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

                                   FORM 10-QSB

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

     For the Quarterly Period Ended September 30, 2000

                         Commission File Number: 0-30211

                                MINDFULEYE, INC.
         --------------------------------------------------------------
                            (formerly, RABATCO, INC.)
             (Exact name of registrant as specified in its charter)


        Nevada                                         87-0616344
------------------------                     -----------------------------
(Place of Incorporation)                        (IRS Employer ID Number)


         Suite 300- 355 Burrard St. Vancouver, British Columbia V6C 2G6
         --------------------------------------------------------------
              (Address of registrant's principal executive office)

                                  604-638-6800
         --------------------------------------------------------------
                         (Registrant's telephone number)



       -------------------------------------------------------------------
             (Former name or address, if changed since last report)


Indicate by check mark whether the registrant has (1) filed all reports required
to be filed by Section 13 of 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 [ ]


       Number of Shares of Common Stock, $0.001 Par Value, Outstanding at
                         September 30, 2000: 13,815,000



<PAGE>

                                MINDFULEYE, INC.
                              For the Quarter Ended
                               September 30, 2000
                              INDEX TO FORM 10-QSB

<TABLE>
                                                                                                    Page
                                                                                                    ----
<S>    <C>                                                                                         <C>
PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS:

       Consolidated Balance Sheets:
         - December 31, 1999 and September 30, 2000...................................................1

       Consolidated Statements of Operations:
         - For the Nine Months and Three Months Ended September 30, 2000..............................2

       Consolidated Statements of Comprehensive Loss
         - For the Nine Months and Three Months Ended September 30, 2000..............................3

      Consolidated Statements of Cash Flow
         - For the Nine Months Period Ended September 30, 2000........................................4

     Consolidated Statements of Stockholders Equity
         -  For the Nine Months Ended September 30, 2000..............................................5

Notes to Financial Statements ........................................................................6

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATIONS.........................................................16

PART II - OTHER INFORMATION

ITEM 1.    LEGAL PROCEEDINGS.........................................................................21

ITEM 2.    CHANGES IN SECURITIES ....................................................................21

ITEM 3.    DEFAULTS UPON SENIOR SECURITIES...........................................................21

ITEM 4.    SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS.........................................21

ITEM 5.    OTHER INFORMATION.........................................................................21

ITEM 6.    EXHIBITS AND REPORTS ON FROM 8-K..........................................................21

SIGNATURES...........................................................................................22
</TABLE>



                                       i

<PAGE>

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS:



MINDFULEYE, INC.
(formerly Rabatco, Inc.)
(A Development Stage Company)
CONSOLIDATED BALANCE SHEETS
(Expressed in United States Dollars)
(Unaudited)


<TABLE>
=============================================================================================================
                                                                              September 30,     December 31,
                                                                                       2000             1999
-------------------------------------------------------------------------------------------------------------
<S>                                                                          <C>               <C>
ASSETS

Current assets
    Cash and cash equivalents                                                $      502,870    $       6,520
    Accounts receivable                                                              32,847            1,661
    Prepaid expenses                                                                  7,772                -
                                                                             ---------------   --------------
Total current assets                                                                543,489            8,181

Capital assets (Note 4)                                                             248,673           23,662
                                                                             ---------------   --------------
                                                                             $      792,162    $      31,843
=============================================================================================================

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities
    Accounts payable and accrued liabilities                                 $       36,798    $      18,740
                                                                             ---------------   --------------
    Total current liabilities                                                        36,798           18,740

Long-term debt (Note 5)                                                                   -          214,093
                                                                             ---------------   --------------
                                                                                     36,798          232,833
                                                                             ---------------   --------------
STOCKHOLDERS' EQUITY

    Capital stock (Note 8)
       Authorized
              100,000,000 common shares with a par value of $0.001

       Issued and outstanding
           September 30, 2000 - 13,815,000 common shares (1999 - 6,750,000)          13,815                1

    Additional paid-in capital                                                    2,170,920                -
    Cumulative translation adjustment                                                (2,535)               -
    Deficit accumulated during the development stage                             (1,426,836)        (200,991)
                                                                             ---------------   --------------
    Total stockholders' equity                                                      755,364         (200,990)
                                                                             ---------------   --------------
                                                                             $      792,162    $      31,843
=============================================================================================================
</TABLE>


History and organization of the Company (Note  1)
Commitments (Note 12)
Subsequent events (Note 15)


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



                                       1
<PAGE>

MINDFULEYE, INC.
(formerly Rabatco, Inc.)
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
(Expressed in United States Dollars)
(Unaudited)


<TABLE>
====================================================================================================================
                                                      Cumulative
                                                    Amounts from
                                                         July 21,
                                                             1999                                       Period From
                                                         (Date of       Three Month      Nine Month        July 21,
                                                    Inception) to    Period Ended      Period Ended          1999 to
                                                    September 30,     September 30,   September 30,   September 30,
                                                             2000             2000             2000            1999
--------------------------------------------------------------------------------------------------------------------
<S>                                                <C>                <C>               <C>             <C>
OPERATING EXPENSES
    Amortization                                   $       30,062     $      9,730      $    27,776     $       649
    Consulting fees                                       313,640          128,760          207,271          45,271
    Contract work                                           1,279                -                -           1,279
    Foreign exchange loss                                   6,412                -                -               -
    Insurance                                               1,300              336              963               -
    Interest and bank charges                              11,571              584            7,235              38
    Investor relations                                      5,977            3,760            4,088              15
    Legal and audit fees                                  156,493           29,596          147,241           2,277
    Marketing and brand development                        98,003           48,628           98,003               -
    Newsalert and other infeed services                    27,684           10,798           27,684               -
    Office and miscellaneous                               98,949           32,430           84,669           8,649
    Rent and utilities                                     59,075           16,210           52,296           2,498
    Stock based compensation expense                      103,850                -          103,850               -
    Telephone and communications                           34,249           13,726           31,835           1,656
    Wages and benefits                                    512,225          180,768          466,867           9,281
                                                   ---------------    -------------     ------------    ------------
Loss before other item                                 (1,460,769)        (475,326)      (1,259,778)        (71,613)
                                                   ---------------    -------------     ------------    ------------
OTHER ITEM
    Interest income                                        33,933           11,618           33,933               -
                                                   ---------------    -------------     ------------    ------------
Loss for the period                                $   (1,426,836)    $   (463,708)     $(1,225,845)    $   (71,613)
====================================================================================================================
Basic and diluted loss per share                                      $      (0.03)     $     (0.10)    $     (0.01)
====================================================================================================================
Weighted average number of shares outstanding                           13,815,000       12,128,315       6,750,000
====================================================================================================================
</TABLE>





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



                                       2
<PAGE>

MINDFULEYE, INC.
(formerly Rabatco, Inc.)
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(Expressed in United States Dollars)
(Unaudited)





<TABLE>
=============================================================================================================================
                                                    Cumulative
                                                  Amounts from
                                                      July 21,
                                                          1999                                      Period From
                                                      (Date of     Three Month      Nine Month         July 21,
                                                 Inception) to    Period Ended    Period Ended          1999 to
                                                 September 30,   September 30,   September 30,    September 30,
                                                          2000            2000            2000             1999
                                                ----------------------------------------------------------------

