offer the following integrated communications and information services:

     -    high speed Internet Protocol data transport;

     -    online business content, including live news coverage, emergency field
          services, remote video surveillance, on-site progress monitoring,
          energy conservation and building management;

     -    online application hosting services, such as online shopping;

     -    web design, web hosting and content development services;

     -    a complete production support facility to be built in Malaysia which
          will include backlot, stages, lighting, post production facilities and
          conference rooms;

     -    in connection with equipment manufacturers, the sale of customer
          premises equipment, including wireless modems, transceivers and
          set-top boxes.

VISIONET  - THE BROADBAND NETWORK

     The Company expects to focus on deploying its network infrastructure for
its wireless digital broadband network in the Central Region of Malaysia where
the country's capital, Kuala Lumpur, is located. The Company intends to utilize
a technology called Local Multipoint Distribution Service ("LMDS"), which is a
point-to-multipoint broadband communications technology. LMDS uses the
super-high "millimeter" portion of the airwaves for integrated communications
services. Due to the relatively large bandwidth of the LMDS signal, LMDS systems
have the capacity to provide interactive voice, video and data services.

     High-speed data services are limited by bandwidth capacity of copper wire
networks, which are currently provided by incumbent local exchange companies.
While fiber optic trunk networks have been laid throughout Malaysia, the
availability of "last-mile" fiber connections to homes and commercial buildings
currently are limited due to the high costs of installing fiber to individual
homes and offices. The Company believes that VISIONET, which is a fixed wireless
network, can provide a cost-effective way to deliver broadband services across
the last mile to the customer's home or office.

     The Company has successfully completed a "link budget" test in the first
quarter of 2000. The test was designed to determine the optimum transmission
range under adverse weather conditions and the subscriber capacity per cell. The
test results will form the basis for the proposed implementation of VISIONET to
cover the Central Region of Malaysia, popularly known as the Klang Valley, where
Kuala Lumpur and the Multimedia Super Corridor (the "MSC") are located. The
Company currently plans to launch the "pilot" for VISIONET in late May 2000.

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     The Company hopes that the commercial launch of VISIONET will occur in the
third quarter of 2000. The Company is currently negotiating with building owners
to obtain roof access to install antennas and transceivers on major buildings in
the Klang Valley. The Company expects to utilize buildings that are owned by
local municipal councils to act as cell sites for its network. Network traffic
will be routed via wireless transmission located on a cell site, which has a
direct line of sight to the transceivers installed at the customers' premises.
These cell sites will act as aggregation points for the distribution of network
traffic.

     The Company hopes to enter into a strategic alliance with Fiberail Sdn Bhd,
a 60%-owned subsidiary of Telekom Malaysia, a Malaysian company ("Fiberail"),
whereby the Company's wireless broadband network would be integrated with
Fiberail's existing fiber optic trunk network. Fiberail owns an existing fiber
optic trunk network that has been laid along the national railway grid
connecting major towns and cities in Malaysia. The Company believes that such a
strategic alliance could serve to connect its cell sites and switching
facilities to the Company's Network Management Center. The Company is currently
negotiating with Fiberail on the terms and conditions of such a strategic
alliance.

     Ultimately, the Company hopes to provide its customers with access to a
broad range of applications and services offered by visionetwork.com and the
Internet using a television or personal computer. To access the Company's
services through a television, a customer would need a set-top box, wireless
modem, and transceiver. To access the Company's network through a personal
computer, a customer would need a Network Interface Card and software.

STRATEGIC ALLIANCES

     On April 7, 2000, the Company executed a Letter of Intent with an equipment
manufacturer, EER Systems Inc. of Virginia ("EER"), pursuant to which the
Company would be able to obtain a long-term supply of the "best of breed"
transceivers and system integration services. The Company hopes to enter into a
definitive long-term supply agreement with EER. In addition, the Company hopes
to enter into a strategic alliance with EER relating to the joint implementation
of a Pan Asian broadband network sometime before the commercial launch of the
VISIONET network.

     The Company is currently negotiating with a wireless broadband modem
manufacturer for a long-term supply of "best of breed" wireless modems.

     On October 6, 1997, the Company entered into a Memorandum of Understanding
with Fiberail under which the parties agreed to collaborate with respect to the
integration of the Company's wireless broadband network with Fiberail's fiber
optic network. The Memorandum of Understanding contemplates that the parties
will seek to implement the integration of their respective networks through a
strategic alliance and, as described above, the parties are currently
negotiating the terms and conditions of such a strategic alliance.

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BUSINESS MODEL

     The Company is attempting to position itself as an integrated
communications services provider offering a robust network, multimedia content
and other related applications and services.

WIRELESS BROADBAND NETWORK

     As discussed earlier, the Company hopes to make VISIONET widely available
throughout major towns and cities in Malaysia. Initially, the Company plans to
deploy VISIONET in the populous Klang Valley. The Company hopes that the
strategic alliances referred to above will permit the Company to offer
comprehensive national network coverage and to integrate existing fiber optic
networks with the Company's broadband network.

     The MSC, which is funded by the Government of Malaysia, is a major part of
Malaysia's goal to become an industrialized country by 2020. The MSC currently
includes a new city center, new government administrative center and a
residential and commercial area, as well as the international airport in Sepang.
The MSC is equipped with a 2.5 Gbps to 10 Gbps digital fiber optic backbone. The
Company believes that the MSC will attract and generate residential and business
customers who will demand efficient, effective high-speed data transmission
capability. The Company believes that demand for broadband capacity will
increase in the growing financial and commercial center of the MSC and that
there is therefore a significant opportunity for a wireless broadband network
that can service that demand.

     The Company intends to rapidly build out its network to obtain a
"first-to-market" advantage as well as reduce its deployment cost by integrating
with Fiberail's network to bring VISIONET only to areas where there is a demand
for broadband services. The Company hopes to exploit this advantage by
delivering a broad range of services including high-speed Internet access and
other content-rich applications.

     The Company hopes to begin signing up customers by the end of the second
quarter of 2000. In this respect, the Company has made initial contacts with
large Malaysian companies and the response has been encouraging.

CONTENT DEVELOPMENT

     To provide the Company's network with content-rich applications, the
Company is developing e-commerce portals on behalf of its customers. Content
development is not only limited to web site development, but may include the
creation of virtual private networks, archiving and hosting services, and
customer-specific programming. The Company is currently negotiating with a U.S.
based content provider to obtain technical assistance in the field of
programming and web site architecture. If a strategic alliance with an
established content provider materializes, the Company hopes to be able to
create a "critical mass" of multimedia content for delivery to its customers via
the Company's planned broadband network.

     In addition to successfully completing the strategic alliances referred to
above, the Company's ability to develop and provide content is dependent upon
the Company acquiring real estate on which to build a multimedia content
production center. AEI is negotiating to acquire a 60% equity interest in a
company that owns land located in the state of Pahang, Malaysia, on which land
the Company would propose to build the production center. If the Company can

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obtain such land, and if the Company can successfully build a multimedia content
production support center, the Company hopes to be able to provide the following
services to its customers:

     -    On-site scenic design and construction

     -    On-site prop shop

     -    Video post production

     -    Grip and lighting services

     -    Platform boom lifts

     -    Conference rooms

     -    Production offices

     -    Bungalows and offices

     The Company currently expects that the cost of setting up such a multimedia
content production center will be at least $7 million.

NETWORK AND CUSTOMER PREMISES EQUIPMENT

     Among other things, the success of the Company's business plan is dependent
upon the Company's ability to obtain and provide network and customer premises
equipment that is necessary for the operation of the Company's planned broadband
network. The Company hopes to be able to obtain network and customer premises
equipment in Malaysia through licensing agreements and joint ventures with
equipment manufacturers.

FUTURE PLANS

     If the Company is successful in providing broadband network services in
Malaysia, the Company's long-term goal is to replicate the business, financial
and technical model of VISIONET in other countries, especially in Asia.
Successfully deploying any such network depends on a large number of
unpredictable factors, which include the Company's ability to raise capital, the
Company's technical ability, the cost of acquiring broadband licenses and
spectrum rights, the regulatory framework and climate in each country, and the
Company's relationship with local telecommunication service providers, among
many other things.

COMPETITION

     The telecommunications and multimedia industries are highly competitive.
The Company faces potential competition from well-known global communications
companies, other existing telecommunications service providers, satellite
broadcast operators, and start-up companies, among many others. The Company had
hoped that its license would help the Company obtain a "first-to-market"
advantage, however the Company now believes that the Government of Malaysia will
issue new telecommunications licenses to other companies after March 31, 2000.

<PAGE>

     In Malaysia, there are at least six telecommunications service providers
offering telephony services. The Company expects that it will face significant,
direct competition from incumbents and other telecommunication start-ups once
the Government of Malaysia begins to award additional spectrum rights.

     The Company does not believe that the use or availability of raw materials
will be a material factor in the Company's activities.

RISK FACTORS

     To the Company's knowledge, no company has ever attempted to create a
wireless broadband network in Malaysia. As a result, the Company faces a
significant number of risks and uncertainties associated with executing its
business plan, only some of which the Company can currently anticipate. These
risks and uncertainties may impair the Company's progress and profitability. The
risks described below are intended to highlight risks that are specific to the
implementation and operation of a wireless broadband network, but are not the
only risks that the Company faces. Additional risks and uncertainties, including
those generally affecting the global economy, the political and economic climate
in Malaysia and the rest of Asia, the industry in which the Company operates,
the public securities market, and risks that the Company currently deems
immaterial may ultimately impair its business and results of operations.

     This report includes forward-looking statements, which involve risks and
uncertainties. The Company's actual results could differ materially from those
anticipated in these forward-looking statements as a result of numerous factors,
including those described below and elsewhere in this Item 1, Item 6
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" and in other portions of this report.

IF THE COMPANY'S LICENSE IS ALTERED OR REVOKED, THE COMPANY WOULD BE UNABLE TO
IMPLEMENT ITS BUSINESS PLAN.

     The Company believes that the wireless broadband license the Company has
obtained from the Government of Malaysia is material to the Company's business.
Any material alteration or revocation of the license would have a material
adverse effect on the Company and would prevent the Company from implementing
its business plan. As described earlier, the Government of Malaysia has the
unilateral right to revoke the Company's license upon thirty days' notice. In
addition, while the Company currently believes that it has the only license
granted by the Government of Malaysia, the Government may issue additional
licenses to the Company's competitors, which could also have a material adverse
effect on the Company.

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THE COMPANY EXPECTS TO INCUR NET LOSSES FOR THE EXTENDED FUTURE.

     The Company expects to incur substantial and growing net losses over the
next several years to fund the growth of the Company's business. The Company's
ability to stem its losses and achieve and maintain profitability is dependent
on many factors, including:

     -    the Company's ability to execute its business plan over an extended
          period of time;

     -    the general state of the communications markets;

     -    competition in the Company's target markets;

     -    the success of competing technologies; and

     -    the general state of the financial markets.

As a result, the Company cannot give any assurances that the Company will be
profitable in the future.

IF THE COMPANY IS UNABLE TO SUCCESSFULLY IMPLEMENT ITS BUSINESS PLAN, THE
COMPANY'S FINANCIAL CONDITION WOULD BE IMPAIRED.

     If the Company is unable to successfully implement its business plan, the
Company's financial condition and performance would be impaired. The Company's
business plan and strategy include numerous elements that may be difficult or
costly to execute, and the Company may not be successful in implementing these
elements. For example, the Company's success is dependent on its ability to
successfully build and operate its VISIONET system, and the Company can provide
no assurances that it can successfully do so. Even if the Company is able to
successfully build and operate its VISIONET system, there may be insufficient
demand for the Company's services, in which event the Company will not generate
sufficient revenues to offset the Company's planned expenditures, thereby having
an adverse effect on the Company's business operations and financial condition.

FIXED WIRELESS COMMUNICATION SERVICES ARE RELATIVELY NEW AND NOT WIDELY USED,
AND MAY NOT RECEIVE WIDE MARKET ACCEPTANCE.

     The broadband services to be offered by the Company are relatively new and
are not widely used anywhere in the world. Such services may not receive wide
market acceptance. In addition, the Company competes with a wide variety of
alternative communications solutions that include:

     -    fiber optic lines;
     -    satellite-based and other wireless systems, including Multichannel
          Multipoint Distribution Service; and
     -    digital subscriber line (DSL) technology, which allows for high speed
          transmission over traditional copper lines.

     The Company's failure to gain wide market acceptance of its fixed wireless
services relative to these or other technologies may render the Company unable
to implement its business plan or meet its operational and financial objectives,
and may have an adverse effect on the Company's business operations and
financial condition.

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THE FAILURE OF THIRD PARTIES WITH WHOM THE COMPANY DOES BUSINESS TO MEET THE
COMPANY'S REQUIREMENTS COULD ADVERSELY AFFECT THE COMPANY'S BUSINESS.

     The Company's business plan and operations rely on the Company's ability to
obtain services provided by other communications companies. The failure of one
or more of these companies to meet the Company's needs could adversely affect
the Company's business and results of operations. Some of these companies may
also be the Company's competitors and, accordingly, in the future, they may be
unwilling to provide the Company with the services it requires. These companies
may also decide to dedicate their resources and networks to other communications
companies or to facilitate their own growth and, as a result, elect to scale
back or terminate the services they provide to the Company. The failure of any
of these third parties to perform could prevent or delay the creation and
implementation of the Company's VISIONET network, limit the types of services
the Company can provide to its customers and potential customers and adversely
impact the Company's relationship with its customers. Any of these occurrences
could have an adverse effect on the Company's business, results of operations
and financial condition.

DEPENDENCE UPON LIMITED SUPPLIERS OF LMDS EQUIPMENT.

     Currently, there are only a few LMDS equipment suppliers that produce
network infrastructure and customer premises equipment. The Company may be
unable to obtain LMDS equipment at a cost-effective price. In addition, the
Company may not be able to obtain reasonable alternatives to LMDS equipment.
Changing technologies may also result in lack of proper equipment support by
manufacturers. A delay in obtaining necessary equipment and/or unreasonably high
equipment prices would negatively impact the Company's ability to implement its
business plan and provide its service to subscribers and higher equipment prices
would adversely affect the Company's operating results and could damage future
marketing efforts.

