ONSCREEN TECHNOLOGIES, INC.

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

                                   FORM 10-QSB

                   QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                ------------------------------------------------
                      For quarter ended September 30, 2004
                         Commission File Number 0-29195


                           ONSCREEN TECHNOLOGIES, INC.
                 (Name of Small Business Issuer in Its Charter)

         Colorado                         (7310)                 84-1463284
--------------------------------------------------------------------------------
(State or jurisdiction of      (Primary Standard Industrial   (I.R.S. Employer
incorporation or organization) Classification Code Number)   Identification No.)


                         200 9th Avenue North, Suite 210
                          Safety Harbor, Florida 34695
                                 (727) 797-6664
                                 --------------
          (Address and Telephone Number of Principal Executive Offices
                        and Principal Place of Business)

                           John "JT" Thatch, President
                                 (727) 797-6664
                           OnScreen Technologies, Inc.
                         200 9th Avenue North, Suite 210
                          Safety Harbor, Florida 34695
            (Name, Address and Telephone Number of Agent for Service)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed  by  Section  13 or 15 (d) of the  Securities  Exchange  Act of 1934
during the preceding 12 months (or for such shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days.

                 Yes |X|  No |_|

As of October  15, 2004 there were  30,651,361  shares of the  Company's  common
stock  outstanding and an obligation to issue 4,206,671  additional common stock
shares, 2,785,580 shares of Series A Convertible Preferred Stock outstanding and
an obligation to issue 27,941 shares of Series B Convertible Preferred Stock.

                                       1
<PAGE>


                           ONSCREEN TECHNOLOGIES, INC.


                                      INDEX

                                                                            Page
                                                                            ----
                                     Part I

         Item 1  Financial Statements .......................................3
                  Condensed Balance Sheets...................................3
                  Condensed Statements of Operations.........................4
                  Condensed Statements of Cash Flows.........................5
                  Notes to the Condensed Financial Statements................7
         Item 2   Management's Discussion and Analysis of
                  Financial Condition and Results of Operations.............17
                  Overview..................................................17
                  Intellectual Property.....................................18
                  Critical Accounting Policies..............................18
                  Liquidity and Capital Resources...........................19
                  Results of Operations.....................................21
         Item 3   Controls and Procedures...................................24

                                     Part II

         Item 1   Legal Proceedings.........................................24
         Item 2   Changes in Securities ....................................24
         Item 3   Defaults Upon Senior Securities...........................25
         Item 4   Submission of Matters to a Vote of Security Holders.......25
         Item 5   Other Information.........................................25
         Item 6   Exhibits and Reports on Form 8-K..........................25
                  Signatures................................................26

                  Exhibits..................................................27



<PAGE>


                          PART I. FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS
                           ONSCREEN TECHNOLOGIES, INC.
                            CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                                                         September 30,   December 31,
                                                                                              2004           2003
                                                                                          (Unaudited)
                                                                                         ------------    ------------
<S>                                                                                      <C>             <C>
                                     Assets
 Current Assets
 Cash and cash equivalents                                                               $  2,000,828    $  1,323,923
  Marketable securities                                                                       750,386              --
  Accounts receivable, net of allowance for doubtful accounts of $14,620 at
   September 30, 2004 and $149,907 at December 31, 2003                                            --           4,584
  Prepaid expenses and other current assets                                                    56,447              --
                                                                                         ------------    ------------
 Total Current Assets                                                                       2,807,661       1,328,507
 Property and Equipment, net of accumulated depreciation of $670,831 at September
    30, 2004 and $543,308 at December 31, 2003                                                548,771         569,711
                                                                                         ------------    ------------
 Other Assets
 Restricted cash                                                                               30,000
 Due from affiliate                                                                             7,258           3,646
 Technology rights, net of accumulated amortization of $125,833 at September 30, 2004         396,667              --
 Other assets                                                                                  46,261          21,276
                                                                                         ------------    ------------
 Total Other Assets                                                                           480,186          24,922
                                                                                         ------------    ------------
 Total Assets                                                                               3,836,618    $  1,923,140
                                                                                         ============    ============
                    Liabilities and Stockholders' Deficiency
                    ----------------------------------------
 Current Liabilities
 Notes and loans payable                                                                 $         --    $    537,979
 Accounts payable and other payables                                                          157,569         540,942
 Accrued expenses                                                                             236,846         513,929
 Accrued compensation                                                                          69,667         216,689
 Deferred revenues                                                                                 --          58,238
 Deferred gain on sale of future revenues                                                          --         150,000
                                                                                         ------------    ------------
 Total Current Liabilities                                                                    464,082       2,017,777
                                                                                         ------------    ------------
 Accrued compensation payable with common stock                                                78,749              --
                                                                                         ------------    ------------
 Total Liabilities                                                                            542.831       2,017,777

 Stockholders' Equity (Deficiency )
 Preferred stock, par value $0.001; 10,000,000 shares authorized
    Convertible Series A, Preferred stock, 5,000,000 shares authorized, 2,785,580 and
        2,639,080 shares issued and outstanding at September 30, 2004 and December 31,
        2003, respectively; liquidation preference of $2,785,580 at September 30, 2004          2,786           2,639
    Convertible Series B preferred stock, 30,000 shares authorized, no
        shares issued and outstanding, liquidation preference of $240 per share                    --              --
 Preferred stock Series A issuable, at par value (50,000 shares at December 31, 2003)              --              50
 Preferred stock Series B issuable, at par value (27,941 shares at September 30, 2004)             28              --
 Common stock, par value $0.001; 150,000,000 shares authorized,
      30,651,361 and 13,589,776 shares issued and outstanding at
      September 30, 2004 and December 31, 2003, respectively                                   30,652          13,590
 Common stock issuable, at par value.  (4,206,671and 8,199,907 shares at
      September 30, 2004 and December 31, 2003, respectively)                                   4,207           8,200
 Additional paid-in capital                                                                21,978,697      13,125,449
 Accumulated deficit                                                                      (18,096,900)    (11,408,933)
                                                                                         ------------    ------------
                                                                                            3,919,470       1,740,995
 Less deferred consulting expense                                                             (19,059)     (1,418,307)
 Less deferred compensation expense                                                          (456,624)             --
 Less subscriptions receivable                                                               (150,000)       (417,325)
                                                                                         ------------    ------------
 Total Stockholders' Equity (Deficiency)                                                    3,293,787         (94,637)
                                                                                         ------------    ------------
 Total Liabilities and Stockholders' Equity (Deficiency)                                 $  3,836,618    $  1,923,140
                                                                                         ============    ============
</TABLE>

                 See accompanying notes to financial statements

                                       3
<PAGE>


                           ONSCREEN TECHNOLOGIES, INC.
                       CONDENSED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                For the three months ended      For the nine months ended
                                                      September 30,                   September 30,
                                                  2004            2003            2004            2003
                                              ------------    ------------    ------------    ------------
<S>                                           <C>             <C>             <C>             <C>
Revenues                                      $     56,643    $     72,275    $    137,836    $    275,452

Cost of Revenues                                        --              88             488          75,909
                                              ------------    ------------    ------------    ------------

Gross Profit                                        56,643          72,187         137,348         199,543
Operating Expenses
Selling, general and administrative                853,286         630,729       5,929,381       1,807,694

Research and development                           345,511              --         704,752          28,200
Bad debt                                               315          12,913          11,953          99,945
                                              ------------    ------------    ------------    ------------
Total Operating Expenses                         1,199,112         643,642       6,646,086       1,935,839
                                              ------------    ------------    ------------    ------------

Loss from Operations                            (1,142,469)       (571,455)     (6,508,738)     (1,736,296)
                                              ------------    ------------    ------------    ------------
Other Income (Expense)

Other income                                         1,375          16,650          14,461          44,672
Settlement gain (loss), net                        (64,050)        (25,553)        251,251         286,942
Interest income (expense), net                       5,152         (34,507)        (53,194)       (107,377)
                                              ------------    ------------    ------------    ------------
Total Other Income (Expense), Net                  (57,523)        (43,410)        212,518         224,237
                                              ------------    ------------    ------------    ------------
Net Loss                                        (1,199,992)       (614,865)     (6,296,220)     (1,512,059)
Preferred Stock Dividends                         (195,725)        (46,405)       (391,747)       (122,837)
                                              ------------    ------------    ------------    ------------
Net Loss Available to Common Stockholders     $ (1,395,717)   $   (661,270)   $ (6,687,967)   $ (1,634,896)
                                              ============    ============    ============    ============
Basic and Diluted Loss Per Common Share:      $      (0.04)   $      (0.06)   $      (0.22)   $      (0.15)
                                              ============    ============    ============    ============
 Weighted average common shares outstanding     33,891,245      10,907,911      29,876,458      10,715,715
                                              ============    ============    ============    ============
</TABLE>