<S>                                              <C>              <C>             <C>              <C>
Net loss                                         $  (1,426,836)   $  (463,708)    $ (1,225,845)    $   (71,613)
Other comprehensive income, net of tax:
  Foreign currency translation adjustments              (2,535)        (2,987)          (2,535)              -
                                                 --------------   ------------    -------------    ------------

Consolidated comprehensive loss                  $  (1,429,371)   $  (466,695)    $ (1,228,380)    $   (71,613)
================================================================================================================

Basic and diluted comprehensive loss per share                    $     (0.03)    $      (0.10)    $     (0.01)
================================================================================================================

Weighted average number of shares outstanding                      13,815,000       12,128,315       6,750,000
================================================================================================================

</TABLE>








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



                                       3
<PAGE>

MINDFULEYE, INC.
(formerly Rabatco, Inc.)
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Expressed in United States Dollars)
(Unaudited)


<TABLE>
====================================================================================================================
                                                                        Cumulative
                                                                      Amounts from
                                                                          July 21,
                                                                              1999                      Period From
                                                                          (Date of       Nine Month        July 21,
                                                                     Inception) to     Period Ended          1999 to
                                                                     September 30,    September 30,   September 30,
                                                                              2000             2000            1999
--------------------------------------------------------------------------------------------------------------------
<S>                                                                 <C>                <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES
    Loss for the period                                             $   (1,426,836)    $ (1,225,845)    $   (71,613)
    Items not affecting cash:
       Amortization                                                         30,062           27,776             649
       Stock based compensation expense                                    103,850          103,850               -

    Changes in non-cash working capital items:
       Increase in accounts receivable                                     (32,847)         (31,186)         (1,872)
       Increase in prepaid expenses                                         (7,772)          (7,772)              -
       Decrease in due to related parties                                  (23,116)         (23,116)              -
       Increase in accounts payable and accrued liabilities                 33,298           14,558               -
                                                                    ---------------    -------------    ------------
    Net cash used in operating activities                               (1,323,361)      (1,141,735)        (72,836)
                                                                    ---------------    -------------    ------------

CASH FLOWS FROM INVESTING ACTIVITIES
    Acquisition of capital assets                                         (278,735)        (252,787)         (6,224)
    Acquisition of investment in subsidiary (net of cash acquired)       2,257,500        2,257,500               -
                                                                    ---------------    -------------    ------------
    Net cash provided by investing activities                            1,978,765        2,004,713          (6,224)
                                                                    ---------------    -------------    ------------

CASH FLOWS FROM FINANCING ACTIVITIES
    Proceeds from issuance of common stock                                       1                -               1
    Due to related parties                                                (150,000)        (150,000)         91,775
    Repayment of long-term debt                                                  -         (214,093)              -
                                                                    ---------------    -------------    ------------
    Net cash used in financing activities                                 (149,999)        (364,093)         91,776
                                                                    ---------------    -------------    ------------

Change in cash and cash equivalents for the period                         505,405          498,885          12,716

Effect of exchange rates on cash and cash equivalents                       (2,535)          (2,535)              -

Cash and cash equivalents, beginning of period                                   -            6,520               -
                                                                    ---------------    -------------    ------------
Cash and cash equivalents, end of period                            $      502,870     $    502,870     $    12,716
====================================================================================================================
</TABLE>


Supplemental disclosure with respect to cash flows (Note 9)


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



                                       4
<PAGE>

MINDFULEYE, INC.
(formerly Rabatco, Inc.)
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(Expressed in United States Dollars)
(Unaudited)


<TABLE>
======================================================================================================================
                                                                               Deficit
                                                                           Accumulated
                                                            Additional      During the     Cumulative           Total
                                                               Paid-in     Development    Translation   Stockholders'
                                    Shares        Amount       Capital           Stage     Adjustment          Equity
----------------------------------------------------------------------------------------------------------------------
<S>                           <C>            <C>          <C>            <C>              <C>           <C>
Balance, July 21, 1999                  -     $       -    $        -     $          -     $       -     $          -

    Common stock issued               160             1             -                -             -                1

    Loss for the period                 -             -             -         (200,991)            -         (200,991)
                               -----------    ----------   -----------    -------------    -----------    -------------

Balance, December 31, 1999            160             1             -         (200,991)            -         (200,990)

    Common stock issued                53             -             -                -             -                -
                               -----------    ----------   -----------    -------------    -----------    -------------

Balance, March 13, 2000               213             1             -         (200,991)            -         (200,990)

    Capital stock of
       MindfulEye.com at
       March 13, 2000                (213)           (1)            1                -             -                -

    Capital stock of
       MindfulEye Inc. at
       March 13, 2000           6,905,000             -             -                -             -                -

    Shares issued to acquire
       MindfulEye.com           6,910,000         6,910     2,073,974                -             -        2,080,884

    Adjustment to par value             -         6,905        (6,905)               -             -                -

    Stock based
    Compensation expense                -             -       103,850                -             -          103,850

     Loss for the period                -             -             -       (1,225,845)       (2,535)      (1,228,380)
                               -----------    ----------   -----------    -------------    -----------    -------------

Balance at
    September 30, 2000         13,815,000     $  13,815    $2,170,920     $ (1,426,836)    $  (2,535)    $    755,364
======================================================================================================================
</TABLE>




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



                                       5
<PAGE>

MINDFULEYE, INC.
(formerly Rabatco, Inc.)
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in United States Dollars)
(Unaudited)
SEPTEMBER 30, 2000
================================================================================



1.   HISTORY AND ORGANIZATION OF THE COMPANY

     The Company was incorporated  under the laws of the state of Nevada on June
     16, 1977 with  authorized  common stock of 100,000 shares with par value of
     $0.25.  On June 20, 1998,  the  authorized  common  stock was  increased to
     100,000,000 shares with a par value of $0.001.

     On June 20, 1998, the Company completed a forward common stock split of one
     share of its  outstanding  stock  for five  shares.  This  report  has been
     prepared  showing  after stock split shares with a par value of $0.001 from
     its inception.

     The Company has been in the  development  stage since its inception and has
     been  primarily  engaged in the business of developing  mining  properties.
     During 1982,  the Company  abandoned its  remaining  assets and settled its
     liabilities and since that date remained inactive until March 2000.

     Effective  March 13,  2000,  the  Company  acquired  all of the  issued and
     outstanding    common    stock    of    MindfulEye.com     Systems,    Inc.
     ("MindfulEye.com"). MindfulEye.com was incorporated on July 21, 1999, under
     the laws of British  Columbia.  MindfulEye.com  is in the development stage
     and is currently developing a subscription-based service for the retail and
     institutional   investment  community  that  delivers  proprietary  content
     directly to subscribers by wireless devices, fax, e-mail and the web.

     The  company  changed  its name from  Rabatco,  Inc.  to  MindfulEye,  Inc.
     ("MindfulEye") on May 12, 2000.