FAILURE TO OBTAIN ACCESS RIGHTS TO BUILD THE COMPANY'S NETWORK WOULD ADVERSELY
AFFECT THE COMPANY'S ABILITY TO IMPLEMENT ITS BUSINESS PLAN.

     The Company may not be able to obtain access rights to the number or type
of buildings that are required to deploy the Company's broadband network. In
order to build a network and reach customers, the Company needs access to
buildings where the Company's antennas will be placed. Failure to secure access
rights on a timely basis would prevent the Company from implementing its
business plan and could have an adverse effect on the Company's business and
financial condition. In addition, the Company needs certain governmental
approvals prior to building certain critical facilities, including repeater
stations, and placing the Company's antennas on high-rise buildings.

ABILITY TO RAISE CAPITAL IN THE FUTURE ON A TIMELY BASIS MAY ADVERSELY AFFECT
OUR ABILITY TO FUND OUR OPERATIONS.

     The Company will require substantial capital to fund its planned capital
expenditures and operations. The Company does not expect to be able to generate
sufficient cash from operations to provide the necessary capital to execute the
Company's business plan. If the Company is unable to generate sufficient cash
from its operations or raise capital as needed, the Company will be unable to
pursue or execute its current business plan and fund its operations.

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THE COMPANY'S BUSINESS AND INDUSTRY ARE SUBJECT TO EXTENSIVE REGULATIONS THAT
COULD CHANGE AT ANY TIME AND RESTRICT THE COMPANY'S ABILITY TO COMPETE WITH ITS
COMPETITORS.

     The Malaysian communications industry (including spectrum allocation and
usage) is highly regulated by the Malaysian government. Regulations that govern
the Company's business could change at any time, which could adversely affect
the way the Company conducts its business and its ability to continue to conduct
its business in the manner it has planned. The Company may incur substantial
costs in complying with these regulations, and failure to comply with applicable
rules and regulations could result in the Company having to pay penalties or its
license being revoked by the government. In addition, changes in regulations
could also increase competition, which may have an adverse effect on the
Company's business and results of operations.

FAILURE TO HIRE OR RETAIN QUALIFIED PERSONNEL COULD HURT THE COMPANY'S BUSINESS.

     The Company's future success and performance is dependent on its ability to
identify, hire, train and retain experienced technical and marketing personnel.
The Company faces significant competition for employees with the skills required
for its business. There can be no assurance that the Company will succeed in
attracting and retaining the services of qualified and experienced technical and
marketing personnel.

THE MARKETS IN WHICH THE COMPANY OPERATES ARE VERY COMPETITIVE AND INCREASED
COMPETITION COULD ADVERSELY AFFECT THE COMPANY.

     The Company faces intense competition with regional, national and global
companies in the markets in which the Company intends to operate and may not be
able to effectively compete in these markets. Many of the Company's competitors
are well-established and have large and well-developed networks and systems,
long-standing relationships with customers and suppliers, greater name
recognition and have, or have access to, significantly greater financial,
technical and marketing resources. Many of these companies have the ability to
subsidize competing services with revenues from a variety of other services.
Moreover, the growing consolidation of companies and the formation of strategic
alliances within the communications and media industries (including the recently
announced MCI WorldCom/Sprint and America Online/Time Warner mergers) could give
rise to more powerful competitors.

THE INTERNATIONAL NATURE OF THE COMPANY'S OPERATIONS SUBJECT THE COMPANY TO
SPECIAL RISKS.

     The Company currently intends to operate primarily in Malaysia and perhaps
elsewhere in Asia. The Company therefore faces special risks related to
operating in international markets, which the Company may not be able to
overcome. The following are some of the risks inherent in doing business in
Malaysia and other non-U.S. markets:

     -    unanticipated changes in regulatory requirements, tariffs, customs,
          duties and other trade barriers;

     -    limitations on the Company's flexibility in structuring foreign
          investments imposed by regulatory authorities;

     -    longer payment cycles and problems in collecting accounts receivable;

     -    political and economic risks;

<PAGE>

     -    translation and transaction exposure from fluctuations in exchange
          rates of other currencies; and

     -    potentially adverse tax and cash flow consequences resulting from
          operating in multiple countries with different laws and regulations.

THE COMPANY DOES NOT HAVE ALL OF ITS HISTORICAL CORPORATE RECORDS AND CANNOT BE
SURE ABOUT POTENTIAL LIABILITIES RELATING TO ITS FORMER OPERATIONS AND ACTIONS
BY ITS FORMER OFFICERS AND DIRECTORS.

     Notwithstanding the Company's demand, its former lawyers, David Wagner and
David Wagner & Associates, P.C., have not delivered to the Company the
historical corporate records they prepared and maintained on behalf of Kalan. As
a result, the Company's current management does not have access to all of the
Company's historic corporate records and does not know what information may be
contained in or omitted from the records that are in the lawyers' possession.
The Company is pursuing claims against these individuals regarding this matter.

     In addition, the agreement and plan of merger those same lawyers prepared
in connection with the Reverse Acquisition contains representations by the
Company and an officer's certificate containing representations by Sanford
Altberger, the Company's former President, to the effect that Kalan had no
liabilities at the time of the Reverse Acquisition. However, based on the
amounts that the Company's former lawyers and others first claimed to be owed
after the Reverse Acquisition, the Company now believes those representations
may not have been true when they were made by the Company's former officers and
directors. Although the Company cannot be sure about the existence or amount of
any potential liabilities relating to the Company's pre-Reverse Acquisition
operations, or actions or omissions by its former officers and directors, the
Company does not have any outstanding liabilities of which it is currently aware
relating to its pre-Reverse Acquisition operations, other than legal fees
alleged to be owed to its former lawyers. Moreover, based on its review of the
Company's affairs in connection with the Reverse Acquisition, management of the
Company does not believe that the absence of the historic corporate records
affects the integrity of the Company's financial statements.

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REGULATION

     The business operations of PTSB are regulated by both the Malaysian
Ministry of Energy Communications & Multimedia (MECM) (formerly known as the
Ministry of Energy Telecommunications & Post) and the Communications and
Multimedia Commission ("CMC") of Malaysia. PTSB's license is governed by the
Malaysian Communications & Multimedia Act 1998 ("Act 588") which became
effective on April 1, 1999. This new Act, which has superseded the
Telecommunications Act of 1950 and the Broadcasting Act of 1988, is to provide
for and to regulate the converging communications and multimedia industries in
Malaysia.

     Under Malaysian law, PTSB has the option of registering its existing
wireless broadband license under Act 588 or maintaining the terms of the license
under the repealed Act. The Company believes that it would be more advantageous
to register its license under the new Act, and has on March 3, 2000 registered
with the CMC its intention to register its license under the new Act. The
registration is effective on the date of filing with the CMC.

     While the Company believes that Act 588 is the most significant
industry-specific governmental regulations that apply to the Company's business,
the Company is subject to a large number of other laws in different countries
and localities.

EFFECT OF REGULATIONS ON THE COMPANY

     The Company currently expects that both CMA 1998 and CMCA 1998 ("Act 589"),
which came into effect after the Company's broadband license was granted, will
have a net positive influence on the Company's participation in the multimedia
industry. These Acts have broadened the scope of permissible business operations
for industry participants by providing new opportunities, particularly in
telephony, multimedia and Internet Protocol compatible communications. The
Company hopes that it will benefit because the Acts compel all
telecommunications network operators to accord equal access service to their
customers. With equal access, customers who are registered with one
telecommunications network operator will have the option to use the services of
any other network operator and be invoiced separately by the respective operator
for the services used.

     The Company believes that it is presently the only company in Malaysia to
be granted a wireless video communication network ("WVCN") license to deliver
interactive multimedia applications and services. This exclusivity may cease
when the government of Malaysia lifts the current freeze on applications for new
licenses on March 31, 2000.

<PAGE>

CONDITIONS OF LICENSE GRANTED TO PTSB

     On May 28, 1997, PTSB was granted a license to establish, maintain and
operate a telecommunications system for the provision of broadband
communications services throughout Malaysia. Under the license agreement, the
services the Company is permitted to provide include the following:

-    interactive distance learning
-    live news coverage
-    remote video surveillance
-    emergency field services
-    on-site progress monitoring; and
-    energy conservation and building management.

     The provision of additional services is subject to the prior written
approval of the Director General of Telecommunications.

     The license granted to the Company is for an initial ten-year term. Under
the terms of the License Agreement, the terms and conditions of the license are
subject to review from time to time by the Minister of Energy Communications and
Multimedia, and the Minister may add, vary or revoke any terms or condition
imposed on the Company. The key provisions of the License Agreement are outlined
below:

     (i)  Payment of Fees - The Company is required to pay the following amounts
          to the Ministry of Energy Communications & Multimedia at the following
          times: (a) on the date the License was granted, the sum of RM 50,000
          (U.S. $19,250, based on an exchange rate of RM3.80: US$1.00 as at
          March 31, 2000); and (b) beginning on December 31, 1997 and annually
          thereafter a renewal fee in an amount equal to 0.08% of the Company's
          annual audited gross sales subject to an annual minimum of RM 5,000
          (US$1,316 based on an exchange rate of RM3.80 : US$1.00 as of March
          31, 2000) per year. The amount of the annual license fee is subject to
          review by the Minister of Energy Communications and Multimedia after
          the first three years. As of the year ended December 1999, the Company
          had paid all amounts that were payable under the License.

     (ii) Connection of Other Systems and Apparatus - The Company must allow any
          person or organization to connect peripheral equipment or apparatus to
          VISIONET for the transmission and receiving of any messages within or
          amongst its private premises, provided that the person or organization
          shall have earlier entered into an agreement with the Company
          stipulating terms and conditions, relevant charges and equipment
          specifications for such connection.

    (iii) Network Security - The Company must adequately ensure that: (a) there
          is no obstruction or intervention of the Company's network; (b) the
          Company does not interfere with the working of other
          telecommunications systems or the radio communications services of the
          Government of Malaysia or the Malaysian Armed Forces or any other
          station licensed by the Government; and (c) the Company complies with
          all regulations, directives and orders given by the Telecommunications
          Authority of Malaysia and the International Telecommunications Union
          regarding the transmission and use of bandwidth and frequencies.

<PAGE>

     (iv) Price Control - The Minister reserves the right to establish price
          control arrangements for the relevant service provided by the Company
          with which the Company is required to comply. The Company must
          maintain separate financial data and accounts for the WVCN services
          and must submit such data to the Minister upon request.

     (v)  Content - The Company must comply with any terms and conditions
          imposed by any relevant governmental authorities with respect to
          programming content.

     (vi) Transferability - The Company is not permitted to assign, transfer,
          sublet or otherwise dispose of its rights, duties, liabilities,
          obligations and privileges under the WVCN license to any person,
          except with the prior written consent of the Minister.

    (vii) Contracts with Third Parties to Operate or Provide Licensed System or
          Services - Where the Company has entered into or intends to enter into
          any joint venture, association, contract or arrangement with a third
          party, the effect of which would be to permit the third party to
          operate or provide the Company's services, the Company must seek the
          Minister's approval.

   (viii) Compliance with the Law - The Company must observe and comply with
          the CMA 1998 (or any Regulations made thereunder), the International
          Telecommunications Convention and any other treaty or convention to
          which Malaysia is a party. Nothing in the WVCN license can have the
          effect of varying the Company's obligations to obtain any other
          licenses, permits or approvals that may be required under the laws of
          Malaysia.

          For example, the Company is required to obtain approval from the
          Standards & Research Institute of Malaysia (the "SIRIM") for the
          Company's proposed network transmission and customer premises
          equipment prior to the importation and installation of such equipment
          in Malaysia. The Company does not currently anticipate any difficulty
          in obtaining approval from the SIRIM for the proposed network
          transmission and customer premises equipment because the Company
          believes that the technical and performance specifications of the
          relevant equipment conforms to the standards established by the
          International Telecommunications Union, of which Malaysia is a member.

     (ix) Exceptions and Limitations on Obligation - The Company shall not be
          held to have failed to comply with an obligation imposed upon it by or
          under the WVCN license if and to the extent that the Director General
          is satisfied that that it is prevented from complying with those
          obligations for the following reasons: (a) the malfunction or failure
          of any apparatus or equipment where the Director General determines
          that reasonable measures were taken beforehand; (b) the act or
          omission of any national authority or international organization; or
          (c) any other factor which, in the opinion of the Director General is
          beyond the Company's reasonable control and which notwithstanding the
          exercise by it of reasonable diligence and foresight, the Company was
          unable to prevent or overcome.

<PAGE>

     (x)  Revocation of WVCN License - The Minister may at any time revoke the
          WVCN license by thirty days notice in writing given to the Company at
          its registered office in any of the following circumstances: (a) if
          any fee payable is unpaid thirty days after it becomes due whether a
          notice in writing has been given to the Company or not; (b) upon
          breach of any Conditions imposed in the WVCN license; (c) if the
          Company enters into receivership or liquidation; or whether voluntary
          or involuntary save for the purpose of amalgamation or reconstruction;
          (d) if the Company ceases to carry on its business; or (e) if any
          action was taken for voluntary winding up or dissolution of the
          Company or any order pursuant to the Malaysian Companies Act 1965 is
          made for the compulsory winding up or dissolution of the Company.

In the event that the WVCN license is not renewed or revoked, the Company will
not be entitled to any payment of compensation whatsoever from the Ministry for
any loss or damage that may have been incurred or suffered by the Company. The
determination of the license will not prejudice or affect the right of the MECM
to receive any sum due to the MECM for any breach or non-performance of any of
the conditions set out in the license.

RESEARCH & DEVELOPMENT COSTS

     In the last two fiscal years, the Company has not spent any significant
funds on research and development activities. This is expected to change during
2000 when the Company expects to undertake joint research and development work
with equipment manufacturers based in the United States.

ENVIRONMENTAL LAWS

     To date, the Company has not incurred any material costs for compliance
with any prevailing environmental laws of Malaysia or the United States.

PATENTS AND TRADEMARKS

     The Company has no other patent, except for a patent for digital image
display technology that the Company acquired from Synervest Sdn Bhd, a company
controlled by Mustaffa Yacob, a director of PTSB. The Company is in advanced
negotiations with a third party to acquire this Patent from the Company. The
Company's subsidiary, PTSB, has registered the name "VISIONET" as its service
tradename and trademark with the Malaysian Registry of Trade Marks and Patents.
No other intellectual property registration is pending.

