UNITED STATES

                    SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C.
                                FORM 10-KSB

[ X ]      ANNUAL  REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

     For the fiscal year ended December 31, 2000

[    ]     TRANSITION  REPORT  PURSUANT TO  SECTION  13  OR  15(d)  OF  THE
     SECURITIES EXCHANGE ACT OF 1934


                      Commission File No.  000-12139
                      Intelliquis International, Inc.
          (Exact name of Registrant as specified in its charter)

                      NEVADA                           87-0630562
          (State or other jurisdiction of            (IRS Employer
          incorporation or organization)          Identification No.)

                352 West 12300 South #300 Draper, Utah 84020
           (Address and zip code of principal executive offices)

     Registrant's telephone number, including area code: (801) 990-2600
Securities registered pursuant to Section 12(b) of the Act: NONE
Securities registered pursuant to Section 12(g) of the Act: NONE

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

Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained,
to the best of Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB.    [ x  ]

Revenue for the year ended December 31, 2000:   $ 2,427,236

As of December 31, 2000 the aggregate market value of the voting stock held
by non-affiliates of the Registrant was $632,474.84.
As   of  December  31,  2000  the  number  of  shares  outstanding  of  the
Registrant's Common Stock was 3108,221,475.

                                [1]

                                  PART I



ITEM 1.  DESCRIPTION OF BUSINESS
       Intelliquis International, Inc. ("the Company" or "Intelliquis") has
  become  a  republisher,  marketer and supporter  of  Internet  Year  2000
  utility,  reference and communication software products for the  computer
  software  retail market.  The Company was incorporated as  Leesburg  Land
  and  Mining  Inc., June 21, 1983 in Colorado for the purpose  of  seeking
  out  and developing a business opportunity.  Effective December 31, 1998,
  the  Company  acquired  all  of the equity of  Intelliquis  LLC,  a  Utah
  Limited  Liability Company, which then became a wholly  owned  subsidiary
  ("the  Subsidiary") of the Company.  During this same period the  Company
  changed  its  corporate  domicile  to Nevada  and  changed  its  name  to
  Intelliquis  International, Inc.  The Subsidiary was  founded  in  August
  1997  and  organized  in Utah in December 1997, as  a  Limited  Liability
  Company.   As  a  result  of  the  acquisition  of  the  Subsidiary,  the
  controlling   shareholders   of   the   Subsidiary   became   controlling
  shareholders of the Company.

       The  Company  built  a  position in the  software  market  by  first
  licensing  fully  tested software applications from independent  software
  developers  and  then  developing  or  acquiring  a  family  of  software
  applications.   During the year 2000 The Company's changed  its  emphasis
  to   Internet  Utilities  titles,  but  will  offer  software  titles  in
  reference,  and  communication programs both in the  North  American  and
  International  market.  The software products are being marketed  through
  traditional  software  distribution channels to retail  outlets  and  the
  Internet's  World  Wide  Web. Since the release of  the  Company's  first
  software  title  in November 1997, the Company has grossed  approximately
  $11 million in sales to date.

       The  Company has licensed and as current products, a total of  seven
  software  titles  through  the  end  of  2000  namely:  Web  Site  Medic,
  TotalFax,  Web  Site Traffic Builder, Traffic Analyzer,  Credit  Builder,
  Mass-E-Mailer, and Cyber Surveillance. In the last quarter of  1997,  the
  Company  republished and released its first three titles (NetFax, Speed98
  and  Credit  Builder).  During 1998, Intelliquis released  another  three
  titles (TotalFax, Fix2000, and Web Site Traffic Builder).

       In  1999,  the Company purchased and redesigned Credit  Builder  and
  launched  it  as  Credit Builder Deluxe. Intelliquis also released  Cyber
  Surveillance during fourth quarter 1999.

       Intelliquis announced the launch of two new titles at the  beginning
  of  2000,  Mass-E- Mailer and Web Site Traffic Analyzer (Traffic  Meter).
  Mass-E-Mailer  is  a  bulk e-mail message program that  allows  users  to
  broadcast  e-mails to multiple contact lists. Web Site  Traffic  Analyzer
  allows  Webmasters  and  web  site owners to track  and  monitor  traffic
  patterns to and within their Internet sites. The Company offers Web  Site
  Traffic  Analyzer as a stand-alone product and has included  the  product
  with Web Site Traffic Builder in a suite of Internet products.

       The  Company  developed and released it's own version  of  Web  Site
  Traffic  Builder  in July of 2000.  Traffic Builder  is  a  program  that
  submits  web  site  information to the major search  engines.   With  the
  availability  of  new and quality titles to license, the Company  intends
  to release new titles on a regular basis in 2001 and beyond.

       The Company has licensed and released a total of five software titles
  namely, IntelliFix2000 (formerly Fix2000), TotalFax, Website Traffic
  Builder, Credit Builder, and Speed98.  In the last quarter of 1997, the
  Company republished and released the first three titles (NetFax, Speed98
  and Credit Builder).  In the first quarter of 1998, Intelliquis released
  another two titles (TotalFax and Fix2000).  Intelliquis' most recent title
  (Website Traffic Builder) was released in August 1998.  With the
  availability of new and quality titles to license, the Company intends to
  release new titles on a regular basis in 1999 and beyond.


ITEM 2.  DESCRIPTION OF PROPERTY
       The  Company's  headquarters are located at 352  West  12300  South,
  Suite  300, Draper, Utah 84020.  The main telephone number of the Company
  is  (801)  990-2600.  The Company has a three-year lease of 3,900  square
  feet  of  office  space  and 5,638 square feet of warehouse  space.   The
  Company  performs  its  own  warehousing  and  fulfillment  of  all   its
  products.

                                [2]

ITEM 3.  LEGAL PROCEEDINGS
  1.   On The Planet, Inc. v. Intelliquis International, Inc., et al.  On May
  6, 1999, On The Planet, Inc.("OTP"), filed an action against the Company in
  the United States District Court for the District of Utah, entitled On The
  Planet v. Intelliquis International, Inc., Civil No. 2:99CV324K.  The
  claims purportedly arise out of a Software Rights Agreement under which the
  Company granted OTP "an exclusive license for direct sales along with a
  nonexclusive license for all other sales including but not limited to
  retail sales" for certain Y2K fix software identified therein.  OTP asserts
  that the Company violated that Agreement by engaging in direct sales or
  giving third parties a license to engage in direct sales of the Y2K fix
  software and other related products.  OTP asserts claims of copyright
  infringement, breach of contract and fraud.  In addition to injunctive
  relief, OTP is seeking unspecified damages including profits lost through
  the direct sales of the Y2K fix software, as well as attorneys' fees and
  punitive damages.  In response to the lawsuit filed by OTP, the Company
  denied the claims filed against it and has filed counterclaims seeking
  rescission of the Software Rights Agreement and asserting breach of
  contract of that Agreement.  The Company has also filed additional claims
  against OTP and its principal, Ernest Hemple, arising from conduct that the
  Company believes to constitute defamation and interference with contract.
  On November 8, 2000. On The Planet filed in Federal Court and release of
  lawsuit. In March 2001 OTP and the Company reached a settlement agreement
  relating to the remaining cash liability owed OTP.  OTP agreed to forgive
  any remaining debt in exchange for 1,500,000 of the Company's restricted
  common shares.

  2.   Rosenthal Engineering v. Intelliquis. This case was brought by Doren
  Rosenthal d/b/a Rosenthal Engineering ("Rosenthal") against the  Company,
  based on claims made by Rosenthal that stem from an alleged breach  of  a
  licensing  agreement. The case includes claims for  breach  of  contract,
  misappropriation of trade secrets, and others.
       Rosenthal is a software programmer that developed computer  programs
  designed  to  fix Year 2000 bugs in software programs. Rosenthal  alleges
  that  he  entered  into  a licensing agreement with Intelliquis,  whereby
  Intelliquis licensed Rosenthal's software program and included it in  the
  Company's own Year 2000 fix, and whereby Intelliquis did not pay  certain
  royalties  owed to Rosenthal, and also that Intelliquis made unauthorized
  use  of  Rosenthal's  program. Rosenthal  has  filed  a  lawsuit  in  the
  Superior  Court  for the State of California based on  the  contract  and
  related  claims,  and  is  seeking  damages  in  an  unspecified  amount.
  Rosenthal  has also threatened to file a lawsuit in Federal  Court  based
  on  claims  related to intellectual property. Outside of the  litigation,
  Rosenthal has stated that he is seeking in excess of $1,000,000.
               Intelliquis denies all of the allegations made by  Rosenthal
  in  the case, and has filed a Demurrer (the state court equivalent  of  a
  motion  to dismiss) to the complaint. Intelliquis has taken the  position
  that  any  royalties  owed,  if any, are of a nominal  amount,  and  were
  properly  withheld as a reserve due to potential returns of the Rosenthal
  product  as a result of product defects. Intelliquis also denies that  it
  engaged  in  any misappropriation of trade secrets, or any of  the  other
  acts  alleged.  Intelliquis intends to defend the present and  threatened
  actions of Rosenthal.
       This  matter  is in its early stages, and the outcome is  uncertain.
  There  can  be  no assurance that Intelliquis will be successful  in  its
  defense  of  the case, and in the event that Intelliquis is unsuccessful,
  the amount of potential damages that may be awarded is also uncertain.

