UNITED STATES
                       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 YEAR ENDED MARCH 31, 2005

                         Commission File Number 0-11882


                             B2DIGITAL, INCORPORATED
                 (Name of Small Business Issuer in its Charter)


                                    DELAWARE
                 (State or Other Jurisdiction of Incorporation)


                                   84-0916299
                      (I.R.S. Employer Identification No.)


          9171 Wilshire Blvd., Suite B, Beverly Hills, California 90210
                    (Address of principal Executive Offices)


               ISSUER'S TELEPHONE NUMBER ISSUER'S FACSIMILE NUMBER
                     Tel (310) 281-2571 Fax (310) 281-0042


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


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

                          COMMON STOCK- $.001 PAR VALUE
                                (Title of Class)

Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act of 1934 during the past 12 months (or for such
shorter periods that the issuer was required to file such reports), and (2) had
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 Issuer's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any amendment to
this Form 10-KSB. |_|

The issuer's revenues for the year ended March 31, 2005 were $683,746.

As of July 8, 2005, there were 403,870,939 shares of Common Stock issued and
outstanding.


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<PAGE>

The aggregate market value of the Issuer's common stock held by non-affiliates
was $1,488,367 based on the closing price of the Issuer's common stock on July
8, 2005 of $.004.

Transitional Small Business Disclosure Format (Check one): Yes |_| No |X|


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<PAGE>

                                 B2DIGITAL, INC.
                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
PART  I                                                                           PAGE NO.

<S>                                                                                 <C>
ITEM  1     DESCRIPTION OF BUSINESS                                                  4
ITEM  2     DESCRIPTION OF PROPERTY                                                 14
ITEM  3     LEGAL PROCEEDINGS                                                       14
ITEM  4     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                     15

PART  II
ITEM  5     MARKET FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND
             SMALL BUSINESS ISSUER PURCHASES OF EQUITY SECURITIES                   15
ITEM  6     MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION               18
ITEM  7     FINANCIAL STATEMENTS                                                    26
ITEM  8     CHANGES IN DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
             FINANCIAL  DISCLOSURE                                                  38
ITEM 8A     CONTROLS AND PROCEDURES                                                 38
ITEM 8B     OTHER INFORMATION                                                       38

PART  III
ITEM  9     DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT                      38
ITEM  10    EXECUTIVE COMPENSATION
ITEM  11    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
             AND RELATED STOCKHOLDER MATTERS                                        41
ITEM  12    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
ITEM  13    EXHIBITS                                                                43
ITEM  14    PRINCIPAL ACCOUNTANT FEES AND SERVICES                                  44
</TABLE>


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                                     PART I

ITEM  I.  BUSINESS

OVERVIEW

The "Company" or "B2Digital", is a provider of in-room, on-demand video
entertainment and satellite services to the domestic lodging industry. B2Digital
has a base of approximately 8,000 installed rooms, which consist of contract
rights of Hotel Movie Networks with Pay Per View and Cable/Satellite access, and
associated Hardware and Peripherals. The purchase of Hotel Movie Network,
enabled B2Digital to provide in-room video entertainment and information
services on several platforms. The Video On Call system allows hotel guests to
select, at any time, movies through the television set in their hotel rooms. The
PPV S-8 system is a reliable basic Pay Per View system that allows the Company
to enter the Mid to Small hospitality market on a cost effective basis.

In addition to movies, B2Digital's platforms provide for in-room viewing of
select cable channels (such as HBO, Starz Encore, ESPN, CNN and the Disney
Channel) and other interactive and information services, which include the
capability for high-speed Internet access. B2Digital primarily provides its
services under long-term contracts to hotel chains, hotel management companies,
and individually owned and franchised hotel properties. B2Digital offers
services predominantly in the smaller franchise hotel categories serving
business travelers and other unaffiliated hotels.

All of the installed rooms of Hotel Movie Network are located in the United
States and its territories.

The Company launched new product in June 2004 which enables B2Digital to supply
Point-to-Point Wireless Local Loop internet connectivity in each contracted
hotel room through the B2 Wireless Access Point (B2WAP) which connects to the
in-room B2digitaltv.com for laptop users and the B2 Digital TV set top box and
handheld remote control for in-room television. These products allow us to
market a large variety of in-room digital services, which include making airline
reservations, ordering pizza, event ticketing, and transportation services,
along with delivery of Hollywood movies, sports and live events, and distinct
genres of Pay-Per-View content. We will also actively market the B2Wap service
and the B2 Digital TV Broadband Set Top Television System with our complete
Hotel & MDU Connectivity products later this year through a business-to-business
marketing partner. The Company has an additional 5000 rooms equipped with this
new service.

These products may be viewed at the web site: www.B2digitaltv.com


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<PAGE>

HISTORY

B2Digital, Inc. (referred to herein as "B2Digital", the "Company", or "BTWO"), a
technological development corporation, was incorporated in Colorado on June 8,
1983. It was administratively dissolved in 1997 and as a part of winding up of
its affairs, the directors acting as trustees, entered into a Plan of Merger in
1999 with Telecommunication Products, Inc. a newly formed entity and merged into
it and then purchased Interleisure S.A. a privately held company incorporated
under the laws of the commonwealth of the Dominican Republic. The predecessor
business was to act as a developer of data compression technology and
video-conferencing software but then ventured into other market opportunities.
The Company failed in its business efforts prior to 2002. On July 20, 2004,
Telecommunication Products, Inc. changed its name to B2Digital, Inc. With the
filing of Articles of Merger with the Delaware Secretary of State, we were
redomiciled from Colorado to Delaware, and our number of authorized common
shares was increased to 500,000,000. Effective January 12, 2005, we amended our
Articles of Incorporation to increase our authorized common stock to 900,000,000
shares of common stock and to authorize 50,000,000 shares of preferred stock.
2,000,000 shares of preferred stock have been designated as Series A Convertible
Preferred Stock.

On September 2002, we entered into an Letter of Intent with Coast
Communications, Inc. for the acquisition of the assets of privately-held Hotel
Movie Networks, Inc., a Nevada Corporation domiciled in Mesa, Arizona. Such
assets consist of inventory, contracts and contract rights with certain
production studios.

In January 2003, B2Digital purchased a complete inventory of guest entertainment
systems from Omega Funding, Inc. consisting of hardware and peripherals for
$100,000 in cash and 1,900,000 shares of common stock. This inventory can supply
the necessary hardware for deployment into over 100,000 guest rooms at a savings
over the current industry average installation cost per room.

In March 2003, the Company entered into an agreement to purchase the assets of
Hotel Movie Networks, Inc. ("HMN") which made the Company a supplier of Video On
Demand ("VOD") and Satellite Guest Entertainment systems to the mid-market
hospitality industry. The purchase included a customer base of over 8,000 rooms
through contract rights. These contracts consist mainly of "Free-to-Guest" or
"Pay-per-Stay" guest services. The transaction closed on August 1, 2003. The
former shareholders of Hotel Movie Network received 2,000,000 shares of our
common stock and $150,000 cash. Additionally, we issued a $1,000,000 Convertible
note that pays 7.5% interest per annum.

Through the purchase of assets of Hotel Movie Network, we supply Video On Demand
and Satellite Guest Entertainment systems to the mid-market hospitality
industry. The purchase of the assets of Hotel Movie Networks, Inc. provides
affiliation with an established network of professional guest systems
installation contractors who are experienced and familiar with the Hotel Movie
Network business model.

On November 2003, the Company entered into an agreement with EchoStar and Dish
Network which enables the Company to purchase programming at a favorable
discount.


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<PAGE>

We intend to bring consumers a quality experience through video on demand and
through providing traditional cable, satellite and internet access to users of
Hotel Movie Network Our web site is www.b2digitaltv.com.

On March 6, 2004, we entered into a Letter of Agreement with B2 Networks, LLC,
whereby B2 Networks would provide data center facilities, management systems for
video and set top services and assist with operating the Hotel Link services. On
April 23, 2004, we agreed to purchase 20% of B2 Networks, LLC in exchange for
1,667,667 shares of common stock and $500,000. On August 2004, we amended this
agreement to reduce the amount of purchase to 10% of the LLC in exchange for
$200,000 and 2,667,000 shares of common stock.

The Company launched a new product in June 2004 with the announcement of the
strategic alliance agreement with Powerlinx and Choice Hotels International, one
of the largest hotel franchise companies in the world with more than 5,000
hotels, inns, all-suite hotels and resorts open and under development in 44
countries under the Comfort Inn, Comfort Suites, Quality, Clarion, Sleep Inn,
Rodeway Inn, Econo Lodge and MainStay Suites brand names.

Pursuant to the agreement, B2 Networks and B2Digital will be supplying
Point-to-Point Wireless Local Loop internet connectivity in each hotel room
through the B2 Wireless Access Point (B2WAP) which will connect to the in-room
Hotellinktv.com for laptop users and the B2 Digital TV set top box and handheld
remote control for in-room television. These products allow Powerlinx to market
a large variety of in-room digital services, which include making airline
reservations, ordering pizza, event ticketing, and transportation services,
along with delivery of Hollywood movies, sports and live events, and distinct
genres of Pay-Per-View content. We will also actively market the B2Wap service
and the B2 Digital TV Broadband Set Top Television System with our complete
Hotel & MDU Connectivity products later this month through our
business-to-business marketing partner, Powerlinx, Inc. These products may be
viewed at the web site: www.b2digitaltv.com.

On December 15, 2004, we entered into an Letter of Agreement with B2 Networks,
LLC whereby B2 Networks will provide certain operations assistance to the
company in exchange for a portion of the gross revenue or $10,000 per month.

On January 20, 2005, B2Digital, Inc. entered into a Purchase Agreement with
EuroSwiss Equities, Ltd., a privately-held Caribbean company, whereby BTWO
agreed to purchase certain online casinos from EuroSwiss, including marketing
rights and back office support (the "Assets"). In exchange for the Assets, we
agreed to pay EuroSwiss $300,000.00 and 1,000,000 shares of the BTWO's Series A
Convertible Preferred Stock, payable over three months. This agreement was
subsequently terminated on May 4, 2005. No consideration was given to Euroswiss.


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<PAGE>

INDUSTRY OVERVIEW

The provision of in-room entertainment and information services to the lodging
industry includes offering pay-per-view motion pictures, archived television
content, games, music, internet connectivity, guest programming of select pay
cable channels, and an increasing array of interactive programs and information
services. Pay-per-view services were introduced in the early 1970's and have
since become a standard amenity offered by many hotels to their guests.
Historically, providers of programming to hotels delivered their content on a
fixed time schedule that did not provide the hotel guest flexibility in choosing
when to watch a movie. Typically, a guest would be offered a choice of four to
eight movies, each of which would be shown once every two to four hours. The
development of video switches enabled providers of pay-per-view services to
offer scheduling flexibility to the viewer. Depending on the type of system
installed and the size of the hotel, guests can choose up to 50 different movies
with an on-demand system. Changes in technology have also led to the ability to
provide a number of on-demand interactive services such as guest folio review,
automatic checkout, survey completion, guest messaging, video games, and
internet service. The market for in-room entertainment and information is
characterized as a highly competitive environment among several
industry-dedicated companies and a number of new entrants including cable
companies, telecommunications companies, laptop connectivity companies and
others.