EMPLOYEES

     At December 31, 1999, the Company had 10 full-time employees and 12
part-time employees. The Company currently plans to embark on an aggressive
recruitment effort in the first six months of 2000 in an effort to prepare for
the targeted launch of VISIONET in the third quarter of 2000.

<PAGE>

ITEM 2.   DESCRIPTION OF PROPERTIES.

     Between January 1, 1999 and June 30, 1999, the Company's principal office
was located at Tower II, Suite 100, 12835 E. Arapahoe Road, Englewood, Colorado
80112. Following the Reverse Acquisition, on July 1, 1999, the Company's
principal executive office was relocated to Malaysia. The Company's present
principal executive office is located at No. 60A Jalan 19/3 46300 Petaling Jaya
Selangor, Malaysia. The Company owns office furniture and equipment with a net
book value of $36,716 as of December 31, 1999.

     In March 2000, the Company leased additional office space at Menara Merais,
No.1 Jalan 19/3, 46300 Petaling Jaya, Selangor, Malaysia. The Company intends to
move its principal executive office and network management center to Menara
Merais, while maintaining the current location as its network engineering
support center. Menara Merais is located 300 meters away from the current
location.

     The Company has no other properties and the Company believes that its
existing and planned facilities are adequate for its current requirements and
that suitable additional space will be available as needed to accommodate future
expansion of its operations.

ITEM 3.   LEGAL PROCEEDINGS.

     Following the Reverse Acquisition, certain disputes arose between the
Company and Sanford Altberger, Michael Raisch and David Wagner, the Company's
former President, Treasurer and legal counsel, respectively, each of whom either
directly and/or beneficially owns common stock of the Company. Those disputes
involved, among other things, the issuance of 1,840,000 shares of the Company's
common stock to an entity controlled by Mr. Wagner (the "Disputed Shares") at
the time of the Reverse Acquisition, bills for pre-acquisition legal services,
recovery of the Company's historical corporate records, and various claims of
alleged misrepresentations in connection with the Reverse Acquisition. On
December 14, 1999, these parties conducted a voluntary mediation and agreed to
settle all of their disputes arising out of the Reverse Acquisition. The
mediator's Amended Settlement Memorandum (the "Settlement Memorandum")
confirming the parties' agreement is filed as an exhibit to this Form 10-KSB.
The Settlement Memorandum provided, among other things, for (i) the payment by
the Company to Mr. Wagner of $150,000 for attorneys' fees owed and in exchange
for the transfer to the Company of the Disputed Shares, (ii) the purchase by the
Company of the outstanding shares of common stock then owned by Messrs.
Altberger, Raisch and Wagner (excluding the Disputed Shares referred to in
clause (i) above) at a price of $1.00 per share and (iii) the delivery by
Messrs. Altberger, Raisch and Wagner of the Company's historical corporate
records.

     In mid-January 2000, Messrs. Altberger and Raisch repudiated the Settlement
Memorandum, and Mr. Wagner refused to close the settlement transactions. On
January 24, 2000, the Company filed an action in the Arapahoe County, Colorado,
District Court, titled KALAN GOLD CORP. V. SANFORD ALTBERGER, MICHAEL RAISCH,
DAVID J. WAGNER, DAVID J. WAGNER & ASSOCIATES, P.C., DAVID WAGNER & ASSOCIATES
DEFINED BENEFITS PLAN, MARION LIMITED LIABILITY COMPANY AND VERONICA BROWNELL,
Case No. 00CV0172, seeking to (1) recover actual and consequential damages the
Company incurred as a result of the defendants' breach of the Settlement
Memorandum; (2) obtain a decree of specific performance requiring Messrs.
Altberger, Raisch and Wagner to perform their obligations under the Settlement
Memorandum; (3) recover the Company's attorneys' fees and costs incurred in
enforcing the Settlement Memorandum; and (4) recover the Company's historical
corporate records and the Disputed Shares.

<PAGE>

     On March 3, 2000, the Company filed a motion to voluntarily dismiss,
without prejudice, all of its claims against Messrs. Altberger and Raisch, which
motion the court granted on March 7, 2000. As part of the agreement to dismiss
its claims, Messrs. Altberger and Raisch represented and warranted to the
Company that they do not have any of its corporate records in their possession,
custody or control.

     On March 16, 2000, the defendants David J. Wagner, David J. Wagner &
Associates, P.C., David Wagner & Associates Defined Benefits Plan, Marion
Limited Liability Company and Veronica Brownell (the "Wagner defendants") filed
their answer and two counterclaims against the Company. The first counterclaim
seeks approximately $193,000 in attorneys' fees that David J. Wagner &
Associates, P.C. alleges the Company owes for legal services, the major portion
of which were rendered prior to the Reverse Acquisition, and the second
counterclaim seeks a declaration removing a stop transfer order the Company
issued to its stock transfer agent with respect to shares of common stock held
in the names of the Wagner defendants. The Company responded to the
counterclaims on April 10, 2000 asking the court to dismiss them because they
were all settled under the Settlement Memorandum and are therefore invalid as a
matter of Colorado law.

     In addition, on January 21, 2000, the Arapahoe County District Court issued
an order to show cause directing the Wagner defendants to appear and show cause
why the court should not direct them to return to the Company the Company's
corporate records and the Disputed Shares. The hearing with respect to such
order to show cause commenced on March 17, 2000 and has been continued to April
24, 2000.

     The Company intends to prosecute the case vigorously and believes it is has
meritorious claims and defenses. The Company has set aside US$150,000 as a
contingency for its liability to the Wagner defendants. The Company can give no
assurances concerning the outcome of the dispute, but believes that the outcome
of this litigation will not have a material adverse effect on the Company's
business and results of operations.


<PAGE>

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

     The Company did not submit any matter to a vote of the Company's security
holders during the fourth quarter of the fiscal year covered by this Annual
Report.


<PAGE>

                                     PART II

ITEM 5.   MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

     Since January 1997, the Company's securities have traded on the
over-the-counter (OTC) "Bulletin Board" market under the symbol, "KNGC". Before
then, the Company's securities had never been listed for trading on any market.

     The table below sets forth the range of high and low bid quotations of the
Company's common stock as publicly reported by Marketguide during the Company's
1999 fiscal year. The following bid price market quotations represent prices
between dealers and do not include retail markup, markdown, or commissions;
hence, they may not represent actual transactions.

<TABLE>
<CAPTION>
Fiscal Year 2000    High   Low
                    ------ ------
<S>                <C>     <C>
First Quarter      $1.56   $0.23

<CAPTION>
Fiscal Year 1999    High   Low
                    ------ ------
<S>                <C>     <C>
First Quarter      $1.25   $0.38
Second Quarter     $2.25   $0.38
Third Quarter      $1.69   $0.31
Fourth Quarter     $0.56   $0.19

<CAPTION>
Fiscal Year 1998    High   Low
                    ------ ------
<S>                <C>     <C>
First Quarter      $0.75   $0.88
Second Quarter     $0.75   $0.84
Third Quarter      $0.90   $1.00
Fourth Quarter     $1.75   $1.88
</TABLE>

     As of March 15, 2000, 97,290,999 shares of the Company's common stock were
outstanding and the number of holders of record of the Company's common stock at
that date was approximately 120. However, the Company estimates that it has a
significantly greater number of shareholders because a substantial number of the
Company's shares are held in "street name" by the Company's market makers. On
April 10, 2000, the closing trade price for the Company's common stock was $0.91
per share.

     Under the Company's Articles of Incorporation, holders of common stock are
entitled to receive such dividends as may be declared by the Company's Board of
Directors. No dividends on the common stock were paid by the Company during the
periods reported herein.

RECENT SALE OF UNREGISTERED SECURITIES

     The following securities that were not registered under the Securities Act
of 1933, as amended, have been issued or sold by the Company during the past
three years:

(i) As at January 1, 1997, the Company's issued share capital was 7,053,499. The
Company had also granted non-compensatory options to purchase 312,500 shares of
common stock to the officers of the Company. During 1997 and 1998, 37,000 and
200,000 stock options were exercised, respectively.

<PAGE>

(ii) In October 1998, the Company issued a total of 2,300,000 shares of its
common stock to the following parties in exchange for four licenses to gold
properties in the African country of Burkina Faso:

<TABLE>
<S>                                   <C>
      Ovorvi Overseas Corporation     1,300,000*
      Great Western Finance Inc       1,000,000*
</TABLE>

     *These shares have been returned and were cancelled in April 1999, prior to
the Reverse Acquisition.

(iii) In October 1998, the Company issued 700,000 shares of its common stock to
Michael Raisch, who was at the time the Company's Treasurer and a Director, and
Orovi Corporation, a company controlled by Sanford Altberger, who was at the
time the Company's President and a Director, in exchange for forgiveness of debt
as follows:

<TABLE>
<S>                                 <C>
      Orovi Corporation                  465,000
      Michael Raisch                     235,000
                                       ---------
                                         700,000
                                       =========
</TABLE>

(iv) On April 20, 1999, the Company issued an aggregate of 83,320,000 shares of
common stock to stockholders of AEI and 3,680,000 shares of common stock to its
financial advisor and former lawyers in connection with the Reverse Acquisition.

(v) On February 24, 2000, the Company issued an aggregate of 2,300,000 shares of
common stock to Mr. Wan Malek Ibrahim in a private placement for cash
consideration of $1,150,000 at 50 cents per share. Proceeds from this private
placement were used to repay advances made to the Company by Mr. Patrick Lim and
LSH Asset Holdings Sdn Bhd.

     The issuances of securities described above were made in reliance on the
exemption from registration provided by Section 4(2) of the Securities Act for
transactions not involving a public offering.

SAFE HARBOR STATEMENT

This Form 10-KSB and other reports filed by the Company from time to time with
the Securities and Exchange Commission, as well as the Company's press releases,
contain or may contain forward-looking statements and information that are based
upon beliefs of, and information currently available to, the Company's
management, as well as estimates and assumptions made by the Company's
management. Forward-looking statements can be identified by the use of
forward-looking terminology such as "believes", "may", "should", "anticipates",
"estimates", expects", "future", "intends", "hopes", "plans" or the negative
thereof. Such forward-looking statements involve known and unknown risks,
uncertainties and other factors that could cause actual results of the Company
to vary materially from historical results or from any future results expressed
or implied in such forward-looking statements.

Such factors include, among others, the following: revocation of the Company's
license, ability to successfully implement its business plans, market acceptance
of fixed wireless broadband services, ability to obtain services provided by
other communications companies, limited suppliers of LMDS equipment, failure to
obtain roof access, the ability of the Company to raise capital on a timely
basis, the Company's business is subject to existing and future government
regulations, failure to retain qualified personnel, competitive pressures and
potentially adverse tax and cash flow consequences resulting from operating in
multiple countries with different laws and regulations, ability to maintain
profitability in the future and general economic and business

<PAGE>

conditions in Malaysia. The Company does not undertake to update, revise or
correct any forward-looking statements.


<PAGE>

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

GENERAL

     The Company was incorporated in 1985 in the state of Colorado and had no
revenue-generating operations until the Reverse Acquisition by Animated
Electronic Industries Sdn Bhd ("AEI") on April 20, 1999. As a result of the
Reverse Acquisition, AEI became a wholly-owned subsidiary of the Company. To
allow a more meaningful comprehension of the Company's past and future
operations, the consolidated financial statements for the years ended December
31, 1998 and 1999 are prepared as if the Reverse Acquisition had occurred at the
beginning of the years presented.

     The Company currently provides multimedia content production and the design
and development of websites. The Company hopes to be able to provide other
broadband multimedia communication services that include the operation of a
wireless digital broadband network, VISIONET, and the sale of customer premises
equipment.

REVENUE

     Revenue for 1999 was primarily derived from the production of multimedia
programs; design and consulting services for web-site development and network
engineering services; and consulting fees for project management services. In
1998, the Company was principally engaged in the marketing of video
telecommunication and surveillance devices, and revenue was primarily derived
from the sales of such equipment.

     The Company's hopes to be able to derive its revenue from development and
production of interactive multimedia contents, web hosting, operation of a
wireless broadband network and sale of customer premises equipment. In the
future, the Company anticipates that its revenue will be generated mainly from
the following sources:

1.   Fees for development and production of multimedia content;
2.   Fees for design and development of interactive web site;
3.   Web site hosting services and annual maintenance fees;
4.   Advertising revenues from banner advertisements, event sponsorship and pay
     per view;
5.   Sales of customer premises equipment;
6.   Usage fees from customers using its wireless broadband network;
7.   Sale of archived information; and
8.   A share of the revenue from on-line e-commerce through strategic
     partnerships and joint ventures.

COST OF SALES

     Cost of sales for 1999 and 1998 mainly consist of purchase cost of video
telecommunication and surveillance devices. Following the Company's business
plans, the Company anticipates that the costs of sales in future periods will be
comprised of: -

1.   Production costs for development and production of multimedia content
     design and development of interactive web site such as licensing costs and
     the costs of employing consultants as required on a project basis from time
     to time.
2.   Costs for assembly and distribution cost of customer premises equipment.

<PAGE>

COMPARISON AND ANALYSIS OF RESULTS FOR YEARS ENDED DECEMBER 31, 1999 AND 1998.

     Total revenue increased by $590,338, or 50%, to $1,782,749 for the year
ended December 31, 1999 from $1,192,411 for the year ended December 31, 1998.
This increase in 1999 is partly due to an improvement in the economic conditions
experienced by most countries in Asia in 1999 in comparison to the difficult
economic conditions in Asia in 1998. As economic conditions did not permit the
Company to deploy its wireless broadband network immediately after being granted
the license to operate VISIONET, the Company concentrated on the design,
manufacturing and marketing of video telecommunications and surveillance
equipment in 1998. With the gradual economic improvement in 1999, the Company
moved its focus to the development and production of multimedia content and
provision of consulting services to companies seeking to establish an
interactive multimedia website.

     86% of the total revenue in 1999 was generated from six major customers
compared to a single customer accounting for 85% of the total revenue in 1998.
Although the Company recognizes that there is significant reliance on major
customers, the Company believes that this is due to the pioneer nature of the
Company's business in the development and production of multimedia content. With
the deployment of VISIONET in 2000 and the development of other aspects of the
Company's business as outlined in Item 1, the Company hopes to be able to reduce
this reliance on a few major customers in 2000.