  3.   United  Television,  Inc. d.b.a. KTVX 4 Utah vs.  Intelliquis,  LLC,
  Third  District  Court,  Salt  Lake  County,  State  of  Utah  Civil  No.
  000909917; In its Complaint, United Television, Inc. asserts a claim  for
  payment  in the amount of $5,848.67 purportedly owed for the broadcasting
  of  advertising for Intelliquis International, Inc. (the "Company").   On
  February  7,  2001,  United Television and the  Company  entered  into  a
  Stipulation   through  which  the  Company  agreed  to  pay   to   United
  Television, Inc. the sum of $2,500.00 payable in three installments,  the
  final  installment in the amount of $250.00 being due on April 16,  2001.
  Upon payment in full, this matter will be dismissed, with prejudice.

  4.  Onesource.com, Inc. vs. Intelliquis, LLC, Third District Court, Salt
  Lake County, State of Utah Civil No. 000411165: Onesource seeks to
  recover the sum of $44,943.11, allegedly owed for the packaging,
  shipping and distribution of software products produced by the Company.
  The Company has filed an Answer and Counterclaim through which it seeks
  to recover the sum of approximately $50,000.00.
                                [3]

  The claim of the Company arises from the shipment of packaged product by
  Onesource in an amount substantially in excess of the amount ordered by
  distributors and the consequent return of those products resulting in a cash
  reimbursement paid by Onesource and debited to the Company.  Discovery
  is proceeding in this matter.
       This  matter  is in its early stages, and the outcome is  uncertain.
  There  can  be  no assurance that Intelliquis will be successful  in  its
  defense  of  the case, and in the event that Intelliquis is unsuccessful,
  the amount of potential damages that may be awarded is also uncertain.

   5.          Elite  Marketing, LC vs. Intelliquis, LLC,  Fourth  District
  Court, Utah County, State of Utah Civil  No.  00403243:  Elite Marketing
  has asserted  claims  against  the Company  through which it seeks to recover
  $19,180.32, allegedly  due  as payment  for  the production of compact discs.
  Elite Marketing and the Company entered into a Stipulation and Settlement
  Agreement on March  14, 2001.   That Agreement requires that the Company make
  payments  to  Elite Marketing  in  the  total amount of $4,000.00, of that
  amount  a  final payment in the amount of $2,000.00 is due and payable on
  April 15,  2001. Upon  receipt  of  payment in full by Elite Marketing, the
  Complaint  in this matter will dismissed, with prejudice.

  6.  All West Communications vs. Intelliquis, LLC, Third District Court,
  Salt Lake County, State of Utah Civil No. 000410898: All West
  Communications has filed a Complaint seeking the recovery of $12,677.21
  allegedly owed for telecommunication services.  Intelliquis has agreed
  to make monthly payment of $1,000 per month till satisfied.

  7.         MCB Printing, Inc. d.b.a. Excell Graphics, Inc. vs. Intelliquis,
  et al., Fourth District Court, Utah County, State of Utah Civil No.
  000403250:  In its Complaint, MCB Printing, Inc. seeks to recover
  $16,350.50 allegedly owed for printing services provided to the Company.
  The Company has filed an Answer through which it denies that any amounts
  are owing to plaintiff.  Discovery is now under way in this matter.  This
  matter is in its early stages, and the outcome is uncertain. There can be
  no assurance that Intelliquis will be successful in its defense of the
  case, and in the event that Intelliquis is unsuccessful, the amount of
  potential damages that may be awarded is also uncertain.

  8.  Cyberspace Headquarters, LLC vs. Intelliquis International,
  Inc.,United States District Court, Central District of California, State
  of California Civil No.  00-12834 AHM: In this action Cyberspace
  Headquarters claims that the Company breached a License Agreement which
  licensed certain software to the Company for inclusion in its products.
  Cyberspace Headquarters argues that because the License Agreement was
  breached, the Company's license to make use of that software was
  terminated and thus, through continued sales, the Company infringed on
  the Cyberspace Headquarters copyright to that software.  The Company has
  filed an Answer in which it denies those allegations and will file a
  Counterclaim through which it will seek to recover damages arising from
  certain defects in the software licensed from Cyberspace Headquarters.
  In a Rule 26(f) Report, Cyberspace Headquarters states that it will seek
  to recover damages in an amount between $50,000.00 and $200,000.00.  The
  Company has submitted a Notice of Claim to its insurer, Evanston
  Insurance Company.  The insurer, at this time, has neither admitted nor
  denied coverage.
  This  matter is in its early stages, and the outcome is uncertain.  There
  can  be  no assurance that Intelliquis will be successful in its  defense
  of  the  case,  and  in the event that Intelliquis is  unsuccessful,  the
  amount of potential damages that may be awarded is also uncertain.

  9.              Cyberspace   Headquarters,   LLC   vs.   Intelliquis   In
  ternational,  Inc., Superior Court, State of California,  County  of  Los
  Angeles  Civil  No.   BC241520;  In  this  state  court  companion  case,
  Cyberspace  Headquarters seeks to recover damages allegedly arising  from
  the  breach  of  the  License Agreement, as discussed immediately  above,
  and,  in  addition,  has asserted claims purportedly  arising  under  the
  California  Business Practices Act for an interference  with  prospective
  economic  advantage.  Cyberspace Headquarters alleges that it is entitled
  to  recover  "not less than $45,000.00" on its breach of contract  claim.
  The  Company has filed an Answer denying the material allegations of  the
  Complaint  and will file a Counterclaim based on the defective  software.
  Cyberspace Headquarters has not specified the damages, which it seeks  to
  recover on the remaining claims. This matter is in its early stages,  and
  the  outcome  is  uncertain. There can be no assurance  that  Intelliquis

                                [4]

  will  be  successful in its defense of the case, and in  the  event  that
  Intelliquis is unsuccessful, the amount of potential damages that may  be
  awarded is also uncertain.

  10.   MSAS Global Logistics, Inc. vs. Intelliquis, LLC d.b.a. Intelliquis
  International,  Inc.  Third District Court, Salt Lake  County,  State  of
  Utah  Civil No. 00411518: In its Complaint, MSAS Global Logistics asserts
  claims  based  on  an  open  account for the shipment  of  the  Company's
  products  through which it seeks to recover $91,004.21.  The Company  has
  filed  an  Answer, denying the material allegations of the Complaint  and
  has   asserted  a  Counterclaim  through  which  it  seeks   to   recover
  $300,000.00 as damages for the negligent destruction of certain  products
  by  agents  of  MSAS Global Logistics.  This proceeding  remains  in  the
  discovery  stage  of litigation.This matter is in its early  stages,  and
  the  outcome  is  uncertain. There can be no assurance  that  Intelliquis
  will  be  successful in its defense of the case, and in  the  event  that
  Intelliquis is unsuccessful, the amount of potential damages that may  be
  awarded is also uncertain.


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS
None

                                  PART II


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

     The  Company's  Common  Stock has been traded on  the  OTC  Electronic
  Bulletin  Board under the symbol INTQ since February 5, 1999.   Prior  to
  February  5,  1999, there was no known public trading  in  the  Company's
  Common  Stock.    In April 1999, the Company completed  a  forward  stock
  split of one for three shares through a stock dividend.

     The  following  table  reflects the high and low  bid  prices  of  the
  Company's  Common Stock as reported by the OTC Electronic Bulletin  Board
  from  February 5, 1999 to March 31, 2000 (post stock split).  Such prices
  are  inter-dealer  quotations  without  retail  mark-ups,  markdowns   or
  commissions, and may not represent actual transactions.

     1999  Calendar  Period:                      High      Low

     1st Quarter                               $  5.00      1.50

     2nd Quarter                                  6.26      2.75

     3rd Quarter                                  5.00      2.125

     4th Quarter                                  2.8125    0.5625

     2000 Calendar Period:

     1st Quarter                                  2.87      0.50

     2nd Quarter                                  1.43      0.375

     3rd Quarter                                  0.4375    0.17

     4th Quarter                                  0.24      0.04


     As of December 31, 2000, there were 1093 stockholders of record.

                                [5]

     The  Company does not presently pay cash dividends on its Common Stock
  and  anticipates that, for the foreseeable future, no cash dividends will
  be paid on its Common Stock.


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

Background

     The  Company  was  incorporated as Leesburg Land and  Mining  Inc.  in
  Colorado  for  the  purpose  of seeking out  and  developing  a  business
  opportunity.   Effective December 31, 1998, the Company acquired  all  of
  the  equity  of  Intelliquis  LLC,  which  then  became  a  wholly  owned
  subsidiary  ("the Subsidiary") of the Company.  During this  same  period
  the  Company  changed its corporate domicile to Nevada  and  changed  its
  name  to  Intelliquis International, Inc.  The Subsidiary was founded  in
  August  1997  and  incorporated  in December  1997,  as  a  Utah  Limited
  Liability  Company.   As a result of the acquisition of  the  Subsidiary,
  the   controlling  shareholders  of  the  Subsidiary  became  controlling
  shareholders of the Company.

     The  Company  (hereafter "the Company" may  be  used  to  include  the
  activities of its newly acquired Subsidiary) has built a position in  the
  software  market  by  first licensing fully tested software  applications
  from  independent software developers and then developing or acquiring  a
  family  of  software applications.  The Company's main emphasis  lies  in
  Internet  Utilities titles, but will offer a selection of  reference  and
  communication  titles  both  in  the  North  American  and  International
  markets.   The  software products are being marketed through  traditional
  software  distribution channels, retail outlets and the Internet's  World
  Wide  Web.   Since the release of the Company's first software  title  in
  November  1997,  the Company has grossed approximately $11  111111million
  in  sales  to  date.  The Company is currently building distribution  and
  direct sales capabilities worldwide.