OUR BUSINESS

Manual functions of the equipment and system are limited to changing
videocassettes once per month and will be all handled by B2Digital's service
personnel, who also update the system's movie titles screens. Hotel Movie
Network's information system is capable of generating regular reports of guests'
entertainment selections, permitting to adjust its programming to respond to
viewing patterns. The number of guests that can view a particular movie at the
same time varies from hotel to hotel depending upon the popularity of the movie
and by providing more copies of the most popular programming titles to the
hotels.

Increased deployment of high-speed, two-way digital communications capability
may enable B2Digital to provide more advanced interactive and information
features, such as video games, in addition to basic guest services such as video
checkout, room service ordering and guest satisfaction surveys. The system also
enables hotel owners to broadcast informational and promotional messages and to
monitor room availability.

For example, in a typical hotel with 200 rooms, the central head-end video rack
would consist of approximately 30 videocassette recorders containing up to four
copies of the most popular movies and a total of up to 15 different titles. The
system includes a computerized in-room on-screen menu that offers guests a list
of only those movie selections available to the guest at that time. As a result,
even though the on-screen menu may not include a list of all titles available in
the particular hotel, the list includes all movies currently available to the
guest, thus eliminating the possibility of a guest being disappointed when the
guest's selection is not available.


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<PAGE>

B2Digital will undertake a significant investment when it installs its system in
a hotel property, sometimes rewiring part of the hotel. Depending on the size of
the hotel property, the quality of the cabling and antenna system at the hotel,
and the configuration of the system installed, the installation cost of a new,
on-demand system with movies, guest services, including the head-end equipment
averages from approximately $80 to $120 per room.

The installation cost of a system with digital content storage is approximately
$45 per room higher than the system in the same size hotel. The system can be
modified to enable On Call functionality for movies, games, Internet, and guest
services at a cost of $280 per room. Video On Call will only be installed in
association with videocassette players, rather than digital content storage, in
certain markets due to constraints placed on B2Digital by most movie studios
that provide B2Digital with movie content.

The Video System will be the Company's primary platform. It consists of a
microprocessor controlling the television in each room, and a central video rack
and system computer located elsewhere in the hotel. Programming signals
originate from videocassette players located within the head-end rack and are
transmitted to individual rooms by way of video technology. The system computer
controls movie starts automatically. The system computer also records the
purchase by a guest of any title and reports billing data to the hotel's
accounting system, which posts the charge to the guest's bill.

SERVICES

                           Pay-Per-View Movie Services

B2Digital provides on-demand and, in some cases, scheduled in-room television
viewing of major motion pictures and independent non-rated motion pictures for
mature audiences, for which a hotel guest pays on a per-view basis. Depending on
the type of system installed and the size of the hotel, guests can choose up to
30 different movies with a Video On Call system, or from eight to twelve movies
with a scheduled system.

B2Digital obtained non-exclusive rights to show recently released motion
pictures from major motion picture studios generally pursuant to a master
agreement with each studio. The license period and fee for each motion picture
are negotiated individually with each studio, which typically receives a
percentage of that picture's gross revenues generated by the pay-per-view
system. Typically, B2Digital obtains rights to exhibit major motion pictures
during the "Hotel/Motel Pay-Per-View Window," which is the time period after
initial theatrical release and before release for home video distribution or
cable television exhibition. B2Digital attempts to license pictures as close as
possible to the motion pictures' theatrical release date to benefit from the
studios' advertising and promotional efforts. B2Digital also obtains independent
motion pictures, most of which are non-rated and are intended for mature
audiences, for a one-time flat fee that is nominal in relation to the licensing
fees paid for major motion pictures.

B2Digital provides service under contracts with hotels that generally provide
for a term of five to seven years. Under these contracts, B2Digital installs its
system into the hotel at B2Digital's cost and B2Digital retains ownership of all


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<PAGE>

its equipment used in providing the service. B2Digital has required the hotels
to provide televisions. B2Digital's contracts with hotels generally provide that
B2Digital will be the exclusive provider of in-room, pay-per-view video
entertainment services to the hotel and generally permit B2Digital to set the
movie price. Under certain circumstances, certain hotels may have the right to
prior approval of the price increases, which approval may not be unreasonably
withheld. The hotels collect movie-viewing charges from their guests and retain
a commission equal to a negotiated percentage of the total pay-per-view revenue,
which varies in relationship with the size and profitability of the system. Some
contracts also require B2Digital to upgrade systems to the extent that new
technologies and features are introduced during the term of the contract. At the
scheduled expiration of a contract, B2Digital generally seeks to extend the
agreement on terms that are based upon the competitive situation in the market.

The revenue which is generated from pay-per-view service is dependent on the
occupancy rate at the property, the "buy rate" or percentage of occupied rooms
that buy movies or other services at the property, and the price of the movie or
service. Occupancy rates vary based on the property's location, its competitive
position within the marketplace and, over time, based on seasonal factors and
general economic conditions. For instance, occupancy rates and revenues per room
typically are higher during the summer months and lower during the winter months
due to seasonal travel patterns. Buy rates generally reflect the hotel's guest
mix profile, the popularity of the motion pictures or services available at the
hotel, and the guests' other entertainment alternatives. Buy rates also vary
over time with general economic conditions and the business of B2Digital is
closely related to the performance of the business and Mid sized hotel segments
of the lodging industry. Movie price levels are set based on the guest mix
profile at each property and overall economic conditions. Currently, movie
prices typically range from $8.95 to $9.95 for a purchase by the hotel guest.

Guest Programming Services

B2Digital also markets guest-programming services pursuant to which a hotel may
elect to receive one or more programming channels, such as HBO, CNN, ESPN, TBS,
Disney Channel, Discovery Channel, and other cable networks, which the hotel
provides to guests at no additional cost. B2Digital provides hotels with guest
programming services through a variety of arrangements, including having the
hotel pay the company a monthly fee per room for each programming channel
selected or including the cost or part of the cost of such programming within
the Company's overall contractual arrangements with the hotel or hotels.
B2Digital has a unique contract with each network vendor (approximately 30
vendors, serving 50-60 channels). Payment to network vendors is based on
subscriber/room count but also use variables such as the combination of channels
received, occupancy, volume, and penetration. The term of the contracts with
network vendors average three to five years.

SUPPLIERS

In some cases B2Digital contracts directly with various electronics firms for
the manufacture and assembly of its systems hardware. Historically, these
suppliers have been dependable and able to meet delivery schedules on time. The
Company believes that, in the event of a termination of any of its sources,


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<PAGE>

alternate suppliers could be located without incurring significant costs or
delays. However, certain electronic component parts used with the Company's
products are available from a limited number of suppliers and can be subject to
temporary shortages. In such event, the Company could experience a temporary
reduction in the rate of new installations and/or an increase in the cost of
such installations. If the Company were to experience a shortage of any given
electronic part, the Company believes that alternative parts could be obtained
or system design changes could be made.

The head-end electronics for the Company's systems is assembled at the Company's
facilities for testing prior to shipping. Following assembly and testing of
equipment designed specifically for a particular hotel, the system is shipped to
each location, where B2Digital employees trained technicians to install the
system, typically assisted by independent contractors.

B2Digital, through its acquisition of Hotel Movie Network, maintains direct
contractual relations with various suppliers of pay-per-view and guest
programming services, including the motion picture studios and/or their domestic
and international distributors and programming networks. B2Digital believes its
relationships with all suppliers are adequate.

SALES AND MARKETING

Substantially all revenue is derived from obtaining contracts with hotels in the
United States not under contract with existing vendors or whose contracts with
other vendors are expiring or have expired. B2Digital believes that
opportunities for additional growth in the markets in the United States are more
limited than in the past. The Company strategy for new customers is target both
smaller hotels lower cost hotels as well. Management anticipates that the lower
costs and flexibility afforded by the Company's products will make marketing to
smaller hotels and some lower cost hotels economically attractive than in the
past.

CUSTOMERS

The Company typically negotiate and enter into a separate contract with each
hotel for the services provided. However, for some of the large hotel management
companies the Company will negotiate and enter into a single master contract for
the provision of services for all of the corporate-managed hotels of such
management company. In the case of franchised or independently owned hotels, the
contracts are generally negotiated separately with each hotel.

Existing contracts generally have a term of five to seven years from the date
the system becomes operational. At expiration, B2Digital typically seeks to
extend the term of the contract on then current market terms.

COMPETITION

In the U.S., taking into account the various providers of cable television
services, there are numerous providers of in-room video entertainment to the


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lodging industry, and at least two of our competitors, LodgeNet Entertainment
Corporation, and Inn Room Video, Inc., provide on-demand pay-per-view, guest
programming and guest services by means of in-room television. Internationally,
there are more companies competing in the pay-per-view lodging industry than in
the United States.

Pay-per-view, the most profitable component of the services currently offered,
competes for a guest's time and entertainment resources with broadcast
television, guest programming, and cable television services. In addition, there
are a number of competitors that are developing ways to use their existing
infrastructure to provide in-room entertainment and/or information services to
the lodging industry, including cable companies (including wireless cable)
telecommunications companies, internet and high-speed connectivity companies,
and direct-to-home and direct broadcast satellite companies. Some of these
competitors have been providing guest programming services to hotels and are
beginning to provide video-on-demand, Internet and high-speed connectivity to
hotels.

B2Digital is a competitive provider of in-room video entertainment services to
the United States lodging industry. Domestically, B2Digital competes with
smaller providers for the Mid to Small lodging market.

Competition with respect to the provision of in-room video entertainment and
information systems centers on a variety of factors, depending upon the
circumstances important to a particular hotel. Among the more important factors
are (i) the features and benefits of the entertainment and information systems,
(ii) the quality of the vendor's technical support and maintenance services, and
(iii) the financial terms and conditions of the proposed contract. With respect
to hotel properties already receiving in-room entertainment services, the
current provider may have certain informational and installation cost advantages
compared to outside competitors.

Furthermore, while the Company is addressing the likelihood of increased demand
for Internet services in the hotel guestroom, B2Digital may face additional
competition in this area from traditional as well as new competitors. In
addition, there are a number of potential competitors that could utilize their
existing infrastructure to provide in-room entertainment to the lodging
industry, including cable companies (including wireless cable),
telecommunications companies, and direct-to-home and direct broadcast satellite
companies. Some of these potential customers already are providing guest
programming services to hotels and testing on-demand video. Some of these
competitors may be better funded from public capital or private venture capitals
markets and have access to additional capital resources that B2Digital does not
have.

B2Digital believes its competitive advantages include: (i) low price; and (ii)
system reliability and high quality service.

B2Digital may compete with local cable television operators by customizing
packages of programming to provide only those channels desired by the hotel
subscriber, which typically reduces the overall cost of the service provided.


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B2Digital anticipates substantial competition in obtaining new contracts with
major hotel chains. The Company believes that hotels view the provision of
in-room on-demand entertainment and information both as a revenue source and as
a source of competitive advantage because sophisticated hotel guests are
increasingly demanding a greater range of quality entertainment and information
alternatives. At the same time, B2Digital believes that certain major hotel
chains have awarded contracts based primarily on the level and nature of
financial and other incentives offered by the service provider. While the
Company believes its competitive position could enable B2Digital to continue to
enter into contractual arrangements that are attractive to hotels, its
competitors may attempt to maintain or gain market share at the expense of
profitability. B2Digital may not always be willing to match incentives provided
by its competitors.

The communications industry is subject to rapid technological change. New
technological developments could adversely effect B2Digital's operations unless
the Company is able to provide equivalent services at competitive prices.