     Costs of sales decreased by $1,043,353, or 99%, to $14,512 in 1999 from
$1,057,865 in 1998 following the change in emphasis of the Company's business
from the sale of telecommunications equipment to the development and production
of multimedia content. The development and production of multimedia content for
1999 has a higher profit margin because it only utilizes the Company's existing
manpower and facilities. As a result, gross profit increased from $134,546 for
the year ended December 31, 1998 to $1,768,237 for the year ended December 31,
1999, an improvement $1,633,691, or 1214%.

     Sales and marketing expenses increased by $6,378, or 60%, to $16,985 for
the year ended December 31, 1999 from $10,607 for the year ended December 31,
1998. This increase is mainly a result of higher expenses on promotion and
marketing incurred to promote the Company's business of developing and producing
multimedia programs and provision of design and consulting services for
interactive website development. For the current financial year, management
expects the expenses on sales and marketing to increase significantly following
the proposed launch of VISIONET.

     Depreciation and amortization increased by $74,822, or 51%, to $221,449 for
the year ended December 31, 1999 from $146,627 for the year ended December 31,
1998. This increase is due to the purchase of communications equipment during
the fourth quarter of 1999 for the deployment of VISIONET, which is currently
anticipated to occur during the third quarter of 2000. General administration
expenses increased by $192,547, or 79%, to $436,202 for the year ended December
31, 1999 from $243,655 for the year ended December 31, 1998. These expenses
mainly consisted of general and administrative costs, including rent, legal
costs and personnel costs. The increase in 1999 was primarily due to $181,295 of
legal fees incurred in connection with the dispute between two former officers
and directors and the former corporate attorney of the Company and the
post-merger management as disclosed under Item 3 of this Form 10-KSB.

     Included in general administration expenses for 1999 were management fees
of $70,000 paid to a company in which Mr. Patrick Lim, the President and Chief
Executive Officer of the

<PAGE>

Company, has a financial interest. The management fee was charged on the basis
of time spent for the administration and management services provided to the
Company.


<PAGE>

     For the year ended December 31, 1999, operating expenses included an amount
of $48,000 deferred compensation for shares of restricted common stocks issued
to Mr. Michael Raisch, the former Director, Treasurer and Secretary of the
Company prior to the Reverse Acquisition. The shares were issued in 1998 for
future services to be rendered to the Company. The full amount was written-off
against revenue for 1999 following Mr Raisch resignation in July 1999.

     Interest expense increased by $36,154, or 134% to $63,125 for the year
ended December 31, 1999 from $26,971 for the year ended December 31, 1998. This
interest primarily relates to the Company's capital lease commitments. At the
Company's request, the Lessor agreed to an extension on the repayment period in
1998 to enable the Company to secure additional working capital financing. The
increase in interest expense is principally attributable to the impact of the
rescheduled lease terms, which commenced only in 1999.

     Operating expenses increased by $357,901, or 84% to $785,761 in 1999
compared with $427,860 in 1998. The increase was mainly due to increase in legal
fees, depreciation and amortization expenses.

     Gain on disposal of tangible assets of $99,680 in 1999 relates to the
disposal of analogue video communication equipment. In 1998, the Company
disposed tangible and intangible assets used in operations of a subsidiary, that
has since been disposed for gains of $830,769 (tangible assets) and $416,411
(intangible assets). These assets, comprising analogue video hardware and
peripherals and a patent for image display, were disposed, as these items were
no longer relevant to the Company's operations upon the disposal of the said
subsidiary.

     The Company provided for taxation of $28,497 in 1999 and zero sum in 1998.
There was no income tax for the Company's operations in 1999 as the income was
derived in Malaysia, which was legislated to be a tax-free year for Malaysian
corporations by the Government of Malaysia. For 1998, the Company was not
subject to income tax as it posted an operating loss of $293,314.

     The taxation charge in 1999 consist of provision for deferred tax arising
from the timing difference between the capital allowance claimed from the Inland
Revenue and the depreciation charged by the Company.

     In 1998, in an effort to streamline its businesses, the Company disposed
three subsidiaries that were no longer relevant to its core activities. These
subsidiaries were MHSB Research & Development Sdn Bhd, Vistel (Asia) Sdn Bhd and
Educasia Sdn Bhd. All three subsidiaries were operating at a loss at the time
the Company disposed them and the Company recognized a loss on the operations of
the disposed subsidiaries of $387,640 and a disposal loss of $514,827.

Liquidity and Capital Resources

     As of the end of the reporting period, the Company had cash and cash
equivalents of $3,959 and working capital of $2,494,404. All operations were
funded from internally generated funds and working capital advanced from time to
time by the principal shareholder, director and officer of the Company. These
advances bear no interest and have no fixed terms of repayment.

     As of December 31, 1999, the Company owed Mr. Lim, the Chief Executive
Officer, President and a Director of the Company, $551,695 and as of December
31, 1998, the Company owed Mr. Lim $563,432), in each case for short-term cash
advances made to the subsidiary of the Company for working capital purposes from
time to time. Additionally, as at December 31, 1999 and as at December 31, 1998,
the amount owing to a company in which Mr. Lim has a financial interest amounted
to $311,428 and $212,142, respectively. This amount was for short-term cash
advances made to the Company and its subsidiaries for working capital purposes
from time to time. These amounts are unsecured, bear no interest and have no
fixed terms of repayment.

<PAGE>

     For the year ended December 31, 1999, net cash generated from operating
activities of $1,484,105 arose from an increase in net income. In 1998, net cash
used in operating activities of $4,225,434 was mainly due to the net increase in
trade and other Account Receivable of $2,918,693. Accounts receivable increased
from $1,047,076 on December 31, 1998 to $1,565,625 on December 31, 1999. This
increase is due to the Company adopting an aggressive credit policy that
provided for extended credit period for its customers. The Company adopted this
policy to develop its business in the production and development of multimedia
content.

     Accounts receivables consists of sales of goods and fees receivables for
production of multimedia programs and Intranet and management and consulting
services. As at December 31, 1999, 41% of Accounts receivables were aged below
90 days and 77% of accounts receivable were due from companies or parties that
are related or affiliated to the Company. The Company has received written
undertakings from all its customers for full settlement of outstanding accounts
receivables. There was no provision for doubtful debts in 1999 as the Company's
management expects to receive a substantial portion of the accounts receivables
by August 31, 2000. Due to the pioneer nature of its business, the Company has
pursued an aggressive credit policy and has extended a lenient credit term to
all its customers, including related parties. All the accounts receivables from
related parties will be collected as letters of undertaking has been given by
these parties. As explained above, following the deployment of VISIONET in 2000,
dependence on affiliated and related parties is expected to be reduced to less
than 10% of the total revenue in 2000.

     Other accounts receivable as at December 31, 1999 included an overdue
amount of $1,698,902 that relates to sales proceeds arising from the disposal of
investments and fixed assets, of which $1,391,007 was due from Synervest Sdn
Bhd, a company controlled by Mustaffa Yacob, a director of PTSB. The Company
expects to collect this amount by August 31, 2000. as the Company has received
written undertakings from its customers for full settlement of such other
accounts receivable.

     Cash used in investing activities was $1,542,636 in 1999. This was mainly
due to the purchase of communications equipment during the fourth Quarter of
1999 amounting to $1,226,961. This investment in tangible fixed asset was made
in anticipation of VISIONET being commercially deployed sometimes in the third
quarter of 2000. In 1998, net cash generated from investing activities of
$2,018,728 was attributable to disposals of subsidiaries and the related assets
in the Company. These subsidiaries were disposed as their operations were no
longer relevant to the Company's core activities.

     The Company expects to incur capital expenditures ranging between $10.0
million to $15.0 million during 2000 in connection with the launch and build-out
of network infrastructure to support the operation of VISIONET. Although the
Company has not committed to any capital expenditures, nor has the Company's
Board of Directors approved any capital expenditures, the Company believes that
investment in infrastructure is a necessary and logical step towards the
Company's plan to deploy its wireless network.

     The Company intends to source these funds internally and through equity or
debt financing. There is, however, no assurance that the Company will be able to
obtain sufficient financing on terms reasonably acceptable to the Company, or at
all. The Company will continuously evaluate its financing requirements and may
decide to consider alternative modes of financing.

     No dividends on the common stock were paid by the Company for the two years
reported herein.

<PAGE>

Y2K COMPLIANCE

     As of the date of this Annual Report, the Company did not experience any
Y2K compliance problems and all computer software appears to be functioning
properly.

<PAGE>

ITEM 7  FINANCIAL STATEMENTS

     The unaudited financial statements of the Company being furnished in
response to this Item are contained in a separate section of this Report
beginning on page F-1.

THE FINANCIAL STATEMENTS OF THE COMPANY INCLUDED IN THIS REPORT ARE UNAUDITED.

     THE COMPANY'S AUDITORS HAVE ADVISED THE COMPANY THAT THEY ARE UNABLE TO
COMPLETE THEIR REVIEW OF THE COMPANY'S FINANCIAL STATEMENTS FOR THE YEAR ENDED
DECEMBER 31, 1999 BY THE PRESCRIBED FILING DATE. IN RELIANCE UPON RULE 12b-21 OF
THE SECURITIES EXCHANGE ACT OF 1934 (WHICH PROVIDES THAT IF ANY REQUIRED
INFORMATION IS UNKNOWN AND NOT REASONABLY AVAILABLE TO THE REGISTRANT EITHER
BECAUSE THE OBTAINING THEREOF WOULD INVOLVE UNREASONABLE EFFORT OR EXPENSE, OR
BECAUSE IT RESTS PECULIARLY WITHIN KNOWLEDGE OF ANOTHER PERSON NOT AFFILIATED
WITH THE REGISTRANT, THE INFORMATION MAY BE OMITTED, SUBJECT TO THE CONDITIONS
SET FORTH THEREIN), THE COMPANY HAS OMITTED THE REQUIRED AUDITED FINANCIAL
STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 1999 AND IS INSTEAD INCLUDING
UNAUDITED FINANCIAL STATEMENTS FOR SUCH PERIOD. THERE CAN BE NO ASSURANCE THAT
THE AUDITED FINANCIAL STATEMENTS WILL NOT DIFFER MATERIALLY FROM THE UNAUDITED
FINANCIAL STATEMENTS INCLUDED IN THIS REPORT. THE COMPANY UNDERTAKES TO AMEND
THIS REPORT AS PROMPTLY AS POSSIBLE TO FILE THE AUDITED FINANCIAL STATEMENTS FOR
THE YEAR ENDED DECEMBER 31, 1999 UPON COMPLETION OF THE AUDITORS' REVIEW OF SUCH
FINANCIAL STATEMENTS AND HAVING RECEIVED A SIGNED REPORT WITH RESPECT THERETO.

ITEM 8. DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

     There were no disagreements on accounting and financial disclosures with
the Company's previous accountant, Cordovano and Harvey, P.C., or the Company's
present accountant, Arthur Andersen & Co., during the reporting period.
Cordovano and Harvey, P.C. resigned on February 11, 2000 and Arthur Andersen &
Co. was engaged as the Company's independent accountant on February 11, 2000.
The Company's financial statements for the last two years prepared by Cordovano
and Harvey, P.C. contained a "going concern" opinion.

<PAGE>

                                    PART III

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

     The Directors and Executive Officers of the Company, and their respective
ages and positions held in the Company, as of April 10, 2000 are as follows:-

<TABLE>
<CAPTION>
      NAME                        AGE    POSITION HELD
      ----                        ---    -------------
<S>                               <C>    <C>
      Wan Abdul Razak bin Muda     63    Chairman and Director

      Patrick Soon-Hock Lim        50    President, Chief Executive Officer and Director

      Valerie Hoi-Fah Looi         41    Secretary and Director

      Charles W. Pollard           42    Director (1)

      Paddy Bowie                  74    Director (1)

      Chee-Hong, Leong             34    Acting Chief Financial Officer/Treasurer

      Wan Malek Ibrahim            52    Executive Chairman
                                         and Director of PTSB
</TABLE>

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

(1)  Mr. Charles W. Pollard and Mrs. Paddy Bowie joined the Board of Directors
     on February 7 and February 24, 2000, respectively.

(2)  The Company's Directors will serve in such capacity until the next annual
     meeting of the Company's shareholders or until their successors have been
     elected and qualified. The officers serve at the discretion of the
     Company's Directors. There are no family relationships among the Company's
     officers and directors, nor are there any arrangements or understandings
     between any of the directors or officers of the Company or any other person
     pursuant to which any officer or director was or is to be selected as an
     officer or director.

MR. WAN ABDUL RAZAK BIN MUDA, 63, has served as the Chairman of the Board of the
Company since April 1999. He is also the Chairman and Director of Tiong Nam
Transport Holdings Bhd, a Malaysian public land cargo transportation and
warehousing company. In addition, since February 1993, Mr. Muda has been the
Chairman of the Board of AEI and PTSB and since May 1995, Mr. Muda has been the
Chairman of the Board of Vistel (Malaysia). Prior to joining Tiong Nam Transport
Holding Bhd in 1992, Mr. Muda had served in the Malaysian Police Force for 34
years. He joined the Malaysian Police Force as a police cadet after completing
senior high school. As part of his training, he attended numerous courses
conducted by the Royal Malaysian Police Training College and rose from the rank
and file to his last position as the Chief Police Officer of the state of
Terengganu, Malaysia.

<PAGE>

MR. PATRICK SOON-HOCK LIM, 50, currently serves as President and Chief Executive
Officer of the Company, positions he has held since the closing of the Reverse
Acquisition in April 1999. Mr. Lim has been the Managing Director at AEI since
August 1988 and has been involved in the multimedia industry for the past 10
years. Mr. Lim earned his Masters in Science from Reading University, United
Kingdom in 1974.

MS. VALERIE HOI-FAH LOOI, 41, has served as the Corporate Secretary since the
closing of the Reverse Acquisition in April 1999 and, in such position, she is
responsible for corporate affairs and human resources of Kalan and AEI. Ms. Looi
has also served as the Senior Vice President, Corporate Affairs at AEI, a
position she has held since joining AEI in 1990. She has over 10 years of
experience in corporate affairs. Ms. Looi holds a Diploma in Management from the
Malaysian Institute of Management, Malaysia.