                 See accompanying notes to financial statements

                                       4

<PAGE>

                           ONSCREEN TECHNOLOGIES, INC.
                       CONDENSED STATEMENTS OF CASH FLOWS
                                    UNAUDITED
<TABLE>
<CAPTION>
                                                                                           For the nine months ended,
                                                                                                   September 30,
                                                                                              2004            2003
                                                                                          ------------    ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                                       <C>             <C>
Net Loss                                                                                  $ (6,296,220)   $ (1,512,059)
Adjustments to reconcile net loss to net cash used in operating activities:
       Stock, warrants and notes issued for compensation and services                        1,910,335         230,567
       Stock based and other non-cash settlement gain, net                                    (315,301)         16,435
        Non-cash interest expense for stock issued to noteholders that were in default          46,500          53,125
       Non-cash interest expense                                                                17,571              --
       Gain on forgiveness of accrued penalties                                                     --        (300,000)
       Bad debt                                                                                 11,638          99,945
       Amortization of technology rights                                                       125,833              --
       Amortization of deferred consulting                                                   1,801,608              --
       Amortization of deferred compensation                                                   183,751              --
       Compensation expense payable in common stock                                            161,874              --
       Depreciation                                                                            128,185         131,394
       Other non-cash income                                                                        --            (354)
(Increase) decrease in assets:
       Accounts receivable and other receivables                                                (7,054)       (126,574)
       Due from affiliate                                                                       (3,612)             --
       Prepaid expenses                                                                        (56,447)             --
       Deferred royalty expense                                                                     --          75,000
       Deposits and other assets                                                               (24,985)          1,174
Increase (decrease) in liabilities:
       Notes and loans payable - related party-accrued interest                                     --           5,485
       Accounts payable and accrued expenses                                                  (480,443)        195,410
       Customer deposits                                                                            --         (28,500)
       Royalties payable                                                                            --          72,951
       Deferred revenues                                                                       (58,238)         21,067
       Accrued commitment penalty                                                                   --         200,000
                                                                                          ------------    ------------
               NET CASH USED IN OPERATING ACTIVITIES                                        (2,885,005)       (864,934)
                                                                                          ------------    ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
       Investment in technology rights                                                        (522,500)             --
       Purchases of marketable securities                                                     (750,386)             --
       Purchase of property and equipment                                                     (107,245)             --
                                                                                          ------------    ------------
               NET CASH USED IN INVESTING ACTIVITIES                                        (1,380,131)             --
                                                                                          ------------    ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
       Series A convertible preferred stock dividends paid                                    (199,956)         (7,534)
       Proceeds from notes and loans payable                                                        --         101,329
       Payments on notes and loans payable                                                    (302,511)             --
       Proceeds from sales of common stock and exercise of warrants and options, net of
       offering costs                                                                        5,369,508              --
       Proceeds from issuance of preferred stock - Series A                                     75,000         820,000
                                                                                          ------------    ------------
               NET CASH PROVIDED BY FINANCING ACTIVITIES                                     4,942,041         913,795
                                                                                          ------------    ------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                                           676,905    $     48,861
Cash and Cash Equivalents at Beginning of Year                                               1,323,923          16,335
                                                                                          ------------    ------------
CASH AND CASH EQUIVALENTS AT END OF YEAR                                                  $  2,000,828    $     65,196
                                                                                          ============    ============
</TABLE>
(Continued)

                                       5
<PAGE>

   (continued)

<TABLE>
<CAPTION>
                                                                                            For the nine months ended,
                                                                                                  September 30,
                                                                                             2004             2003
                                                                                          ----------      ------------

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:

<S>                                                                                       <C>             <C>
   Accounts payable settled with Series A preferred stock                                 $         --    $     89,343
                                                                                          ============    ============
   Accrued expenses settled with Series A preferred stock                                 $         --    $     49,000
                                                                                          ============    ============
   Debt and accrued interest settled with Series A preferred stock                        $         --    $  1,049,155
                                                                                          ============    ============
   Accrued compensation settled with Series A preferred stock                             $     24,000    $         --
                                                                                          ============    ============
   Debt and accrued liability settled with common stock                                   $    391,961    $         --
                                                                                          ============    ============
   Subscription receivable paid with reduction of notes payable                           $     18,575    $         --
                                                                                          ============    ============
   Conversion of Series A convertible preferred stock to common stock                     $        340    $         --
                                                                                          ============    ============
   Series A preferred stock dividend resulting from intrinsic value of convertible
     preferred stock                                                                      $    172,000    $         --
                                                                                          ============    ============
   Series B preferred stock dividend resulting from intrinsic value of convertible
     preferred stock                                                                      $         28    $         --
                                                                                          ============    ============
</TABLE>

                 See accompanying notes to financial statements

                                       6
<PAGE>



NOTE 1 BASIS OF PRESENTATION AND GOING CONCERN

During the annual meeting of the shareholders,  the shareholders voted to change
the corporation  name from New Millennium Media  International  Inc. to OnScreen
Technologies,  Inc.  to  reflect  the  main  focus  of the  Company  which is to
manufacture and license products utilizing the OnScreen(TM) technology.

The accompanying  financial statements have been prepared on the assumption that
the Company will continue as a going concern.  As reflected in the  accompanying
financial statements,  the Company has a net loss of $6,296,220 and cash used in
operations  of  $2,885,005  for the nine months ended  September  30, 2004.  The
ability of the  Company to  continue  as a going  concern  is  dependent  on the
Company's  ability  to  bring  the  OnScreen(TM)  product  to  market,  generate
increased sales,  obtain positive cash flow from operations and raise additional
capital. The financial statements do not include any adjustments that may result
from the outcome of this uncertainty.

The Company continues to raise additional capital for the  commercialization  of
its  OnScreen(TM)  technology  product line.  The Company  believes it will have
sufficient  cash to meet its  funding  requirements  to bring  the  OnScreen(TM)
technology  product  line into  production  during the first  half of 2005.  The
Company has  experienced  negative cash flows from  operations  and incurred net
losses in the past and there can be no assurance as to the availability or terms
upon which additional financing and capital might be available, if needed.

The accompanying unaudited financial statements have been prepared in accordance
with accounting  principles  generally  accepted in the United States of America
and the rules and  regulations  of the United  States  Securities  and  Exchange
Commission for interim financial information.  Accordingly,  they do not include
all the information and footnotes necessary for a comprehensive  presentation of
financial  position and results of operations  and should be read in conjunction
with the Company's  Annual  Report,  Form 10-KSB for the year ended December 31,
2003.

It is management's opinion,  however, that all material adjustments  (consisting
of normal recurring  adjustments)  have been made which are necessary for a fair
financial  statement  presentation.  The results for the interim  period are not
necessarily indicative of the results to be expected for the year.

NOTE 2 REVENUE

During 2004, the Company focused on development of its  OnScreen(TM)  technology
and related products.  Currently, the OnScreen(TM) products are in the prototype
stage.  In conjunction  with this focus,  the Company  conveyed and assigned its
right,  title and interest relating to EyeCatcherPlus  displays to a third party
during 2004. The Company retains ownership and a security interest in all assets
conveyed and assigned.  The third party will pay the Company five percent of the
gross advertising sales revenue derived from these displays.


                                       7
<PAGE>


NOTE 3 MARKETABLE SECURITIES AVAILABLE-FOR-SALE

During the third  quarter  2004, in order for the Company to optimize its return
on the equity  funds it had raised,  it invested  in certain  liquid  marketable
securities.    The   Company   classifies   these   marketable   securities   as
available-for-sale.   The  cost  approximately  equaled  fair  market  value  at
September  30,  2004,  therefore  no  unrealized  gain or loss was  recorded  at
September 30, 2004 for these securities.

NOTE 4 LOSS PER COMMON SHARE

Common stock  equivalents in the three- and nine-month  periods ended  September
30,  2004 and 2003 were  anti-dilutive  due to the net losses  sustained  by the
Company during these periods,  thus the diluted  weighted  average common shares
outstanding in these periods are the same as the basic  weighted  average common
shares outstanding.