Liquidity and Capital Resources

     During  the year ended December 31, 2000, the Company had a  net  loss
  attributable  to  common shareholders of $10,736,363.  During  the  years
  ended  December  31,  1999  and  2000,  the  Company's  operations   used
  $1,755,898 and $336,240 of cash respectively.  The Company's decrease  in
  cash for operating activities is primarily attributable to a decrease  in
  sales and collections from its account receivables.

     Liquidity  is  a  significant concern for the  Company  until  it  can
  generate  adequate  cash  flows  from  operations,  which  are  primarily
  dependent  on  the  development,  marketing  and  distribution   of   the
  Company's  products.  Management believes that continued  financing  will
  be  needed  to provide working capital for operations.  In addition,  the
  Company  is  continuing  to expand into International  markets  including
  Canada,  Europe  and Latin America.  However, the Company anticipates  an
  increase  in  sales from both direct and the Internet  for  its  web-site
  related software programs.

Results of Operations

      The  Company  derives  revenue  from  software  products,  which  are
  developed  or republished by Intelliquis. The Company sells its  products
  in  North America primarily through retailers and distributors and direct
  over  the  Internet.  The Company's international sales represented  less
  than 20% of sales during fiscal 2000.


     The  Company's  sales decreased to $2,427,236 in 2000 from  $7,457,568
  for  fiscal 1999.  The Company's decrease of sales and returns of its Y2K
  software programs is one of the main reasons for the overall decrease  in
  business.  Certain of the Company's distributors, including  its  largest
  distributor  have the right to return product for credit.   The  decrease
  in  sales is also related to the Company's inability to collect from  its
  primary  distributor. This did not allow the Company to  have  sufficient
  capitol to supply enough products to its new and existing customers.

                                [6]

     The  Company  increased market penetration in 2000 with  TotalFax  and
  Website  Traffic  Builder,  Mass E Mailer and Traffic  Analyzer  software
  programs.  The Company believes that sales for its current programs  will
  remain  steady throughout the year.  In addition, the Company is planning
  to release at least one new software program every six months.

     Cost  of  sales  includes  cost  of  goods  sold,  royalties  paid  to
  developers  and the costs for maintaining technical support.    The  cost
  of  sales  totaled $559,210 for fiscal 2000 and constituted 23% of  total
  sales.  The  Company anticipates the cost of sales will be  approximately
  40%  of  sales  for  the  year 2001.  A large portion  of  the  marketing
  expense is determined by sales volume.

     General  and  administrative expenses increased to  $5,318,637  during
  fiscal  2000.  The increase in costs can be attributed to the  settlement
  cost,  legal fees dealing with the On the Planet litigation and the  cost
  of  Public  Relations(PR)  for the company.  The  Company  believes  that
  general  and  administrative expenses will decrease as operations  become
  more efficient and should be 25% of sales.

    The Company had a net loss of $10,736,363 compared to a net loss of
  $74,506 for fiscal 1999.  The primary reason for the net loss was the
  write-off  $551,382 of the ISA card inventory, settlement of the On the
  Planet matter and the company is forced to write off a large percentage
  of its accounts receivable, primarily from its major distributor. The
  Company plans to return to profitability for the year 2001 by managing
  cost of sales, to achieve an increased profit margin, build direct
  Internet sales, lower overhead and tighter collection procedures.

     For 2001, the Company is expected to continue with its overseas growth
  in  its current product lines.  The Company established sales/fulfillment
  centers  in  England  to handle sales in Europe.  The  Company  has  also
  signed   agreements   with   a   number  of   established   international
  distributors in Spain, Netherlands, and the United Kingdom.

     The  Company  has  down-sized it number  of  employees  but  does  not
  anticipate   any  production  and/or  sales  facilities   and   personnel
  limitations  to fulfill its goals for 1999 2001 and beyond.  The  Company
  is  also  expanding  its  sales potential and  presence  by  selling  its
  products   directly   to   consumers  over  the  internetInternet,   thus
  eliminating  a  significant overhead of wholesale  and  retail  marketing
  through  existing  channels.  During the year 2000 the  Company  built  a
  specific   Website   for  each  of  its  major   products.    They   are:
  www.websitetrafficbuilder.com,                      www.mass-emailer.com,
  www.trafficanalyzer.net and www.totalfax.net.


ITEM 7.  FINANCIAL STATEMENTS
(a)(1)    The following financial statements of the Company and its
          subsidiaries have been filed as part of this report (see Item 8
          "Financial Statements and Supplementary Data"):

          Independent Auditors' Report

          Balance Sheets as of December 31, 2000.

          Statements of Operations for the years ended December 31, 2000
          and 1999

          Statement of Stockholders' Equity (Deficit) for the Years Ended
          December 31, 1999 and 2000.

          Statement of Cash Flows for the years ended December 31, 2000 and
          December 31, 1999.

          Notes to Financial Statements.

                                [7]

  (2)     Schedules are omitted because of the absence of conditions under
          which they are required or because the required information is
          given in the financial statements or notes thereto.



ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING

AND FINANCIAL DISCLOSURE
     Gordon,  Hughes,  &  Banks,  LLP, CPAs was  previously  the  principle
  accountant  for  Intelliquis International, Inc.  In  January  1999,  the
  Board  of  Directors  approved the engagement  of  the  firm  of  Crouch,
  Bierwolf  &  Chisholm to replace Gordon, Hughes, & Banks, LLP,  CPAs  who
  declined  to stand for reelection as the Certifying Accountants  for  the
  Company.
     In  connection  with  the  audit of the  previous  fiscal  year  ended
  December  31,  1997, there were no disagreements with Gordon,  Hughes,  &
  Banks,  LLP,  CPAs  on any matter of accounting principle  or  practices,
  financial  statement disclosure, or auditing scope or  procedures,  which
  disagreements; if not resolved to their satisfaction, would  have  caused
  them  to  make  reference  in connection with their  opinion  to  subject
  matter  of the disagreement. Said firm has not advised the registrant  of
  any reportable events.
     The accountant's report of May 12, 1998 on the financial statements of
  Intelliquis International, Inc. as of December 31, 1997 and for the  year
  ended  did not contain any adverse opinion or disclaimer of opinion,  nor
  were  they  qualified  as  to  uncertainty, audit  scope,  or  accounting
  principles.
     The  Board of Directors approved the engagement of the accounting firm
  of  Hansen, Barnett and Maxwell CPAs of Salt Lake City in connection with
  the  audit  of the fiscal year ended December 31, 2000.   There  were  no
  disagreements  with Crouch Bierwolf & Chisholm, CPAs  on  any  matter  of
  accounting  principle  or practices, financial statement  disclosure,  or
  auditing  scope  or procedures, which disagreements; if not  resolved  to
  their  satisfaction,  would  have  caused  them  to  make  reference   in
  connection  with  their opinion to subject matter  of  the  disagreement.
  Said firm has not advised the registrant of any reportable events.


                                 PART III



ITEM 9.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
     The  following information is furnished with respect to the  Company's
  Board   of  Directors  and  executive  officers.   There  are  no  family
  relationships  between  or  among  any  of  the  Company's  directors  or
  executive officers.

Directors and Executive Officers
     The Company's management team consists of experienced professionals in
  the   area  of  software  licensing,  marketing,  sales,  operation   and
  financial  strategies.  The Company presently has  a  total  of  fourteen
  full-time  and part-time contract workers as needs arise.   In  addition,
  there   are  contractual  relationships  with  third  party  distribution
  companies  and  Asian  and  European  partners  to  assist  in   software
  distribution  and  marketing.  Messrs. Bernard Yaw, Blair  Barrett,  Mark
  Tippets  and  Say Thean Lim are the majority shareholders of the  Company
  at this moment. Other directors will be added in the future.

                                [8]

      The  Board of Directors and executive officers of the Company  as  of
date of this report are as follows:

  Name                              Age  (2000)   Position with the Company

  Bernard Yaw                       40            Director, President and CEO

  Dave Jones                        37            Chief Financial Officer

  Mark Tippets                      48            Director, Vice President
                                                  of Sales and Marketing

  Say Thean Lim                     39            Director, Director of
                                                  Business Development


       Following is a discussion of the business background of each
  director, President and executive officer.  Messrs. Bernard Yaw and
  Mark Tippets are full-time employees of the Company.  Other
  directors shall devote only such time as may be necessary to the
  Company's business and affairs.

     Bernard  Yaw, was appointed to be Director, President and CEO  of  the
  Company  since  the  acquisition of Intelliquis LLC  ("the  Subsidiary").
  Mr.  Yaw  served  as  Manager of the Subsidiary since  its  inception  in
  December  1997.  He joined the Subsidiary as Vice President of  Strategic
  Business  in  May  1998 in charge of International,  Internet  sales  and
  Investment.   Prior to joining the Company, Mr. Yaw served  as  President
  and  Director  of  IN2 Technologies, Inc., a developer of  Internet  Form
  Publishing  software.   Mr. Yaw also served as President  of  Handwriting
  Imaging  Systems  Corp.;  a  company  and  developer  of  a  hand   print
  recognition and document imaging software.  In 1987, Mr. Yaw founded  the
  Goleta  branch  of  Teltron  Computer  Systems,  an  early  importer  and
  manufacturer  of  IBM  PC  compatible computers  and  system  integrators
  located  in  the bi-county area of Santa Barbara and Ventura, California.
  Mr. Yaw graduated from Oral Roberts University in Tulsa, Oklahoma with  a
  Bachelor of Science degree in Computer Science in 1985.