INTERNATIONAL MARKETS

In addition to its intended operations in the United States, B2Digital may in
the future offer its services in Canada, Latin America, Puerto Rico, the U.S.
Virgin Islands, Hong Kong, Singapore, Thailand, Australia, the Bahamas, Europe,
and elsewhere in the Asia-Pacific region. However, the Company generally would
also incur greater capital expenditures and operating and servicing costs
outside the United States.

The competition to provide pay-per-view services to hotels is greater in
international markets than in the United States. Expansion of B2Digital's
operations into foreign markets involves certain risks that are not associated
with further expansion in the United States, including availability of
programming, government regulation, currency fluctuations, language barriers,
differences in signal transmission formats, local economic and political
conditions, and restriction on foreign ownership and investment. Consequently,
these risks may hinder B2Digital's ability to create any base of hotel rooms in
foreign markets.

REGULATION

The Communications Act of 1934, as amended by the Cable Communications Policy
Act of 1984, the Cable Television Consumer Protection and Competition Act of
1992 and the Telecommunications Act of 1996, governs the distribution of video
programming by cable, satellite or over-the-air technology, through regulation
by the Federal Communications Commission, or FCC. However, because our video
distribution systems do not use any public rights of way, they are not
classified as cable systems and are subject to minimal regulation. Thus, the FCC
does not directly regulate the pay-per-view or free-to-guest services provided
by us to hotel guests.

Various laws and governmental regulations may affect the internet-based services
potentially offered by us. There are currently few laws or regulations directly
applicable to access to or commerce on commercial online services or the


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Internet. However, because of the increasing popularity and use of commercial
online services and the Internet, a number of laws and regulations may be
adopted with respect to commercial online services and the Internet. The
adoption of such laws or regulations in the future may slow the growth of
commercial online services and the internet, which could in turn cause a decline
in the demand for our internet-based services and products or otherwise have an
adverse effect on us. Moreover, the applicability to commercial online services
and the internet of existing laws governing issues such as property ownership,
libel, personal privacy and taxation is uncertain and could expose us to
liability.

On January 18, 2001, the FCC released a Notice of Inquiry regarding interactive
television services, or ITV, over cable television. The FCC seeks comment on,
among other things, an appropriate definition of ITV services, whether access to
a high -speed connection is necessary to realize ITV capabilities, and whether a
nondiscrimination rule is necessary and/or appropriate. The outcome of this
proceeding and any rules ultimately adopted by the FCC could affect the ITV
services currently offered by us and the ITV services which we may offer in the
future.

Although the FCC generally does not directly regulate the services provided by
us, the regulation of video distribution and communications services is subject
to the political process and has been in constant flux over the past decade.
Further material changes in the law and regulatory requirements must be
anticipated and our business could be adversely affected by future legislation
or new regulations.

Because most music is copyrighted, license agreements are required for the DMN
service. Agreements and arrangements with major rights holders and/or
organizations permit the distribution of music. However, such licensing has been
the subject of industry-wide arbitration and/or litigation for a number of
years. Depending upon the outcome of on-going proceedings, the license fees for
such distribution may increase.

We do not purport to describe all present and proposed federal, state and local
regulations and legislation relating to the video programming industry
applicable to us. Other existing federal, state and local laws and regulations
currently are, or may be, the subject of a variety of judicial proceedings,
legislative hearings, and administrative and legislative proposals that could
change in varying degrees the manner in which private cable operators, other
video programming distributors, and Internet service providers operate. We
cannot predict the outcome of these proceedings or their impact upon our
operations at this time.


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<PAGE>

PATENTS, TRADEMARKS AND COPYRIGHTS

We have one patent registered in the Dominican Republic for our video
technology. We own and, through our acquisition of Hotel Movie Network, our
various trade names, trademarks, service marks, and logos to be used in our
businesses, which we intend to actively protect.

EMPLOYEES

As of March 31, 2005, we employed 8 full-time employees and 6 consultants. None
of the employees are subject to a collective bargaining agreement, and there is
no union representation. We believe our employee relationships are good.

RESEARCH AND DEVELOPMENT COSTS

Over the last two years, we spent $330,000 on research and development.

ITEM 2. DESCRIPTION OF PROPERTY

Our principal executive office address is 9171 Wilshire Boulevard, Suite B,
Garden Level, Beverly Hills, California 90210. We lease our facilities month to
month. Our rent expense was $12,000 for the year ended March 31, 2005. The
facilities are of adequate size to allow us to grow to approximately eight
people, after which time we will need to seek larger space. Our month-to-month
agreement will allow us flexibility in moving as we employ more personnel.

We took over a lease through the acquisition of Hotel Movie Network. The
facilities are located at 1030 S. Mesa Drive, Mesa, Arizona 85210. These
premises have 30,000 square feet of storage and 5,000 square feet of offices and
work shops. We believe these facilities are adequate in size to handle all
operations the United States and the Caribbean for the foreseeable future.

ITEM 3. LEGAL PROCEEDINGS

In July 2003, we were served with a lawsuit from William B. Krusheski in United
States District Court for Southern District of California. The complaint sought
in excess of $75,000 on a note allegedly due and $135,000 in other compensatory
damages. In June 2004, the county court of San Diego, California awarded a
default judgment in favor of Mr. Krusheski in the amount of $135,000. The
company has offered payments of $5,000 per month until the debt is settled. We
have to date had no response from Mr. Krusheski.

We settled the lawsuit filed by John M. Brazier against us, our transfer agent
and Mr. Russell filed in May 2003 in the District Court of Denver in the state
of Colorado. The settlement terms require us to issue Mr. Brazier 770,000 shares
of our common stock and warrants to purchase an additional 2 million shares of


                                       14
<PAGE>

our common stock at $0.15 per share. Additionally, we will pay Mr. Brazier
$177,500 in cash. We have already issued the shares to Mr. Brazier.

In March 2004, Mr. Dennis H. Johnston, a former Director and General Counsel of
the company, filed a lawsuit in the state of California seeking back salary and
stock for his service to the Company. We responded with a motion to strike and a
motion for demurrer. We subpoenaed several individuals, corporations and certain
documentation. In July, Mr. Johnston filed a "Motion to Quash" which was denied.
On August 3, 2004, Mr. Johnston dismissed the lawsuit.

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

On June 22, 2004 we filed a Schedule 14C Information Statement with the SEC
reporting that majority shareholders of the company had resolved to effect the
following actions by written consent:

1.    To approve the merger between "Telecommunication Products, Inc." with and
      into "B2Digital, Inc., a newly formed Delaware Corporation, pursuant to
      which the Company's name changed to "B2Digital, Inc." The Company was
      re-domiciled from Colorado to Delaware, and its number of authorized
      common shares was increased from 100,000,000 to 500,000,000.

On December 14, 2004 we filed a Schedule 14C Information Statement with the SEC
reporting that majority shareholders of the company had resolved to effect the
following actions by written consent:

1.    Amend the Certificate of Incorporation in order to increase the amount of
      authorized common stock to 900,000,000 shares, $.001 par value, from
      500,000,000 shares, $.001 par value.

2.    Amend the Certificate of Incorporation to authorize 50,000,000 shares of
      preferred stock, $.001 par value.

These actions became effective on or about December 27, 2004.

                                     PART II

ITEM 5. MARKET FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND SMALL BUSINESS
ISSUER PURCHASES OF EQUITY SECURITIES

Our common stock began trading on the Over-The-Counter Bulletin Board under the
symbol "BTWO" on November 10, 2001. Prior to November 10, 2001, our common stock
was quoted under the symbol "TLCR."

The following table sets forth the high and low bid prices for shares of our
common stock for the periods noted, as reported by the National Daily Quotation
Service and the Over-The-Counter Bulletin Board. Quotations reflect inter-dealer
prices, without retail mark-up, mark-down or commission and may not represent
actual transactions.


                                       15
<PAGE>

                                                 LOW       HIGH
                                                 ---       ----
             2003
             ----
             First Quarter                       .14       .55
             Second Quarter                      .02       .22
             Third Quarter                       .23       .50
             Fourth Quarter                      .26       .44

             2004
             ----
             First Quarter                       .15       .21
             Second Quarter                      .04       .16
             Third Quarter                       .04       .13
             Fourth Quarter                      .04       .12

             2005
             ----
             First Quarter                       .01       .01

As of March 31, 2005, our common stock was held by approximately 326
stockholders of record. We believe that the number of beneficial owners is
substantially greater than the number of record holders because a significant
portion of our outstanding common stock is held of record in broker "street
names" for the benefit of individual investors. The transfer agent of our common
stock is Continental Stock Transfer. Their phone number is (212) 509-4000.

DIVIDEND POLICY

Our Board of Directors determines any payment of dividends. We do not expect to
authorize the payment of cash dividends on common stock in the foreseeable
future. Any future decision with respect to dividends will depend on future
earnings, operations, capital requirements and availability, restrictions in
future financing agreements, and other business and financial considerations.
The Preferred Stock when authorized with rights and privileges could require
dividends. The Company has not paid any dividends in the past several years.

RECENT SALES OF UNREGISTERED SECURITIES.

During the quarter ending March 31, 2005, the company issued the following
unregistered shares of common stock.

On January 12, 2005, we issued Marcia Pearlstein, our acting CFO, 4,000,000
shares of restricted common stock, valued at $4,000. The shares were issued with
a Rule 144 legend based upon the exemption from registration found in Section
4(2) of the Securities Act and/or Regulation D of the Securities Act Rules.


                                       16
<PAGE>

Equity Compensation Plans

We amended the "Telecommunication Products, Inc. Non-Employee Directors and
Consultants Retainer Stock Plan" during our fiscal year ended March 31, 2003.
The purpose of the plan is to enable us to promote our interests and the
interests of our shareholders by attracting and retaining non-employee directors
and consultants capable of furthering our future success by aligning their
economic interests more closely with those of our shareholders, by paying their
retainer or fees in the form of shares of our common stock. In the period ended
March 31, 2003, pursuant to agreements for past and future services, we issued 4
individuals a total of 3,000,000 shares of common stock pursuant to this plan.
On or about March 18, 2003, we amended the Stock Plan ( Amendment No. 1) to
authorize an additional 4,000,000 shares and registered these additional shares
on Form S-8. On or about June 9, 2004, we amended the Stock Plan (Amendment No.
2 ) to authorize an additional 40,000,000 shares and registered these additional
shares on Form S-8.

On October 12, 2004, the corporation entered into a Fee Agreement for
Professional Services with Richard O. Weed. Terms of the Fee Agreement provided
for, among other things, the issuance to Mr. Weed of 2,000,000 shares of common
stock, and options to purchase 2,000,000 shares of the corporation's common
stock at an exercise price of $.03 per share. These options expire December 31,
2010.

On January 10, 2005, we adopted the 2005 Non-Qualified Stock Compensation Plan
whereby the corporation may compensate key employees, advisors and consultants
by issuing them shares of its capital stock in exchange for services rendered
and to be rendered and thereby conserve the corporation's cash resources. We
reserved 60,000,000 shares of our $.001 par value common stock for issuance
under the Plan and registered the shares on a Form S-8 registration statement
with the Securities and Exchange Commission on January 11, 2005. On or about
February 10, 2005, we amended the Stock Plan to authorize an additional
100,000,000 shares and registered these additional shares on Form S-8. At March
31, 2005, there were approximately 60,500,000 shares remaining for issuance.