MRS. PADDY BOWIE, 74, joined the Board of the Company in February 2000. Mrs.
Bowie is currently the Managing Director of Paddy Schubert, a business
consulting firm which she founded in 1980 She earned her Diploma in Education
from Oxford University, United Kingdom in 1948 and a Masters in English from
Manchester University, United Kingdom in 1946.

MR. CHARLES W. POLLARD, 42, joined the Board in February 2000. He has been the
Managing Director of Omni Air International Inc ("OMNI"), a U.S.-based airline
based in Oklahoma, since March 1997. Prior to joining OMNI, Mr. Pollard served
as President and Chief Executive Officer of World Airways, Inc. from October
1987 to March 1997. Mr. Pollard also practiced corporate law in the Washington,
D.C. office of Skadden, Arps, Slate, Meager & Flom, an international law firm
where he was an associate specializing in corporate finance, project finance and
mergers and acquisition. He is a member of the District of Columbia Bar and
received a Bachelor of Arts in Economics from Saint Auselm College, a Masters in
Public Administration from Syracuse University and a Doctorate of Law from
George Washington University Law Center.

MR. CHEE-HONG LEONG, 34, Fellow of Association of Chartered Certified
Accountants, United Kingdom has been the Acting Chief Financial Officer of the
Company since February 7, 2000. Mr. Leong is also the Corporate Finance Manager
of AEI, a position he has held since joining AEI in January 2000. He is
responsible for the financial and administrative functions of the Company. Prior
to joining AEI, Mr. Leong was the Assistant Accounts Manager at Industrial
Concrete Product from April 1994 to December 1999. Mr. Leong earned his Bachelor
of Arts in Accounting at Ulster University in Northern Ireland in 1989 and
qualified as a Chartered Certified Accountant with the Association of Chartered
Certified Accountants in 1994.

MR. WAN MALEK IBRAHIM, 52, has served as the Executive Chairman and Director of
PTSB since February 14, 2000. Mr Ibrahim is also a non-executive director of
World Airways, Inc., a position he has held since 1992. He was the Managing
Director of Malaysian Airline Systems Bhd ("MAS"), a position he held from April
1994 until his retirement in March 1999. Since his retirement, he has remained
on the board of MAS as a non-executive director. Mr Ibrahim graduated from the
University of Malaya in 1971 with a Bachelor of Arts in Chinese Studies.

     The Company does not pay fees to members of the board of directors and
presently has no plans to pay directors' fees. The Company intends to grant
stock options to members of the board of directors who are not employees of the
Company or any subsidiary of the Company ("Outside Directors"). The Company
hopes that such grants of stock options will encourage ownership of capital
stock of the Company by Outside Directors and will be necessary in order to
attract and retain qualified persons to serve on the Company's Board. Presently,
Wan Abdul Razak bin Muda, Charles Pollard and Paddy Bowie are Outside Directors
of the Company.

<PAGE>

COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934.

     Section 16(a) of the Securities Exchange Act of 1934, as amended, (the "34
Act"), requires the Company's officers and directors and persons who own
beneficially more than ten percent of the Company's Common Stock to file initial
reports of ownership and changes in ownership with the Securities and Exchange
Commission ("SEC"). Based solely on a review of copies of the Section 16(a)
reports furnished to the Company and written representations by certain
reporting persons, the Company believes that all of the Company's officers and
directors, and all persons owning more than ten percent of the Company's Common
Stock have filed the subject reports, if required, on a timely basis during and
with respect to the fiscal year ended December 31, 1999, except that:-

(i.)   LSH Asset Holdings Sdn. Bhd and Mr. Patrick Soon-Hock Lim filed in
       November 1999, Forms 3 required to have been filed in April 1999; and
       filed in November 1999, Forms 4 required to be filed in August 1999.

(ii.)  Ms. Valerie Hoi-Fah Looi filed in November 1999, Forms 3 and 4 required
       to have been filed in April 1999 and August 1999, respectively.

(iii.) Mr. Wan Abdul Razak bin Muda filed in November 1999, a Form 3 required to
       have been filed in April 1999.

(iv.)  Mr. Ahmad Fauzi Zahari filed in November 1999 a Form 3 required to have
       been filed in August 1999. He has yet to file a Form 4 required to have
       been filed in December 1999.

ITEM 10.  EXECUTIVE COMPENSATION.

     The following table sets forth the Summary Compensation Table for the Chief
Executive Officer and other executive officers who were serving as executive
officers at the end of the last completed fiscal year and whose salary and bonus
aggregated at in excess of $100,000. No other compensation not covered in the
following table was paid or distributed by the Company to such persons during
the period covered. Employee Directors receive no additional compensation for
service on the Board of Directors of the Company. Outside Directors received no
compensation from the Company as such during this period, except as indicated
below.

     The Company (under former management prior to the Reverse Acquisition) had
granted a stock option to Mr. Raisch, the former Secretary-Treasurer and a
Director, for 75,000 common shares at $.02 per share until November 14, 2001,
which option the Company and Mr. Raisch have agreed to cancel.

     As of the date hereof, the Company has no other options issued or
outstanding. The Company has no retirement, pension, profit sharing, stock
option, insurance or other similar programs. There were no long-term
compensation plans, awards, options nor any other compensation offered by the
Company.

<PAGE>

                           SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
NAME AND PRINCIPAL POSITION   YEAR  ANNUAL
---------------------------   ----  COMPENSATION
                                    ------------
                                    SALARY      BONUS
                                    ------      -----
<S>                           <C>   <C>         <C>
Patrick Soon-Hock Lim         1999  $7,895       (1)
President, Chief Executive    1998  Not applicable
Officer and Director          1997  Not applicable



Sanford Altberger             1999  $--          (2)
Former President              1998  $--
and Director                  1997  $--
</TABLE>

-------------
(1)  Mr. Lim became President, Chief Executive Officer and a Director of the
     Company on April 20, 1999 in connection with the Reverse Acquisition.
     Amounts received in 1999 represent director's fee from AEI for the year
     ended December 31, 1999.

(2)  Mr. Altberger was the President of the Company until April 20, 1999 when he
     was replaced by Mr. Lim in connection with the Reverse Acquisition. Orovi
     Corporation, a private company controlled by Mr. Altberger, advanced loans
     to the Company from time to time for operational purposes. As of January 1,
     1998, the Company owed Orovi Corporation $84,926. An additional $41,300 was
     advanced through December 31, 1998. The balance owed, plus accrued
     interest, was satisfied by the Company issuing 465,000 shares of its common
     stock as payment of the debt in 1998.

<PAGE>

EMPLOYMENT AGREEMENTS

     The Company has no employment agreements with its Chief Executive Officer
and other executive officers. However, its wholly-owned subsidiary, AEI, and
Chee Hong Leong had entered into a letter agreement, dated December 8, 1999,
with respect to Mr. Leong's appointment as Corporate Finance Manager of AEI.
Under the letter agreement, Mr. Leong will receive a basic salary of $18,947 per
year and be entitled to unspecified stock option grants to be awarded by Kalan
Gold Corporation in the future. Either party may terminate the letter agreement
by giving the other party one month's prior written notice.

     AEI and Ms. Valerie Hoi-Fah Looi entered into a letter agreement dated
January 1, 1999 with respect to Ms. Looi's redesignation as Senior Vice
President of Corporate Affairs at AEI. Under the letter agreement, Ms. Looi will
receive a basic salary of $13,578 per year subject to review by the Company from
time to time.


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

     The following sets forth the number of shares of the Company's common stock
beneficially owned by (i) each person who, as of March 15, 2000, was known by
the Company to own beneficially more than five percent (5%) of its common stock;
(ii) each of the Directors and Executive Officers of the Company and (iii) the
Directors and Executive Officers of the Company as a group. As of March 15,
2000, there were 97,290,999 common shares issued and outstanding.

<TABLE>
<CAPTION>
NAME AND ADDRESS             NUMBER OF SHARES OF        PERCENT OF
OF BENEFICIAL OWNER(1)       BENEFICIAL OWNER (2)       CLASS
-------------------------------------------------------------------------------
<S>                          <C>                      <C>
Patrick Soon-Hock Lim        50,445,000 (3)             51.84

Wan Abdul Razak bin Muda     300,000 (4)                *

Valerie Hoi-Fah Looi         4,700,000                  4.83


Wan Malek Ibrahim (5)        4,200,000 (6)              4.32

Charles W. Pollard           0                          *

Paddy Bowie                  0                          *
                             ------------               ------
All Officers and Directors as
a Group (6 persons)          59,645,000                 61.31
                             ============               ======
</TABLE>
-----------------
*    Less than 1%.


(1)  The address for each beneficial owner is c/o Kalan Gold Corporation, 60A
     Jalan 19/3, 46300 Petaling Jaya, Selangor, Malaysia.

<PAGE>

(2)  The inclusion herein of any shares of common stock as beneficially owned
     does not constitute an admission of beneficial ownership of those shares.
     Unless otherwise indicated, each person listed above has sole investment
     and voting power with respect to the shares listed.

(3)  Includes (a) 8,000,000 shares directly owned by Mr. Lim's wife, (b)
     8,000,000 shares directly owned by Mr. Lim's son and (c) 25,245,000 shares
     owned by LSH Asset Holdings Sdn Bhd, a corporation controlled by Mr. Lim
     and his wife.

(4)  Of such shares (i) 60,000 are beneficially owned by Mr. Muda's spouse and
     (ii) 60,000 are held by each of Mr. Muda's three daughters.

(5)  Mr. Ibrahim is the Executive Chairman and a Director of PTSB.

(6)  Includes 1,250,000 shares owned by Mr. Ibrahim's spouse.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     The Company has significant related party transactions with the following
entities:

LSH ASSET HOLDINGS SDN BHD ("LSH")

     LSH is a company wholly owned by the Company's Chief Executive Officer and
President and Director, Mr. Patrick Lim and Mr. Lim's wife. During the year
ended December 31, 1999, LSH billed the Company $70,000 for management fees.
During the year ended December 31, 1998, the Company purchased tangible fixed
assets, including computer, studio and communications equipment valued at
$254,342 from LSH. In addition, the cost of goods sold for 1998 included
communications equipment purchased from LSH valued at $1,002,963. LSH also made
short term advances to the Company from time to time for working capital
purposes. As at December 31, 1999, the amount owing to LSH was $311,428 and at
December 31, 1998, the amount owing to LSH was $212,142. This amount is
unsecured, bears no interest and has no fixed terms of repayment and is recorded
in the financial statements as "due to a company in which a director has
financial interest".

VISIONEWS ASIA SDN BHD (VASB)

     During the year ended December 31, 1999, the Company billed VASB total fees
of $238,796 for production of multimedia programs. The amount due from VASB,
included under Accounts Receivable as at December 31, 1999, was $86,848. The
Company also purchased communications equipment valued at $1,226,961 from VASB
in 1999. For the year ended December 31, 1998, the Company sold
telecommunications equipment to VASB for a total value of $1,012,927 and the
amount outstanding as at December 31, 1998 included under Accounts Receivable
was valued at $1,046,944. The terms of repayment for the amount due from VASB is
similar to terms accorded to the Company's other existing customers. Mr. Patrick
Lim is a director of VASB and owns a 40% equity interest in VASB. Mr. Mustaffa
Yacob, who is a director of PTSB, is also a director of VASB and owns a 20%
equity interest in VASB. VASB has given a written undertaking to the Company to
settle progressively all amounts due to the Company as at December 31, 1999 by
August 2000. All transactions between the Company and VASB were in Ringgit
Malaysia, the local currency of Malaysia.

<PAGE>

SYNERVEST SDN BHD (SSB)

     During the year ended December 31, 1999, the Company billed SSB for project
consulting fees totaling $197,897 for design and development work on multimedia
website and Internet Protocol based Extranet. The amount outstanding included in
Accounts Receivable as at December 31, 1999 was $92,105. The terms of repayment
for the amount due from SSB are similar to terms accorded to the Company's other
existing customers. The Company also acquired a patent for digital image display
technology from SSB in 1999, for an aggregate purchase price of $448,567 as
consideration for settlement of an amount owing by SSB. The Company is in
advanced negotiations with a third party to acquire this patent from the
Company. Mustaffa Yacob is a director of SSB and holds a 60% equity interest in
SSB.

As at December 31, 1999, an overdue amount of $1,391,007 from SSB was included
in Other Accounts Receivable and as at December 31, 1998, an overdue amount of
$1,720,665 from SSB was included in Other Accounts Receivable. This amount
primarily arose in the year ended December 31, 1998 when the Company sold to SSB
tangible and intangible assets used in the operations of a subsidiary, that has
since been disposed. These assets, comprising analog video hardware and
peripherals and a patent for image display, were sold to SSB for a total sum of
$1,661,175.

     SSB has given a written undertaking to the Company to settle progressively
all amounts due to the Company as at December 31, 1999 by August 2000. All
transactions between the Company and Synervest were in Ringgit Malaysia, the
local currency of Malaysia.

KHIDMAT MAKMUR SDN BHD (KMSB)

     Mustaffa Yacob is a director of KMSB and holds a 30% equity interest in
KMSB. During the year ended December 31, 1999, the Company billed KMSB for
project consulting fees totaling $456,601 for design and development work on
multimedia website. The amount outstanding included in Accounts Receivable as at
December 31, 1999 was $455,382. The terms of repayment for the amount due from
KMSB are similar to terms accorded to the Company's other existing customers.
KMSB has given written undertaking to the Company to settle progressively all
amounts due to the Company as at December 31, 1999 by August 2000. All
transactions between the Company and KMSB were in Ringgit Malaysia, the local
currency of Malaysia.

MY ARCHITECT (MYA) AND MY DRAUGHTING SERVICES (MDS)

     Mustaffa Yacob is the principal partner of MYA and MDS. During the year
ended December 31, 1999, the Company billed MYA $290,368 (and MDS $154,742 for
design and development work on multimedia website. The Company also sold to MYA
a video communications system valued at $130,610 in 1999 The amount outstanding
included in Accounts Receivable as at December 31, 1999 was $419,855 for MYA and
$154,329 for MDS. The terms of repayment for the amount due from MYA and MDS are
similar to terms accorded to the Company's other existing customers. Both firms
have given written undertakings to the Company to settle progressively all
amounts due to the Company as at December 31, 1999 by August 2000. All
transactions between the Company and both firms were in Ringgit Malaysia, the
local currency of Malaysia.