NOTE 5 INCOME TAXES

The Company has not  recognized an income tax benefit for its  operating  losses
generated in the three- and nine-month periods ended September 30, 2004 and 2003
based on  uncertainties  concerning  its ability to generate  taxable  income in
future  periods.  The tax benefits for the three- and  nine-month  periods ended
September  30,  2004 and 2003 is offset  by a  valuation  allowance  established
against  deferred tax assets arising from operating  losses and other  temporary
differences,  the  realization of which could not be considered more likely than
not. In future  periods,  tax benefits  and related  deferred tax assets will be
recognized  when  management  considers  realization  of such amounts to be more
likely than not.

NOTE 6 STOCK BASED EMPLOYEE COMPENSATION

For the stock options and warrants issued to employees,  the Company has elected
to apply the intrinsic value based method of accounting prescribed by Accounting
Principles  Board  ("APB")  Opinion  No.  25,  "Accounting  for Stock  Issued to
Employees," and related interpretations. Under the intrinsic value based method,
compensation  cost is  measured on the date of grant as the excess of the quoted
market price of the underlying stock over the exercise price.  Such compensation
amounts are amortized over the respective vesting periods of the options.


                                       8
<PAGE>


The following table  illustrates the effect on net loss and loss per share as if
the fair value  based  method of  accounting  had been  applied  to  stock-based
employee compensation,  as required by SFAS No. 123, "Accounting for Stock-Based
Compensation" and SFAS 148 "Accounting for Stock-Based Compensation - transition
and  disclosure",  an  amendment  of SFAS No. 123 for the three and nine  months
ended September 30, 2004 and 2003:

<TABLE>
<CAPTION>
                                      Three months ending September 30,  Nine months ending September 30,

                                              2004            2003            2004           2003
                                         ------------    ------------    ------------    ------------
<S>                                      <C>             <C>             <C>             <C>
   Net Loss Available to Common
       Stockholders:
   Net loss available to common
       stockholders, as reported         $ (1,395,717)   $   (661,270)   $ (6,687,967)   $ (1,634,896)
       Plus:  Intrinsic value
             of compensation
             costs included in
             net loss                           8,367              --         100,701          70,500

      Deduct: Fair value of 7
              stock-based
              employee
              compensation costs              (21,460)       (157,200)       (142,500)       (353,206)
                                         ------------     ------------   ------------    ------------
      Pro forma  net loss               $  (1,408,810)     $ (818,470)   $ (6,729,766)   $ (1,917,602)
                                         ============     ============   ============    ============

  Loss per share:

  Basic and Diluted - as reported        $      (0.04)   $      (0.06)   $      (0.22)   $      (0.15)
                                         ============    ============    ============    ============
  Basic and Diluted - pro forma          $      (0.04)   $      (0.08)   $      (0.23)   $      (0.18)
                                         ============    ============    ============    ============
</TABLE>

The  Company  estimates  the fair value of each stock  option and warrant at the
grant date by using the Black-Scholes option-pricing model.

NOTE 7 NOTES PAYABLE

The note holders with an original  principal of $250,000 had a right to purchase
50,000  additional common shares for January and February 2004 since the Company
was not current on these notes during  those  months.  The Company  recorded the
value  of the  right  to buy  the  50,000  shares  of  common  stock  using  the
Black-Scholes  Options  Pricing  Model at $46,500.  This amount was  recorded as
interest  expense  during the first  quarter of 2004.  These  notes and  accrued
interest were paid in full on March 12, 2004 by paying the note holders $250,000
and issuing  12,500  shares of the Company's  common stock.  These shares issued
were valued at $11,500 and after  consideration  of additional  interest due for
2004  and a  receivable  of  $18,575  due  from the  note  holders  from  option
exercises, the Company recognized a gain of $7,103 in 2004.

Also, the Company paid off a $50,000 note during the first quarter of 2004.

During May, a  noteholder  exercised  the right to convert a $215,861  note into
863,442 shares of the Company's common stock.


                                       9
<PAGE>


NOTE 8 COMMITMENTS

(A) EMPLOYMENT AND CONSULTANT AGREEMENTS

On January 2, 2004,  the Company  entered into a two-year  consulting  agreement
with an individual to perform various financial and administrative  duties. This
consultant  will be paid $75,000  annually  with a bonus of $25,000 worth of the
Company's  common  stock,  which must be issued  within two and one-half  months
after the end of each year.  (This  individual  was  previously  the Director of
Operations and this  consulting  agreement  replaced his employment  agreement).
During  October  2004,  the  Company's  Board of  Directors  and the  consultant
approved that this consultant  agreement  revert back to the employee  agreement
with the  same  financial  terms as the  consulting  agreement.  The  employment
agreement expires May 21, 2005.

On  February  3,  2004,  an  addendum  was  made to the  President's  employment
agreement  whereby  the Company  agreed to cap the  President's  entitlement  to
shares of common  stock at  3,000,000  and pay him one  percent  of all  revenue
derived from any licensing  fees received by the Company in connection  with the
OnScreen(TM)  technology,  provided  that the  Company  consummates  the private
placement in its entirety and receives the portion of the unit purchase price to
which it is entitled.  During the nine months  ended  September  30,  2004,  the
Company issued 1,040,000  shares and recorded 626,312 shares as issuable;  which
brings  the  number  of shares  issued  and  issuable  to the  President/CEO  to
3,000,000.  On February  10, 2004,  the  Company's  board of directors  approved
increasing the President's salary to $150,000 since the employment agreement for
the President  included the provision that he would get paid equal  compensation
to any other senior executive of the Company (the President,  OnScreen  Products
Division's salary is $150,000).

On  February  5, 2004,  the  agreement  with the  President,  OnScreen  Products
Division  was  extended  with  an  effective  date of  November  1,  2003  for a
three-year term. The salary will be $150,000 in the first year,  $180,000 in the
second year and $240,000 in the third year.  $120,000 of the first year's salary
is to be paid in cash and the remaining $30,000 will be accrued. The full salary
will be paid in cash when the  Company  achieves  a  positive  cash flow for two
consecutive  months.  The  accrued  compensation  will be paid when the  Company
reaches  aggregate  sales of $2.5  million  or at the  employee's  option he may
procure stock through the employee stock option plan.  This employee has a right
to 450,000 shares of the Company's common stock.  These shares,  if the employee
is terminated  for cause or resigns,  may be  repurchased  from the employee for
$450. The amount of shares that can be  repurchased  by the Company  declines by
150,000 shares each year, resulting in the shares being fully vested on November
1, 2006. These 450,000 shares were issued during the second quarter of 2004.

(B) ROYALTY, LICENSE FEE AGREEMENTS AND TECHNOLOGY RIGHTS

On  January  14,  2004,  a  licensor  agreed to accept  $175,000  in lieu of the
remaining  $250,000  minimum payment owed during 2004, which the Company paid on
January 15, 2004 and the  licensor  agreed to accept an  additional  $400,000 by
March 31, 2004 for the  licensor to convey to the Company its 25% royalty  right
in the OnScreen(TM) License Agreement. This $400,000 was paid on March 16, 2004.
After this payment, there are no more royalty payments owed to this licensor and
now the Company retains 100% ownership of the OnScreen(TM)  license. The Company
recorded  $52,500 as a reduction in accrued  royalty  payments and the remaining
$522,500 of the $575,000  payments as a technology  right intangible asset to be
amortized over the estimated life of the technology of twenty years.

                                       10
<PAGE>

On February 3, 2004, a third party and the Company reached a master settlement
and release agreement whereby, in consideration for the exchange of mutual
releases and the third party relinquishing any claim to any of the benefits of
the OnScreen(TM) (including the 11.25% license payments), the Company paid to
this third party during June 2004 $150,000 plus agreed to pay an annually
declining percentage of revenue of 5% in 2005 declining to 2% in year 2008 and
thereafter from the OnScreen(TM) revenues. In the event of a change of control
of the Company, the percentage of revenue shall terminate and a single payment
transaction fee shall be paid by the Company to this third party ranging from
10% of the OnScreen(TM) appraised value up to $100,000,000, 7.5% for the
appraised value between $100,000,001 and $200,000,000, 5% of the appraised value
between $200,000,001 and $300,000,000, and 4% of the appraised value between
$300,000,001 and $400,000,000 and 3% for the appraised value between
$400,000,001 and $500,000,000 and 2% for any appraised amounts between
$500,000,001 and $600,000,000.