                                       17
<PAGE>

                      Equity Compensation Plan Information

<TABLE>
<CAPTION>
                                                                                                Number of securities
                                                                                              remaining available for
                                                                                               future issuance under
                             Number of securities to              Weighted-average              equity compensation
                             be issued upon exercise              exercise price of               plans (excluding
                             of outstanding options,             outstanding options,         securities reflected in
                               warrants and rights               warrants and rights                 column (a))

<S>                             <C>                                 <C>                               <C>
Plan category............              (a)                               (b)                            (c)
                               -------------------               -------------------                -----------

Equity compensation plans
approved by security
holders .................               --                                --                             --
                               -------------------               -------------------                -----------

Equity compensation plans
not approved by security
holders .................           2,000,000                             --                         60,500,000
                               -------------------                -------------------               -----------

Total ...................           2,000,000                            $.03                        60,500,000
                               -------------------                -------------------               -----------
</TABLE>

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

You should read this section together with our consolidated financial statements
and related notes thereto included elsewhere in this report.

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

This report contains forward-looking statements that involve risks and
uncertainties. We generally use words such as "believe," "may," "could," "will,"
"intend," "expect," "anticipate," "plan," and similar expressions to identify
forward-looking statements, including statements regarding our expansion plans.
You should not place undue reliance on these forward-looking statements. Our
actual results could differ materially from those anticipated in the
forward-looking statements for many reasons, including the risks described in
our "Risk Factors" section and elsewhere in this report. Although we believe the
expectations reflected in the forward-looking statements are reasonable, they
relate only to events as of the date on which the statements are made, and our
future results, levels of activity, performance or achievements may not meet
these expectations. We do not intend to update any of the forward-looking
statements after the date of this document to conform these statements to actual
results or to changes in our expectations, except as required by law.


                                       18
<PAGE>

CRITICAL ACCOUNTING POLICIES

Accounts receivable - The Company follows the allowance method of recognizing
uncollectible accounts receivable. The allowance method recognizes bad debt
expense as a percentage of accounts receivable based on a review of accounts
receivable outstanding and the Company's prior history of uncollectible accounts
receivable.

Fair value of financials instruments - The Company's financial instruments
includes accounts receivable, accounts payable, notes payable and long-term
debt. The fair market value of accounts receivable and accounts payable
approximate their carrying values because their maturities are generally less
than one year. Long-term notes receivable and debt obligations are estimated to
approximate their carrying values based upon their stated interest rates.

Inventories - Inventories are stated at the lower of cost (first-in, first-out)
or market.

Property and equipment - Property and equipment are stated at cost, net of
accumulated depreciation. Depreciation is provided primarily by the
straight-line method over the estimated useful lives of the related assets
generally of five to seven years.

Income taxes -The Company accounts for income taxes in accordance with Statement
of Financial Accounting Standards No. 109, "Accounting for Income Taxes", which
requires an asset and liability approach to financial accounting and reporting
for income taxes. Deferred income tax assets and liabilities are computed
annually for differences between the financial statement and tax basis of assets
and liabilities that will result in taxable or deductible amounts in the future
based on enacted tax laws and rates applicable to the periods in which the
differences are expected to affect taxable income. Valuation allowances are
established when necessary to reduce the deferred tax assets to the amount
expected to be realized. Income tax expense is payable or refundable for the
period plus or minus the change during the period in deferred tax assets and
liabilities.

Revenue recognition - The Company's revenues are derived principally from the
sale of satellite systems and pay-per-view movies to hotels. Revenue from the
sale of satellite systems is recognized after the system has been installed, and
there are no longer any material commitments to the customer. The Company
recognizes revenue from the pay-per-view movies on the accrual basis. The
Company bills its customers for the month that services are performed.

Stock options - The Company accounts for stock options issued to employees in
accordance with APB No.25.

The Company has elected to adopt the disclosure requirements of SFAS No.123
"Accounting for Stock-based Compensation". This statement requires that the
Company provide proforma information regarding net income (loss) and income
(loss) per share as if compensation cost for the Company's stock options granted
had been determined in accordance with the fair value based method prescribed in


                                       19
<PAGE>

SFAS No. 123. Additionally, SFAS No. 123 generally requires that the Company
record options issued to non-employees, based on the fair value of the options.

Income (Loss) per share - Basic earnings per share includes no dilution and is
computed by dividing net earnings (loss) available to stockholders by the
weighted number of common shares outstanding for the period. Diluted earnings
per share reflect the potential dilution of securities that could share in the
Company's earnings. During the years ended March 31, 2005 and 2004, there were
no dilutive securities.

GOING CONCERN OPINION

Our audited financial statements for the fiscal year ended March 31, 2005,
reflect a net loss of $4,801,840. These conditions raised substantial doubt
about our ability to continue as a going concern.

TWELVE MONTH PERIOD ENDED MARCH 31, 2005 AS COMPARED TO TWELVE MONTH PERIOD
ENDED MARCH 31, 2004

NET REVENUES

Net revenues for the year ended March 31, 2005 were $683,746 compared to
$467,477 for the year ended March 31, 2004 the increase is due to having the
operations of Hotel Movie Network the entire year of 2005.

COST OF REVENUES

Cost of revenues for the year ended March 31, 2005 were $323,813 compared to
$222,183 for the year ended March 31, 2004. Our Cost of Revenue increased due to
having the operations of Hotel Movie Network the entire year of 2005.

OPERATING EXPENSES

Operating Expenses for the year ended March 31, 2005 were $5,485,586 compared to
$2,688,796 for the year ended March 31, 2004 due to an increase in cost of sales
of $101,630 from March 31, 2004, an increase in general administration in the
amount of $1,135,592 from March 31, 2004 and an increase in fees for
professional services. These expenses were a result of due to having the
operations of Hotel Movie Network the entire year of 2005. In addition, an
increase in interest in the amount of $129,568 is due to notes payable to Hotel
Movie Network and certain individuals including our Chief Executive Officer for
cash advances. Further, for March 31, 2005 the company had expenses of $330,000
for research and development and $1,100,000 for impairment of inventories.


                                       20
<PAGE>

NET LOSS

Net Loss for the year ended March 31, 2005 was $4,801,840 compared to $2,221,319
for the year ended March 31, 2004 due to an increase in expenses as of March 31,
2005 in the amount of $2,580,521.

BASIC AND DILUTED LOSS PER SHARE

Our basic and diluted loss per share for the year ended March 31, 2005 was $.028
compared to $.048 for the year ended March 31, 2004.

LIQUIDITY AND CAPITAL RESOURCES

As of March 31, 2005, our Current Assets were $382,546 and Current Liabilities
were $965,049. Cash and cash equivalents were $5,711. Our Stockholder's Deficit
at March 31, 2005 was $2,700,923. We had a net usage of cash due to operating
activities in March 31, 2005 and 2004 of $915,817 and $272,851 respectively. We
had net cash used by financing activities of $342,719 and $928,858 for the
twelve month period ended March 31, 2004 and 2005, respectively.

Our obligations include:

A Promissory note for $1,000,000 payable based on the purchase agreement of our
subsidiary; Hotel Movie Network which pays 7.5% per annum.

A Promissory note for $800,000 payable for monies lent to company by our
President and CEO Robert Russell which pays 7.5% per annum.

Agreement with B2 Networks

On March 6, 2004, we entered into a Letter of Agreement with B2 Networks, LLC,
whereby B2 Networks would provide data center facilities, management systems for
video and set top services and assist with operating the Hotel Link services. On
April 23, 2004, we agreed to purchase 20% of B2 Networks, LLC in exchange for
1,667,667 shares of common stock and $500,000. On August 2004, we amended this
agreement to reduce the amount of purchase to 10% of the LLC in exchange for
$200,000 and 2,667,000 shares of common stock.

On December 15, 2004, we entered into a Letter of Agreement with B2 Networks
whereby B2Networks will provide certain operations assistance to the company in
exchange for a portion of gross revenue or $10,000 per month.

The amounts paid to B2 Networks have been recorded as research and development
since the project has not achieved technical feasibility.


                                       21
<PAGE>

Dutchess Private Equities Fund II , LP

On February 23, 2005, Dutchess Private Equities Fund II, LP declared a note in
the amount of $26,400 due. Subsequent to March 31, 2005, on July 7, 2005,
Dutchess notified us that they elected to switch the Note and associated
penalties to a Convertible Debenture with registration rights requiring that a
registration agreement be filed within twenty days and effective within forty
days. We have not filed a registration statement or made any payments on this
Note and Dutchess is claiming penalties of $1,000 per day as a result. At July
6, 2005, Dutchess alleged the principal balance was $35,176.31. No action has
been filed in this matter.

Employment Agreements

We entered into a formal written employment agreement with Mr. Russell effective
January 25, 2002 which provides payments aggregating $125,000 per year. The
agreement was suspended and was reinstated in September 2003. On January 25,
2005, we entered into a new agreement with Robert Russell whereby Mr. Russell
agreed to serve as Chief Executive Officer of the company for a period of three
years for $240,000 per annum. Mr. Russell also received a signing bonus of
1,000,000 shares of Series A Convertible Preferred Stock.

On December 23, 2003, we entered into a consulting agreement with Marcia
Pearlstein, whereby Ms. Pearlstein would act as Interim Chief Financial Officer
and corporate secretary for one year for $60,000 per annum. On February 9, 2005,
we extended this agreement until December 31, 2005 and issued Ms. Pearlstein a
signing bonus of 200,000 shares of Series A Convertible Preferred Stock.

                                  RISK FACTORS

An investment in our common stock involves a high degree of risk. You should
carefully consider the following risk factors, other information included in
this filing and information in our periodic reports filed with the SEC. If any
of the following risks actually occur, our business, financial condition or
results of operations could be materially and adversely affected, and you may
lose some or all of your investment.

RISKS ABOUT OUR BUSINESS

WE HAVE A HISTORY OF LOSSES AND AN ACCUMULATED DEFICIT WHICH MAY CONTINUE IN THE
FUTURE AND WHICH MAY PREVENT US FROM OPERATING AND EXPANDING OUR BUSINESS.

We have incurred significant net operating losses in each of the years ended
March 31, 2004 and 2005. We realized a net loss of $2,221,319 for the twelve


                                       22
<PAGE>

months ended March 31, 2004, as compared to net loss of $4,801,840 for the
twelve months ended March 31, 2005. Our accumulated deficit through March 2005
was $9,835,933. We may continue to incur losses and may never achieve or sustain
profitability. An extended period of losses and negative cash flow may prevent
us from operating and expanding our business.

OUR INDEPENDENT AUDITORS HAVE ISSUED A GOING CONCERN OPINION DUE TO OUR
RECURRING LOSSES AND WORKING CAPITAL SHORTAGES, WHICH MEANS WE MAY NOT BE ABLE
TO CONTINUE OPERATIONS UNLESS WE OBTAIN ADDITIONAL FUNDING.

Our audited financial statements for the fiscal year ended March 31, 2005,
reflect a net loss of $4,801,840. These conditions raised substantial doubt
about our ability to continue as a going concern if we do not acquire sufficient
additional funding or alternative sources of capital to meet our working capital
needs. If we do not obtain additional funding, we may not be able to continue
our operations.

WE NEED AND MAY BE UNABLE TO OBTAIN ADDITIONAL FUNDING ON SATISFACTORY TERMS,
WHICH COULD DILUTE OUR STOCKHOLDERS' INTERESTS OR IMPOSE BURDENSOME FINANCIAL
RESTRICTIONS ON OUR BUSINESS.