     The  accompanying  financial  statements  have been prepared by the Company
     without audit. In the opinion of management, all adjustments (which include
     only  normal  recurring   adjustments)  necessary  to  present  fairly  the
     financial position, results of operations,  changes in stockholders' equity
     and cash flows at  September  30, 2000 and for the periods  then ended have
     been made.  These financial  statements  should be read in conjunction with
     the audited financial statements of the Company for the year ended December
     31, 1999. The results of operations for the period ended September 30, 2000
     are not  necessarily  indicative of the results to be expected for the year
     ending December 31, 2000.


2.   BASIS OF PRESENTATION

     These financial  statements contain the financial  statements of MindfulEye
     and  MindfulEye.com  presented on a consolidated  basis. On March 13, 2000,
     MindfulEye  acquired  all of the issued and  outstanding  share  capital of
     MindfulEye.com  by issuing 6,910,000 common shares (Note 6). As a result of
     the share exchange,  control of the combined companies passed to the former
     shareholders  of  MindfulEye.com.  This  type of  share  exchange  has been
     accounted for as a capital transaction accompanied by a recapitalization of
     MindfulEye.com.   Recapitalization   accounting   results  in  consolidated
     financial  statements  being  issued  under  the  name  MindfulEye  but are
     considered a continuation  of  MindfulEye.com.  As a result,  the financial
     statements  presented represent the consolidated  financial position of the
     above  companies as at September 30, 2000 and the results of operations and
     cash flows of MindfulEye.com for the period from July 21, 1999 to September
     30, 2000 and the results of operations  and cash flows of  MindfulEye  from
     its deemed  date of  acquisition  during the  period.  The number of shares
     outstanding at September 30, 2000 as presented are those of MindfulEye.



                                       6
<PAGE>

MINDFULEYE, INC.
(formerly Rabatco, Inc.)
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in United States Dollars)
(Unaudited)
SEPTEMBER 30, 2000
================================================================================



3.   SIGNIFICANT ACCOUNTING POLICIES

     Principles of consolidation

     The  consolidated   financial  statements  include  MindfulEye,   Inc.  and
     MindfulEye.com  Systems,  Inc. All  significant  intercompany  balances and
     transactions have been eliminated upon consolidation.

     Use of estimates

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

     Cash and cash equivalents

     Cash and cash equivalents  include highly liquid  investments with original
     maturities of three months or less.

     Loss per share

     In February 1997, the Financial Accounting Standards Board issued Statement
     of Financial  Accounting  Standards  No. 128,  "Earnings  Per Share" ("SFAS
     128").  Under  SFAS 128,  basic and  diluted  earnings  per share are to be
     presented.  Basic  earnings  per  share  is  computed  by  dividing  income
     available to common  shareholders by the weighted  average number of common
     shares  outstanding  in the period.  Diluted  earnings per share takes into
     consideration common shares outstanding  (computed under basic earnings per
     share) and potentially dilutive common shares.

     Income taxes

     Income  taxes are  provided  in  accordance  with  Statement  of  Financial
     Accounting Standards No. 109 ("SFAS 109"), "Accounting for Income Taxes". A
     deferred tax asset or liability is recorded for all  temporary  differences
     between  financial and tax reporting and net operating loss  carryforwards.
     Deferred tax expenses  (benefit) result from the net change during the year
     of deferred tax assets and liabilities.

     Deferred  tax assets are  reduced by a  valuation  allowance  when,  in the
     opinion of management,  it is more likely than not that some portion or all
     of the deferred  tax assets will not be  realized.  Deferred tax assets and
     liabilities  are  adjusted for the effects of changes in tax laws and rates
     on the date of enactment.

     Accounting for derivative instruments and hedging activities

     In  September  1998,  the  Financial   Accounting  standards  Board  issued
     Statement  of  Financial   Accounting   Standards  No.  133  ("SFAS  133"),
     "Accounting  for  Derivative  Instruments  and  Hedging  Activities"  which
     establishes  accounting and reporting standards for derivative  instruments
     and for hedging  activities.  SFAS 133 is effective for all fiscal quarters
     of fiscal  years  beginning  after June 15,  1999.  In June 1999,  the FASB
     issued SFAS 137 to defer the effective date of SFAS 133 to fiscal  quarters
     of fiscal  years  beginning  after  June 15,  2000.  The  Company  does not
     anticipate  that the  adoption  of the  statement  will have a  significant
     impact on its financial statements.



                                       7
<PAGE>

MINDFULEYE, INC.
(formerly Rabatco, Inc.)
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in United States Dollars)
(Unaudited)
SEPTEMBER 30, 2000
================================================================================



3.   SIGNIFICANT ACCOUNTING POLICIES (cont'd.....)

     Stock-based compensation

     Statement  of  Financial  Accounting  Standards  No. 123,  "Accounting  for
     Stock-Based  Compensation,"  encourages, but does not require, companies to
     record  compensation cost for stock-based  employee  compensation  plans at
     fair value. The Company has chosen to account for stock-based  compensation
     using  Accounting  Principles  Board Opinion No. 25,  "Accounting for Stock
     Issued to Employees."  Accordingly  compensation  cost for stock options is
     measured as the excess, if any, of the quoted market price of the Company's
     stock at the date of the grant over the amount an  employee  is required to
     pay for the stock.

     The Company accounts for stock-based  compensation  issued to non-employees
     in accordance  with the provisions of SFAS 123 and the Emerging Issues Task
     Force  consensus in Issue No. 96-18 (EITF 96-18"),  "Accounting  for Equity
     Instruments  that are Issued to Other Than  Employees  for  Acquiring or in
     Conjunction with Selling, Goods or Services".

     Comprehensive income

     In 1998, the Company adopted  Statement of Financial  Accounting  Standards
     No. 130 ("SFAS 130"),  "Reporting  Comprehensive  Income".  This  statement
     establishes  rules  for  the  reporting  of  comprehensive  income  and its
     components.

     Financial instruments

     The Company's  financial  instruments consist of cash and cash equivalents,
     accounts  receivable,  accounts payable and accrued  liabilities,  and long
     term debt.  Unless  otherwise  noted, it is  management's  opinion that the
     Company is not exposed to  significant  interest,  currency or credit risks
     arising from these financial instruments. The fair value of these financial
     instruments approximate their carrying values, unless otherwise noted.

     Foreign currency translation

     Translation  amounts  denominated in foreign currencies are translated into
     United States currency at exchanges rates prevailing at transactions dates.
     Carrying  values of monetary  assets and  liabilities  are adjusted at each
     balance  sheet date to reflect the  exchange  rate at that date.  Gains and
     losses from restatement of foreign currency monetary assets and liabilities
     are included in income.

     Capital assets and amortization

     Capital  assets  are  recorded  at  cost  less  accumulated   amortization.
     Amortization  is being provided for annually,  using the declining  balance
     method at the following rates:

          Computer software                                 100%
          Computer hardware                                 30%
          Furniture and equipment                           20%


     Leasehold improvements are amortized over the period of the lease.