(C)  OTHER COMMITMENTS

On February 3, 2004 (and amended June 15, 2004), the Company entered into an
agreement with a third party whereby the Company conveyed and assigned its
right, title and interest that the Company has relating to EyeCatcherPlus and
Drive Time Network (except to its Display assets) as well as the right for the
third party to place the Company's EyeCatcherPlus Displays. The Company retains
ownership and a security interest in all assets conveyed and assigned. The third
party will pay the Company five percent of the gross advertising sales revenue
derived from these Displays. The five percent fee will continue until the
Company receives the pre-agreed total amount for the Displays. The third party
shall issue fifteen percent of its stock to the Company at the time of the
agreement. The Company recorded this 15% investment at -0- during 2004. During
second quarter 2004, the Company issued a warrant to purchase 200,000 shares of
its common stock to this third party (See Note 10). During the first six months
of 2004 in accordance with the agreement, the Company contributed $5,000 monthly
for five months to this third party. This $30,000 was expensed during 2004.

NOTE 9 PREFERRED STOCK

On February 3, 2004, the Company's board of directors  designated  30,000 shares
of preferred  stock as Series B Convertible  Preferred  Stock  ("Series B"). The
Series B is convertible to common shares on a one thousand-for-one ratio, is due
annual dividends at $1 per share, payable quarterly,  as authorized by the Board
and the dividends are cumulative.  Series B has a liquidation  value of $240 per
share and has voting rights of one thousand votes per Series B share.

As of  September  30,  2004,  the  Company  recorded  27,941  shares of Series B
Convertible  Preferred  Stock as issuable.  This is comprised of 23,204 Series B
shares  issuable  to the  private  placement  unit  holders  during 2003 and the
exercise of their  warrants  during 2004 and 4,737  Series B shares  issuable to
private placement shareholders during 2004. (See Note 10)

                                       11
<PAGE>

During March 2004, the Company  converted  30,000 shares of Series A convertible
preferred stock into 120,000 shares of the Company's common stock at the request
of the Series A  convertible  preferred  stock  holder.  During  July 2004,  the
Company  converted  55,000 shares of Series A convertible  preferred  stock into
220,000 shares of the Company's  common stock at the request of certain Series A
convertible preferred stock holders.

During the first nine months of 2004, the Company received payment of $50,000 on
a Series A Convertible  Preferred Stock subscription and issued 50,000 shares of
Series A convertible preferred stock that was issuable at December 31, 2003.

During the first nine months of 2004, the Company sold 25,000 shares of Series A
convertible  preferred  stock for cash at $1.00 per share for total  proceeds of
$25,000.

During the first nine months of 2004, the Company issued 24,000 shares of Series
A convertible  preferred stock for services totaling $24,000 that was accrued as
a liability at December  31,  2003.  These shares were valued at $1.00 per share
based on contemporaneous  cash sales. The measurement date was the date at which
the performance of the services had been completed.

During the first nine months of 2004,  the Company  issued  12,500 shares of its
Series A convertible  preferred stock for consulting  services totaling $12,500.
These shares were valued at $1.00 per share based on contemporaneous cash sales.
The  measurement  date was the date at which the performance of the services had
been completed.

During the first nine months of 2004, the Company recorded  $172,000 and $28 for
the intrinsic value associated with the embedded beneficial  convertible feature
of the Series A convertible  preferred stock and Series B convertible  preferred
stock,  respectively.  This amount was  computed as the  difference  between the
conversion price and the fair value of the preferred  stock,  which was computed
as the fair value of the common stock based on the quoted  trading  price at the
preferred stock issuance dates, multiplied by the conversion ratio (four-for-one
for Series A and one  thousand-for-one  for Series B). This  intrinsic  value is
limited to the amount of the proceeds  allocated  to the  preferred  stock.  For
financial  statement  purposes,  this $172,028 was recorded as a preferred stock
dividend.  Additionally,  during  the first  nine  months of 2004,  the  Company
recorded Series A convertible preferred stock dividends of $203,996 and Series B
convertible preferred stock dividends of $15,723.

During July 2004,  the Company  issued  120,000 shares of its Series A Preferred
Stock  to  its  Chief  Financial  Officer  in  accordance  with  his  employment
agreement.  These  120,000  shares  were  valued  at $1.00  per  share  based on
contemporaneous  cash sales  around  the grant  date.  The total  value of these
shares of $120,000 is being  expensed over the three-year  employment  agreement
with $90,000 deferred and $30,000 expensed as of September 30, 2004.

NOTE 10 OTHER EQUITY TRANSACTIONS

During  February 2004, the Company issued  5,900,000  shares of its common stock
related to the 2003 private placement that was recorded as common stock issuable
at December 31, 2003.

                                       12
<PAGE>

During  February  2004,  6,700,000  shares of the  Company's  common  stock were
issuable by the exercise of the $0.50 warrants from the private  placement.  The
Company received $3,350,000 ($2,867,054 net of cash offering costs) cash related
to the  exercise of these  warrants.  During May 2004,  the  Company  issued the
6,700,000  shares of the Company's common stock related to the exercise of these
warrants.

On  February  3, 2004,  the Company and Swartz  entered  into a  settlement  and
termination of investment agreement. The Company agreed to i) promptly issue the
379,907  shares of common  stock from the 2003  cashless  exercise of the Swartz
warrants of which  Swartz  agreed to limit its sales of these  shares of Company
stock to ten percent of the Company's trading volume for any calendar month, ii)
Swartz shall retain the 100,000 shares of stock that had been issued during 2002
per the  initial  agreement  and then  were not  valid as put  shares as the put
transaction  was never  executed,  but the shares had been  issued to Swartz and
iii) the  investment  agreement  between the Company and Swartz shall  terminate
subject to the  completion of items i - iii above.  During  February  2004,  the
Company  issued the 379,907  shares of common  stock  (without  any  restrictive
legends). The 100,000 shares of the Company's common stock issued were valued at
$104,000 using the quoted marked price on the date of settlement.  This $104,000
settled  the  $100,000  commitment  payable  that  was  owed to  Swartz  and the
remaining $4,000 was recognized as a settlement loss.

A  plaintiff  held a  convertible  promissory  note for  $234,869 at 8% interest
accruing  from the note date of August 1999.  The Company  believed the note was
not valid;  however, as a contingency,  the Company recorded a total of $328,058
in accrued expenses at December 31, 2003 related to this matter.  On February 5,
2004,  the  Company  satisfied  this  disputed  note with  60,000  shares of the
Company's  common  stock.  These  shares were  valued at $60,600  based upon the
quoted  trading price of $1.01 on the settlement  date.  The Company  recorded a
settlement gain of $267,458 in February 2004.

During the first quarter of 2004, the Company issued 50,000 shares of its common
stock  pursuant to the exercise of the rights of certain  note  holders  granted
under the default  provisions of certain promissory notes. The issuance resulted
in additional  subscriptions  receivable of $1,250 for a total issuance price of
$1,250 or $0.025 per share.

On January 3, 2004,  the Company issued 100,000 shares of its common stock to an
individual  for services.  These shares were valued at $106,000 using the quoted
marked price on the date of grant.

During March 2004, an individual  exercised a warrant to purchase 100,000 shares
of the  Company's  common  stock at an  exercise  price of $0.20 per share.  The
Company received the $20,000 during April 2004.

During  March 2004,  a former  employee  exercised  an option to purchase  5,000
shares of the  Company's  common stock at an exercise  price of $0.40 per share.
The Company received $2,000 for the exercise of this option.

Certain  notes were paid in full on March 12,  2004 by paying  the note  holders
$250,000 and issuing 12,500 shares of the Company's  common stock.  These shares
issued were valued at $11,500 based on the quoted  trading price of $0.92 on the
settlement date and after  consideration of additional interest due for 2004 and
a receivable  of $18,575 due from the note holders  from option  exercises,  the
Company recognized a gain of $7,103 in 2004 (See Note 7).

                                       13
<PAGE>

During the first quarter of 2004, the Company issued warrants to an employee and
a  director  each to  purchase  100,000  shares of the  Company's  common  stock
(200,000 in total).  These  warrants were valued at $149,000 under the intrinsic
value  method of APB 25 and will be recorded as  compensation  expense  over the
service period.

During the first  quarter of 2004,  the  Company  granted a warrant to a service
provider to purchase  20,736 shares of its common stock at an exercise  price of
$0.25 expiring  January 21, 2007.  The warrant was valued at $20,041,  which was
charged to consulting  expense  immediately  since the services were  considered
completed.  The  warrants  were valued  using the  Black-Scholes  option-pricing
model.  During June 2004, this warrant and another  warrant to purchase  100,000
additional  shares of the  Company's  common stock were  exercised.  The Company
received $30,184 of cash and issued the 120,736 shares of common stock.