Historically, we have relied upon cash from financing activities to fund all of
the cash requirements of our activities. We have not been able to generate any
cash from our operating activities in the past and we may not be able to
generate any significant cash in the future. Deteriorating global economic
conditions and the effects of ongoing military actions against terrorists may
cause prolonged declines in investor confidence in and accessibility to capital
markets. Future financing may not be available on a timely basis, in sufficient
amounts or on terms acceptable to us. Any future equity financing may also
dilute existing stockholders' equity. Any debt financing or other financing of
securities senior to common stock will likely include financial and other
covenants that will restrict our flexibility. At a minimum, we expect these
covenants to include restrictions on our ability to pay dividends on our common
stock. If we find additional financing with satisfactory terms, your interests
may be diluted and we may have to accept restrictions on our business.

WE ONLY RECENTLY ACQUIRED HOTEL MOVIE NETWORK AND IF WE CAN NOT IMPLEMENT OUR
PLANS, WE MAY NEVER BECOME PROFITABLE.

Our business model includes leveraging the assets we acquired from Hotel Movie
Network, Inc. We have just begun to incorporate these assets into our company.
Accordingly, we are unable to predict the demand for our services and are


                                       23
<PAGE>

therefore unable to predict whether our business model may be sustained. If we
are unable to generate significant revenues under our current business model, we
may never become profitable and, if we become profitable, we may not be able to
sustain profitability. The Company launched new product in June 2004 which
enables B2Digital to supply supply Point-to-Point Wireless Local Loop internet
connectivity in each contracted hotel room through the B2 Wireless Access Point
(B2WAP) which connects to the in-room B2digitaltv.com for laptop users and the
B2 Digital TV set top box and handheld remote control for in-room television.
These products allow us to market a large variety of in-room digital services,
which include making airline reservations, ordering pizza, event ticketing, and
transportation services, along with delivery of Hollywood movies, sports and
live events, and distinct genres of Pay-Per-View content. We will also actively
market the B2Wap service and the B2 Digital TV Broadband Set Top Television
System with our complete Hotel & MDU Connectivity products later this year
through a business-to-business marketing partner. The Company has an additional
5000 rooms equipped for this new service.

OUR REVENUES, IF ANY, MAY BE AFFECTED BY THE SEASONAL OCCUPANCY RATES OF HOTELS
WE DO BUSINESS WITH.

Our revenue, if any, will partly depend on the occupancy rate of the hotel
properties we serve. Occupancy rates can vary season to season based on the
property's location and attractions nearby. Generally, occupancy rates are
higher during the summer and lower during the winter. Occupancy rates affect our
potential number of customers, which affects our revenue. Because we do not
control occupancy rates, we may not be able to significantly influence negative
trends or seasonality in our revenues, if any.

OUR REVENUES, IF ANY, WILL BE AFFECTED BY FACTORS OUT OF OUR CONTROL.

In addition to occupancy rates, our revenues will be affected by many factors
out of our control including:

- the rate at which hotel guests buy our services;
- the popularity of movies we license;
- the amount of marketing studios used to promote their movies; and
- other entertainment options at the hotel property.

While we may decide which hotels we enter into contracts with, many factors out
of our control will ultimately affect the rate at which guests buy our services.
We do not control all of the factors that could influence guests to make a
decision to buy our services and therefore we can not control the amount of
revenues we generate.


                                       24
<PAGE>

WE DEPEND ON THIRD PARTIES FOR OUR PROGRAMMING CONTENT AND IF THEY INCREASE
THEIR FEES, OUR PROFITABILITY COULD BE AFFECTED.

Our programming content is provided by third parties. We currently pay a fee for
the right to broadcast their programming. If these third parties increase their
fees, we will have to either pass the increased costs on to our customers which
could adversely affect our revenues or our profitability may decrease.

IF WE DO NOT MANAGE OUR GROWTH EFFECTIVELY, WE MAY NOT BE ABLE TO IMPLEMENT OUR
BUSINESS PLAN AND BECOME PROFITABLE.

Our business strategy envisions a period of rapid growth that may strain our
administrative and operational resources. Our ability to effectively manage
growth will require us to continue to expand the capabilities of our operational
and management systems and to attract, train, manage and retain qualified
engineers, technicians, salespersons and other personnel. We may not be able to
manage our growth, particularly if our losses continue or if we are unable to
obtain sufficient financing. If we are unable to successfully manage our growth,
we may not be able to implement our business plan and become profitable.

IF WE CAN NOT PROTECT OUR PROPRIETARY RIGHTS AND INTELLECTUAL PROPERTY, WE MAY
NOT BE ABLE TO COMPETE EFFECTIVELY IN THE MARKETPLACE.

We will rely on a combination of trade secrets and contractual provisions to
protect our proprietary rights and products. These protections may not be
adequate and competitors may independently develop technologies that are similar
or identical to our products. We may experience delays in the introduction and
market acceptance of new products due to the expense of adopting new technology
and customer resistance to learning new technology. If we can not protect our
proprietary rights and intellectual property, we may not be able to compete
effectively in the marketplace.

IF COMMUNICATIONS TO OUR PRIMARY SERVERS ARE INTERRUPTED, OUR OPERATIONS MAY NOT
GENERATE REVENUE.

Although our servers are maintained by our host, all of our primary servers are
vulnerable to interruption by damage from fire, flood, power loss,
telecommunications failure, break-ins, terrorist attacks and other events beyond
our control. We do not maintain business interruption insurance. A significant
system disruption would adversely affect our business, because we would be
unable to deliver our services during the disruption and may therefore lose
existing and potential customers.


                                       25
<PAGE>

WE OPERATE WITHIN A HIGHLY COMPETITIVE MARKET AND IF WE DO NOT SUCCEED IN
ATTRACTING CUSTOMERS, WE WILL NOT BE ABLE TO IMPLEMENT OUR BUSINESS PLAN.

The market for on-demand video entertainment and satellite services is extremely
competitive and can be significantly affected by many factors, including changes
in local, regional or national economic conditions, changes in consumer
preferences, brand name recognition and marketing and the development of new and
competing technologies. We expect that existing businesses that compete with us
have greater financial resources than we do and will be able to undertake more
extensive marketing campaigns and adopt more aggressive advertising sales
policies than we can. If we can not compete successfully, we may not be able to
implement our business plan.

ITEM 7. FINANCIAL STATEMENTS

                             B2Digital, Incorporated
                      FKA Telecommunication Products, Inc.
                              Financial Statements
                                 March 31, 2005

                                    Contents

                                                                     Page
Report of independent Registered Public Accounting Firm               F-1

Financial Statements

       Balance Sheets                                                 F-2
       Statements of Operations                                       F-3
       Statements of Stockholders' Equity                             F-4
       Statements of Cash Flows                                       F-5

Notes to Financial Statement                                      F-6 to F-11


                                       26
<PAGE>

Larry O'Donnell, CPA, P.C. Telephone (303) 745-4545
2228 South Fraser Street
Unit 1
Aurora, Colorado 80014

Board of Directors
B2Digital, Incorporated
Beverly Hills, California

I have audited the accompanying balance sheet of B2Digital, Incorporated FKA
Telecommunication Products, Inc. as of March 31, 2005 and 2004 and the related
statements of operations, stockholders' equity and cash flows for the two years
then ended This financial statement is the responsibility of the Company's
management. My responsibility is to express an opinion on this financial
statement based on my audits.

I conducted my audit in accordance with Standards Of the Public Companies
Accounting Oversight Board (United States). Those standards require that I plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. I believe that my audits provide a reasonable
basis for my opinion.

In my opinion, based on my audits and the report of other auditors, the
financial statements referred to above fairly present in all material respects,
the financial position of B2Digital, Incorporated FKA Telecommunication
Products, Inc as of March 31, 2005 and 2004 the results of its operations and
cash flows for the years then ended and in conformity with generally accepted
accounting principles in the United States of America.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 9 to the
financial statements, the Company's significant operating losses raise
substantial doubt about its ability to continue as a going concern. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.


/s/ Larry O'Donnell, CPA, P.C.
-----------------------------
Larry  O'Donnell,  CPA,  P.C.
August 1, 2005


                                       F-1
<PAGE>

                            B2 Digital, Incorporated
                      FKA Telecommunication Products, Inc.
                                 Balance Sheets

                                          March 31,                 March 31,
                                            2005                       2004
                                       -------------              -------------

                                     Assets

Current Assets
Cash                                   $       5,711              $       1,093
Accounts receivable                           76,744                     60,404
Inventories                                  287,301                  1,371,366
Prepaid expense                               12,790
                                       -------------              -------------
 Total current assets                        382,546                  1,432,863
                                       -------------              -------------
Property and equipment
Hotel equipment                              622,805                    622,805
Office furniture and equipment               454,121                    448,698
Leasehold improvements                        28,300                     28,300
                                       -------------              -------------
                                           1,105,226                  1,099,803
Less accumulated depreciation                984,968                    867,080
                                       -------------              -------------
                                             120,258                    232,723
                                       -------------              -------------
                                       $     502,804              $   1,665,586
                                       =============              =============

                      Liabilities and Stockholders' Equity

Current Liabilities
Accounts payable and accrued
 expenses                              $     528,049              $     532,550
Related party loans payable                  242,000                    215,000
Notes payable                                120,000
Bond payable                                  75,000                     75,000
                                       -------------              -------------
     Total current liabilities               965,049                    822,550
                                       -------------              -------------
Convertible notes payable                  1,438,678                  1,438,678
Note payable related party                   800,000
                                       -------------              -------------
                                           2,238,678                  1,438,678
Commitments and contingency
Stockholders' Equity

Preferred stock,2005 $.001 per value
      2004 no par value, 50,000,000
      shares authorized, 1,200,000
      shares And 800,000 shares
      respectively
      issued and outstanding                 516,000                    800,000
Common stock,2005 $.001 par value
       2004 no par value,
      900,000,000 shares
      authorized, 336,870,939 and
      74,706,704 respectively shares
      issued and outstanding                 336,870                  3,638,451
Additional paid in Capital                 6,332,140
Accumulated deficit                       (9,835,933)                (5,034,093)
Stock subscription receivable                (50,000)
                                       -------------              -------------
                                          (2,700,923)                  (595,643)
                                       -------------              -------------
                                       $     502,804              $   1,665,586
                                       =============              =============

                      See Notes to Financial Statements


                                       F-2
<PAGE>

                            B2 Digital, Incorporated
                      FKA Telecommunication Products, Inc.
                            Statements of Operations

                                                   Year ended March 31,
                                       ----------------------------------------
                                             2005                       2004
                                       -------------              -------------
Revenues                               $     683,746              $     467,477
                                       -------------              -------------
Expenses
Cost of sales                                323,813                    222,183
General and Administrative Expenses        3,521,240                  2,385,648
Research and development                     330,000
Impairment of inventories                  1,100,000
Interest                                     210,533                     80,965
                                       -------------              -------------

 Total Expenses                            5,485,586                  2,688,796

Net Income
  (Loss)                               $  (4,801,840)             $  (2,221,319)
                                       =============              =============

Basis and Diluted
   Earnings
   (Loss)
   Per Share
                                       $       (.028)             $       (.048)
                                       =============              =============
Weighted average
Shares out-standing                      172,693,000                 46,485,000