     Dave  Jones,  has served as Chief Financial Officer  for  the  Company
  since  the acquisition of the Subsidiary. Mr. Jones has served as CFO  of
  the  Subsidiary  since  November 1998 and  is  responsible  for  all  the
  accounting  functions and financial planning of the  Company.   Prior  to
  joining  the Subsidiary, Mr. Jones served as Chief Financial  Officer  of
  RC  Management  Corporation d.b.a. Video III since 1993.   From  1990  to
  1993,  he  served  as Assistant Controller at Rocky Mountain  Helicopters
  and  an  accountant  at  Deloitte and Touche from 1989-1990.   Mr.  Jones
  received  his  License for Certified Public Accountancy in the  State  of
  Utah  since  1991.   He graduated from Brigham Young  University  with  a
  Bachelor  of  Science degree in Accounting in 1989.  In October  of  2000
  Dave  Jones  resigned as CFO for Intelliquis.  Intelliquis  is  currently
  looking for a new CFO.

     Mark  Tippets,  was  appointed  as  Director  and  Vice  President  of
  Marketing  and Sales of the Company since the acquisition of  Intelliquis
  LLC.    He  has  served  as  Vice-President  of  Marketing  and  Business
  Development  of  the Subsidiary, since its inception  in  December  1997.
  Prior  to  joining the Company, Mr. Tippets has been associated with  the
  computer  industry for seven years.  Starting with Gazelle Systems  as  a
  customer  service representative, Mark worked his way into dealer  sales.
  After  a  year,  Mark  was  promoted to a managerial  position  with  the
  company's OEM and Government Sales.  During his final year at Gazelle  in
  1993,  Mr. Tippets' work accounted for half of the Company's sales.   Mr.
  Tippets  then  started a company called Channel Marketing in  late  1993.
  Channel  Marketing  is  a  marketer and distributor  representative  firm
  representing  many  computer hardware and software companies.   Channel's
  list  of  clients includes AIWA America and CyberMedia, just  to  name  a
  few.

     Say Thean Lim, was appointed as member of the Board of Directors since
  its  acquisition of the Subsidiary. Mr. Lim, through his holding  company
  Statmart  USA, was the initial start-up investor of the Subsidiary  since
  its  inception.   He joined the Subsidiary as a Manager in  August  1998.
  Mr.  Lim has been an entrepreneur and business consultant since 1996 with
  strategic  investments  in technology based companies  in  semiconductor,
  precision  machining,  multimedia and software  development,  e-commerce,
  industrial  and  virtual training industries in Malaysia and  the  United
  States  of  America.  Some of the Malaysian companies are in the  process
  of  obtaining listings on the Kuala Lumpur Stock Exchange (KLSE) and  the
  Malaysian   Exchange  of  Securities  Dealing  and  Automated   Quotation
  (MESDAQ).  One of the multimedia development companies is in the  process
  of  securing a Multimedia Super Corridor (MSC) status in Malaysia.   From
  1984-1991,  Mr.  Lim  worked  in various capacities  at  a  semiconductor
  manufacturing  plant in Penang, Malaysia.  He started  as  an  Industrial
  Engineer  and was eventually promoted to Operations Manager.  From  1992-
  1995,  he  was  the CEO of Unico Technology Sdn. Bhd., a PC manufacturing
  and  exporting company with approximately 1,500 employees and  an  annual
  turnover  of  RM  500  million.  Mr. Lim received a Bachelor  of  Applied
  Science in Computers, Industrial and Electrical Engineering degree and  a
  Bachelor  of  Engineering  in  Industrial  Engineering  degree  from  the
  Technical University, Nova Scotia, Canada in 1984.

                                [9]

ITEM 10.  EXECUTIVE COMPENSATION

Compensation of Executive Officers and Directors
     No  executive  officer was paid or accrued cash compensation,  in  the
  form  of salaries, in excess of $100,000 for the year ended December  31,
  19982000.

     There  were  no cash bonus plans in effect at December  31, 2000.
  The  Company does not maintain or contribute to any pension or retirement
  plan  in  which  the directors or executive officers of the  Company  are
  participants  or  are  entitled to receive benefits,  but  the  Board  of
  Directors may recommend one or more programs for adoption in the future.

     It  is  the  Company's intention to pay Directors, who  are  not  also
  officers,  a  cash  compensation of up to $1,000 for each  meeting,  plus
  reimbursement of reasonable expenses, (total amount not to exceed  $1,500
  per  quarter per director) for serving on the Board of Directors  or  its
  committees.

     The  Company intends to grant options to purchase Common Stock of  the
  Company to senior officers, directors and employees of the Company.   The
  purpose  of  the  options is to attract and retain the  services  of  key
  employees or directors.

     The  Company  reimburses Bernard Yaw for flight travel  in  connection
  with  business  duties.   In addition, the Company  intends  to  pay  the
  premiums  on  group insurance in which executive officers may participate
  and   reimburse   officers   for  certain   other   expenses   (including
  entertainment,  meals and parking), a small portion of which  may  relate
  to  personal expenses or use.  The Company believes that these  items  or
  related  costs,  if paid, are not excessive or unusual,  but  rather  are
  ordinary and necessary business expenses.  The aggregate amount of  these
  personal  expenses,  which  cannot  be  precisely  ascertained,  is   not
  expected  to  exceed  10%  of  the  cash  compensation  received  by  any
  executive officer or 10% of the aggregate cash compensation reported  for
  the group.

     The  Company  has  signed  non-competing  employment  agreements  with
  Messrs.  Bernard Yaw,  and Mark Tippets and Blair Barrett (jointly  known
  as  "Officers").  Pursuant to the employment agreement, Messrs. Yaw,  and
  Tippets  and  Barrett  will be paid a monthly  employment  salary  to  be
  negotiated  between  the  Company and the  Officers.   The  term  of  the
  agreement  is  for a period of two years.  The Company may terminate  the
  employment at any time for cause.  In the event of a termination or  upon
  leaving  the  employment of the Company, the Officers may not  engage  in
  any  employment which is in direct competition with the Company  for  one
  year  after  the  termination or leave of employment.  In  addition,  the
  Company  has  the right to first refusal to purchase any or  all  of  the
  shares owned by Officers that were acquired directly from the Company.


                                [10]


   The following table summarizes the compensation paid the named executive
officers during the 2000 fiscal year.

Name of Officers          Compensation of Officers     Any enefits to Officers

Bernard Yaw,              $ 61,000.00                  Travel Expenses,
President &CEO                                         Apartment Rental

Mark Tippets,             $ 60,000.00
Vice President


Employment Agreements and Other Compensation Arrangements

     The  Company currently has employment agreements with all officers  of
  the   Company  including  a  non-compete  clause  after  termination   or
  resignation.

Compensation of Non-Employee Director There is currently no compensation
paid to non-employment directors.

ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
     The  following table sets forth information as of April 13, 1999, with
  respect   to  the  number  of  shares  of  the  Company's  Common   Stock
  beneficially owned by the directors and officers of the Company,  by  all
  officers  and  directors  of  the  Company  as  a  group,  and  by   each
  shareholder known by the Company to be the beneficial owner of more  than
  5%  of  the  outstanding Common Stock of the Company, the only  class  of
  voting   securities   outstanding.  Unless  otherwise   specified,   each
  individual  has  sole  voting and investment power with  respect  to  the
  shares beneficially owned.

Name and Address                                  Shares
of Beneficial Owner      Position                 Beneficially Owned

Say Thean Lim            Director                 10,103,608     27.51%
1 Lebuhraya Scott
Penang 10350
West Malaysia

Bernard Yaw              Director, President       1,001,856      2.72%
Millennium Ventures Worldwide Limited
100 Orr Road
Alameda, CA 94502

Mark Tippets             Director, Vice President  2,357,664      6.42%
876 South 725 West
Orem UT 84058

Blair Barrett                                      4,686,496     12.76%
2871 East Morningside
Drive
Salt Lake City UT
84124

Western Financial Communication, Inc.              1,846,000      5.08%
4596 Miller Ave. 3rd FL
Mill Valley, CA 94941



Officers and Directors As a Group (4 persons)     20,909,604     56.94%


Item 12.  Certain Relationships and Related Transactions
     Other  than  executive  compensation, during  the  reported  year  the
  Registrant did not enter into any transactions with management which  are
  to be reported under this Item.

                                [11]

Item 13.  Exhibits, and Reports on Form 8-K
(A)  Exhibits

Exhibit
          No.                Description

         23.01      Consent of Crouch, Bierwolf & Chisholm
         23.02      Consent of Hansen Barnett & Maxwell

(b)  The Registrant filed a report Form 8-K during the second quarter of
    the fiscal year ended June 30, 2001.



                                SIGNATURES

   Pursuant to the requirements of Section 13 or 15(d) of the Securities
  Exchange Act of 1934, the Registrant has duly caused this Report to be
    signed on its behalf by the undersigned, thereunto duly authorized.

     Intelliquis International, Inc.

By:  Bernard Yaw

________________________
/s/   Bernard Yaw



Dated:    May 15, 2001

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

SIGNATURE                TITLE                         DATE

/s/ Bernard Yaw          President and Director
                         (Principal Executive and
                          Financial Officer)           May 15, 2001

/s/ Mark Tippets         Vice President
                         Marketing                     May 15, 2001


/s/ Dave Jones           Chief Financial
                         Officer                       May 15, 2001



<PAGE>
                    INTELLIQUIS INTERNATIONAL, INC.




              INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

                                                                     Page

Report of Independent Certified Public Accountants                   F-1

Consolidated Balance Sheets - December 31, 2000 and 1999             F-2

Consolidated Statements of Operations for the Years Ended
 December 31, 2000 and 1999                                          F-3

Consolidated  Statements  of Stockholders' Equity  (Deficit)
 for the Years Ended December 31, 1999 and 2000                      F-4

Consolidated Statements of Cash Flows for the Years Ended
 December 31, 2000 and 1999                                          F-5

Notes to Consolidated Financial Statements                           F-7

<PAGE>


HANSEN, BARNETT & MAXWELL
  A Professional Corporation
 CERTIFIED PUBLIC ACCOUNTANTS

                                                   (801) 532-2200
Member of AICPA Division of Firms                 Fax (801) 532-7944
      Member of SECPS                        345 East Broadway, Suite 200
Member of Summit International Associates   Salt Lake City, Utah 84111-2693


          REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To the Board of Directors and Stockholders
Intelliquis International, Inc.

We  have  audited  the  accompanying  consolidated  balance  sheet  of
Intelliquis International, Inc. and Subsidiary as of December 31, 2000
and  the  related consolidated statements of operations, stockholders'
equity  (deficit),  and  cash flows for the  year  then  ended.  These
financial   statements  are  the  responsibility  of   the   Company's
management.  Our  responsibility is to express  an  opinion  on  these
financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally
accepted  in the United States. Those standards require that  we  plan
and perform the audit to obtain reasonable assurance about whether the
financial  statements  are  free of material  misstatement.  An  audit
includes  examining, on a test basis, evidence supporting the  amounts
and  disclosures in the financial statements. An audit  also  includes
assessing  the  accounting principles used and  significant  estimates
made  by  management,  as  well as evaluating  the  overall  financial
statement   presentation.  We  believe  that  our  audit  provides   a
reasonable basis for our opinion.

In  our  opinion,  the consolidated financial statements  referred  to
above present fairly, in all material respects, the financial position
of  Intelliquis International, Inc. and Subsidiary as of December  31,
2000 and the results of their operations and their cash flows for  the
year  then  ended  in conformity with accounting principles  generally
accepted in the United States.

The  accompanying consolidated financial statements have been prepared
assuming  that  the  Company will continue  as  a  going  concern.  As
discussed  in  Note  1 to the financial statements,  the  Company  has
suffered  a  significant loss from operations during  the  year  ended
December  31, 2000 totaling $4,704,708. During the year ended December
31,   2000,  the  Company  had  a  net  loss  attributable  to  common
shareholders of $10,736,363. Moreover, during the years ended December
31,  1999  and  2000,  the Company's operations  used  $1,755,898  and
$336,240 of cash, respectively. These matters raise substantial  doubt
about   the  Company's  ability  to  continue  as  a  going   concern.
Management's  plans in regard to these matters are also  described  in
Note  1.  The  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 should the Company be unable to continue as a going concern.

                                   /s/ Hansen, Barnett & Maxwell
                                   -----------------------------
                                   HANSEN, BARNETT & MAXWELL

Salt Lake City, Utah
May 10, 2001

                                F-1

                    INTELLIQUIS INTERNATIONAL, INC.
                      CONSOLIDATED BALANCE SHEETS


                                                         December 31,
                                                   ------------------------
                                                      2000         1999
                                                   -----------  -----------
                                ASSETS
Current Assets
  Cash and cash equivalents                        $         -  $   264,395
  Trade accounts receivable                             21,229    4,123,507
  Receivables from employees                                 -       56,632
  Notes receivable                                      60,840      598,220
  Inventory                                            130,287      951,845
  Prepaid expenses and deposits                         10,200       39,360
                                                   -----------  -----------
     Total Current Assets                              222,256    6,033,959
                                                   -----------  ------------
Property and Equipment, Net                            115,529       147,350
                                                   -----------  ------------
Other Assets
  Certificate of deposit                                     -        42,256
  Intangibles, net of $54,632 and $4,364
   accumulated amortization, respectively              194,389         6,213
                                                   -----------  ------------
     Total Other Assets                                194,389        48,469
                                                   -----------  ------------
Total Assets                                       $   532,474  $  6,229,778
                                                   ===========  ============

            LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

Current Liabilities
  Checks written in excess of cash in bank         $       747  $          -
  Accounts payable and accrued liabilities             689,010     3,115,869
  Payable to employee                                   18,000             -
  Short-term borrowings                              1,854,406       275,853
  Preferred stock dividends payable                    141,700        22,028
                                                   -----------  ------------
     Total Current Liabilities                       2,703,863     3,413,750
                                                   -----------  ------------
Stockholders' Equity (Deficit)
   Preferred stock - $0.001 par value;
    5,000,000 shares  authorized; 1,800 and
    and 2,000 shares issued and outstanding,
    respectively                                             2             2
   Common stock -$0.001 par value; 50,000,000
    shares authorized; 38,221,475 and 33,462,420
    shares issued and outstanding, respectively         38,221        33,462
   Treasury stock                                          (70)            -
   Additional paid-in capital                        8,579,929     2,835,672
   Accumulated deficit                             (10,789,471)      (53,108)
                                                   -----------  ------------
       Total Stockholders' Equity (Deficit)         (2,171,389)    2,816,028
                                                   -----------  ------------
Total Liabilities and Stockholders'
 Equity (Deficit)                                  $   532,474  $  6,229,778
                                                   ===========  ============

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

                                F-2


                    INTELLIQUIS INTERNATIONAL, INC.
                 CONSOLIDATED STATEMENTS OF OPERATIONS




                                               For  the Years
                                             Ended December 31,
                                         -------------------------
                                             2000         1999
                                         ------------  -----------

Sales                                    $  2,427,236  $ 7,457,568

Cost of Sales                                 559,210    3,759,506
                                         ------------  -----------
Gross Profit                                1,868,026    3,698,062
                                         ------------  -----------
Expenses
  Sales and marketing                       1,254,097    1,442,675
  General and administrative                5,318,637    1,320,028
                                         ------------  -----------
  Total Expenses                            6,572,734    2,762,703
                                         ------------  -----------
Operating Income (Loss)                    (4,704,708)     935,359
                                         ------------  -----------
Other Income (Expense)
  Interest expense                           (415,905)    (125,694)
  Interest income                              26,264       18,364
  Bad debt                                 (4,313,903)     (60,000)
  Inventory write-down                       (551,382)    (820,507)
  Loss from litigation                       (657,057)           -
                                         ------------  -----------
  Other Expense, Net                       (5,911,983)    (987,837)
                                         ------------  -----------
Net Loss                                  (10,616,691)     (52,478)

Dividends related to convertible
 preferred stock                             (119,672)     (22,028)
                                         ------------  -----------
Net Loss Attributed to Common
 Shareholders                            $(10,736,363) $   (74,506)
                                         ============  ===========
Basic and Diluted Loss Per Common Share  $      (0.30) $     (0.00)
                                         ============  ===========
Weighted Average Number of Common
 Shares Used in Per Share Calculation      36,302,355   33,820,488
                                         ============  ===========

The accompanying notes are an integral part of these consolidated
financial statements.

                                F-3


                      INTELLIQUIS INTERNATIONAL, INC.
             CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT
<TABLE>
<CAPTION>

                               Preferred Stock        Common Stock         Treasury Stock
                              ------------------  ---------------------  -------------------                             Total
                             Accumulated            Equity\                                                          Stockholders'
                               Shares    Amount     Shares      Amount    Shares     Amount     APIC      Deficit     (Deficit)
                              --------  --------  -----------  --------  ---------  -------  ----------  -----------  -----------
<S>                          <C>       <C>       <C>          <C>       <C>        <C>       <C>         <C>          <C>
Balance,  December 31, 1998          -  $      -   37,759,233  $ 37,759          -  $     -  $  132,241  $    21,398  $   191,398

Common stock repurchase
 from  officer                       -         -   (6,202,944)   (6,203)         -        -    (153,797)           -     (160,000)

Issuance of common stock in
 private  placement                  -         -    1,815,000     1,815          -        -   1,060,185            -    1,062,000

Issuance of preferred stock      2,000         2            -         -          -        -   1,730,453            -    1,730,455

Issuance of common stock
 to  employees                       -         -       91,344        91          -        -      66,590            -       66,681

Fractional shares cancelled
 in 3-for-1 stock split              -         -         (213)        -          -        -           -            -            -

Net loss                             -         -            -         -          -        -           -      (74,506)     (74,506)
                              --------  --------  -----------  --------  ---------  -------  ----------  -----------  -----------
Balance, December 31, 1999       2,000         2   33,462,420    33,462          -        -   2,835,672      (53,108)   2,816,028

Preferred shares converted
 into common shares               (200)        -      508,055       508          -        -        (508)           -            -

Conversion of a payable to
 common stock                        -         -      250,000       250          -        -     577,875            -      578,125

Common stock issued
 for cash                            -         -       15,000        15          -        -         235            -          250

Litigation settlement paid
 by officer                          -         -            -         -          -        -      78,125            -       78,125

Common stock issued in
 settlement of litigation            -         -    1,805,000     1,805          -        -     416,633            -      418,838

Common stock issued for
 services performed                  -         -    2,181,000     2,181          -        -   4,858,882            -    4,861,063

Common stock received for
 partial settlement of a
 receivable                          -         -            -         -   (200,000)    (200)    (40,425)           -      (40,625)

Treasury stock issued for cash       -         -            -         -     30,000       30       1,772            -        1,802

Treasury stock issued in
 settlement of litigation            -         -            -         -    100,000      100       6,150            -        6,250

Offering costs                       -         -            -         -          -        -    (167,343)           -     (167,343)

Expenses paid by officer             -         -            -         -          -        -      12,861            -       12,861

Net loss                             -         -            -         -          -        -           -  (10,736,363) (10,736,363)
                              --------  --------  -----------  --------  ---------  -------  ---------- ------------  -----------
Balance, December 31, 2000       1,800  $      2   38,221,475  $ 38,221    (70,000) $   (70) $8,579,929 $(10,789,471) $(2,171,389)
                              ========  ========  ===========  ========  =========  =======  ==========  ===========  ===========
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.