PATRICK LIM

     As of December 31, 1999 and December 31, 1998, the Company owed the
President and Chief Executive Officer of the Company, Mr. Patrick Lim, $551,695
and $563,432, respectively, for short-term cash advances made to the subsidiary
of the Company for working capital purposes from time to time. The amount owing
to Mr. Lim is unsecured, bears no interest and has no fixed terms of repayment
and is recorded in the financial statements as "due to a director".

<PAGE>

OROVI CORPORATION

     Orovi Corporation, a private company controlled by Sanford Altberger, the
former President and a Director of the Company, advanced loans to the Company
from time to time for operational purposes. As of January 1, 1998, the Company
owed Orovi Corporation $84,926. An additional $41,300 was advanced through
December 31, 1998. The balance owed, plus accrued interest, was satisfied by the
Company issuing 465,000 shares of its common stock as payment of the debt in
1998.

     The Company entered into a verbal agreement effective September 1, 1997 to
rent office space from Orovi Corporation, effective September 1, 1997. The
agreement required monthly rental payments of $1,000 per month. This agreement
was terminated on June 30, 1999.

ITEM 13.  EXHIBITS, LIST AND REPORTS ON FORM 8-K.

(a)   Exhibits.

       3.1  Articles of Incorporation (Incorporated by reference to Exhibit 3A
            to the Company's Form 10-SB filed with the SEC on March 6, 1995.)

       3.2  Articles of Amendment (Incorporated by reference to Exhibit 3B to
            the Company's Form 10-SB filed with the SEC on March 6, 1995.)

       3.3  Bylaws (Incorporated by reference to Exhibit 3C to the Company's
            Form 10-SB filed with the SEC on March 6, 1995.)

       3.4  Articles Of Amendment to change name from Knight Natural Gas to
            Kalan Gold Corporation.

      10.1  Amended Settlement Memorandum, dated December 14, 1999, as confirmed
            by Judge Jim R. Carrigan of the Judicial Arbiter Group in Denver.

      10.2  Agreement and Plan of Reorganization, dated April 20, 1999, between
            Kalan Gold Corporation and Animated Electronic Industries Sdn. Bhd.
            (Incorporated by reference to Exhibit 2.1 to the Company's Current
            Report on Form 8-K/A dated April 20, 1999, as filed with the SEC on
            July 2, 1999.)

      10.3  Employment  Letter  Agreement,  dated January 1, 1999,  between
            Valerie Looi and Animated Electronic Industries Sdn. Bhd.

      10.4  Employment Letter Agreement, dated December 8, 1999, between Leong
            Chee Hong and Animated Electronic Industries Sdn. Bhd.

      21.1  List of Subsidiaries

      27.1  Financial Data Schedule

      99.1  Letter from Arthur Andersen & Co. dated April 14, 2000

(b)  Reports on Form 8-K.

     None.

<PAGE>

                                   SIGNATURES

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


                              Kalan Gold Corporation

Dated: April 13, 2000     By:   /s/ Patrick Soon-Hock Lim
                              ----------------------------
                                    Patrick Soon-Hock Lim
                                    President and Chief Executive Officer

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the Company
and in the capacities and on the dates indicated.

<TABLE>
<CAPTION>
              SIGNATURE                      TITLE                              DATE
------------------------------------- ----------------------------------------  -----------------
<S>                                   <C>                                       <C>
   /s/ Patrick Soon-Hock Lim          President, Chief Executive                April 13, 2000
------------------------------------- Officer and Director
                                      (Principal Executive Officer)

   /s/ Chee Hong Leong                Acting Chief Financial Officer            April 13, 2000
------------------------------------- (Principal Financial Officer and
                                      Principal Accounting Officer)

   /s/Wan Abdul Razak bin Muda        Chairman and Director                     April 13, 2000
-------------------------------------

   /s/ Looi Hoi Fah                   Director                                  April 13, 2000
-------------------------------------

   /s/  Paddy Bowie                   Director                                  April 13, 2000
-------------------------------------

   /s/Charles W. Pollard              Director                                  April 14, 2000
-------------------------------------
</TABLE>

<PAGE>

                                   KALAN GOLD CORPORATION

                          INDEX TO UNAUDITED FINANCIAL STATEMENTS.

<TABLE>
<S>                                                                             <C>
Consolidated Balance Sheets as of December 31, 1999 and 1998 ................... F3
Consolidated Statements of Operations, Years Ended December 31, 1999
and 1998........................................................................ F4
Consolidated Statements of Cash Flow, Years Ended December 31, 1999
and 1998 ....................................................................... F5
Consolidated Statements of Changes in Shareholders' Equity ..................... F7
Notes to Consolidated Financial Statements ..................................... F8
</TABLE>

















                                      F1
<PAGE>

     THE FOLLOWING FINANCIAL STATEMENTS OF THE COMPANY ARE UNAUDITED.

     THE COMPANY'S AUDITORS HAVE ADVISED THE COMPANY THAT THEY ARE UNABLE TO
COMPLETE THEIR REVIEW OF THE COMPANY'S FINANCIAL STATEMENTS FOR THE YEAR ENDED
DECEMBER 31, 1999 BY THE PRESCRIBED FILING DATE. IN RELIANCE UPON RULE 12b-21 OF
THE SECURITIES EXCHANGE ACT OF 1934 (WHICH PROVIDES THAT IF ANY REQUIRED
INFORMATION IS UNKNOWN AND NOT REASONABLY AVAILABLE TO THE REGISTRANT EITHER
BECAUSE THE OBTAINING THEREOF WOULD INVOLVE UNREASONABLE EFFORT OR EXPENSE, OR
BECAUSE IT RESTS PECULIARLY WITHIN KNOWLEDGE OF ANOTHER PERSON NOT AFFILIATED
WITH THE REGISTRANT, THE INFORMATION MAY BE OMITTED, SUBJECT TO THE CONDITIONS
SET FORTH THEREIN), THE COMPANY HAS OMITTED THE REQUIRED AUDITED FINANCIAL
STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 1999 AND IS INSTEAD INCLUDING
UNAUDITED FINANCIAL STATEMENTS FOR SUCH PERIOD. THERE CAN BE NO ASSURANCE THAT
THE AUDITED FINANCIAL STATEMENTS WILL NOT DIFFER MATERIALLY FROM THE UNAUDITED
FINANCIAL STATEMENTS INCLUDED IN THIS REPORT. THE COMPANY UNDERTAKES TO AMEND
THIS REPORT AS PROMPTLY AS POSSIBLE TO FILE THE AUDITED FINANCIAL STATEMENTS FOR
THE YEAR ENDED DECEMBER 31, 1999 UPON COMPLETION OF THE AUDITORS' REVIEW OF SUCH
FINANCIAL STATEMENTS AND HAVING RECEIVED A SIGNED REPORT WITH RESPECT THERETO.



















                                       F2



<PAGE>

                             KALAN GOLD CORPORATION

                           CONSOLIDATED BALANCE SHEETS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                 December 31,    December 31,
                                                                                     1999            1998
                                                                                 ------------    ------------
<S>                                                                             <C>              <C>
CURRENT ASSETS                                                                     $                $
        Cash and cash equivalents                                                      3,959             826
        Accounts receivable                                                        1,565,625       1,047,076
        Others accounts receivable                                                 1,785,239       2,126,942
        Inventories                                                                    6,786           6,786
        Patent                                                                       448,567               -
                                                                                 -----------      ----------
              Total current assets                                                 3,810,176       3,181,630

TANGIBLE FIXED ASSETS
        Net book value                                                             1,683,926         638,732

GOODWILL ON CONSOLIDATION                                                            604,101         570,685
                                                                                 -----------      ----------
              Total Assets                                                         6,098,203       4,391,047
                                                                                 ===========      ==========
                  LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES
        Others accounts payable & accrued liabilities                                400,251         123,878
        Amount due to a company in which a director has financial                    311,428         212,142
        interest
        Amount due to a director                                                     551,695         563,432
        Obligation under capital leases                                               52,398          18,093
                                                                                 -----------      ----------
              Total current liabilities                                            1,315,772         917,545
                                                                                 -----------      ----------
LONG TERM LIABILITIES
        Obligation under capital leases                                              152,473         125,114
        Deferred tax                                                                  28,421               -
                                                                                 -----------      ----------
              Total long term liabilities                                            180,894         125,114
                                                                                 -----------      ----------

MINORITY INTERESTS                                                                   423,234         229,569

SHAREHOLDERS' EQUITY (Note E)
        Preferred stock, $0.10 par value, 1,000,000 shares authorized,                     -               -
              -0- shares issued and outstanding
        Common stock, $.00001 par value, 100,000,000 shares
              Authorized,  94,990,999 shares issued and outstanding                      950             950
        Additional paid-in capital                                                 2,711,059       2,711,059
        Unearned compensation                                                              -        (48,000)
        Retained deficit                                                           1,394,806         371,386
        Foreign currency translation reserve                                          71,488          83,424
                                                                                 -----------      ----------
              Total shareholders' equity                                           4,178,303       3,118,819
                                                                                 ===========      ==========
              Total liabilities and shareholders' equity                           6,098,203       4,391,047
                                                                                 ===========      ==========
</TABLE>

                                       F3


<PAGE>

                             KALAN GOLD CORPORATION

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                           For The Year Ended
                                                                              December 31
                                                                      ----------------------------
                                                                          1999            1998
                                                                      -----------     ------------
<S>                                                                   <C>             <C>
                                                                        $                $
REVENUES
        Sales of communication equipment                                   27,706       1,189,025
        Consultancy and production fees receivable                      1,755,043           3,386
                                                                      -----------     -----------
                                                                        1,782,749       1,192,411
                                                                      -----------     -----------
        Less: Cost of Sales
        Cost of goods sold                                               (14,512)     (1,057,865)
                                                                      -----------     -----------
                                                                         (14,512)     (1,057,865)
                                                                      -----------     -----------
Gross Profit                                                            1,768,237         134,546
Less: Operating expenses
        Sales and marketing                                                16,985          10,607
        Depreciation and amortization                                     221,449         146,627
        Unearned compensation written off                                  48,000               -
        General operation and administration                              436,202         243,655
        Interest                                                           63,125          26,971
                                                                      -----------     -----------
              Total operating expenses                                    785,761         427,860
                                                                      -----------     -----------
Operating Profit/(Loss)                                                   982,476       (293,314)
Add: Other income
        Gain on disposal of tangible assets                                99,680         830,769
        Gain on disposal of intangible assets                                   -         416,411
        Other income                                                       57,040          34,608
                                                                      -----------     -----------
Income from continuing operations before taxation                       1,139,196         988,474
Taxation                                                                 (28,497)               -
                                                                      -----------     -----------
Income from continuing operations                                       1,110,699         988,474

Less: Losses from operations of
              disposed subsidiary companies                                     -       (387,640)
        Loss on disposal of subsidiary companies                                -       (514,827)
                                                                      -----------     -----------
Net income for the year                                                 1,110,699          86,007
Minority interests                                                       (87,279)         (9,602)
                                                                      -----------     -----------
Net income applicable to common shareholders                            1,023,420          76,405
                                                                      ===========     ===========
Number of common shares outstanding                                    94,990,999      94,990,999
Basic earnings per share                                                     0.01            0.00
</TABLE>

                                       F4

<PAGE>

                             KALAN GOLD CORPORATION
                      CONSOLIDATED STATEMENTS OF CASH FLOW
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                            For The Years Ended
                                                                                December 31
                                                                        -----------------------------
                                                                            1999           1998
                                                                        -----------------------------
<S>                                                                     <C>             <C>
                                                                              $             $
  CASH FLOWS FROM OPERATING ACTIVITIES
         Net income                                                         1,139,196       988,474
         Adjustments to reconcile net earnings to net cash used
                 In operating activities:
         Goodwill amortization                                                 72,894        42,388
         Depreciation                                                         148,555       104,239
         Stock issued for other than cash                                           -        58,239
         Gain on agreement termination                                              -       (4,517)
         Gain on disposal of fixed assets                                    (99,680)     (830,134)
         Gain on disposal of investments                                            -       (3,066)
         Gain on disposal of patent                                                 -     (416,411)
         Loss from operations of disposed subsidiary companies                      -     (387,640)
         Loss on disposal of subsidiary companies                                   -     (514,827)
         Minority shares of retained profits                                        -       411,051
         Writing off of unearned compensation                                  48,000             -
         Translation difference                                              (11,936)             -
         Changes in assets and liabilities:
         Increase in receivables                                            (176,846)   (2,918,693)
         Increase/(decrease) in payables                                      363,922     (781,901)
         Decrease in inventories                                                    -        27,364
                                                                        -------------  ------------
                 Net Cash provided by/(used in) operating activities        1,484,105   (4,225,434)
                                                                        -------------  ------------

  CASH FLOWS FROM INVESTING ACTIVITIES
         Proceeds from disposal of fixed assets                               132,892     1,377,992
         Purchase of fixed assets                                         (1,226,961)     (307,506)
         Proceeds from disposal of investments in subsidiaries                      -       528,764
         Purchase of investment                                                     -     (232,986)
         Proceeds from disposal of investments                                      -       236,052
         Purchase of patent                                                 (448,567)       (5,109)
         Proceeds from disposal of patent                                           -       421,521
                                                                        -------------  ------------
                 Net cash (used in)/provided by investing activities      (1,542,636)     2,018,728
                                                                        -------------  ------------

  CASH FLOWS FROM FINANCING ACTIVITIES
         Proceeds from issue of shares of common stock                              -     2,190,722
         Deferred payment/(payment) of obligation under capital leases         61,664      (29,772)
         Proceeds from exercise of stock options                                    -         4,000
         Proceed from advances from affiliates                                      -        41,300
                                                                        -------------  ------------
                 Net cash provided by financing activities                     61,664     2,206,250
                                                                        -------------  ------------

  NET INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS                        3,133         (456)
  Cash and cash equivalent, beginning of period                                   826         1,282
                                                                        -------------  ------------
  Cash and cash equivalent, end of period                                       3,959           826
                                                                        =============  ============
</TABLE>

                                       F5

<PAGE>

                             KALAN GOLD CORPORATION

                      CONSOLIDATED STATEMENTS OF CASH FLOW
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                              For The Years Ended December 31
                                                           --------------------------------------
                                                                1999                  1998
                                                           -----------------     -----------------
<S>                                                        <C>                   <C>
                                                                  $                    $
  SUPPLEMENTAL CASH FLOW DISCLOSURES
           Cash paid for interest during the period                        0                18,902
                                                                   =========             =========
           Cash paid for income taxes                                      0                     0
                                                                   =========             =========
</TABLE>

NON-CASH INVESTING AND FINANCING ACTIVITIES:

     There were no non-cash investing and financing activities during the year
ended December 31, 1999.