                        See Notes to Financial Statements


                                       F-3
<PAGE>

                            B2 Digital, Incorporated
                      FKA Telecommunication Products, Inc.
                       Statements of Stockholders' Equity
                       Years Ended March 31, 2005 and 2004

<TABLE>
                                                             Additional
                                       Common Stock            Paid in       Preferred      Stock      Accumulated
                                   Shares         Amount       Capital         Shares       Amount       Deficit         Total
<CAPTION>
<S>                             <C>            <C>           <C>             <C>          <C>          <C>            <C>
Balance, March 31, 2003          30,723,804                  $1,707,244        800,000    $ 800,000    $(2,812,775)   $    305,531

Issuance of common stock
  for Hotel Movie Network         2,000,000

Issuance of common stock
 for services based on value
 of services performed           21,855,369     1,384,738                                                                1,384,738

Issuance of common stock
  As collateral for debt          2,000,000

Common stock issued for
cash                              3,711,559       259,669                                                                  259,669

Issuance of common stock for
 debt                             8,400,000       256,000                                                                  256,000

Issuance of common stock
 for past considerations          8,300,000

Issuance of common stock
 For litigation settlement          770,000        30,800                                                                   30,800

Common stock returned            (3,054,029)

Net loss for the year                                                                                     (221,319)     (2,434,818)

Balance, March 31, 2004          74,706,704    $3,638,451                      800,000    $ 800,000    $(5,034,093)   $   (595,643)

Preferred stock retired                                                       (800,000)    (800,000)                      (800,000)

Exchange of no par value
 shares for $.001 par
 value shares                                  (3,563,744)    3,563,744

Issuance of stock
 for B2 Network                   2,667,000         2,667        97,333                                                    100,000

Issuance of common
 stock for services
 based on value of
 services performed             190,208,088       190,208     1,984,493                                                  2,174,701

Issuance of preferred
 stock for services
 based on value of
 services performed                                                          1,200,000      516,000                        516,000

Issuance of common
 stock for cash                  85,989,147        85,989       669,870                                                    755,859

Common shares
 returned for no
 consideration                  (16,700,000)      (16,700)       16,700

Net loss for the year                                                                                   (4,801,840)     (4,801,840)

Balance, March 31, 2005         336,870,939    $  336,871    $6,332,140      1,200,000    $ 516,800    $(9,835,933)   $ (2,650,923)
</TABLE>

                        See Notes to Financial Statements


                                       F-4
<PAGE>

                            B2 Digital, Incorporated
                      FKA Telecommunication Products, Inc.
                            Statements of Cash Flows

                                                     Years ended March
                                                         March  31,
                                            -----------------------------------
                                                 2005                 2004
                                            -------------         -------------
Cash Flows from Operating Activities
Net income (loss)......................     $  (4,801,840)        $  (2,221,318)
Adjustments to reconcile net income
 to net cash from operating activities
 Depreciation .........................           117,888                99,565
 Impairment of inventories ............         1,100,000
 Stock issued for Services ............         2,690,701             1,415,518
Decrease (increase) in:
Accounts receivable ...................           (16,340)               36,643
Inventory .............................           (15,935)               11,794
Other assets ..........................           (12,790)
Increase (decrease) in:
Accounts payable and accrued
expenses ..............................            22,499               384,927
                                            -------------         -------------
Net cash provided (used)
By operating ..........................          (915,817)             (272,851)
                                            -------------         -------------
Cash Flows From Investing Activities
Acquisition of property
And equipment .........................            (5,423)               (2,059)
Acquisition Home Movie Network, Inc.
net of cash acquired ..................                                 (66,716)
                                            -------------         -------------
Net cash provided (used) in investing
activities ............................            (5,423)              (68,775)
                                                                        (36,974)
                                            -------------         -------------
Cash Flows From Financing Activities
Increase in Notes payable .............           120,000                83,050
Proceeds from sale of stock ...........           805,858               259,669
                                            -------------         -------------
Net cash used by financing
Activities ............................           925,858               342,719
                                            -------------         -------------

Net increase (decrease) in cash .......             4,618                 1,093
Cash, beginning .......................             1,093
                                            -------------         -------------
Cash, ending ..........................     $       5,711         $       1,093
                                            =============         =============

Schedule of noncash investing and financing transactions

Common stock issued for B 2 network ...     $     100,000         $          --
Amounts Payable Converted to
preferred Stock........................     $     800,000
Common stock issued for debt...........                           $     156,000

                        See Notes to Financial Statements


                                       F-5
<PAGE>

                             B2Digital, Incorporated
                        Telecommunication Products, Inc.
                          Notes to Financial Statements

1.    Summary of significant accounting policies

Nature of operations - The Company was incorporated in Colorado on June 8, 1983
as Telecommunication Products, Inc. (referred to herein as "Telecommunication
Products," the "Company" or "Telpro"), a technological development corporation.
The company was established as a developer of data compression technology. On
July 20, 2004, Telecommunication Products, Inc. changed its name to B2Digital,
Inc. and reincorporated in the State of Delaware.

The acquisition of Hotel Movie Networks Inc. which closed on August 1, 2003
provided a revenue-positive operations infrastructure and an extensive network
of contractors throughout the United States to both deploy new technology and
expand product lines. Operations consist of on going pay-per-view movie rentals
from hotel establishments and related services with these hotel establishments.

On March 6, 2004, we entered into a Letter of Agreement with B2 Networks, LLC,
whereby B2 Networks would provide data center facilities, management systems for
video and set top services and assist with operating the Hotel Link services.

Cash and cash equivalents - For purposes of the statement of cash flows, the
Company considers all highly liquid debt with original maturities of ninety days
or less, to be cash equivalents.

Accounts receivable - The Company follows the allowance method of recognizing
uncollectible accounts receivable. The allowance method recognizes bad debt
expense as a percentage of accounts receivable based on a review of accounts
receivable outstanding and the Company's prior history of uncollectible accounts
receivable.

Fair value of financials instruments - The Company's financial instruments
includes accounts receivable, accounts payable, notes payable and long-term
debt. The fair market value of accounts receivable and accounts payable
approximate their carrying values because their maturities are generally less
than one year. Long-term notes receivable and debt obligations are estimated to
approximate their carrying values based upon their stated interest rates.

Inventories - Inventories are stated at the lower of cost (first-in, first-out)
or market.

Property and equipment - Property and equipment are stated at cost, net of
accumulated depreciation. Depreciation is provided primarily by the
straight-line method over the estimated useful lives of the related assets
generally of five to seven years.

Income taxes -The Company accounts for income taxes in accordance with Statement
of Financial Accounting Standards No. 109, "Accounting for Income Taxes", which
requires an asset and liability approach to financial accounting and reporting
for income taxes. Deferred income tax assets and liabilities are computed
annually for differences between the financial statement and tax basis of assets
and liabilities that will result in taxable or deductible amounts in the future
based on enacted tax laws and rates applicable to the periods in which the
differences are expected to affect taxable income. Valuation allowances are
established when necessary to reduce the deferred tax assets to the amount
expected to be realized. Income tax expense is payable or refundable for the
period plus or minus the change during the period in deferred tax assets and
liabilities.


                                       F-6
<PAGE>

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

Revenue recognition - The Company's revenues are derived principally from the
sale of satellite systems and pay-per-view movies to hotels. Revenue from the
sale of satellite systems is recognized after the system has been installed, and
there are no longer any material commitments to the customer. The Company
recognizes revenue from the pay-per-view movies on the accrual basis. The
Company bills its customers for the month that services are performed.

Stock options - The Company accounts for stock options issued to employees in
accordance with APB No.25.

The Company has elected to adopt the disclosure requirements of SFAS No.123
"Accounting for Stock-based Compensation". This statement requires that the
Company provide proforma information regarding net income (loss) and income
(loss) per share as if compensation cost for the Company's stock options granted
had been determined in accordance with the fair value based method prescribed in
SFAS No. 123. Additionally, SFAS No. 123 generally requires that the Company
record options issued to non-employees, based on the fair value of the options.

Income (Loss) per share - Basic earnings per share includes no dilution and is
computed by dividing net earnings (loss) available to stockholders by the
weighted number of common shares outstanding for the period. Diluted earnings
per share reflect the potential dilution of securities that could share in the
Company's earnings. During the years ended March 31, 2005 and 2004, there were
no dilutive securities.

Recent accounting pronouncements

FASB Interpretation 46R "Consolidation of Variable Interest Entities", as
revised (FIN 46R), requires that variable interest entities created before
December 31, 2003 be consolidated during the first interim period beginning
after December 15, 2003. Accordingly, on January 1, 2004, we adopted FIN 46R and
the initial application had no impact on our financial statements.

In January, 2004 the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 132 (revised 2003) "Employers' Disclosures
about Pensions and Other Postretirement Benefits", an amendment of FASB
Statements No. 87, 88, and 106. The Statement revises employers' disclosures
about pension plans and other postretirement benefit plans. The statement
retains the disclosure requirements contained in FASB Statement No. 132, which
it replaces, and requires additional annual disclosures about the assets,
obligations, cash flows, and net periodic benefit cost of defined benefit
pension plans and other defined benefit postretirement plans. Statement No. 132R
requires us to provide disclosures in interim periods for pensions and other
postretirement benefits. We adopted Statement No. 132R in the quarter ended
March 31, 2004 and the initial application had no impact on our financial
statements.

In November 2004, the FASB issued SFAS No. 151, "Inventory Costs an amendment of
ARB No. 43, Chapter 4." This Statement clarifies the accounting for abnormal
amounts of idle facility expense, freight, handling costs, and wasted materials.
This Statement is effective for inventory costs incurred during fiscal years
beginning after June 15, 2005. The initial application of SFAS No. 151 will have
no impact on the Company's financial statements.

In December 2004, the FASB issued SFAS No. 152, "Accounting for Real Estate
Time-Sharing Transactions - an amendment of FASB Statements No. 66 and 67." This
Statement references the


                                       F-7
<PAGE>

financial accounting and reporting guidance for real estate time-sharing
transactions that is provided in AICPA Statement of Position 04-2, "Accounting
for Real Estate Time-Sharing Transactions." This Statement also states that the
guidance for incidental operations and costs incurred to sell real estate
projects does not apply to real estate time-sharing transactions. This Statement
is effective for financial statements for fiscal years beginning after June 15,
2005. The initial application of SFAS No. 152 will have no impact on the
Company's financial statements.

In December 2004, the FASB issued SFAS No. 153, "Exchanges of Nonmonetary Assets
- an amendment of APB Opinion No. 29." This Statement eliminates the exception
for nonmonetary exchanges of similar productive assets and replaces it with a
general exception for exchanges of nonmonetary assets that do not have
commercial substance. A nonmonetary exchange has commercial substance if the
future cash flows of the entity are expected to change significantly as a result
of the exchange. This Statement is effective for nonmonetary asset exchanges
occurring in fiscal periods beginning after June 15, 2005. The Company does not
expect application of SFAS No. 153 to have a material affect on its financial
statements.