On April 15, 2004,  the Company  issued a warrant to purchase  600,000 shares of
its common stock for  services.  This  warrant was valued at $402,360  using the
Black Scholes Option model.  The Company will record the expense related to this
warrant over the 90-day agreement period the services are performed. During June
2004, this warrant and another warrant to purchase an additional  600,000 shares
of the  Company's  common stock were  exercised  for a total  exercise  price of
$450,000.  The Company has received  $300,000 of cash and at September  30, 2004
has a subscriptions  receivable recorded for the remaining $150,000. The Company
issued 600,000 shares of its common stock during July 2004 and recorded a common
stock  issuable of $600 related to the remaining  600,000  shares of common that
are issuable at September 30, 2004.

During May 2004, the Board of Directors  extended the exercise date of the $0.75
warrants from May 30, 2004 to June 30, 2004.

As  discussed  above in the notes  payable  section,  during  May, a  noteholder
exercised  her right to convert her  $215,861  note into  863,442  shares of the
Company's common stock.

During June 2004, the Company issued warrants to purchase  525,000 shares of its
common  stock for  services to two  parties.  These  warrants  were valued at an
aggregate of $255,765 using the Black Scholes Option model. The Company recorded
the expense related to these warrants during June 2004.

During June 2004, 335,333 shares of the Company's common stock were issuable and
20,000 shares were issued by the exercise of some of the $0.75 warrants from the
2003 private  placement.  These shares remained  issuable at September 30, 2004.
The Company received $266,500 of cash.

During the nine  months of 2004,  the  Company  issued  1,040,000  shares of its
common stock to its  President/CEO  and recorded  626,312  shares as issuable at
September 30, 2004 in accordance  with his  employment  agreement.  These shares
were  valued at the  quoted  trading  price of $0.86 on the  grant  date and the
expense of $1,433,028 was recorded during the second quarter of 2004.

During the second  quarter of 2004,  the Company  issued  450,000  shares of its
common stock to its President,  OnScreen  Products  Division.  The Company has a
right to  repurchase  these shares from the employee for $450 if the employee is
terminated for cause or resigns. The amount of shares that can be repurchased by
the Company declines by 150,000 shares each year,  resulting in the shares being
fully vested on November 1, 2006.  The shares were valued at $454,500 based upon
the quoted  trading  price of $1.01 on the grant date and will be recorded as an
expense over the employee's three-year employment agreement.

                                       14
<PAGE>

During the third quarter of 2004, the Company  granted and issued 100,000 shares
of its common stock to a research and  development  provider.  These shares were
valued at $83,000  using the quoted  marked price of $0.83 per share on the date
of grant.

During  2003,  the  Company  recorded  $250,000  stock  subscribed  based upon a
subscription  agreement the Company had with an investor.  The 1,000,000  shares
related to this subscription receivable are recorded as common stock issuable at
December 31, 2003.  This  subscription  receivable  has not been  fulfilled  and
during the third quarter 2004, the Company reduced its  subscription  receivable
for the $250,000 and reduced the common stock issuable for the 1,000,000 shares.

During  the third  quarter  of 2004,  the  Company  sold some of its  securities
through a private placement.  This 2004 private placement is comprised of 666.67
shares of common  stock and 1.194  shares of Series B  Preferred  Stock for each
$500 received. During the third quarter of 2004, the Company received $1,983,770
of proceeds related to this 2004 private  placement and recorded 4,737 shares of
Series B Preferred  Stock as issuable  and  2,645,026  shares of common stock as
issuable at September 30, 2004.

During the first quarter of 2004, the Company  received  $100,000 and recorded a
subscription  receivable of $100,000 for 800,000 shares of its common stock. The
800,000 shares were recorded as issuable. During July 2004, the Company and this
party  mutually  terminated the agreement and the Company paid back the $100,000
originally  paid,  reduced the  subscription  receivable of $100,000 to zero and
will not  issue the  800,000  shares  that were  recorded  as  issuable  to this
investor.  The Company also paid an  additional  $68,121 as  settlement of other
amounts owed to this  individual.  The $68,121 was recorded as a settlement loss
during 2004.

NOTE 11 OTHER SETTLEMENTS

During the nine months of 2004, the Company  settled  several  payables owed and
recorded  a  settlement  gain of $48,782  during  the first nine  months of 2004
related to these settlements.

NOTE 12 SUBSEQUENT EVENTS


On October 6, 2004, the Company's Board of Directors approved the following. All
of the warrants and common stock transactions granted to employees are accounted
for based upon the  intrinsic  value based method of  accounting  prescribed  by
Accounting Principles Board ("APB") Opinion No. 25, "Accounting for Stock Issued
to  Employees,"  and related  interpretations.  Under the intrinsic  value based
method,  compensation cost is measured on the date of grant as the excess of the
current market price of the underlying stock over the exercise price.

      The President and Chief  Executive  Officer's  (CEO) annual salary will be
      $180,000  effective  November  1,  2004  which is in  accordance  with his
      employment  agreement  whereby he gets paid  equal to any other  executive
      officer.

                                       15
<PAGE>

      The Audit  Committee  Chairman  of the Board of  Directors  was  granted a
      five-year  warrant  to  purchase  600,000  shares of common  stock with an
      exercise price of $0.25 for services  provided.  This warrant is valued at
      $240,000  under the intrinsic  value method of APB 25 and will be recorded
      to compensation expense during October as the services have been provided.

      For additional services to be provided, the Chief Operating  Officer/Chief
      Financial Officer (COO) was granted 375,000 Series A Convertible Preferred
      shares and 1,500 Series B  Convertible  Preferred  shares in the following
      increments:  125,000  Series A shares  and 500 Series B shares on or about
      January  1,  2006;  125,000  Series A shares and 500 Series B shares on or
      about July 1, 2006, and 125,000 Series A shares and 500 Series B shares on
      or about December 31, 2006. These shares will be issued with the provision
      that the COO has not terminated his  employment  voluntarily  prior to the
      issuance  of the  shares.  The  375,000  shares  of  Series A  Convertible
      Preferred  Stock are  valued at $1.00 per share  based on  contemporaneous
      cash  sales  during  2004.  The  total  value of these  Series A shares is
      $375,000  and  will be  expensed  over  the  remaining  term of the  COO's
      employment  agreement.  The 1,500 shares of Series B Convertible Preferred
      Stock are valued at $620 per share based on the market value of the common
      stock  multiplied  times the conversion ratio of 1,000. The total value of
      these Series B shares is $930,000 and will be expensed  over the remaining
      term of the COO's employment agreement.

      The COO was granted a  five-year  warrant to  purchase  500,000  shares of
      common stock with an exercise price of $0.25 for services  provided.  This
      warrant is valued at $200,000  under the intrinsic  value method of APB 25
      and  will be  recorded  to  compensation  expense  during  October  as the
      services have been provided.

      The COO's salary increases to $150,000  retroactive to January 1, 2004 and
      on November 1, 2004 increases to $180,000.

      For additional services to be provided,  the President,  OnScreen Products
      Division was granted a five-year  warrant to purchase  2,000,000 shares of
      common stock with an exercise price of $0.25 for services  provided.  This
      warrant can be exercised on or after November 7, 2006. The warrant expires
      if the employee voluntarily terminates his employment prior to November 7,
      2006.  This warrant is valued at $800,000 under the intrinsic value method
      of APB 25 and will be recorded to compensation expense through the vesting
      date of November 7, 2006.

      The  Director  of   Administration's   former  employment   agreement  was
      reinstated and the consulting agreement was terminated. In accordance with
      this  employment  agreement,  the  Director of  Administration  is paid an
      annual  salary of $75,000  and a stock bonus of the  Company's  registered
      common  stock  equal in value to $25,000  within two and  one-half  months
      after the end of each year of  employment  during which he was employed by
      the Company. The employment agreement expires May 21, 2005.

      The Director of Administration was granted a five-year warrant to purchase
      600,000  shares  of  common  stock  with an  exercise  price of $0.25  for
      services provided.  This warrant is valued at $240,000 under the intrinsic
      value method of APB 25 and will be recorded to compensation expense during
      October as the services have been provided.

The  $150,000  owed to the  Company  was not paid for  600,000  shares that were
recorded as issuable at  September  30, 2004.  On October 11, 2004,  the Company
agreed  that they would not issue the  600,000  shares and would not collect the
$150,000 owed for those shares.  The Company also agreed to issue 100,000 shares
of stock to this party for the services they provided to the Company  during the
Company's  negotiations with a third party which included the forgiveness by the
third party of dividends  that accrued on 114,343 shares of Series A Convertible
Preferred Stock.