                                F-4


                   INTELLIQUIS INTERNATIONAL, INC.,
                 CONSOLIDATED STATEMENTS OF CASH FLOWS



                                                      For the Years
                                                    Ended December 31,
                                                 ------------------------
                                                    2000         1999
                                                 ------------  ------------
Cash Flows From Operating Activities
   Net loss                                      $(10,736,363) $    (74,506)
   Adjustments to reconcile net loss to net
    cash used by operating activities:
       Depreciation and amortization                   95,836        30,316
       Interest expense relating to conversion
        of note payable                               366,116             -
     Expenses paid for by officer                      90,986             -
     Stock issued in settlement of litigation         424,688             -
     Stock issued for services performed            4,861,063        66,681
     Bad debt expense                               4,313,903             -
     Loss from inventory write down                   551,382             -
     Changes in operating assets and liabilities:
       Accounts receivable                           (193,081)   (3,560,173)
       Employee receivables                            56,632             -
       Other receivables                              (21,712)            -
       Prepaid expenses and deposits                   29,160       (32,022)
       Inventory                                      270,176      (821,328)
       Accounts payable and accrued liabilities      (582,698)    2,635,134
       Employee payable                                18,000             -
       Accrued dividends                              119,672             -
                                                 ------------  ------------
      Net Cash and Cash Equivalents Used In
       Operating Activities                          (336,240)   (1,755,898)
                                                 ------------  ------------
Cash Flows From Investing Activities
   Payments to purchase property and equipment
    and intangible assets                            (252,191)     (123,369)
   Proceeds from redemption of certificate
    of deposit                                         42,256             -
                                                 ------------  ------------
      Net Cash and Cash Equivalents Used
       In Investing Activities                       (209,935)     (123,369)
                                                 ------------  ------------
Cash Flows From Financing Activities
  Checks written in excess of cash in bank                747             -
  Proceeds from issuance of stock                       2,052     2,792,455
  Repurchase of stock                                       -      (160,000)
  Deferred offering costs                            (167,343)            -
  Proceeds from short-term borrowings                       -        86,353
  Principal payments on notes payable                 (53,599)            -
  Issuance of notes receivable                              -      (598,220)
  Principal payments on notes receivable              499,923             -
                                                 ------------  ------------
      Net Cash and Cash Equivalents Provided
       By Financing Activities                        281,780     2,120,588
                                                 ------------  ------------
Net Increase (Decrease) in Cash and
 Cash Equivalents                                    (264,395)      241,321
                                                 ------------  ------------
Cash and Cash Equivalents at Beginning of Period      264,395        23,074
                                                 ------------  ------------
Cash and Cash Equivalents at End of Period       $          -  $    264,395
                                                 ============  ============

The accompanying notes are an integral part of these consolidated
financial statements.

                                F-5

                   INTELLIQUIS INTERNATIONAL, INC.,
                 CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (CONTINUED)

                                                      For the Years
                                                    Ended December 31,
                                                 ------------------------
                                                    2000         1999
                                                 ------------  ------------
Supplemental Cash Flow Information
  Interest paid                                  $     49,789  $    107,330

Non-Cash Investing and Financing Activities
  Conversion of notes payable into common stock  $    212,009  $          -
  Accounts payable converted into notes payable     1,844,162             -
  Stock received for partial settlement
   of receivable                                       40,625             -
  Expenses paid by officer                             90,986             -
  Stock issued in settlement of litigation            424,688             -
  Stock issued for services performed               4,861,063             -

The accompanying notes are an integral part of these consolidated
  financial statements.

                                F-6


               INTELLIQUIS INTERNATIONAL, INC.
         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - ORGANIZATION AND NATURE OF OPERATIONS

Organization   and   Principles  of  Consolidation   -   Intelliquis
International,  Inc.  (the  Company)  (formerly  Leesburg  Land  and
Mining, Inc.) was created on June 21, 1983 in the State of Colorado.
The  Company  was involved in mining activities until  approximately
1987,  when  it  ceased all activities and began  disposing  of  its
assets.  It has not had any business activity since that time.   The
Company   changed   its  name  in  December  1998   to   Intelliquis
International, Inc. Also in December 1998, the Company  created  and
later merged with a Nevada subsidiary.

Intelliquis,  LLC  was  created in 1997 as a corporation  and  later
reorganized  as  a limited liability company in the State  of  Utah.
Intelliquis  International, Inc. acquired  all  of  the  outstanding
units of Intelliquis LLC effective December 31, 1998.

The  acquisition  is accounted for as a "reverse acquisition"  where
the   parent  corporation  is  taken  over  by  the  owners  of  the
subsidiary.   All activity of the financial reports is that  of  the
subsidiary operation.

Principles of Consolidation - The accompanying consolidated financial
statements include the accounts of Intelliquis International, Inc. and
its wholly owned subsidiary (collectively the "Company"). The operations
of acquired entities have been included from the date of their acquisitions.
Intercompany transactions and accounts have been eliminated in consolidation.

Nature  of  Operations - Intelliquis was organized for the purpose of
licensing and marketing computer software to wholesale and private label
customers.

Business Condition - The accompanying consolidated financial statements
have been prepared assuming that the Company will continue as a going
concern. The Company has suffered a significant loss from operations
during the year ended December 31, 2000 totaling $4,704,708.  During
the year  ended December 31, 2000,  the  Company  had  a  net  loss
attributable to common shareholders of $10,736,363. Moreover, during
the years ended December 31, 1999 and 2000, the Company's operations
used  $1,755,898 and $336,240 of cash, respectively.  These  matters
raise substantial doubt about the Company's ability to continue as a
going  concern.  In  the future, the Company must obtain  additional
financing  to provide working capital for operations. Management  is
attempting  to  develop  and  market new  products  to  finance  its
operations.  The 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 should the Company be unable to continue as a going concern.

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES

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, disclosure of contingent  assets
and liabilities at the date of the financial statements and revenues
and  expenses  during  the  reporting  period.  In  these  financial
statements,  assets,  liabilities  and  earnings  involve  extensive
reliance on management's estimates. Actual results could differ from
those estimates.

                                F-7

Cash and Cash Equivalents and Fair Value of Financial Instruments  -
The Company considers all short term, highly liquid investments that
are readily convertible to known amounts as cash equivalents.

The  carrying  amounts  reported  in the  accompanying  consolidated
financial  statements  for cash, accounts  receivable  and  accounts
payable  approximate  fair  values  because  of  the  immediate   or
short_term  maturities of these financial instruments. The  carrying
amounts  of  the Company's debt obligations approximate  fair  value
based on current interest rates available to the Company.

Capitalized Software Costs - In accordance with Financial Accounting
Standards Board ("FASB") Statement of Financial Accounting Standards
("SFAS")  No. 86, "Accounting for the Costs of Computer Software  to
be Sold, Leased or Otherwise Marketed" development costs incurred in
the  research and development of new software products to  be  sold,
leased  or  otherwise  marketed  are  expensed  as  incurred   until
technological  feasibility in the form of a working model  has  been
established.  In 1999, the Company charged its software  development
costs  to  research  and  development expense  in  the  accompanying
consolidated  statements  of  operations.  In  2000,   the   Company
capitalized software development costs totaling $238,445.

Accounts  Receivable - Accounts Receivable is shown net of allowance
for  bad  debt  and returns of  $748,044 and $473,497 for  2000  and
1999, respectively. Certain of the Company's distributors, including
the  largest  distributor,  have the right  to  return  for  credit,
products  purchased  from  the Company.  The  Company  had  a  major
concentration  in  accounts receivable with  one  major  distributor
accounting  for 68% of all receivables at December 31, 1999.  During
2000,  the Company and this distributor were unable to agree on  the
amount owed to the Company by the distributor. The Company has filed
a  suit  against  the  distributor seeking $1,000,000.  Due  to  the
uncertainty  surrounding  the collection of  all  amounts  owed  the
Company  by this distributor, this receivable has been written  off.
The  possibility exists of collecting what is owed  to  the  Company
depending on the outcome of the lawsuit.

Inventory  -  Inventory consists of finished  goods  (assembled  and
unassembled  computer software) valued at lower of  cost  (FIFO)  or
market.  Near the end of 1999, the Company purchased a large  number
of  computer  cards  that  were  programmed  with  "Y2K"  compliance
software  for  use  in  its Intellifix 2000  Software  Package.  The
purchase  resulted  in  an oversupply of the cards  that  cannot  be
returned  to the supplier. After the year 2000 commenced, there  was
no  longer a demand for the cards in their current form. At December
31, 1999, the cost of the cards was written down from $7.50 per unit
to  $3.75 per unit, resulting in a loss of $820,507. At December 31,
2000, the cost of the cards was written down from $3.75 per unit  to
$0.50  per  unit,  resulting in a loss of  $551,382.  Management  is
uncertain it will be able to sell its inventory of these cards.