                                       8
<PAGE>

MINDFULEYE, INC.
(formerly Rabatco, Inc.)
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in United States Dollars)
(Unaudited)
SEPTEMBER 30, 2000
================================================================================



3.   SIGNIFICANT ACCOUNTING POLICIES (cont'd.....)


     Disclosure about segments of an Enterprise and related information

     Statement  of  Financial  Accounting  Standards  No.  131 ("SFAS  131"),  "
     Disclosure  About  Segments  of  an  Enterprise  and  Related  information"
     requires  use of  management  approach  model for  segment  reporting.  The
     management  approach  model  is  based  on the way a  company's  management
     organizes  segments within the company for making  operating  decisions and
     assessing  performance.  Reporting  segments  are  based  on  products  and
     services,  geography,  legal structure,  management structure, or any other
     manner in which the management disaggregates a company. Currently, SFAS 131
     has no effect on the company's financial statements as substantially all of
     the company's operations are conducted in one industry segment in Canada.


4.   CAPITAL ASSETS

<TABLE>
     =================================================================================================
                                                                              Net Book Value
                                                                     ---------------------------------
                                                         Accumulated    September 30,     December 31,
                                                Cost    Amortization             2000             1999
     -------------------------------------------------------------------------------------------------
    <S>                                <C>              <C>             <C>               <C>
     Computer hardware                 $    178,995     $    19,169     $    159,826      $    20,565
     Computer software                       10,516           5,175            5,341            3,097
     Leasehold improvements                   9,190             919            8,271                -
     Furniture and equipment                 80,034           4,799           75,235                -
                                       ------------     -----------     ------------      -----------
                                       $    278,735     $    30,062     $    248,673      $    23,662
     =================================================================================================
</TABLE>


5.   LONG TERM DEBT

<TABLE>
    =============================================================================================-================
                                                                                   September 30,     December 31,
                                                                                            2000             1999
    --------------------------------------------------------------------------------------------------------------
<S>                                                                                   <C>             <C>
    Note payable  to a  related  party, bearing  interest  at the  Bank  of
        Montreal  prime  rate plus 2%, or 10% if  undeterminable;  secured;
        repayable on either receipt of proceeds from second round Phase II
        Equity financing or Initial Public Offering, whichever is earlier.            $       -       $   214,093
    ==============================================================================================================
</TABLE>



                                       9
<PAGE>

MINDFULEYE, INC.
(formerly Rabatco, Inc.)
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in United States Dollars)
(Unaudited)
SEPTEMBER 30, 2000
================================================================================


6.   RECAPITALIZATION

     On March 13, 2000, the Company  acquired all of the issued and  outstanding
     share  capital of  MindfulEye.com.  As  consideration,  the Company  issued
     6,910,000  shares  at a deemed  value  of  $1,930,883  and  paid  $150,000.
     Legally, the Company is the parent of MindfulEye.com.  However, as a result
     of the share exchange  described above,  control of the combined  companies
     passed to the former  shareholders  of  MindfulEye.com.  This type of share
     exchange has been accounted for as a capital  transaction  accompanied by a
     recapitalization  of  MindfulEye.com,  rather than a business  combination.
     Accordingly,  the net  assets of  MindfulEye.com  will be  included  in the
     balance sheet at book values and the deemed acquisition of the Company will
     be accounted for by the purchase  method with the net assets of the Company
     recorded at fair market value at the date of acquisition.  The revenues and
     expenses and assets and liabilities  reflected in the financial  statements
     prior to the date of acquisition are those of  MindfulEye.com.  Revenue and
     expenses and assets and  liabilities  subsequent to the date of acquisition
     include the accounts of the Company.

     The  cost of an  acquisition  should  be  based  on the  fair  value of the
     consideration given, except where the fair value of the consideration given
     is not clearly  evident.  In such a case,  the fair value of the net assets
     acquired is used.

     The 6,910,000  common shares issued pursuant to the  acquisition  agreement
     were  deemed to have a value of  $1,930,883  based on the fair value of the
     Company's net assets.

     The total purchase price of $2,080,883 was allocated as follows:

       Cash                                            $    2,257,500
       Due to related parties                                (173,117)
       Accounts payable and accrued liabilities                (3,500)
                                                        --------------
                                                        $   2,080,883


7.   STOCK OPTIONS AND WARRANTS

     The following stock options were outstanding at September 30, 2000.

     =========================================================================
                 Number             Exercise
              of shares                Price      Expiry date
     -------------------------------------------------------------------------
              1,815,000                 $3.50     June 7, 2002
                 75,000                 $3.50     August 14, 2002
                 10,000                 $3.50     August 22, 2002
                 20,000                 $3.50     September 1, 2002
                 10,000                 $3.50     October 24, 2002
                  9,000                 $3.50     December 25, 2002
     =========================================================================

     The following warrants were outstanding at September 30, 2000.

     ======================================================================
              Number                  Exercise
           of shares                     Price     Expiry date
     ----------------------------------------------------------------------
             537,500                     $ 2.10    March 20, 2001
                         then at         $2.50     March 20, 2002
     ======================================================================



                                       10
<PAGE>

MINDFULEYE, INC.
(formerly Rabatco, Inc.)
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in United States Dollars)
(Unaudited)
SEPTEMBER 30, 2000
================================================================================


8.   CAPITAL STOCK

     As  a  result  of  the  recapitalization   described  in  Note  6,  whereby
     MindfulEye.com  is deemed to be the acquiror for accounting  purposes,  the
     number and value of common shares issued and  outstanding  at September 30,
     2000 are MindfulEye's.

9.   SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH FLOWS

<TABLE>
     ====================================================================================
                                                                             Period From
                                                               Nine Month       July 21,
                                                             Period Ended        1999 to
                                                            September 30,  September 30,
                                                                     2000           1999
     ------------------------------------------------------------------------------------
    <S>                                                      <C>           <C>
     Cash paid during the period for interest                 $       -     $         -
     Cash paid during the period for income taxes                     -               -
     ====================================================================================
</TABLE>

     The following  non-cash  transaction  occurred during the nine month period
     ended September 30, 2000:

     a)   The company issued 6,910,000 shares at a deemed value of $1,929,365 to
          acquire 100% of the outstanding shares of MindfulEye.com.

     No non-cash  transactions  occurred during the period from July 21, 1999 to
     September 30, 1999.

10.  STOCK BASED COMPENSATION EXPENSE

     Statement  of  Financial  Accounting  Standards  No. 123,  "Accounting  for
     Stock-Based  Compensation"  encourages  but does not require  companies  to
     record  compensation cost for stock-based  employee  compensation  plans at
     fair value. The Company has chosen to account for stock-based  compensation
     using  Accounting  Principles  Board Opinion No. 25,  "Accounting for Stock
     Issued to Employees".  Accordingly,  compensation cost for stock options is
     measured as the excess,  if any, of quoted  market  price of the  Company's
     stock at the date of grant over the option price.

     The Company  accounts for stock issued to  non-employees in accordance with
     the provisions of SFAS 123 and the Emerging  Issues Task Force consensus in
     Issue No.  96-18,  "Accounting  for Equity  Instruments  that are Issued to
     Other Than Employees for Acquiring or in Conjunction  with Selling Goods or
     Services".