                                       16
<PAGE>

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
of Operations.

General

Management's   discussion  and  analysis   contains   various  "forward  looking
statements." Such statements consist of any statement other than a recitation of
historical fact and can be identified by the use of forward-looking  terminology
such as "may,"  "expect,"  "anticipate,"  "estimate,"  or  "continue"  or use of
negative or other variations or comparable terminology.

We caution that these statements are further qualified by important factors that
could cause  actual  results to differ  materially  from those  contained in the
forward-looking   statements,   that  these   forward-looking   statements   are
necessarily  speculative,  and there are certain  risks and  uncertainties  that
could cause actual events or results to differ materially from those referred to
in such forward-looking statements.

Overview

OnScreen  Technologies,  Inc. is a publicly traded company (OTC-BB:ONSC) focused
on   commercializing   its   innovative   technology  to  the  world  of  visual
communications.  The company  concentrates on motion display solutions and seeks
to  develop  innovative  approaches  to  visual  communication  and  advertising
products  and  delivery   systems.   The  Company  is  focused  on  the  design,
development,  licensing  and sale of LED video  displays  manufactured  with the
OnScreen(TM) technology architecture.

OnScreen  Technologies,  Inc. is focused on providing next  generation LED video
displays for the Department of Transportation (DOT), Law Enforcement,  Emergency
Response,  Department of Homeland Security and commercial  advertising  markets.
Utilizing   a   revolutionary   patent   pending   architecture.    OnScreen(TM)
Technologies'  LED displays should provide  solutions that are up to 65% lighter
than current LED displays and reduce wind loading by up to 75%. The architecture
enables  the  placement  of  LED  signs  on  existing  structures  with  reduced
structural  support for the Variable Message Sign market and has resulted in the
creation of the first truly portable Rapid Dispatch Emergency Signs (RDES) using
the patent protected  OnScreen(TM)  technology.  The RediAlert(TM)  RDES can fit
into any emergency  vehicle and provides bright LED illumination in a three feet
by five feet display that collapses to the size of a suit case for easy storage.
It is powered  through the  vehicle's  batteries and can be deployed by a single
person emergency responder.

The  OnScreen(TM)  architecture is a patent pending  technology,  which is a new
generation  in bright  LED  displays  that is  expected  to  provide  key design
improvements  in cost,  weight and brightness  compared to current LED displays.
Applications  for  OnScreen(TM)  technology  include,  but are not  limited  to,
Compact Portable Signage,  Variable Message Signage,  LED Billboards and Outdoor
Video  Screens.  OnScreen(TM)  plans to  capitalize  on the full  breadth of the
OnScreen(TM)  market  opportunity via a series of  manufacturing,  licensing and
distribution partnerships.


                                       17
<PAGE>

The company expects delivery of the initial  OnScreen(TM)  products in the first
half of 2005. Until these products are delivered, the Company does not expect to
record  significant  revenues.  Although the  EyeCatcherPlus  and the mobile LED
jumbo  screen  truck are  believed to be  economically  viable,  management  has
assigned the rights to the EyeCatcherPlus screens to a third party for 5% of the
revenues  generated and continues to receive  revenues from the mobile LED unit,
the majority of management's  focus is concentrated on the OnScreen(TM)  product
development  and marketing.  The Company's plan is to focus all of its resources
on  the  commercialization  of  the  OnScreen(TM)  product  technology.  Through
licensing  agreements  and some  established  accounts,  the Company  expects to
receive  some revenue  from its mobile LED truck and the motion  display  boards
during 2004.

During the nine months ended September 30, 2004, OnScreen(TM) continued to incur
significant  losses  from  operations.  The  Company  incurred  a  net  loss  of
$6,296,220  for the nine  months  ended  September  30,  2004.  This net loss of
$6,296,220  includes  non-cash  charges of  approximately  $4 million for equity
given to employees and consultants for past services provided.

A priority of management during 2004 has been and is to raise the capital needed
to continue to fund the development and marketing of the Company's  OnScreen(TM)
products.  During the first nine months of 2004, the Company  received  proceeds
totaling  $5,369,508  comprised of  $3,133,554,  net of offering  costs from the
exercise  of the $0.50 and some of the $0.75  warrants  that were  issued to the
2003 private placement unit holders, $1,983,770 from the 2004 private placement,
$352,184 from other  warrants and options  exercised less $100,000 that was paid
back to an investor whose subscription  agreement was terminated.  Management is
continuing to pursue private equity funding. These funds will enable the Company
to develop its OnScreen(TM) products and continue the Company's operations until
the Company brings the OnScreen(TM) products to market.

Intellectual Property
---------------------
We rely on various  intellectual  property laws and contractual  restrictions to
protect our proprietary  rights in products,  logos and services.  These include
confidentiality,  invention  assignment and  nondisclosure  agreements  with our
employees,  contractors,  suppliers and strategic partners.  The confidentiality
and  nondisclosure  agreements with employees,  contractors and suppliers are in
perpetuity or for a sufficient  length of time so as to not threaten exposure of
proprietary  information.  In addition,  we intend to pursue the registration of
our trademarks and servicemarks in the U.S. and internationally.

A provisional  patent was filed August 26, 2002 on the OnScreen(TM)  technology.
The patent was filed July 23, 2003 on the OnScreen(TM)  technology that contains
over 50 separate claims.  OnScreen(TM) retained Knobbe,  Martens,  Olson & Bear,
LLP to manage our current  interests  relative to the inventor's  prosecution of
the full national and international  patents.  The Company continues to file and
protect its  intellectual  property  rights,  trademarks  and  products  through
continued filings with the US Patent and Trademark Office.

Critical Accounting Policies

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States of America requires  management to make
estimates  and  assumptions  that have a  significant  impact on the results the
Company reports in its financial  statements.  Some of the Company's  accounting
policies  require its  management to make  difficult and  subjective  judgments,
often as a result of the need to make  estimates of matters that are  inherently
uncertain.  Actual  results  may differ  from these  estimates  under  different
assumptions or conditions. Below, the Company discusses this further, as well as
the estimates and judgments involved.

                                       18
<PAGE>

Asset Impairment
----------------
The Company  reviews its  long-lived  assets for impairment  whenever  events or
changes in circumstances  indicate that the carrying amount of the asset exceeds
its  fair  value  and may not be  recoverable.  In  performing  the  review  for
recoverability,  the Company  estimates the future cash flows expected to result
from  the use of the  asset  and  its  eventual  disposition.  If the sum of the
expected future cash flows  (undiscounted  and without interest charges) is less
than the carrying amount of the asset, an impairment loss is recognized equal to
the excess of the carrying amount over the fair value.  Otherwise, an impairment
loss is not  recognized.  Management  estimates the fair value and the estimated
future cash flows expected.  Any changes in these estimates could impact whether
there was impairment and the amount of the impairment.

Allowance for Doubtful Accounts
-------------------------------
The Company  maintains an allowance for doubtful  accounts for estimated  losses
resulting  from the inability of its customers to make  required  payments.  The
Company regularly evaluates the collectibility of its trade receivables.  At the
point in time the Company  determines  that the customer may not be able to meet
its full  obligation  to the  Company,  the  Company  records an  allowance  for
doubtful accounts for the amounts the Company estimates are not collectable. Any
changes in these  estimates  could impact the Company's  statement of operations
and financial position.

Liquidity and Capital Resources

General
-------
The  Company's  cash and cash  equivalents  balance  at  September  30,  2004 is
$2,000,828 and its marketable  securities  available-for-sale  is $750,386.  Its
working  capital  balance at September 30, 2004 is  $2,343,579.  The Company has
funded its operations and investments in equipment through cash from operations,
equity financings and borrowing from private parties as well as related parties.
It has also funded its operations through stock paid to vendors, consultants and
certain employees.

Cash used in operations
-----------------------
The  Company's  operating  requirements  generated  a  negative  cash  flow from
operations of  $2,855,005  for the nine months ended  September  30, 2004.  This
includes  payments to settle  several  existing  payables and accrued  expenses,
which reduced the payables and accruals by $480,443 from December 31, 2003.  The
Company does not expect to have significant cash settlement  payments during the
remainder of 2004.

During  2003 and the first  quarter  of 2004,  the  Company  has used  stock and
warrants as a form of payment to certain vendors, consultants and employees.

As the Company  focuses on the  OnScreen(TM)  technology  during  2004,  it will
continue to fund research and development  related to the OnScreen(TM)  products
as well as sales and marketing  efforts related to these  products.  The Company
does not expect to record  much  revenue  and will  continue  to use cash in its
operating activities until its OnScreen(TM) product line is commercialized which
is expected to be during the first half of 2005.