2.    Purchase of assets of Hotel Movie Network, Inc.

On March 31, 2003 the Company agreed to purchased Hotel Movie Network, Inc. The
transaction wsas completed August 1, 2003. The acquisition was recorded as a
purchase. The Company paid $150,000 and issued the securities. The securities
were two million shares of common stock, a promissory note convertible into one
million shares of Series A Preferred Stock, and a promissory note convertible
for $1,276,809 convertible into an amount of preferred stock which has net to be
determined (approximately 1,276,809 shares). The promissory note can be
converted into preferred stock at $1 per share. The transaction was recorded as
follows:

Assets purchased from Hotel Movie Network, Inc.:

      Cash                                                          $     8,284
      Accounts receivable                                                97,047
      Inventory                                                       1,283,160
      Property and equipment                                            161,123
      Total assets acquired                                           1,549,614

Liabilities assumed from Hotel Movie Network, Inc.:

      Accounts payable and accruals                                     110,936
      Total liabilities assumed                                         110,936

      Net purchase price                                            $ 1,438,678

The following unaudited pro forma summary presents the results of operations for
the year ended March 31, 2004 of the Company as if the business combination had
occurred on April 1, 2003.

      Revenues                                                      $   720,519
      Net income (loss)                                             $(2,545,444)
      Earnings (loss) per share                                     $     (.055)


                                       F-8
<PAGE>

The above amounts are based upon certain assumptions and estimates which the
Company believes are reasonable. The pro forma results do not necessarily
represent results which would have occurred if the business combination had
taken place at the date and on the basis assumed above.

In July 2002 two officers of the Hotel Movie Network, Inc. contributed a note
receivable valued at $1,898,072 in exchange for the issuance of 25,000,000
shares of common stock. The note consisted of funds due from an entity, which
had acquired the pay-per-view operations from the officers. That entity was an
unrelated party. The note contributed was valued at its predecessor cost. The
note has a collateral clause securing all of the assets of the pay-per-view
operations. The note was in default and the Hotel Movie Network, Inc.
immediately foreclosed on the note and acquired all of the pay-per-view assets
and related liabilities. The assets and liabilities were recorded at the
carrying value of the note.

3.    Agreement with B2 Networks

On March 6, 2004, we entered into a Letter of Agreement with B2 Networks, LLC,
whereby B2 Networks would provide data center facilities, management systems for
video and set top services and assist with operating the Hotel Link services. On
April 23, 2004, we agreed to purchase 20% of B2 Networks, LLC in exchange for
1,667,667 shares of common stock and $500,000. On August 2004, we amended this
agreement to reduce the amount of purchase to 10% of the LLC in exchange for
$200,000 and 2,667,000 shares of common stock.

On December 15, 2004, we entered into a Letter of Agreement with B2 Networks
whereby B2Networks will provide certain operations assistance to the company in
exchange for a portion of gross revenue or $10,000 per month.

The amounts paid to B2 Networks have been recorded as research and development
since the project has not achieved technical feasibility.

4.    Inventories

Inventories consist of finished goods.

During the year ended March 31, 2005 the Company recognized an impairment loss
of $1,100,000 related to inventories.

5.    Notes payable

The Company has a promissory note which bears interest at six percent and is
unsecured. The note is due September, 2003. If the note is not paid at maturity,
the unpaid balance and accrued interest shall bear interest at twelve percent.
The note was retired in April 2005 in return for common stock and cash.

On April 2004 the Company converted 800,000 shares of Series A preferred stock
owned by the Company's president and CEO Robert Russell to a note payable. Mr
Russell had previously converted the note payable into the preferred stock. The
conversion is back to a note payable that reverts the capital back to its
previous condition which pays 7.5% per annum.

6.    Bond payable

The Company has a bond payable which bears interest at ten percent and is
unsecured. The bond was due July, 2004. The Company has negociated the right to
pay the bond when it has adequate source of funding.

7.    Preferred stock

The Company has 50,000,000 authorized shares $.001 par value preferred stock
with rights and preferences as designated by the board of directors at the time
of issuance. The board has designated two million shares as Series A each share
may be converted into 240 shares of common stock.


                                      F-9
<PAGE>

8.    Income taxes

There is no provision for income taxes since the Company has incurred net
operating losses. Income taxes at the federal statutory rate is reconciled to
the Company's actual income taxes as follows:

                                              2005                       2004
Federal income tax benefit at
statutory rate (34%)                   $  (1,400,000)             $    (827,000)
State income tax benefit net
of federal tax effect                       (217,000)                   (62,000)
Deferred income tax valuation
allowance                                  1,617,000                    889,000
                                       -------------              -------------
                                       $          --              $          --

The Company's deferred tax assets are as follows:

Net operating loss carryforward        $   2,875,000              $   1,258,000
Valuation  allowance                      (2,875,000)                (1,258,000)
                                       -------------              -------------
                                       $          --              $          --

At March 31, 2005, the Company has net operating loss carryforwards of $8
million which may be available to offset future taxable income through 2022.

9.    Litigation

We settled the lawsuit filed by John M. Brazier against us, our transfer agent
and Mr. Russell filed in May 2003 in the District Court of Denver in the state
of Colorado. The settlement terms require us to issue Mr. Brazier 770,000 shares
of our common stock and warrants to purchase an additional 2 million shares of
our common stock at $0.15 per share. Additionally, we will pay Mr. Brazier
$177,500 in cash. We have already issued the shares to Mr. Brazier.

In July 2003, we were served with a lawsuit from William B. Krusheski in United
States District court for Southern District of California. The complaint seeks
in excess of $75,000 on a note allegedly due and $135,000 in other compensatory
damages. In April 2004 the Company entered into a settlement agreement with
incremental cash payments totaling $100,000 payable over the course of 4 months
beginning May 15, 2004. In June 2004, the county court of San Diego, California
awarded a default judgment in favor of Mr. Krusheski in the amount of $135,000.
The company has offered payments of $5,000 per month until the debt is settled.
We have to date had no response from Mr. Krusheski.

In March 2004 Mr. Dennis H. Johnston a former Director and General Counsel filed
a lawsuit in the state of California seeking back salaries and stock for his 2
years of service to the Company. We responded with a motion to strike and a
motion for demurrer. We subpoenaed several individuals, corporations and certain
documentation. In July, Mr. Johnston filed a "Motion to Quash" which was denied.
On August 3, 2004, Mr. Johnston dismissed the lawsuit.


                                      F-10
<PAGE>

10.   Going Concern

The Company's financial statements are prepared using generally accepted
accounting principles applicable to a going concern which contemplates the
realization of assets and liquidation of liabilities in the normal course of
business. The Company has incurred losses from operations which have resulted in
an accumulated deficit of $9,369,933 at March 31, 2005, which together raises
substantial doubt about the Company's ability to continue as a going concern.
The accompanying financial statements do not include any adjustments relating to
the recoverability and classification of asset carrying amounts or the amount
and classification of liabilities that might result from the outcome of this
uncertainty. Management believes that the Company will generate sufficient
revenue and commissions through its licensing agreements and hotel pay-per-view
to cover operating expenses in the future, although no assurance of this can be
given.


                                      F-11
<PAGE>

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

None.

ITEM 8A. CONTROLS AND PROCEDURES

An evaluation was performed under the supervision and with the participation of
our management, including our Chief Executive Officer and our Chief Financial
Officer, of the effectiveness of our disclosure controls and procedures as of
March 31, 2005. Based on that evaluation, our management, including the CEO and
CFO, concluded that our disclosure controls and procedures are effective to
ensure that information required to be disclosed by us in reports that we file
or submit under the Securities Exchange Act is recorded, processed, summarized
and reported as specified in the SEC's rules and forms.

During the last quarter, there were no changes in our internal control over
financial reporting that have materially affected, or that are reasonably likely
to materially affect our internal control over financial reporting.

ITEM 8B. OTHER INFORMATION

On February 23, 2005, Dutchess Private Equities Fund II , LP declared a note
issued by us in the amount of $26,400 due. Subsequent to March 31, 2005, on July
7, 2005, Dutchess notified us that they elected to switch the Note and
associated penalties to a Convertible Debenture with registration rights
requiring a that a registration agreement be filed within twenty days and
effective within forty days. We have not filed a registration statement or made
any payments on this Note and Dutchess is claiming penalties of $1,000 per day
as a result. At July 6, 2005, Dutchess alleged the principal balance was
$35,176.31. No action has been filed on this matter,

                                    PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS OF REGISTRANT AND COMPLIANCE WITH SECTION
16(a) OF THE EXCHANGE ACT

NAME                          AGE         POSITION
----                          ---         --------
Robert C. Russell              38         CEO and Director
Igor Loginov                   44         Chief Technical Officer, Director
Marcia A. Pearlstein           50         Interim Chief Financial Officer
                                          Corporate Secretary, Director


                                       27
<PAGE>

Robert C. Russell has been our Chief Executive Officer and director since
January 2002 and is responsible for managing our overall business affairs. Prior
to this, Mr. Russell was President and Chief Executive Officer of Interleisure
S.A. from January 1999 to January 2002 when InterLeisure was purchased by
Telecommunication Products Inc. Interleisure S.A. was a technology company
developing data compression software and systems for the internet market. He is
a native of Northern Ireland who attended Damelin College in South Africa, where
he obtained a National diploma in financial management.

Igor Loginov, PhD has been our Chief Technological Officer since May 2002 and is
responsible for the design, development, and deployment of our technology. Prior
to this, Mr. Loginov was a Senior Project Manager for Interleisure S.A. from
July 2000 until July 2002 when InterLeisure was purchased by Telecommunication
Products, Inc. From 1998 to 2000 Mr. Loginov held a role as a Senior Software
Engineer for Semantica, Ltd, where he led development of accounting and business
software applications. Mr. Loginov has over fifteen years of experience in
computer and Internet-related technologies and holds a Doctorate degree in
physics obtained from Belarussian State University.

Marcia A. Pearlstein has been the Corporate Secretary and Interim Chief
Financial Officer since December 21, 2003. Ms. Pearlstein joined B2Digital in
2002. A native of the United States she obtained her B.S. and M.B.A. in Business
Administration with a concentration in Finance from the University of
Pennsylvania graduating Summa Cum Laude. Prior to joining B2Digital Ms.
Pearlstein worked at an executive placement service in which she was General
Manager and Controller over a seven-year period.

AUDIT COMMITTEE FINANCIAL EXPERT

The Company does not have an audit committee financial expert, but plans to
designate an expert once it generates sufficient revenue.

SECTION 16(A) REPORTING

Section 16(a) of the Securities Exchange Act of 1934 requires the Corporation's
executive officers and directors and holders of greater than 10% of our
outstanding common stock to file initial reports of their ownership of our
equity securities and reports of changes in ownership with the Securities and
Exchange Commission. Based solely on a review of the copies of such reports
furnished to us and written representations from our executive officers and
directors, we believes that all Section 16(a) filing requirements were complied
with in the fiscal year ended March 31, 2005 except both Robert Russell and
Marcia Pearlstein failed to timely file Form 4s for their acquisitions of
1,000,000 and 200,000 shares, respectively, of Series A Convertible Preferred on
February 10, 2005. These Forms were subsequently filed on February 15, 2005 and
February 16, 2005, respectively.


                                       28
<PAGE>

CODE OF ETHICS

The Company has adopted a code of ethics that applies to its principal executive
officers, principal financial officers and principal accounting officers or
controllers and those performing similar functions.