     Following is a summary of the stock option activity:

<TABLE>
     ================================================================================================
                                                                                            Weighted
                                                                                             Average
                                                                               Number       Exercise
                                                                            of Shares          Price
     ------------------------------------------------------------------------------------------------
    <S>                                                                     <C>          <C>
     Outstanding at December 31, 1999                                               -    $         -
     Granted                                                                1,939,000           3.50
     Forfeited                                                                      -              -
     Exercised                                                                      -              -
                                                                          -----------
     Outstanding at September 30, 2000                                      1,939,000    $      3.50
     ================================================================================================
     Weighted average fair value of options granted during the period                    $      1.20
     ================================================================================================
</TABLE>



                                       11
<PAGE>

MINDFULEYE, INC.
(formerly Rabatco, Inc.)
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in United States Dollars)
(Unaudited)
SEPTEMBER 30, 2000
================================================================================



10.  STOCK BASED COMPENSATION EXPENSE (cont'd.....)

     Following  is a  summary  of the  status  of  the  options  outstanding  at
     September 30, 2000:

<TABLE>
    ===============================================================================================
                                              Outstanding Options              Exercisable Options
                                     --------------------------------------------------------------
                                                       Weighted
                                                        Average      Weighted             Weighted
                                                      Remaining       Average              Average
                                                    Contractual      Exercise             Exercise
    Exercise Price                       Number            Life         Price   Number       Price
    -----------------------------------------------------------------------------------------------
    <S>                               <C>            <C>          <C>          <C>       <C>
    $3.50                             1,939,000           1.69     $    3.50    52,500    $   3.50
    ===============================================================================================
</TABLE>


     Compensation

     The  Company  granted  556,500  options to  consultants  during the current
     period  which are  accounted  for  under the  Emerging  Issues  Task  Force
     Consensus in Issue No. 96-18.  Accordingly,  using the Black-Scholes option
     pricing  model,  the  options are marked to fair value  through  charges to
     operations as stock-based compensation. Stock-based compensation recognized
     pursuant to EITF 96-18  during the nine month period  ended  September  30,
     2000 was  $103,850.  This  amount  can be  allocated  to the other  expense
     categories in the accompanying  statements of operations as consulting fees
     of $103,850.

     The Company granted  1,382,500 options to employees which are all accounted
     for using Accounting Principles Board Opinion No. 25, "Accounting for Stock
     Issued to Employees".  Had  compensation  expense relating to the 1,382,500
     options  granted to employees  been  recognized  on the basis of fair value
     pursuant to Statement of  Financial  Accounting  Standard No. 123, net loss
     and loss per share would have been adjusted as follows:

<TABLE>
     =================================================================================================
                                                                                          Period From
                                                                      Nine Month             July 21,
                                                                    Period Ended              1999 to
                                                                   September 30,        September 30,
                                                                            2000                 2000
     -------------------------------------------------------------------------------------------------
     <S>                                                       <C>                   <C>
     Loss for the period
        As reported                                            $     (1,225,845)     $       (71,613)
                                                               =================     ================
        Pro forma                                              $     (1,586,717)     $       (71,613)
                                                               =================     ================

     Basic and diluted loss per share
        As reported                                            $         (0.10)      $        (0.01)
                                                               =================     ================
        Pro forma                                              $         (0.13)      $        (0.01)
     =================================================================================================
</TABLE>



                                       12
<PAGE>

MINDFULEYE, INC.
(formerly Rabatco, Inc.)
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in United States Dollars)
(Unaudited)
SEPTEMBER 30, 2000
================================================================================



10.  STOCK BASED COMPENSATION EXPENSE (cont'd....)

     The fair value of each option granted is estimated  using the Black Scholes
     Option Pricing Model.  The assumptions  used in calculating fair values are
     as follows:

    ==========================================================================
                                                                  Period from
                                                   Nine Month        July 21,
                                                 Period Ended         1999 to
                                                September 30,   September 30,
                                                         2000            2000
    --------------------------------------------------------------------------
    Risk free interest rate                            6.425%            -
    Expected life of the options                   2.05 years            -
    Expected volatility                               138.28%            -
    Expected dividend yield                              -               -
    ==========================================================================


11.  RELATED PARTY TRANSACTIONS

     The Company  entered into the following  transactions  with related parties
     during the nine month period ended  September 30, 2000, and the period from
     July 21, 1999 to September 30, 1999:

     a)   Paid or accrued $58,875 to director and an officer for consulting fees
          (September 30, 1999 - $44,965).

     b)   Included in long-term  debt is an amount of $Nil  (December 31, 1999 -
          $214,093) which is payable to a director of the Company.

     c)   Included in accounts  payable and accrued  liabilities is an amount of
          $Nil (December 31, 1999 - $5,571) which is payable to directors of the
          Company.

     d)   The Company repaid $100,000 for amounts due to related parties.


12.  COMMITMENTS

     a)   The Company  leases office  premises  pursuant to an operating  lease,
          which expires in 2005. Future annual lease payments are as follows:

               2001                                    $        92,099
               2002                                             95,364
               2003                                             98,629
               2004                                             98,629
               2005                                             49,314
                                                       -----------------
                                                       $       434,035
                                                       =================



                                       13
<PAGE>

MINDFULEYE, INC.
(formerly Rabatco, Inc.)
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in United States Dollars)
(Unaudited)
SEPTEMBER 30, 2000
================================================================================



13.  INCOME TAXES

     The Company's total deferred tax asset is as follows:

<TABLE>
     ================================================================================================
                                                                    September 30,       December 31,
                                                                             2000               1999
     ----------------------------------------------------------------------------- ------------------
    <S>                                                            <C>                 <C>
     Tax benefit of net operating loss carryforward                $      485,124      $      68,337
     Valuation allowance                                                 (485,124)           (68,337)
                                                                   ---------------     --------------
                                                                   $           -       $           -
     ================================================================================================
</TABLE>

     The  Company  has  a  net  operating  loss  carryforward  of  approximately
     $1,426,836,  which  expires in 2019 and 2020.  The Company  provided a full
     valuation  allowance on the deferred tax asset  because of the  uncertainty
     regarding realizability.


14.  ACCUMULATED OTHER COMPREHENSIVE LOSS

     Total  comprehensive  loss for the nine month  period ended  September  30,
     2000,  the period from July 21, 1999 to  September  30, 1999 and the period
     from July 21,  1999 to  September  30,  2000 was  $1,228,380,  $71,613  and
     $1,429,371 respectively. The only item included in other comprehensive loss
     is foreign  currency  translation  adjustments in the amounts of $2,535 for
     the nine month  period ended  September  30, 2000 and $2,535 for the period
     from July 21, 1999 to September 30, 2000.

    ============================================================================
                                                        Foreign     Accumulated
                                                       Currency           Other
                                                    Translation   Comprehensive
                                                     Adjustment          Income
    ----------------------------------------------------------------------------
    Beginning balance, December 31, 1999           $         -     $         -

    Current period change                                2,535           2,535
                                                   -----------     -----------
    Ending balance, September 30, 2000             $     2,535     $     2,535
    ============================================================================


15.  SUBSEQUENT EVENTS

     The following are events which occurred subsequent to September 30, 2000:

     a)   The    Company's    subsidiary,     MindfulEye.com     Systems    Inc.
          ("MindfulEye.com")  and the Canadian  Venture  Exchange  ("CDNX") have
          entered  into  an  agreement   whereby   CDNX   officials   will  test
          MindfulEye.com's    internet   market   surveillance    service.   The
          surveillance  service is  expected to assist  officials  in watching a
          greater  array of stock price  on-line chat,  discussions,  news,  and
          editorial  sources for rumours and other information that could affect
          the stock price of companies that trade on the exchange.