                                       19
<PAGE>

Capital Expenditures
--------------------
During the first quarter of 2004, the Company made payments of $575,000, for the
remaining  OnScreen(TM)  royalty payments and receipt of the inventor's contract
rights,  including all royalty rights in the OnScreen(TM)  License  Agreement of
which  $522,500 of these  payments  were recorded as an investment in technology
rights and will be amortized  over a 20-year life.  These  payments  resulted in
OnScreen(TM) owning 100% of the OnScreen(TM) licensing rights.

The  Company  invested  approximately  $107,000  in  equipment  which was mainly
computer  equipment  used for sales,  marketing,  research and  development  and
administration and for two automobiles during the first nine months of 2004. The
automobiles  display signage advertising the Company's products and will be used
to advertise the products of the Company at trade. During the remainder of 2004,
the Company  anticipates that its capital  expenditures should not significantly
change. The Company plans to outsource the manufacture of its products.

Financing activities
--------------------
During  the  fourth  quarter  of 2003 and into the first  quarter  of 2004,  the
Company  undertook a private placement of investment Units, each investment Unit
consisting  of 4,000  shares of our common  stock,  a warrant to purchase  4,000
shares  of  common  stock at a price of $0.50  per  share  ("Warrant  #1") and a
warrant to purchase  2,000  shares of common stock at a price of $0.75 per share
("Warrant #2"). Additionally, through a 2004 amendment to the private placement,
purchasers  of Units were  issued,  or will be issued,  an  aggregate  of 30,000
shares of our Series B Convertible Preferred Stock as follows:
          12,000 shares pro-rata upon purchase of Units;
          12,000 shares pro-rata to investors who exercise Warrant #1; and
           6,000 shares pro-rata to investors who exercise Warrant #2.

During the first quarter of 2004,  the Company paid certain note holders in full
on March 12, 2004 by paying the note holders  $250,000 and issuing 12,500 shares
of the Company's common stock. Also, the Company satisfied a $50,000 note during
the first quarter of 2004.

The Company paid  $199,956 of Series A  Convertible  Preferred  Stock  dividends
during  the first  six  months of 2004 and the  Company  will have  Series A and
Series B Convertible Preferred Stock dividend payments going forward.

During the first quarter of 2004, the company  received $75,000 from the sale of
Series A Convertible Preferred Stock.

During May 2004, the Company issued  6,700,000 shares of common stock related to
the exercise of Warrant #1. The Company received  $3,350,000  ($2,867,054 net of
cash offering costs) of cash, related to the exercise of these warrants.

During June 2004, 884,666 shares of the Company's common stock were issuable and
20,000 shares were issued by the exercise of some of the $0.75 warrants from the
private placement. The Company received $266,500 of cash related to the exercise
of these warrants.

During the third  quarter  of 2004,  the  Company  received  $1,983,770  of cash
proceeds from its 2004 private  placement and recorded  2,645,026  shares of its
common stock as issuable  and 4,737 of its Series B Preferred  Stock as issuable
at September 30, 2004. This 2004 private placement is comprised of 666.67 shares
of  common  stock and 1.194  shares  of Series B  Preferred  Stock for each $500
received.

                                       20
<PAGE>

Also during the third  quarter of 2004,  the Company  paid an investor  $100,000
that was  previously  received for the purchase of common stock as the agreement
with that investor was mutually terminated.

During the nine months ended September 30, 2004, the Company  received  $352,184
from warrants and options exercised.

Recap of liquidity and capital resources
----------------------------------------
The Company believes that the cash that was generated from the late 2003 private
placement, the cash generated from the 2004 private placement sales and the cash
generated  from  operations,  will be  sufficient  to meet its  working  capital
requirements for the next twelve months. The Company does not expect its revenue
to be  sufficient  to  cover  costs  of  operations  in  the  immediate  future.
Management expects the OnScreen(TM)  technology to be commercialized  during the
first half of 2005 and to begin generating revenue from the OnScreen(TM) product
line by the first half of 2005.  The Company cannot assure that it will generate
revenues  by that  date or that its  revenues  will be  sufficient  to cover all
operating and other  expenses of the Company.  If revenues are not sufficient to
cover all  operating  and other  expenses,  the Company will require  additional
funding.  If  additional  funding is needed,  the Company  will attempt to raise
these funds through  borrowing  instruments or issuing  additional  equity.  The
Company is adequately  confident that equity financing or debt will be available
to fund its operations  until revenue streams are sufficient to fund operations;
however, the terms and timing of such equity or debt cannot be predicted.

Results of Operations

Revenue
-------
Revenue was lower  during the three and nine months  ending  September  30, 2004
compared  to the  same  periods  in the  prior  year  due to the  assignment  of
EyeCatcherPlus  displays  and  the  current  focus  on  the  development  of the
OnScreenTM  technology.  The revenue for the three-month period ending September
30,  2004 was $56,643  comprised  mainly of LED truck  revenue of  $50,203.  The
revenue  for the  three-month  period  ending  September  30,  2003 was  $72,275
comprised  mainly of $19,471 from the  EyeCatcherPlus  displays and $45,912 from
LED truck revenue.

The revenue for the  nine-month  period  ending  September 30, 2004 was $137,836
comprised mainly of LED truck revenue of $74,940. The revenue for the nine-month
period ending  September 30, 2003 was $275,452  comprised mainly of $62,700 from
the sale of EyeCatcher  displays,  $74,410 from the EyeCatcherPlus  displays and
$106,204 from LED truck revenue.

The Company expects to continue to receive  indirect revenue from its assignment
of the  EyeCatcherPlus  business.  Although the Company is no longer seeking new
EyeCatcherPlus  customers  because  of  the  assignment  of  the  EyeCatcherPlus
business,  OnScreen(TM) is still  encouraging  new business  development for the
mobile LED truck  because it remains a source of revenue  and  management  feels
that the sale of the  mobile  LED truck  can  better  be  marketed  as a revenue
producing element. Management expects the OnScreen(TM) technology products to be
commercialized  during  the first half of 2005 and to begin  generating  revenue
from the OnScreen(TM) product line during the first half of 2005.


                                       21
<PAGE>

Cost of revenue
---------------
There was cost of  revenue of $0 and $488 for the three and nine  months  ending
September 30, 2004, respectively,  compared to $88 and $75,909 for the three and
nine months ending September 30, 2003, respectively. The 2003 cost of sales were
primarily related to the sale of EyeCatcher displays.

Selling, General and Administrative Expenses
--------------------------------------------
Selling,  General and  Administrative  (SG&A)  expenses  includes  such items as
wages,  consulting,  general office expenses,  business  promotion  expenses and
costs of being a public company  including legal and accounting fees,  insurance
and investor relations.

SG&A expenses  increased from $630,729 for the three months ended  September 30,
2003 to $853,286 for the same period  during 2004.  This increase of $222,557 is
primarily the result of increased consulting expenses of approximately  $106,000
and increased compensation expenses of approximately $142,000.

SG&A expenses  increased from $1,807,694 for the nine months ended September 30,
2003 to $5,929,381 for the same period during 2004.  This increase of $4,121,687
is  primarily  the result of  increased  consulting  expenses  of  approximately
$2,066,000 and increased compensation expenses of approximately $2,027,000.

The  majority of the increase in the  consulting  expense for the three and nine
months of 2004  compared to 2003 was paid with the  issuance of common stock and
warrants.  At September  30, 2004 the Company has $19,059  remaining in deferred
consulting, the majority of which will be expensed during the remainder of 2004.
The total  non-cash  consulting  expense  for the first  nine  months of 2004 is
$2,095,352.

The increase in  compensation  expense in 2004 compared to 2003 is the result of
hiring  the  required  talent to  facilitate  commercializing  the  OnScreen(TM)
products  and  bringing  these  products to market by the first half of 2005 and
includes  compensation  expense of  $1,433,028  related to the stock  issued and
issuable to the  President/CEO in accordance with his employment  contract.  The
total non-cash compensation expense for the first nine months of 2004 (including
the $1,433,028) is $1,728,961.

The company anticipates its sales and marketing and its technology  expenditures
to  increase  during  the  remainder  of 2004 due to the  commercialization  and
marketing  of its  OnScreen(TM)  product  by the  first  half of 2005  while the
remaining general and administrative  costs are anticipated to decrease compared
to the first quarter of 2004.