ITEM 10. EXECUTIVE COMPENSATION

The following table sets forth certain information regarding our Executive
Officers' compensation for fiscal years ending March 31, 2005, 2004 and 2003:

                           SUMMARY COMPENSATION TABLE

                               ANNUAL COMPENSATION

<TABLE>
<CAPTION>
                                                               Other      Restricted   Options     LTIP                   All Other
 Name & Principal                                              Annual     Compen-      Stock       SARs       Payouts     Compen-
 Position                             Year    Salary ($)       Bonus      sation ($)   Awards     (#)(1)        ($)       Sation ($)
---------------------------------     ----     -------        -------     -------     -------     -------     -------     ---------
<S>                                   <C>       <C>                 <C>         <C>         <C>         <C>         <C>   <C>
Robert C. Russell,                    2005      90,000              0           0           0           0           0     430,000(1)
President                             2004      30,000        300,000           0           0           0           0           0
                                      2003           0              0           0           0           0           0           0
---------------------------------     ----     -------        -------     -------     -------     -------     -------     ---------
Marcia A. Pearlstein                  2005      60,000(2)       4,000           0           0           0           0      86,000(3)
Secretary,                            2004      12,000          9,000           0           0           0           0           0
Interim CFO                           2003           0              0           0           0           0           0           0
---------------------------------     ----     -------        -------     -------     -------     -------     -------     ---------
Igor Loginov,                         2005           0              0           0           0           0           0           0
Chief Technology Officer              2004           0              0       9,000           0           0           0           0
                                      2003           0              0           0           0           0           0           0
---------------------------------     ----     -------        -------     -------     -------     -------     -------     ---------
</TABLE>

(1)   On February 10, 2005, Mr. Russell received a signing bonus of 1,000,000
      shares of Series A Convertible Preferred Stock. These shares were valued
      at $.43 per share.
(2)   Payable in common stock, valued at $.001 per share.
(3)   On February 10, 2005, Ms. Pearlstein received a signing bonus of 200,000
      shares of Series A Convertible Preferred Stock. These shares were valued
      at $.43 per share.

EMPLOYMENT AGREEMENTS

We entered into a formal written employment agreement with Mr. Russell effective
January 25, 2002 which provides payments aggregating $125,000 per year. The
agreement was suspended and was reinstated in September 2003. On January 25,
2005, we entered into a new agreement with Robert Russell whereby Mr. Russell


                                       29
<PAGE>

agreed to serve as Chief Executive Officer of the company for a period of two
years for $240,000 per annum. Mr. Russell also received a signing bonus of
1,000,000 shares of Series A Convertible Preferred Stock.

On December 23, 2003, we entered into a consulting agreement with Marcia
Pearlstein, whereby Ms. Pearlstein would act as Interim Chief Financial Officer
and corporate secretary for one year for $60,000 per annum. On February 9, 2005,
we extended this agreement until December 31, 2005 and issued Ms. Pearlstein a
signing bonus of 200,000 shares of Series A Convertible Preferred Stock.

OPTIONS

For our fiscal year ending March 31, 2005, we did not issue options to our
executive officers or directors and they did not exercise any options.

COMPENSATION OF DIRECTORS

We do not currently compensate our directors although the Company intends to do
so in accordance with industry standards when cash flow resulting so dictates.
There are no stock options, stock grants, plans, LTIPS or Stock Appreciation
Rights in which any directors, have participated in the past fiscal year.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS

The following table sets forth certain information regarding beneficial
ownership of our common stock as of March 31, 2005 (i) by each person who is
known by us to beneficially own more than 5% of our common stock; (ii) by each
of our officers and directors; and (iii) by all of our officers and directors as
a group. Each person's address is c/o B2Digital, Inc., 9171 Wilshire Blvd.,
Suite B, Beverly Hills, California 90210

<TABLE>
<CAPTION>
Title of Class       Name and Address                 Amount and Nature     Percent of
                     of Beneficial                    of Beneficial         Class(2)
                     Owner (1)                        Owner
<S>                  <C>                              <C>                   <C>
Common Stock         Robert Russell                          27,339,150        8.1%
                     9171 Wilshire Blvd., Suite B
                     Beverly Hills, CA 90210
Series A
Preferred Stock                                               1,000,000(3)    83.3%

Common Stock         Igor Loginau                               240,000         <1%
                     9171 Wilshire Blvd., Suite B
                     Beverly Hills, CA 90210

Common Stock         Marcia A. Pearlstein                     4,200,000        1.2%
                     9171 Wilshire Blvd., Suite B
                     Beverly Hills, CA 90210
Series A
Preferred Stock                                                 200,000(3)    16.6%

Common Stock         Shares of all directors and             31,779,150        9.4%
                     executive officers
                     as a group (3 persons)

Series A             Shares of all directors and              1,200,000        100%
 Preferred Stock     executive officers
                     as a group (3 persons)
</TABLE>

*Less than 1% of outstanding shares of Common Stock.

(1)   The address of all individual directors and executive officers is c/o
      B2Digital, Inc. 9171 Wilshire Blvd., Suite B, Beverly Hills, CA 90210
(2)   There were 336,870,939 shares of common stock issued and outstanding on
      March 31, 2005. The calculation of percentage ownership for each listed
      beneficial owner is based upon the number of shares of common stock issued
      and outstanding on March 31, 2005, plus shares of common stock subject to
      options held by such person on March 31, 2005 and exercisable within 60
      days thereafter. The persons and entities named in the table have sole
      voting and investment power with respect to all shares shown as
      beneficially owned by them.
(3)   Series A Convertible Preferred Stock is convertible into common stock at a
      rate of 240 shares per each share of Series A held. The Series A votes
      with the common stock on an as converted basis.


                                       30
<PAGE>

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

For the year ending March 31, 2004, we issued Robert Russell our CEO and
president 8,108,238 shares of common stock as compensation; the transaction was
expensed at $330,000.

For the year ending March 31, 2004, we issued Marcia A. Pearlstein our CFO and
Secretary 200,000 shares of common stock as compensation; the transaction was
expensed at $9,000.

For the year ending March 31, 2004, we issued Igor Loginau 200,000 shares of
common stock as compensation; the transaction was expensed at $9,000.

For the year ending March 31, 2004, the company cancelled and returned to
treasury 1,054,029 belonging to a former Officer and Director.

On April 2004 the Company converted 800,000 shares of Series A preferred stock
owned by the Company's president and CEO Robert Russell to a note payable. Mr
Russell had previously converted the note payable into the preferred stock. The
conversion is back to a note payable that reverts the capital back to its
previous condition which pays 7.5% per annum.

For the year ended March 31, 2005, Mr. Russell received a signing bonus of
1,000,000 shares of Series A Convertible Preferred Stock, valued at $.43 per
share. The shares convert into common stock at a rate of 240 shares per one
share of common stock.


                                       31
<PAGE>

For the year ended March 31, 2005, Ms. Pearlstein received a signing bonus of
200,000 shares of Series A Convertible Preferred Stock, valued at $.43 per
share. The shares convert into common stock at a rate of 240 shares per one
share of common stock. We also issued Ms. Pearlstein 4,000,000 shares of common
stock; which was expensed at $4,000.

ITEM 13. EXHIBITS

The following exhibits are included as part of this Form 10-KSB. Reference to
"the Company" in this Exhibit List means B2Digital, Inc., a Delaware
corporation.

Number      Description
------      -----------
2.1         Asset Purchase Agreement between the Company and Hotel Movie
            Network, Inc., dated March 31, 2003 (incorporated by reference to
            Exhibit 10 of the Form 8-K filed on April 18, 2003).

3.1(a)      Restated Articles of Incorporation (filed as an exhibit to the
            company's Form 8-K filed on October 19, 2001 and incorporated by
            reference herein)

3.1(b)      Amendment to Articles of Incorporation (Incorporated by reference
            from 10QSB dated December 31, 2004).

3.1(c)      Certificate of Designation of Series A Convertible Preferred Stock

3.2         Bylaws (incorporated by reference to Exhibit 3.2 of the company's
            Registration Statement on Form S-18, Registration No. 2-86781-D)

4.1         2005 Non-Qualified Stock Compensation Plan (filed as Exhibit 10.1 to
            the Company's Form S-8 filed on January 11, 2005 and incorporated by
            reference herein).

10.1        Employment Agreement dated January 25, 2005, with Robert C. Russell
            (Incorporated by reference from 10QSB dated December 31, 2004).

10.2        Marketing and Services Agreement between the company and
            InnNovations Multimedia Systems Inc dated April 12, 2004
            (Incorporated by reference to 8-K filed April 12, 2004).

10.3        Member Interest Purchase Agreement between the company and
            B2Networks, Inc. dated April 23, 2004 (Incorporated by reference to
            8-K filed April 23, 2004).

10.4        Consultant Agreement with Marcia A. Pearlstein (incorporated by
            reference from Form 10-QSB dated September 30, 2004).

10.5        Membership Interest Agreement with B2 Networks, LLC, as amended
            (incorporated by reference to Form 8-K filed August 12, 2004)

10.6        Operations Agreement with B2 Networks LLC (Incorporated by reference
            from 10QSB dated December 31, 2004).

10.7        Employment Agreement with Robert Russell (Effective January 25,
            2005) (Incorporated by reference from 10QSB dated December 31,
            2004).

14.1        Code of Ethics (Incorporated by reference to 10KSB filed June 19,
            2004)

31.1        Section 302 Certification of the Chief Executive Officer.

31.2        Section 302 Certification of the Interim Chief Financial Officer.

32.1        Section 906 Certification of the Chief Executive Officer and Interim
            Chief Financial Officer


                                       32
<PAGE>

ITEM 14. PRINCIPAL ACCOUNTANT FEES & SERVICES

Audit Fees

The aggregate fees billed by Larry O'Donnell, CPA, P.C. for professional
services rendered for the audit of the Company's annual financial statements on
Form 10-KSB and the reviews of the financial statements included in the
Company's Form 10-QSB's for the fiscal years ended March 31, 2005 was $2,760 and
March 31, 2004 was $3,500, respectively.

Audit-Related Fees

Audit-related fees for the period ended March 31, 2005 were $13,000 compared to
$16,000 for the period ended March 31, 2004.

Tax Fees or All Other Fees

There were no other fees for the period ended March 31, 2005 or March 31, 2004.

POLICY ON AUDIT COMMITTEE PRE-APPROVAL OF AUDIT AND PERMISSIBLE NON-AUDIT
SERVICES OF INDEPENDENT AUDITORS

The Company currently does not have a designated Audit Committee, and
accordingly, the Company's Board of Directors' policy is to pre-approve all
audit and permissible non-audit services provided by the independent auditors.
These services may include audit services, audit-related services, tax services
and other services. Pre-approval is generally provided for up to one year and
any pre-approval is detailed as to the particular service or category of
services and is generally subject to a specific budget. The independent auditors
and management are required to periodically report to the Company's Board of
Directors regarding the extent of services provided by the independent auditors
in accordance with this pre-approval, and the fees for the services performed to
date. The Board of Directors may also pre-approve particular services on a
case-by-case basis.

                                   SIGNATURES

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

                                        B2Digital, Incorporated


Date: August 9, 2005                    By: /s/ Robert C. Russell
                                            ---------------------------
                                            Robert C. Russell,
                                            Chief Executive Officer


                                       33
<PAGE>

In accordance with the Exchange Act, this report statement was signed below by
the following persons on behalf of the registrant in the capacities and on the
dates stated.

      SIGNATURE                         TITLE                         DATE
      ---------                         -----                         ----


/s/ Robert C. Russell         President,                          August 9, 2005
------------------------      Chief Executive Officer
Robert C. Russell


/s/ Marcia A. Pearlstein      Interim Chief Financial Officer     August 9, 2005
------------------------
Marcia A. Pearlstein


/s/ Igor Loginov              Chief Technical Officer             August 9, 2005
------------------------
Igor Loginov


                                       34