                                       14
<PAGE>

MINDFULEYE, INC.
(formerly Rabatco, Inc.)
(A Development Stage Company)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(Expressed in United States Dollars)
(Unaudited)
SEPTEMBER 30, 2000
================================================================================



15.  SUBSEQUENT EVENTS (cont'd.....)

     b)   The Company  announced a distribution  agreement between the Company's
          subsidiary,  MindfulEye.com,  and  Canada  Newswire  ("CNW")  to offer
          advanced  internet market  surveillance  technologies and services for
          public companies,  securities exchanges,  and regulatory bodies. Under
          the terms of the  agreement,  CNW will act as the  exclusive  Canadian
          distributor  of  MindfulEye.com's   Surveillance  and  SurveillancePro
          Services.







                                       15
<PAGE>


ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS


Except  for  disclosures  that  report the  Company's  historical  results,  the
statements set forth in this section contain forward-looking  statements.  Words
or phrases  "will likely  result",  "are  expected  to",  "will  continue",  "is
anticipated",  "estimate",  "project or projected",  or similar  expressions are
intended  to  identify  "forward-looking  statements"  within the meaning of the
Private Securities Litigation Reform Act of 1995.

Actual results could differ  materially from those projected in  forward-looking
statements.  Additional  information and factors that could cause actual results
to differ materially from those in the forward-looking  statements are set forth
in this Form 10-QSB and the  Company's  Form 10SB,  as  amended,  filed with the
Securities  and Exchange  Commission.  The Company  desires to take advantage of
certain  provisions  in the Private  Securities  Litigation  Reform Act of 1995,
which provide a safe harbor for forward-looking  statements made by or on behalf
of the Company. The Company hereby cautions stockholders,  prospective investors
in the  Company,  and  other  readers  to not  place  undue  reliance  on  these
forward-looking  statements,  which can only address known events as of the date
of this report.


General Overview

MindfulEye,  Inc. (formerly Rabatco,  Inc.)(the "Company" or "MindfulEye"),  was
incorporated  under the laws of the State of Nevada on June 16,  1977.  From the
Company's  inception in 1977 through 1982, the Company was primarily  engaged in
the business of mineral resource exploration. The Company remained inactive from
1982 to 1998.  On March 13,  2000,  the Company  completed  the  acquisition  of
MindfulEye.com  Systems,  Inc.,  a company  engaged in the  business of Internet
software and technology  research and development.  On May 12, 2000, the Company
changed its name to MindfulEye, Inc.

The  financial  statements  presented  in  this  report  contain  the  financial
statements  of  MindfulEye,   Inc.  and  MindfulEye.com   Systems,   Inc.  on  a
consolidated basis. The Company's  acquisition of MindfulEye.com  Systems,  Inc.
has  been   accounted   for  as  a   capital   transaction   accompanied   by  a
recapitalization  of  MindfulEye.com  Systems,  Inc. As a result,  the financial
statements   presented   represent  the  consolidated   financial   position  of
MindfulEye, Inc. and MindfulEye.com, Systems, Inc. as at September 30, 2000, the
results of operations  and cash flows of  MindfulEye.com  Systems,  Inc. for the
period from July 21, 1999 to  September  30, 2000 and the results of  operations
and cash flows of MindfulEye,  Inc. from its deemed date of  acquisition  during
the period.

MindfulEye is  developing a technology  designed to provide  subscribers  to its
service sources of topic-related  content  available on the Internet.  The first
subscriber service that MindfulEye intends to provide is designed to monitor the
content on investor  related  Internet web sites for  information of interest to
subscribers in the investment-related  communities.  MindfulEye's  technology is
designed to:

     -    browse  and  monitor   Internet   websites  for   specific   types  of
          information,  including chat room  discussions,  newswire postings and
          published reports;
     -    rank the information for sentiment and  significance  using Artificial
          Intelligence (AI) technology; and
     -    deliver the information to subscribers in a summarized format.

MindfulEye intends to use AI to rank investor information based on the nature of
the comments,  reports,  news and other information and present this information
in a "MoodIndex" or "MoodScore."

Once the technology is fully developed, the Company anticipates that subscribers
will  be  able to  select  a  number  of  delivery  options  for  receiving  the
information  it collects,  including  cell phone,  pager,  email,  web, fax, and
instant  messaging.  The  Company  anticipates  that it will be able to  deliver
sourced  content  shortly after being  discovered,  batched in time periods,  or
summarized in daily reports.

MindfulEye's system is being developed in a modular fashion so that each content
source will have a dedicated  collection  system that will permit  MindfulEye to
add new  information  sources or "feeds" quickly as they become  available.  The
Company  believes that this modular  architecture  will assist in the scaling of
the system.



                                       16
<PAGE>

MindfulEye is also in the process of using its AI  technology to develop  market
surveillance  services,  which is  designed  to assist  regulatory  officers  in
monitoring online chat, discussions, news, and editorial services for rumors and
other information that could affect the markets they regulate.

MindfulEye has not fully completed the development of the technology  related to
the services that it intends to provide,  and MindfulEye  cannot assure you that
it will successfully  complete such development or that its subscription service
will be commercially successful.

In September  2000, a partnership was entered  between  MindfulEye's  subsidiary
MindfulEye.com  Systems,  Inc. and Microsoft Canada Co. under the Canadian Rapid
Deployment  Program,  a local  initiative  that,  together  with  the  Microsoft
Corporate Program, launches the new SQL Server 2000. SQL Server 2000 is the data
management  and  analysis  backbone  for  Microsoft's  planned  series  of  .NET
applications and services. The server is tailored to rapidly deliver Web-enabled
applications  for  e-commerce,  data  warehousing  and line of business that are
designed to be highly scalable and reliable.  The SQL Server 2000 is designed to
support the significant content storage and real time analysis needs required to
support MindfulEye's  proposed  subscription based Internet monitoring and alert
service.

MindfulEye  announced on September 19, 2000 an agreement between its subsidiary,
MindfulEye.com  Systems,  Inc. and Swift Trade  Securities Inc. ("Swift Trade"),
whereby Swift Trade will offer  MindfulEye's new online  monitoring and research
service to Swift Trade's customer base of 300  professional  day traders.  Swift
Trade is the largest  electronic day trading  operator and training  provider in
Canada,  with 10  locations  nationwide  and five more  scheduled to open in the
first  quarter of 2001.  MindfulEye  is in the  process of  negotiating  similar
agreements  with other  partners.  There can be no assurance that such alliances
will be entered into.

On October 10, 2000,  MindfulEye  announced that its subsidiary,  MindfulEye.com
Systems Inc. and the Canadian  Venture Exchange (CDNX) entered into an agreement
whereby  Canadian  Venture Exchange  officials will test  MindfulEye's  Internet
market  surveillance  service.  The  surveillance  service is designed to assist
officials in monitoring an array of online chat,  discussions,  news,  editorial
sources for rumors and other  information  that could affect market of companies
that trade on the exchange.