Fixed  Assets  -  The Company capitalizes purchases  of  long  lived
assets  that  are expected to give benefit to the Company  over  the
life  of  the asset.  The Company also capitalizes improvements  and
costs that  increases the value of or extend the life of the asset.

                                F-8

Intangible   Assets  -  Intangible  assets  consist  of  capitalized
software  costs and goodwill. The software costs are being amortized
over  three years. The goodwill is being amortized over five  years.
Amortization expense totaled $51,201 and $2,115 for the years  ended
December 31, 2000 and 1999, respectively.

Deferred  Offering  and  Financing Costs - The  Company  capitalizes
direct  costs  associated with the acquisition of  equity  financing
which are netted against the actual equity proceeds.

Income Taxes - The Company recognizes an asset or liability for  the
deferred  tax consequences of all temporary differences between  the
tax bases of assets or liabilities and their reported amounts in the
financial  statements  that will result  in  taxable  or  deductible
amounts  in future years when the reported amounts of the assets  or
liabilities are recovered or settled. These deferred tax  assets  or
liabilities are measured using the enacted tax rates that will be in
effect  when  the differences are expected to reverse. Deferred  tax
assets  are  reviewed periodically for recoverability and  valuation
allowances are provided, as necessary.

Basic and Diluted Loss Per Share - Basic loss per common share from
continuing operations is computed by dividing loss from continuing
operations less preferred dividends by the number of common shares
outstanding during the period. Basic loss per common share applicable
to common shareholders is calculated by dividing loss applicable to
common shareholders by the number of common shares outstanding during
the period. Diluted loss per share is calculated to give effect to
stock warrants and options using the treasury stock method and convertible
preferred stock and convertible notes payable using the if-converted
method. Stock warrants and options, convertible preferred stock, and
convertible notes payable are not included in diluted loss per share
during loss periods when those potentially issuable common shares would
decrease the loss per share.

New Accounting Standards - In June 1998, the FASB issued SFAS No. 133,
"Accounting for Derivative Instruments and Hedging Activities" ("SFAS 133")
SFAS 133 establishes new accounting and reporting standards for companies
to report information about derivative instruments, including certain
derivative instruments embedded in other contracts (collectively referred
to as derivatives), and for hedging activities. This statement, as
extended by SFAS No. 137, is effective for financial statements issued for
all fiscal quarters of fiscal years beginning after June 15, 2000. The
Company does not expect this statement to have a material impact on the
Company's results of operations, financial position or liquidity.

On December 3, 1999, the Securities and Exchange Commission issued Staff
Accounting Bulletin No. 101, "Revenue Recognition in Financial Statements."
This bulletin requires the application of specific criteria in determination
of the timing of revenue recognition in financial statements and is effective
for all fiscal years beginning after December 16, 1999. The Company's
accounting policies conform to the requirements of this bulletin and the
adoption of this bulletin had no material effect upon the Company's results
of operations, financial position or liquidity.

In March 2000, the FASB issued Interpretation No. 44, "Accounting for Certain
Transactions Involving Stock Compensation, an Interpretation of APB Opinion
No. 25." Interpretation No. 44 provides definitive guidance regarding
accouinting for stock-based compensation to non-employee directors.
Interpretation 44 allows non-employee directors to be treated as "employees"
for purposes of applying APB Opinion No. 25. The Company does not expect
this interpretation to have a material impact on the Company's results of
operations, financial position or liquidity.

NOTE 3 - FIXED ASSETS

Fixed assets consist of the following at December 31, 2000 and 1999:

                                           2000      1999
                                        ----------  ----------
  Computer equipment and software       $  142,105  $  130,215
  Office Equipment & Furniture              57,334      57,018
  Leasehold Improvements                     4,180       3,571
                                        ----------  ----------
                                           203,619     190,804
  Less: Accumulated Depreciation           (88,090)    (43,454)
                                        ----------  ----------
     Total Fixed Assets                 $  115,529  $  147,350
                                        ==========  ==========

Computer equipment and software is being depreciated on the straight-
line  method  over  three to five years. Office equipment  is  being
depreciated   on   the  straight-line  method   over   five   years.
Depreciation  expense  was  $44,635 and $8,641  in  2000  and  1999,
respectively.

                                F-9

NOTE 4 - SHORT-TERM BORROWINGS

The Company has acquired short term borrowing for working capital as
follows:

                                                   December 31,  December 31,
                                                       2000         1999
                                                    -----------  -----------
Payable to a vendor; secured by inventory
   purchased from vendor and 1,200,000 shares
   of stock; due on demand                          $ 1,844,162  $         -

Note payable to a bank; secured by all assets of
   the Company and personal guarantees from the
   Company's officers; interest accrued at prime
   plus 2.0% (11.5% at December 31, 2000);
   due on demand                                         10,244       79,500

Payable to a vendor; unsecured; personal
   guarantees by two directors; interest stated
   at 8% per 30 days; due August, 1999                        -      167,929

Note payable to a law firm; unsecured;
   no stated interest                                         -       28,423
                                                    -----------  -----------
                                                    $ 1,854,406  $   275,853
                                                    ===========  ===========
NOTE 5 - RELATED PARTY TRANSACTIONS

The  Company had accounts receivable owing from its employees in the
amount   of   $0  and  $56,632  at  December  31,  2000  and   1999,
respectively. At December 31, 2000, the Company had a payable to  an
employee for $18,000.

In  June  1999,  the Company began negotiations to  acquire   Direct
Media  Communications,  Inc. ("DMC") through  the  issuance  of  the
Company's common stock and cash. Between June and November 1999, the
Company  paid  DMC $590,000. In December 1999, the  transaction  was
negated,  resulting in a receivable of $590,000 from DMC.  In  2000,
DMC repaid $500,000 to the Company.

In  May  2000,  the Company was ordered to issue 180,000  shares  of
restricted  stock, 80,000 shares of unrestricted stock, and  to  pay
$202,100  to  a  plaintiff  as  the  result  of  a  lawsuit  it  was
unsuccessful  in  defending. An officer  of  the  Company  paid  the
plaintiff 80,000 shares of his unrestricted stock as partial payment
of the court order.

During  the year ended December 31, 2000, an officer of the  Company
paid expenses totaling $90,986 on behalf of the Company.

NOTE 6 - STOCKHOLDERS' EQUITY

The  Company issued 91,344 shares of restricted common stock  valued
at  $66,681   to  employees  during 1999.  An  additional  1,815,000
restricted  common shares were issued  for $1,062,000 in  a  private
placement  during the first quarter of 1999. Of  the  shares  issued
360,000  restricted common shares were issued to an  individual  for
assistance in the financing arrangements for the Company.

In  February  1999,  the  Company  reacquired  6,202,944  shares  of
restricted  common  stock  at a cost of $160,000  from  one  of  the
Company's  directors.  Also, in February  1999,  the  same  director
purchased 450,000 shares of the Company's common stock at a price of
$0.67 per share.

                                F-10

In  April 1999, the Company effected a 3-for-1 forward stock  split.
All   information  presented  in  the  financial  statements   gives
retroactive effects to this stock split.

Stock  Issuances for Services - During the year ended  December  31,
2000,  the Company issued shares of common stock to outside  parties
for  services  provided. The shares issued have been valued  by  the
Company's Board of Directors at estimated fair values based on other
issuances   of  shares  for  cash  and  on  the  terms  of   related
transactions.

Conversion  of Debt into Common Stock - In April 2000,  the  Company
satisfied  the  remaining  principal and accrued  interest  totaling
$212,009 relating to a loan advance received in May 1999 by  issuing
250,000 shares of restricted common stock. Non-cash interest expense
relating to this debt conversion was $366,116.

In  May 1999, On The Planet, Inc. (OTP) filed a lawsuit against  the
Company alleging that the Company violated an agreement entered into
between  the Company and OTP by engaging in direct sales  or  giving
third  parties a license to engage in direct sales of  the  Y2K  fix
software  and  other  related  products.   OTP  asserted  claims  of
copyright  infringement, breach of contract and fraud. In  response,
the  Company filed counterclaims for fraud and defamation  by  OTP's
president.  The Company was unsuccessful in defending this  lawsuit.
In May 2000, Intelliquis was issued a court order to pay OTP 180,000
shares of restricted stock, 80,000 shares of unrestricted stock, and
$202,100. The Company issued 180,000 shares of restricted  stock  to
OTP.  An  officer  of the Company issued OTP 80,000  shares  of  his
personal unrestricted stock.

Of  the  cash  settlement ordered, the Company owed OTP  $97,738  in
November  2000.  OTP and the Company reached a settlement  agreement
relating to the remaining cash liability owed to OTP. OTP agreed  to
forgive  any remaining debt relating to the court order in  exchange
for  1,500,000 of the Company's restricted common shares. After  the
agreement  was reached and before the 1,500,000 shares were  issued,
the   Company  and  an  officer  transferred  100,000  and   280,000
additional   common   shares  to  OTP,  respectively.   The   shares
transferred by the Company and the officer were valued at $6,250 and
$30,625,  respectively. As a result of this  final  settlement  with
OTP,  the Company recognized additional loss from litigation expense
totaling $149,137

In  1999,  the Company filed a claim against Bi-Com Link to  recover
royalties  paid  by  the Company. Bi-Com Link filed  a  counterclaim
against the Company demanding payment of royalties allegedly owed by
the  Company. In April 2000, the claim was settled out of court with
the  issuance of 125,000 shares of restricted common stock to Bi-Com
Link.