Research and Development
------------------------
The research and development costs are related to the OnScreen(TM) technology to
which the Company  acquired  the  licensing  rights.  The  $345,511  increase in
research and  technology  costs during the third quarter of 2004 compared to the
third quarter of 2003 and the $676,552 increase in research and technology costs
during the nine months ended  September  30, 2004 compared to the same period in
2003 is a result of activities to further  research and develop the OnScreen(TM)
technology and products.  The Company anticipates increasing its expenditures in
research and development during the remainder of 2004 compared to 2003.

                                       22
<PAGE>

Settlement Gain (Loss), Net
---------------------------

The net  settlement  loss for the three  months  ending  September  30, 2004 was
$64,050  compared to $25,553 for the three  months  ending  September  30, 2003.
During the three  months  ended  September  30,  2004,  the  Company  settled an
agreement for a payment of $68,121.  The $25,553  settlement  loss for the three
months ended September 30, 2003 was for a debt settlement.

The net settlement gain for the nine months ending September 30, 2004 compared
to the same period in 2003 decreased $35,691. The main component of the 2004
gain was due to the settlement of a disputed convertible promissory note in the
principal amount of $234,869 plus 8% interest accruing from the note date of
August 1999. On February 5, 2004, the Company satisfied this disputed obligation
with 60,000 shares of the Company's common stock. These shares were valued at
$60,600 and the Company recorded a settlement gain of $267,458 in February 2004.
The main component of the 2003 gain was the forgiveness of Swartz penalties of
$300,000.

Interest Expense
----------------
The interest  expense for the nine months  ending  September  30, 2004  includes
$46,500  of  non-cash  interest  related to the value of  options  issued  under
default provisions of certain notes.

The interest  expense for the three and nine months  ending  September  30, 2003
includes $15,375 and $53,135,  respectively, of non-cash interest related to the
value of options issued under default provisions of certain notes.

Since the notes and loans  payable  balance is zero at September  30, 2004,  the
Company  anticipates the interest  expense for the remainder of 2004 to be lower
than 2003 interest expense.

Net Loss
--------
The Net Loss  increased  $585,127  from the  third  quarter  of 2003  ($614,865)
compared  to the third  quarter  of 2004  ($1,199,992).  The Net Loss  increased
$4,784,161  from the nine months ending  September 30, 2003  ($1,512,059) to the
nine months ending  September 30, 2004  ($6,296,220).  The increases in net loss
during 2004 compared to 2003 is the result of the  redirection  of the Company's
business  focus to the  OnScreen(TM)  technology  and the  related  increase  in
research and  development,  consulting and general and  administrative  costs to
facilitate commercializing the OnScreen(TM) products and bringing these products
to market by the end of the year.

Preferred Stock Dividends
-------------------------
During the three months ended September 30, 2004,the Company  recorded  $120,000
and  $5  for  the  intrinsic  value  associated  with  the  embedded  beneficial
convertible  feature of the Series A  Convertible  Preferred  Stock and Series B
Convertible Preferred Stock,  respectively.  For the nine months ended September
30,  2004,  the  Company  recorded  $172,000  and $28 for  the  intrinsic  value
associated  with the  embedded  beneficial  convertible  feature of the Series A
Convertible   Preferred  Stock  and  Series  B  Convertible   Preferred   Stock,
respectively.

For financial  statement  purposes,  the  intrinsic  value  associated  with the
embedded  beneficial  convertible  feature of Series A and Series B  Convertible
Preferred Stock was recorded as a preferred stock dividend.

                                       23
<PAGE>

Additionally,  during the three and nine months ending  September 30, 2004,  the
Company  recorded Series A Convertible  Preferred Stock dividends of $69,745 and
$203,996,  respectively,  and Series B Convertible  Preferred Stock dividends of
$5,975 and 15,723, respectively.  For the three and nine months ending September
30, 2003, the Company recorded Series A Preferred Stock dividends of $46,405 and
$122,837, respectively.

Item 3.  Controls and Procedures

Within 90 days prior to the filing of this  report,  the Company  carried out an
evaluation,  under the supervision and with the participation of its management,
including the Chief Executive Officer and Chief Financial Officer, of the design
and  operation  of  its  disclosure  controls  and  procedures.  Based  on  this
evaluation,  the Company's Chief Executive  Officer and Chief Financial  Officer
concluded  that the Company's  disclosure  controls and procedures are effective
for the  gathering,  analyzing and  disclosing  the  information  the Company is
required to disclose in the reports it files under the  Securities  Exchange Act
of 1934, within the time periods  specified in the SEC's rules and forms.  There
have been no significant  changes in the Company's internal controls or in other
factors that could significantly affect internal controls subsequent to the date
of this evaluation.

                           PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

On July 1, 2004, the Company filed a lawsuit  against Mobile Magic  Superscreen,
Ltd.  (breach of contract and civil  conversion),  Capitol City  Trailers,  Inc.
(civil  conversion) and another party (civil fraud) in the Court of Common Pleas
of Franklin  County,  Ohio, Case Number 04 CVH 6884. This lawsuit relates to the
2001  contract  with Mobile Magic  Superscreen,  Ltd. for the  fabrication  of a
mobile LED  superscreen  that  Mobile  Magic  failed to  complete  and  deliver.
Responses to the summons and complaint have been filed and the case is currently
in the discovery process.

Item 2. Changes in Securities.

For  changes  in  securities  prior to July 1, 2004,  please  see the  Company's
10KSB's and 10QSB's filed with the Securities and Exchange Commission.

Common Stock Issued

The company  relied on Section 4(2) of the  Securities  Act of 1933 as the basis
for an exemption from  registration for this issuance.  During the third quarter
of 2004,  the Company issued 100,000 shares of its common stock to an individual
for services performed. These services were valued at $83,000.

The company  relied on Section 4(2) of the  Securities  Act of 1933 as the basis
for an exemption  from  registration  for this  issuance.  During July 2004, the
certain  Series A Preferred  Stock holders  converted  55,000 shares of Series A
Preferred Stock to 220,000 shares of the Company's common stock.

                                       24
<PAGE>

The company  relied on Section 4(2) of the  Securities  Act of 1933 as the basis
for an exemption  from  registration  for this  issuance.  During July 2004, the
Company  issued  120,736  shares of its common  stock that was an  exercise of a
warrant. The Company received $30,184 from the exercise of this warrant.

The company  relied on Section 4(2) of the  Securities  Act of 1933 as the basis
for an exemption  from  registration  for this  issuance.  During July 2004, the
Company  issued  600,000  shares of its common  stock that was an  exercise of a
warrant. The Company received $150,000 from the exercise of this warrant.

SERIES A CONVERTIBLE PREFERRED STOCK ISSUED

The company  relied on Section 4(2) of the  Securities  Act of 1933 as the basis
for an exemption from  registration for this issuance.  During the third quarter
of 2004, the Company issued 120,000 shares of its Series A Preferred Stock to an
employee in accordance with the employment  contract.  These services are valued
at $120,000.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Submission of Matters to a Vote of Security Holders.

None

Item 5. Other Information.

None

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits

Exhibit
Number                              Description

31.1     Certification of Chief Executive Officer pursuant to Exchange Act Rules
         13a-15(e)  and  15d-15(e),  as adopted  pursuant  to Section 203 of the
         Sarbanes-Oxley Act of 2002.
31.2     Certification of Chief Financial Officer pursuant to Exchange Act Rules
         13a-15(e)  and  15d-15(e),  as adopted  pursuant  to Section 203 of the
         Sarbanes-Oxley Act of 2002.
32.1     Certification of Chief Executive  Officer pursuant to 18U.S.C.  Section
         1350, as adopted pursuant to Section 906 of the  Sarbanes-Oxley  Act of
         2002.
32.2     Certification of Chief Financial  Officer pursuant to 18U.S.C.  Section
         1350, as adopted pursuant to Section 906 of the  Sarbanes-Oxley  Act of
         2002.

 (b) Reports on Form 8-K

None

                                       25
<PAGE>

                                   SIGNATURES

Pursuant  to the  requirements  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.

Signed and submitted this 12th day of November 2004.


                                  OnScreen Technologies, Inc
                                  (Registrant)

                                  by: /s/ John "JT" Thatch
                                     ------------------------------------------
                                     John  "JT" Thatch as President/CEO/Director

                                  by: /s/  Mark R  Chandler
                                     -------------------------------------------
                                     Mark R  Chandler as COO/CFO

                                  by: /s/  Russell L  Wall
                                     -------------------------------------------
                                     Russell L  Wall Director/Audit Committee




                                       26