On October 20 2000,  MindfulEye  announced a distribution  agreement between its
subsidiary, MindfulEye.com Systems Inc. and Canada Newswire (CNW), Canada's most
widely used public corporate  disclosure  newswire,  to offer advanced  internet
market surveillance  technologies and services for public companies,  securities
exchanges, and regulatory bodies. Under the terms of the agreement, CNW will act
as  the  exclusive  Canadian   distributor  of  MindfulEye's   Surveillance  and
SurveillancePro services.

In the past nine months,  management has focused its efforts on negotiating  and
entering into the above-mentioned  partnerships and agreements and in completing
the development and testing of the web site and the technologies.

The  following   discussion  and  analysis  explains   MindfulEye's  results  of
operations for the three-month fiscal quarter from July 1, 2000 to September 30,
2000. You should review the  discussion  and analysis of financial  condition in
conjunction  with  MindfulEye's  financial  statements and the related notes, as
well as statements  detailed in MindfulEye's  Securities and Exchange Commission
filings.


Results of Operations

         Fiscal Quarter Ended September 30, 2000

Revenues.  MindfulEye launched version 1.0 "release candidate" of our product in
the second week of October 2000.  Its phase II Beta Version was released on June
29, 2000.  Both these versions were  available to the  subscribers at no charge.
During the quarter  ended  September 30, 2000,  MindfulEye  did not generate any
revenue from its  operations.  MindfulEye  had interest  income in the amount of
$11,618.

Expenses.  During  the fiscal  quarter  ended  September  30,  2000,  MindfulEye
incurred  total  expenses of $475,326  related  primarily  to: (i)  research and
developing its web  technologies;  (ii) marketing and brand  development;  (iii)
professional  and legal fees relating to its Securities and Exchange  Commission
reports  and (iv)  general  overhead  and  administrative  expenses.  During the
quarter,  MindfulEye  paid  consulting  fees in the  amount  of  $128,760  which
included  fees paid to (i)  Everest  Advisory  Group Inc.,  for the  services of
Julian  Remedios as MindfulEye's  chief financial  officer and (ii) fees paid to
Ecotex Service Corporation for management services of Randy Bartsch.  MindfulEye
paid legal and  accounting  fees of $29,596  during  the  fiscal  quarter  ended
September 30, 2000 related to preparation of its filings with the Securities and
Exchange Commission, patent searches and other



                                       17
<PAGE>

corporate and accounting matters. MindfulEye incurred other expenses,  including
amortization  expenses of $9,730, insurance  expense of $336,  interest and bank
charges expenses of $584,  investor relations expenses of $3,760,  marketing and
brand  development  expenses of $48,628,  infeed  services  expenses of $10,798,
office and  miscellaneous  expenses of $32,430,  rent and utilities  expenses of
$16,210,  telephone and  communication  expenses of $13,726 and wages and salary
expenses of $180,768.

MindfulEye anticipates that expenses relating to the development of its web site
will  increase  during the fourth  quarter of 2000 as it launches  the  official
version  of  its  web  site;  it  offers  its  subscription  based  services  to
subscribers and it completes  development of version 1.1 Surveillance  services.
MindfulEye also anticipates  that expenses  relating to marketing and sales will
increase during the fourth quarter of 2000 as it continues an extensive campaign
to market and promote the  MindfulEye.com  website and subscription  services to
the  general  public,  investor  relation  professionals  and  other  investment
community through partnerships with investment professionals.

Net Loss.  MindfulEye  had a net loss of $463,708  or basic and diluted  loss of
$0.03 per share for the fiscal quarter ended September 30, 2000.


Nine Month Period Ended September 30, 2000

Revenues.  MindfulEye launched version 1.0 "release candidate" of our product in
the second week of October 2000.  Its phase II Beta Version was released on June
29, 2000.  Both these versions were  available to the  subscribers at no charge.
During nine month period ended  September 30, 2000,  MindfulEye did not generate
any revenue from its operations. MindfulEye had interest income in the amount of
$33,933.

Expenses.  During the nine month period  ended  September  30, 2000,  MindfulEye
incurred  total  expenses of $1,259,778  related  primarily to: (i) research and
developing  its web  technologies  (ii)  marketing and brand  development  (iii)
professional  and legal fees relating to its Securities and Exchange  Commission
reports and (iv) general overhead and administrative  expenses.  During the nine
month period ended  September 30, 2000,  MindfulEye  paid consulting fees in the
amount of $207,271 which included fees paid to (i) Everest  Advisory Group Inc.,
for the services of Julian Remedios as MindfulEye's chief financial officer (ii)
fees paid to Tod Maffin Inc. relating to general  consulting  services and (iii)
fees  paid to  Ecotex  Service  Corporation  for  management  services  of Randy
Bartsch. MindfulEye paid legal and accounting fees of $147,241 during nine month
period ended  September 30, 2000 related to  preparation of its filings with the
Securities  and Exchange  Commission,  patent  searches and other  corporate and
accounting matters.  MindfulEye incurred other expenses,  including amortization
expenses  of $27,776,  insurance  expenses of $963,  interest  and bank  charges
expenses of $7,235,  investor relations expenses of $4,088,  marketing and brand
development expenses of $98,003, infeed services expenses of $27,684, office and
miscellaneous  expenses  of  $84,669,  rent and  utilities  expenses of $52,296,
telephone and  communication  expenses of $31,835;  wages and salary expenses of
$466,867 and non-cash stock based compensation expenses of $103,850.

Net Loss.  MindfulEye  had a net loss of $1,225,845 or basic and diluted loss of
$0.10 per share for the nine month period ended September 30, 2000.


Plan of Operation

During MindfulEye's fiscal quarter ended June 30, 2000,  MindfulEye launched the
beta-version  of  its  web  site.   MindfulEye  launched  version  1.0  `release
candidate' of our product in the second week of October 2000. MindfulEye intends
to launch its Version 1.1 web site in November  2000,  which will  include  some
enhancements  to the  Version  1.0 and also  intends to launch its  Surveillance
products in November 2000.  Mindfuleye  anticipates that it will begin accepting
paid  subscriptions  for its  services in the fourth  quarter  2000 or the first
quarter 2001. The level of revenues from subscriptions is expected to vary based
on a number  of  factors,  including,  among  other  things:  (i) the  number of
subscribers to Mindfuleye's subscription-based services; (ii) the willingness of
visitors  to  pay  subscription  fees  for  Mindfuleye's  services;   (iii)  the
effectiveness of Mindfuleye's marketing and sales efforts; (iv) general economic
factors affecting the market for securities; and other factors, several of which
are outside the control of Mindfuleye.

After the  official  launch of its website,  MindfulEye  intends to focus on (i)
intensifying its marketing and promotional  efforts for the MindfulEye and brand
development; (ii) developing strategic relationships with the existing and other
Internet  providers,  investment houses and regulatory  bodies;  (iii) obtaining
subscribers  for its services  (iv)  developing  and  enhancing  its  artificial
intelligence  technologies  - LexantTM and (iv)  developing  and  expanding  its
website offerings.