     During the year ended December 31, 1998, the Company issued restricted
common stock in consideration for forgiveness of the following debts:

1. Advances and accrued interest due an affiliate totaling $126,226 and $12,692,
respectively;

2. Accrued rent payable due an affiliate totaling $16,000;

3. Salaries and accrued interest due an officer totaling $29,000 and $547
respectively;

4. Unearned compensation to an officer totaling $48,000;

     Effective December 31, 1998, the Company cancelled options to purchase
350,000 shares of the Company's common stock. As a result, the $129,500 recorded
as outstanding stock options was reclassified as additional paid-in capital.

     During 1998, the Company (under the pre-reverse acquisition management)
terminated its agreement to conduct a reconnaissance for gold in a licensed area
located in the Wassa Amanfi district of Ghana with Esikaman Mining Company
Limited ("Esikaman"). This transaction resulted in the elimination of $42,858
included in property acquisition costs and the related note payable to Esikiman
of $45,647. After the write-off of the remaining discount on the note payable,
the Company recorded a net gain of $4,517.

                                      F6
<PAGE>

                             -KALAN GOLD CORPORATION
           CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

<TABLE>
<CAPTION>

                                 Preferred Stock        Common Stock       Additional
                                -----------------------------------------    Paid-in    Outstanding     Deferred
                                Shares   Par Value    Shares    Par Value    capital      Options     Compensation
                                ------------------------------------------------------------------------------------
<S>                             <C>      <C>        <C>        <C>         <C>        <C>           <C>
      BALANCE, DECEMBER 31,           -          -   7,090,999         71       26,385      129,500               -
      1997
Shares issued upon exercise           -          -     200,000          2        3,998            -               -
  of stock Options
Shares issued to officer to           -          -     465,000          5      154,913            -               -
  repay Advances, accrued
  interest and Accrued rent
Shares issued to officer to           -          -     235,000          2       77,545            -        (48,000)
  repay Accrued salaries,
  accrued interest and
  Deferred compensation
Cancellation of outstanding           -          -           -          -      129,500    (129,500)               -
  stock Options
Adjustment in connection with         -          -  87,000,000        870    2,318,718            -               -
  the issue of shares of
  common stocks for the reverse
  acquisition of Animated
  Electronic Industries Sdn
  Bhd on  April 20, 1999
Differences arising from              -          -           -          -            -            -               -
  translation of financial
  statement of foreign
  subsidiaries
Net income for the year ended         -          -           -          -            -            -               -
  December 31, 1998
                                -------- ---------- ---------- ----------- ------------ --------------- ------------
      BALANCE, DECEMBER 31,
      1998                            -  $       -  94,990,999  $     950  $ 2,711,059  $         -     $  (48,000)

Deferred compensation written         -          -           -          -            -            -          48,000
  off Against income for the year
Differences arising from              -          -           -          -            -            -               -
  translation of financial
  statement of foreign subsidiaries
Net income for the year ended         -          -           -          -            -            -               -
  December 31, 1999
                                -------- ---------- ---------- ----------- ------------ --------------- ------------
      BALANCE, DECEMBER 31,
      1999                            -  $       -  94,990,999 $       950 $  2,711,059 $             - $
                                ======== ========== ========== =========== ============ =============== ============

<CAPTION>
                                                 Retained
                                    Deficit     Profit from   Foreign
                                  Accumulated      merged     Currency
                                    By The       Subsidiary  Translation
                                    Company      Companies     Reserve     Total
                                --------------------------------------------------
<S>                              <C>           <C>           <C>         <C>
      BALANCE, DECEMBER 31,          (269,304)             -          -  (113,348)
      1997
Shares issued upon exercise                  -             -          -      4,000
  of stock Options
Shares issued to officer to                  -             -          -    154,918
  repay Advances, accrued
  interest and Accrued rent
Shares issued to officer to                  -             -          -     29,547
  repay Accrued salaries,
  accrued interest and
  Deferred compensation
Cancellation of outstanding                  -             -          -          -
  stock Options
Adjustment in connection with                -       564,285          -  2,883,873
  the issue of shares of common
  stocks for the reverse
  acquisition of Animated
  Electronic Industries Sdn
  Bhd on  April 20, 1999
Differences arising from                     -             -     83,424     83,424
  translation of financial
  statement of foreign
  subsidiaries
Net income for the year ended        (117,102)       193,507          -     76,405
  December 31, 1998
                                   -------------- ------------ -------- ----------
      BALANCE, DECEMBER 31,
      1998                         $ (386,406)    $  757,792   $ 83,424 $3,118,819

Deferred compensation written                -             -          -     48,000
  off Against income for
  the year
Differences arising from                     -             -   (11,936)   (11,936)
  translation of financial
  statement of foreign
  subsidiaries
Net income for the year ended        (381,756)     1,405,176          -  1,023,420
  December 31, 1999
                                   -------------- ------------ -------- ----------
      BALANCE, DECEMBER 31,
      1999                         $     (768,162)$  2,162,968 $ 71,488 $4,178,303
                                   ============== ============ ======== ==========
</TABLE>


                                           F7
<PAGE>

                             KALAN GOLD CORPORATION

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE A: ORGANIZATION AND BUSINESS

The Company was incorporated under the laws of the State of Colorado on
September 19, 1985. On April 20, 1999, the Company issued 83,320,000 shares of
its common stock in exchange for 100 percent of the outstanding shares of common
stock of Animated Electronic Industries SDN. BHD. ("AEI"), a company
incorporated on October 6, 1988 under the Malaysian Companies Act of 1965. As a
result of this stock acquisition, AEI became a wholly owned subsidiary of the
Company. This acquisition has been treated as a recapitalization of AEI with AEI
as the acquirer (reverse acquisition). In addition, 3,680,000 shares of common
stock were issued to the financial advisor and former legal counsel of the
Company in connection with this reverse acquisition.

AEI has two subsidiary companies, Perwimas Telecommunication Sdn Bhd ("PTSB")
and Vistel (Malaysia) Sdn Bhd ("VMSB"), both of which were incorporated in
Malaysia.

PTSB holds a wireless broadband multimedia network licence granted by the
Ministry of Energy, Communications & Multimedia of Malaysia operating under the
name, VISIONET. PTSB is licensed to provide network facilities and services for
two-way wireless broadband multimedia application which include distance
learning, live news coverage, remote video surveillance, emergency field
services (e.g. telemedicine, etc.), on-site progress monitoring, energy
conservation and building management.

VMSB has been an investment holding company since its inception.

The Company currently provides multimedia content production and the design and
development of websites. The Company hopes to be able to provide other broadband
multimedia communication services that include the operation of a wireless
digital broadband network, VISIONET, and the sale of customer premises
equipment. The Company's core business is the provision of broadband multimedia
communication services that include multimedia content production and the design
and development of websites largely covered by the first sentence of this
paragraph.

NOTE B: SIGNIFICANT ACCOUNTING POLICIES

FINANCIAL STATEMENTS AND PRINCIPLES OF CONSOLIDATION

The pooling of interest method has been adopted as the basis for the preparation
of the consolidated financial statements as only voting common stock was
exchanged for the Reverse Acquisition. Under the pooling of interest method, the
operating statements of the pre-merger entities are combined for the full year
in the year of the combination regardless of the specific date the pooling
occurs. Comparative prior year's financial statements are restated retroactively
to reflect the pooled status.

                                       F8
<PAGE>

The Company's consolidated financial statements for the year ended December 31,
1998 and the year ended December 31,1999 include the accounts of Animated
Electronic Industries Sdn. Bhd. ("AEI") and its Malaysian subsidiary companies,
Vistel (Malaysia) Sdn Bhd, and Perwimas Telecommunications Sdn. Bhd. ("PTSB").
All significant intercompany accounts and transactions have been eliminated in
consolidation.

CASH AND CASH EQUIVALENTS

Cash and cash equivalents consist of cash in hand and federally insured amounts
maintained in a checking account at a bank.

CONCENTRATIONS OF CREDIT RISK

Financial instruments that potentially could subject the Company to
concentrations of credit risk consist largely of trade and other accounts
receivable. This situation arose from the Company adoption of an aggressive
credit policy that provided for extended credit period for its customers. Where
the Company evaluates that the debt has been overdue, the Company will obtain a
letter of undertaking from its debtors as a form of security. As the Company is
in good terms with all of its trade and other debtors, the Company expects to
collect a substantial portion of these amounts by June 30, 2000.

TRANSLATION OF CURRENCIES

The functional currency of the Company's subsidiaries is the local currency. The
financial statements of these subsidiaries are translated to United States
dollars using year-end rates of exchange for assets and liabilities, and average
rates of exchange for the year for revenues, costs, and expenses. Translation
gains/(losses), which are deferred and accumulated, is treated as a component of
shareholders' equity.

The following exchange rates of Ringgit Malaysia (RM) into U.S. Dollars (USD)
were used in preparing the financial statements.

<TABLE>
<S>                     <C>         <C>               <C>
      January 1, 1998   3.8800      January 1, 1999   3.7797
      December 31, 1998 3.7797      December 31, 1999 3.8000
      Average 1998      3.9144      Average           3.7899
</TABLE>

REVENUE RECOGNITION

Revenue represents the net invoiced value of goods sold or fees receivables for
production of multimedia programs and Intranet and management and consulting
services. The Company recognizes revenue from the sales of goods in the period
where significant risks and rewards of ownership has been transferred to its
customers. The Company recognizes revenue from the provision of services when
there is no significant uncertainty regarding the consideration to be received
and in the associated costs to be incurred.

EARNINGS PER COMMON SHARE

Earnings/(loss) per common share are determined in accordance with Statement of
Financial Accounting Standards No. 128, "Earnings Per Share".

                                       F9

<PAGE>

INCOME TAXES

Income taxes are provided for the tax effects of transactions reported in the
financial statements and consist of taxes currently due plus deferred taxes
related primarily to differences between the recorded book basis and tax basis
of assets and liabilities for financial and income tax reporting. The deferred
tax assets and liabilities represent the future tax return consequences of those
differences, which will either be taxable or deductible when the assets and
liabilities are recovered or settled. Deferred taxes are also recognized for
operating losses that are available to offset future taxable income and tax
credits that are available to offset future federal income taxes.

FIXED ASSETS AND DEPRECIATION

Fixed assets are stated at cost less depreciation. Depreciation is calculated on
a straight line method over the expected useful lives of the asset concerned.
The principal annual rates of depreciation are:

<TABLE>
<S>                                                             <C>
      Motor Vehicles, Office Equipment, Furniture & Fittings,     20%
         Computer software
      Tools & Equipment, Video Communication hardware &
         peripherals, Office renovation                           10%
</TABLE>

ASSETS UNDER CAPITAL LEASES

The Company records assets acquired under capital leases as tangible fixed
assets and the corresponding obligation under capital leases as liability. The
initial recording value of a capital lease is the lesser of the fair value of
the leased assets or the present value of the minimum lease payments, excluding
any portion representing executory costs and profit thereon. The asset recorded
under capital leases is depreciated in a manner consistent with the Company's
depreciation policy for other owned assets.

GOODWILL ON CONSOLIDATION AND AMORTIZATION

Goodwill on consolidation arise in the accounts of AEI from the difference
between the fair value and the net tangible assets of its subsidiaries at the
date of acquisition and the purchase price. Goodwill arising on consolidation is
amortized over a period of 15 years.

INVENTORIES

Inventories are stated at the lower of cost and net realisable value. Cost is
determined on a first-in-first-out basis.

ESTIMATES

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.
Actual results could differ from those estimates.

RECLASSIFICATIONS

Certain amounts in the prior year financial statements have been reclassified
for comparative purposes to conform to the presentation in the current year
financial statements.

                                       F10
<PAGE>

NOTE C: RELATED PARTY TRANSACTIONS

The Company has significant related party transactions with the following
entities:

LSH ASSET HOLDINGS SDN BHD ("LSH")

LSH is a company wholly owned by the Company's Chief Executive Officer and
President and Director, Mr. Patrick Lim and Mr Lim's wife. During the year ended
December 31, 1999, LSH billed the Company $70,000 for management fees. During
the year ended December 31, 1998, the Company purchased tangible fixed assets,
including computer, studio and communications equipment valued at $254,342 from
LSH. In addition, the cost of goods sold for 1998 included communications
equipment purchased from LSH valued at $1,002,963. LSH also made short term
advances to the Company from time to time for working capital purposes. As at
December 31, 1999 and as at December 31, 1998, the amount owing to LSH was
$311,428 and $212,142, respectively. This amount is unsecured, bears no interest
and has no fixed terms of repayment and is recorded in the financial statements
as "due to a company in which a director has financial interest".

VISIONEWS ASIA SDN BHD (VASB)

During the year ended December 31, 1999, the Company billed VASB total fees of
$238,796 for production of multimedia programs. The amount due from VASB,
included under Accounts Receivable as at December 31, 1999, was $86,848. The
Company also purchased communications equipment valued at $1,226,961 from VASB
in 1999. For the year ended December 31, 1998, the Company sold
telecommunications equipment to VASB for a total value of $1,012,927 and the
amount outstanding as at December 31, 1998 included under Accounts Receivable
was valued at $1,046,944. The terms of repayment for the amount due from VASB is
similar to terms accorded to the Company's other existing customers. Mr. Patrick
Lim is a director of VASB and owns a 40% equity interest in VASB. Mr. Mustaffa
Yacob, who is a director of PTSB, is also a director of VASB and owns a 20%
equity interest in VASB. VASB has given a written undertaking to the Company to
settle progressively all amounts due to the Company as at December 31, 1999 by
August 2000. All transactions between the Company and VASB were in Ringgit
Malaysia, the local currency of Malaysia.