Treasury  Stock - In 1999, the Company paid DMC a total of $590,000.
Approximately $500,000 was repaid in 2000. Interest on the remaining
receivable  balance accrued at 12%. In September 2000,  the  Company
received  200,000 shares of its own unrestricted common  stock.  The
stock was valued at $0.20 per share on the date it was received  for
a total of $40,625.

                                F-11

The  shares  were paid by an officer of the Company who is  also  an
original  investor in DMC. Settlement of the receivable  called  for
the  issuance of 400,000 shares of the Company's unrestricted common
stock.  The Company recognized bad debt expense totaling $18,453  in
the partial settlement of the receivable.

As a partial final settlement of the Company's liability to OTP, the
Company  issued 100,000 of its treasury shares to OTP. These  shares
were valued at $6,250.

Of the 200,000 shares of treasury stock received, 130,000 shares had
been reissued as of December 31, 2000.

Preferred  Stock - In October 1999, the Company issued 2,000  shares
of  the  Company's 6% Convertible Series A Preferred  Stock  with  a
stated  value of $1,000  per share and a $.001 par value per  share.
The  Company  realized $1,730,455 after legal  expense  of  $83,200,
filing fees of $10,000, travel  expense  of $1,880 and commissions
and  fees  of  $174,565. The   Preferred   Stock  carries  preferences
in  liquidation  and dissolution  and  prohibits  the  payment  of
dividends  to  common shareholders until all accrued dividends in the
Preferred Stock  are paid.

The  Securities Purchase Agreement contains a warrant  allowing  for
the  purchase  up  to 100,000 common shares, a  conditional  warrant
allowing  for  the  purchase of an additional 3,000  shares  of  the
Company's 6% Convertible Series A Preferred Stock, and an additional
warrant  to  purchase  150,000 shares  of  common  stock.  Dividends
accruing  on  the Preferred Stock are payable in cash or  registered
common shares at the Company's option. The conversion price for  the
Series A Preferred Stock is linked to the future market price of the
common  stock. As  a result, the conversion price will change as the
price  for the common shares changes  in the marketplace. Therefore,
the  number  of  common  shares to which the Preferred  Shares  will
convert cannot be determined until the date of conversion. The owner
of  the preferred stock has agreed not to convert the options.  This
agreement is not memorialized.

The  Securities Purchase Agreement required the Company  to  file  a
Registration  Statement with the Securities and Exchange  Commission
to register the underlying shares. In addition, an application for a
stock  listing on the NASDAQ Small-cap Market was to be filed within
45   days.   In  September  2000,  the  aforementioned  Registration
Statement had been filed and became effective.

In  February 2000, 200 shares of preferred stock were converted into
508,055 shares of common stock.

NOTE 7 - COMMITMENTS AND CONTINGENCIES

Legal  Contingencies - The Company has filed an action  against  the
primary  distributor  of its products, through  which  it  seeks  to
recover an amount in excess of $1,000,000. The claims of the Company
arise  from, inter alia, the failure of the distributor to  properly
account  for the Company's product which were returned by retailers,
thus  resulting in debits to the Company's account in amounts  which
were  greater than the price at which the Company invoiced  products
to  the distributor. The distributor has answered the suit, and both
parties   have  entered  into  binding  arbitration.  Due   to   the
uncertainty  in the outcome of this action, the Company has  written
off  all  amounts  receivable  from  this  distributor.  Any  amount
recovered from this action will be recognized in future periods.

                                F-12

A  software  licensor  claims that the Company  breached  a  license
agreement  which  licensed  certain  software  to  the  Company  for
inclusion in its products. The software licensor argues that because
the  license agreement was breached, the Company's license  to  make
use  of  that  software was terminated and thus,  through  continued
sales, the Company infringed on the software licensor's copyright to
that  software.  The Company has filed an answer in which it  denies
those allegations and will file a counterclaim through which it will
seek to recover damages arising from certain defects in the software
licensed. The software licensor will seek to recover damages  in  an
amount  between  $50,000 and $200,000. The Company has  submitted  a
Notice  of  Claim  to its insurer. The insurer, at  this  time,  has
neither  admitted nor denied coverage. Counsel is not  yet  able  to
express an opinion as to the ultimate resolution of this dispute.

This  same software licensor also seeks to recover damages allegedly
arising  from  the  breach  of the license agreement,  as  discussed
immediately above, and, in addition, has asserted claims purportedly
arising  under  the  California  Business  Practices  Act   for   an
interference  with  prospective  economic  advantage.  The  software
licensor  alleges  that  it is entitled to  recover  not  less  than
$45,000  on its breach of contract claim. The Company has  filed  an
answer  denying the material allegations of the complaint  and  will
file  a  counterclaim based on the defective software. The  software
licensor has not specified the damages which it seeks to recover  on
the  remaining  claims.  Counsel, at this time,  cannot  express  an
opinion as to the ultimate resolution of this dispute.

One  of the Company's distributors has asserted claims based  on  an
open  account  for  the shipment of the Company's  products  through
which  it seeks to recover $91,004. The Company has filed an answer,
denying the material allegations of the complaint and has asserted a
counterclaim through which it seeks to recover $300,000  as  damages
for  the negligent destruction of certain products by agents of  the
distributor.  This  proceeding remains in  the  discovery  stage  of
litigation.  At this point it is not possible for counsel to express
a firm opinion as to the ultimate resolution of this dispute.

Another  distributor seeks to recover the sum of $44,943,  allegedly
owed  for  the  packaging,  shipping and  distribution  of  software
products  produced by the Company. The Company has filed  an  answer
and  counterclaim  through which it seeks  to  recover  the  sum  of
approximately  $50,000.  The claim of the Company  arises  from  the
shipment of packaged product by Onesource in an amount substantially
in  excess  of the amount ordered by distributors and the consequent
return  of those products resulting in a cash reimbursement paid  by
the distributor and debited to the Company.  Discovery is proceeding
in  this  matter.  Due  to the uncertainty involved  in  the  claim,
counsel can offer no opinion as to the ultimate outcome.

A  separate distributor seeks to recover $16,350 allegedly owed  for
printing services provided to the Company. The Company has filed  an
answer  through  which  it  denies that any  amounts  are  owing  to
plaintiff.   Discovery is now under way in this matter.  Counsel  is
not  able to express an opinion as to the ultimate outcome  of  this
dispute.

                                F-13

A  third party has filed a complaint seeking the recovery of $12,677
allegedly  owed  for  telecommunication services.  The  Company  has
agreed  to  make monthly payment of $1,000 until the  obligation  is
satisfied.

The  Company is also the subject of certain legal matters, which  it
considers  incidental to its business activities. It is the  opinion
of  management,  after  discussion  with  legal  counsel,  that  the
ultimate disposition of these legal matters will not have a material
impact  on  the  consolidated  financial  condition  or  results  of
operations of the Company.

Employment  Agreement  -  The  Company has  entered  into  Executive
Employment Agreements with its president and vice-president of sales
and marketing. The agreements, which became effective on
February  3,  1999, are for a period of  two years.  The  agreements
provide for compensation to the two parties to be set  by the  board
of  directors,  reimbursement for expenses, termination  for  cause,
fiduciary   responsibility  to  protect  confidential   information,
indemnification  to  the  fullest extent  permitted  by  the  Nevada
Corporation Statutes, a non-compete agreement for one year following
the  party's  departure from the Company and the Company's right  of
first refusal to purchase equity  owned by the parties.

NOTE 8 - OPERATING LEASE

The  Company  leases its operating facilities and certain  equipment
under  non-cancelable operating leases. Rent expense for  the  years
ended   December  31,  1999  and  2000  was  $57,356  and   $84,142,
respectively.    Minimum   rental  payments   under   non-cancelable
operating leases are as follows:

  Year Ending December 31,
     2001                                $ 47,040
     2002                                  11,760
                                         --------
        Total                            $ 58,800
                                         ========

NOTE 9 - INCOME TAXES

There was no provision for or benefit from income for the years ended
December 31, 2000 or 1999.  There were no deferred tax assets as of December
31, 1999. The components of the net deferred tax asset at December 31, 2000
are shown below:

      Benefit of operating loss carry forwards     $ 3,724,360
      Allowance for doubtful accounts                  279,020
      Less: valuation allowance                     (4,003,381)
                                                   -----------
      NET DEFERRED TAX ASSET                       $         -
                                                   ===========

For tax reporting purposes, the Company has net operating loss carry
forwards in the amount of $9,984,880 which will expire in 2020.

The following is a reconciliation of the amount of tax benefit that would
result from applying the federal statutory rate to pretax loss with the
benefit from income taxes for the year ended December 31, 2000:


      Benefit at statutory rate (34%)              $(3,650,363)
      Non-deductible expenses                            1,283
      Change in valuation allowance                  4,003,381
      State tax benefit, net of federal tax effect    (354,301)
                                                   -----------
      NET BENEFIT FROM INCOME TAXES                $         -
                                                   ===========

NOTE 10 - SUBSEQUENT EVENTS

In March 2001, the Company agreed to pay OTP an additional 1,000,000
shares  of  common  stock due to the decrease in the  value  of  the
Company's stock.

                                F-14