                                       18
<PAGE>

Capital Requirements

MindfulEye  anticipates its operating  budget to implement its plan of operation
and to meet its  financial  obligations  during the remainder of its fiscal year
ending December 31, 2000, will be as follows:



                 DESCRIPTION                           December 31,
                                                           2000
-------------------------------------------------    ------------------
Technology & product development                         $230,000

Marketing and brand development                          $120,000

Salaries & benefits - management and office              $170,000

In-feed charges from third parties                       $ 34,000

Legal, regulatory filings and accounting                 $ 34,000

Office and administration                                $ 53,000

Investor relations                                       $ 50,000

Insurances                                               $ 10,000

Capital equipment                                        $ 79,000
                                                      -------------
Totals                                                   $780,000


Liquidity and Capital Resources

As at September 30, 2000,  MindfulEye had working  capital on hand in the amount
of $506,691.  MindfulEye  had cash or cash  equivalents  of  $502,870,  accounts
receivables  of $32,847  and  prepaid  expenses  and  deposits  in the amount of
$7,772. MindfulEye had accounts payable and accrued liabilities in the amount of
$36,798.

MindfulEye  anticipates  that its working  capital is  sufficient to satisfy its
cash requirements  through to November 2000.  MindfulEye  anticipates it will be
required  to raise  financing  during  the  fourth  quarter of 2000 to allow the
company to expand its operations in 2001. MindfulEye anticipates that it will be
required  to raise at least  $200,000  to meet its  anticipated  fourth  quarter
expenditures and an additional  $4,000,000 to $8,000,000 to meet its anticipated
cash  requirements  for the planned  expansion of the Company's  operations  for
marketing,  developing  technology,  applications  and products  during the year
2001. As at September 30, 2000, MindfulEye has no arrangements of financing, and
there can be no assurance  that it will be  successful  in acquiring  sufficient
financing to fund its plan of operation on terms acceptable to MindfulEye, if at
all. Any  inability to obtain  additional  financing,  when needed,  will have a
material  adverse effect on the company,  requiring the company to significantly
curtail or possibly cease its  operations.  In addition,  any additional  equity
financing  may involve  substantial  dilution to the  interests of the Company's
then existing shareholders.

While MindfulEye believes its capital requirement estimates are reasonable, such
estimates  can  change  for many  different  reasons,  some of which are  beyond
MindfulEye's  control.  MindfulEye is a development  stage company,  which means
that it is in the process of developing its  technologies  and that it currently
has no  revenues  from  its  operations.  MindfulEye  anticipates  that  it will
officially  market its services to subscribers on a subscription  fee basis late
in the fourth  quarter.  MindfulEye  currently has no  subscribers  and earns no
income from its  operations.  MindfulEye  does not  believe it will  receive any
significant  revenue from its  subscription  services until at least 2001. There
can be no assurance that  MindfulEye  will  successfully  launch its web site as
planned  or that a  sufficient  number  of  subscribers  will  subscribe  to the
MindfulEye service to make it commercially viable.

MindfulEye  does not  anticipate  it will acquire or dispose of any  significant
equipment in the fourth quarter of 2000.



                                       19
<PAGE>

Subsequent Event

On November 6, 2000,  MindfulEye  closed a Private  Placement of  $150,000.  The
Private  Placement  consisted of the sale of 300,000  common shares at $0.50 per
share to Powerstar,  an accredited  investor,  for the net proceeds of $150,000.
The common shares issued are pursuant to an exemption  from  registration  under
Regulation S of the  Securities  Act 1933.  Mindfuleye  is  attempting  to raise
additional  capital but as at November 14, 2000,  MindfulEye has no arrangements
of  financing,  and  there can be no  assurance  that it will be  successful  in
acquiring  sufficient  financing  to fund its  plan of  operation  on the  terms
acceptable  to  MindfulEye,  if at  all.  Any  inability  to  obtain  additional
financing,  when  needed,  will have a material  adverse  effect on  Mindfuleye,
requiring Mindfuleye to significantly  curtail or possibly cease its operations.
In addition, any additional equity financing may involve substantial dilution to
the interests of the Company's then existing shareholders.

Product Research and Development

MindfulEye  currently  develops all of its technologies  internally.  MindfulEye
anticipates it will spend approximately  $2,000,000 in payroll,  consultants and
equipment  to  develop  the  technology  and the  new  products  related  to its
MindfulEye.com   services  and  support  systems  during  the  next  12  months.
MindfulEye  may also engage  consultants  to assist with  product  research  and
development.

The cost for  developing  technology  is expensive  and the process will require
testing  and  refinement.  MindfulEye's  commercial  success  will depend on its
ability to attract subscribers to its services.  This will require MindfulEye to
develop and use  sophisticated  technologies  to generate,  sustain and maintain
user interest and satisfaction.

There can be no assurance that MindfulEye will successfully develop and test the
technologies  related  to  it  services  on a  timely  basis,  if  at  all.  Any
substantial  delay  in  obtaining  the  required  financing  or  developing  the
MindfulEye  services  and the  support  services  for  subscribers  would have a
materially adverse effect on MindfulEye's business and results of operations.

Personnel

As at September 30, 2000, MindfulEye had 18 full-time employees. This included 3
on management, 9 programmers and developers, who assist us in development of its
internal operating and information systems and technologies, and 6 employees who
are engaged in general and administrative and marketing functions.

MindfulEye also engages independent  consultants to assist in the development of
its technologies and applications,  for public relations services,  NLP (natural
language   processing)   development,   marketing   services  and  communication
consulting.  MindfulEye may also engage additional  consultants in the future to
assist  it  with  the  development  of  software  and  information  systems  and
implementation of its business plan.

MindfulEye's  success  will  depend in large part on its  ability to attract and
retain skilled and experienced  employees and  consultants.  MindfulEye does not
anticipate  any of its  employees  will be  covered by a  collective  bargaining
agreement.  MindfulEye does not currently maintain key man life insurance on any
of its directors or executive officers.

Subsequent to September  30, 2000,  MindfulEye  hired 4 additional  employees to
assist in application  and technology  development.  On October 3, 2000,  Julian
Remedios resigned as Mindfuleye's chief financial officer.

Inflation

MindfulEye's  results of  operations  have not been  affected by  inflation  and
management  does  not  expect  inflation  to have a  significant  effect  on the
Company's operations in the future.

Dividends

The Company has not paid any dividends on its stock.




                                       20
<PAGE>


                           PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

     None.

ITEM 2.  CHANGES IN SECURITIES

     None.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

     None.

ITEM 4.  SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS

     None.

ITEM 5.  OTHER INFORMATION

     None.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

     (a)  Exhibits

          Exhibit
          Number        Description
          ------        -----------
           27.1         Financial Data Schedule

     (b)  Reports on Form 8-K

     The Company  filed no reports on Form 8-K for the Quarter  ended  September
30, 2000.




                                       21
<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 thereto duly authorized.


Date: November 13, 2000


                                    MINDFULEYE, INC.


                                     /s/  Ray Torresan
                                     ----------------------------------------
                                     Ray Torresan
                                     Chairman of the Board of Directors,
                                     President












                                       22
<PAGE>

                                 EXHIBIT INDEX


Exhibit
Number        Description
------        -----------
27.1         Financial Data Schedule