SYNERVEST SDN BHD (SSB)

During the year ended December 31, 1999, the Company billed SSB for project
consulting fees totaling $197,897 for design and development work on multimedia
website and Internet Protocol based Extranet. The amount outstanding included in
Accounts Receivable as at December 31, 1999 was $92,105. The terms of repayment
for the amount due from SSB are similar to terms accorded to the Company's other
existing customers. The Company also acquired a patent for digital image display
technology from SSB in 1999, for an aggregate purchase price of $448,567 as
consideration for settlement of an amount owing by SSB. The Company is in
advanced negotiations with a third party to acquire this patent from the
Company. Mustaffa Yacob is a director of SSB and holds a 60% equity interest in
SSB.

As at December 31, 1999 and as at December 31, 1998, an overdue amount of
$1,391,007 and $1,720,665, respectively, from SSB was included in Other Accounts
Receivable. This amount primarily arose in the year ended December 31, 1998 when
the Company sold to SSB tangible and intangible assets used in the operations of
a subsidiary, that has since been disposed. These assets, comprising analog
video hardware and peripherals and a patent for image display, were sold to SSB
for a total sum of $1,661,175.

SSB has given a written undertaking to the Company to settle progressively all
amounts due to the Company as at December 31, 1999 by August 2000. All
transactions between the Company and Synervest were in Ringgit Malaysia, the
local currency of Malaysia.

                                       F11

<PAGE>

KHIDMAT MAKMUR SDN BHD (KMSB)

Mustaffa Yacob is a director of KMSB and holds a 30% equity interest in KMSB.
During the year ended December 31, 1999, the Company billed KMSB for project
consulting fees totaling $456,601 for design and development work on multimedia
website. The amount outstanding included in Accounts Receivable as at December
31, 1999 was $455,382. The terms of repayment for the amount due from KMSB are
similar to terms accorded to the Company's other existing customers. KMSB has
given written undertaking to the Company to settle progressively all amounts due
to the Company as at December 31, 1999 by August 2000. All transactions between
the Company and KMSB were in Ringgit Malaysia, the local currency of Malaysia.

MY ARCHITECT (MYA) AND MY DRAUGHTING SERVICES (MDS)

Mustaffa Yacob is the principal partner of MYA and MDS. During the year ended
December 31, 1999, the Company billed MYA $290,368 (1998: Nil) and MDS $154,742
for design and development work on multimedia website. The Company also sold to
MYA a video communications system valued at $130,610 in 1999 The amount
outstanding included in Accounts Receivable as at December 31, 1999 was $419,855
for MYA and $154,329 for MDS. The terms of repayment for the amount due from MYA
and MDS are similar to terms accorded to the Company's other existing customers.
Both firms have given written undertakings to the Company to settle
progressively all amounts due to the Company as at December 31, 1999 by August
2000. All transactions between the Company and both firms were in Ringgit
Malaysia, the local currency of Malaysia.

PATRICK LIM

As of December 31, 1999, the Company owed the President and Chief Executive
Officer of the Company, Mr. Patrick Lim, $551,695 and as of December 31, 1998,
the Company owed Mr. Lim $563,432, in each case for short-term cash advances
made to the subsidiary of the Company for working capital purposes from time to
time. The amount owing to Mr. Lim is unsecured, bears no interest and has no
fixed terms of repayment and is recorded in the financial statements as "due to
a director".

OROVI CORPORATION

Orovi Corporation, a private company controlled by Sanford Altberger, the former
President and a Director of the Company, advanced loans to the Company from time
to time for operational purposes. As of January 1, 1998, the Company owed Orovi
Corporation $84,926. An additional $41,300 was advanced through December 31,
1998. The balance owed, plus accrued interest, was satisfied by the Company
issuing 465,000 shares of its common stock as payment of the debt in 1998.

The Company entered into a verbal agreement effective September 1, 1997 to rent
office space from Orovi Corporation, effective September 1, 1997. The agreement
required monthly rental payments of $1,000 per month. This agreement was
terminated on June 30, 1999.

                                       F12
<PAGE>

NOTE D: PATENT

As of December 31, 1999, the Company's Current Assets included a patent for
digital image display technology acquired from SSB as disclosed under Note C:
Related Party Transactions. The Company is in advanced negotiations with a third
party to acquire this patent from the Company. The Company hopes to conclude
this disposal by June 30, 2000. Therefore, the Company had not amortized the
cost of the patent in the financial statements for the year ended December 31,
1999 as required by APB-17. Had the Company adopted APB-17, the patent would
have been amortized over a period of 18 years resulting in an additional
amortization charges of $24,920 in the Company's Statements of Operation for the
year ended December 31, 1999. The Company believes that this amount was not
significant to the results for the year ended December 31, 1999.

NOTE E: FIXED ASSETS

<TABLE>
<CAPTION>
     Fixed assets consisted of :                December     December
                                                31, 1999     31, 1998
                                              --------------------------
<S>                                              <C>            <C>
                                                   $            $
     Motor Vehicle                                       -            -
     Office equipment                               72,095       72,095
     Furniture and fittings                         23,235       28,144
     Tools and equipment                           152,997      153,534
     Video Communication hardware and
     peripherals                                 1,777,128      617,592
     Computer software                             138,048      138,048
     Office renovation                              11,010       11,010
                                                ----------   ----------
                                                 2,174,513    1,020,423
     Less: Accumulated depreciation               (490,587)    (381,691)
                                                ----------   ----------
                                                 1,683,926      638,732
                                                ==========   ==========
</TABLE>

Depreciation for the years ended December 31, 1999 and 1998 amounted to $148,555
and $104,239 respectively.

NOTE F: CAPITAL LEASE OBLIGATIONS

Telecommunications and other assets are leased from various equipment lease
financing facilities. Such leases have been accounted for as capital leases.

Future minimum lease payments on these capital leases are as follows:

                                       F13
<PAGE>

<TABLE>
<CAPTION>
     Year Ending December 31                     December     December
                                                 31, 1999     31, 1998
                                                ----------   ----------
<S>                                           <C>            <C>
                                                   $            $
                                              --------------------------
     2000                                           75,022       18,093
     2001                                           36,284       36,479
     2002                                           36,284       36,479
     2003                                           36,284       36,479
     2004                                           36,284       36,479
     2005 onwards                                   69,517      124,755
                                              ------------------------------
     Total payments                                289,675      288,764
                                                ----------   ----------
     Less: Amount representing interest            (84,804)    (145,557)
                                                ----------   ----------
     Present value of minimum lease payments       204,871      143,207
                                                ==========   ==========
</TABLE>

The carrying value of assets under capital leases was $173,462 and $205,535 at
December 31, 1999 and 1998 respectively, and is included in property and
equipment. Amortization of these assets is included in depreciation expense.

NOTE G: SHAREHOLDERS' EQUITY

PREFERRED STOCK

The Company is authorized to issue one million shares of preferred stock, par
value $.10 per share, which may be issued in series with such designations,
preferences, stated values, rights, qualifications or limitations as determined
by the Board of Directors.

NOTE H:  STOCK OPTIONS

A summary of the status of the Company's stock option awards as of December 31,
1998, and the changes during the period ended December 31, 1998 and 1997 is
presented below:

<TABLE>
<CAPTION>
      FIXED OPTIONS                             NUMBER
      -------------                             ------
<S>                                        <C>
      Outstanding at January 1, 1997            312,500
      Granted                                   350,000
      Exercised                                 (37,500)
      Cancelled                                   -
                                               --------
      Outstanding at December 31, 1997          625,000
                                               ========
      Granted                                     -
      Exercised                                (200,000)
      Cancelled                                (350,000)
                                               --------
      Outstanding at December 31, 1998           75,000
                                               ========
</TABLE>

     The Company (under the pre-reverse acquisition management) had granted a
stock option to Mr. Raisch, the former Secretary, Treasurer and a Director of
the Company, for 75,000 common shares at $.02 per share until November 14, 2001.
By letter dated April 10, 2000, counsel for Mr. Raisch advised the Company that
Mr. Raisch has agreed to cancel such option in return for an amount of $1,500,
representing the exercise price previously paid for such option.

                                       F14


<PAGE>

NOTE I: INCOME TAXES

     As required by SFAS No. 109, the Company is required to provide for
deferred tax assets or liabilities arising due to temporary differences between
the book and tax basis of assets and liabilities existing for the year ended
December 31, 1999 amounting to $28,421 and for the year ended December 31, 1998
amounting to zero.

     For fiscal year 1999, the entire income of the Company was derived from its
operations in Malaysia. No tax provision has been made as 1999 was legislated to
be a tax-free year for Malaysian corporations by the Malaysian Government.

     For 1998, the Company was not liable for any income tax as it posted an
operating loss of $289,136.

NOTE J: FOREIGN CURRENCY TRANSLATION RESERVE

     Foreign currency translation reserve arises from translating the foreign
subsidiaries in Malaysia at different rates from the start of the year with the
year end. The rates used to calculate this reserve is disclosed in the Note of
Accounting Policies. The calculation of this reserve is incorporated as part of
the Consolidated Changes in Shareholders' Equity, $71,488, and $83,424 for 1999
and 1998, respectively.

NOTE K: SUBSEQUENT EVENT

Mr. Charles W. Pollard and Mrs. Paddy Bowie joined the Board Of Directors on
February 7 and February 24, 2000, respectively.

On February 24, 2000, the Company issued an aggregate of 2,300,000 shares of
restricted common stock to Mr. Wan Malek Ibrahim in a private placement for cash
consideration of $1,150,000 at 50 cents per share. Proceeds from this private
placement were used to repay advances made to the Company by Mr. Patrick Lim and
LSH Asset Holdings Sdn Bhd.

On March 15, 2000, AEI and Merais Sdn Bhd (a Malaysian corporation) entered into
a Tenancy Agreement to lease office and roof space at Menara Merais, Petaling
Jaya at a monthly rental fee of $1,600.

NOTE L: COMMITMENTS AND CONTINGENCIES

The Company expects to incur capital expenditures ranging from $10.0 million to
$15.0 million during 2000 in connection with the official launch and build-out
of VISIONET. As of the date of this Report, capital expenditures have been
planned, but no funds have been committed. The Company is not aware of any
contingent liability that may have a material impact on the financial statements
for the year ended December 31, 1999.


                                       F15
<PAGE>

NOTE M: PENDING LITIGATION

     Following the Reverse Acquisition, certain disputes arose between the
Company and Sanford Altberger, Michael Raisch and David Wagner, the Company's
former President, Treasurer and legal counsel, respectively, each of whom either
directly and/or indirectly beneficially owns common stock of the Company. Those
disputes involved, among other things, the issuance of 1,840,000 shares of the
Company's common stock to an entity controlled by Mr. Wagner (the "Disputed
Shares") at the time of the Reverse Acquisition, bills for pre-acquisition legal
services, recovery of the Company's historical corporate records, and various
claims of alleged misrepresentations in connection with the Reverse Acquisition.
On December 14, 1999, these parties conducted a voluntary mediation and agreed
to settle all of their disputes arising out of the Reverse Acquisition. In
mid-January, however, Messrs. Altberger and Raisch repudiated the settlement and
Mr. Wagner refused to close the settlement transactions. On January 24, 2000,
the Company filed an action against these parties in the Arapahoe County,
Colorado, District Court.

     On March 3, 2000, the Company filed a motion to voluntarily dismiss,
without prejudice, all of its claims against Messrs. Altberger and Raisch, which
motion the court granted on March 7, 2000.

     On March 16, 2000, the defendants David J. Wagner, David J. Wagner &
Associates, P.C., David Wagner & Associates Defined Benefits Plan, Marion
Limited Liability Company and Veronica Brownell (the "Wagner defendants") filed
two counterclaims against the Company. The first counterclaim seeks
approximately $193,000 in attorneys' fees that David J. Wagner & Associates,
P.C. alleges the Company owes for legal services the major portion of which were
rendered prior to the Reverse Acquisition, and the second counterclaim seeks a
declaration removing a stop transfer order the Company issued to its stock
transfer agent with respect to shares of common stock held in the names of the
Wagner defendants. The Company responded to the counterclaims on April 10, 2000
asking the court to dismiss them because they were all settled under the
settlement memorandum and are therefore invalid as a matter of Colorado law.

     In addition, on January 21, 2000, the Arapahoe County District Court issued
an order to show cause directing the Wagner defendants to appear and show cause
why the court should not direct them to return to the Company the Company's
corporate records and the Disputed Shares. The hearing with respect to such
order to show cause commenced on March 17, 2000 and has been continued to April
24, 2000.

     The Company intends to prosecute the case vigorously and believes it has
meritorious claims and defenses. The Company has set aside US$150,000 as a
contingency for its liability to the Wagner Defendants. The Company can give no
assurances concerning the outcome of the dispute, but believes that the outcome
of this litigation will not have a material adverse effect on the Company's
business and results of operations.

                                       F16
<PAGE>

NOTE N: RESTATEMENT OF RETAINED EARNINGS FOR THE YEAR ENDED DECEMBER 31 1998.

For the year ended December 31 1998, the consolidated financial statements for
AEI, which was prepared under Malaysian generally accepted accounting
principles, reflected a deferred gain of $4,605,219 (RM: 17,406,348). This
deferred gain arose from the disposal of 10% of the Company's investment in PTSB
to a third party. The Company rescinded this disposal in December 1999 due to
failure of the third party to fulfill its obligations. Therefore, the gain on
disposal was reversed and the retained earnings restated in the year ended
December 31, 1999.

The Company has prepared the consolidated financial statements on the basis that
there was no disposal and, as a result, there was no deferred gain in the
results of operations for the year ended December 31, 1998.

<TABLE>
<CAPTION>
                                                          RM                $
<S>                                                 <C>              <C>
Profit, after minority interest following             18,163,810       14,640,255
Malaysian GAAP
Deferral gains on disposal of a subsidiary company   (17,406,348)      (4,605,219)
                                                    ============     ============
                                                         757,462           35,036
                                                    ============     ============
</TABLE>







                                       F17