United States Securities and Exchange Commission
                             Washington, D.C. 20549

                                   Form 10-QSB

(Mark One)
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
                  For the quarterly period ended March 31, 2002

[ ] TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE EXCHANGE ACT
         For the transition period from _________ to __________________

                         Commission File Number: 0-29285
                                                 -------

                             ONLINE INNOVATION, INC.
                 (Name of Small Business Issuer in its charter)

               Delaware                                52-2058364
   --------------------------------------    ---------------------------------
     (state or other jurisdiction of            (I.R.S. Employer I.D. No.)
     incorporation or organization)

          1118 Homer Street, #118, Vancouver, British Columbia V6B 6L5
          ------------------------------------------------------------
                    (Address of principal executive offices)

                                 (604) 669-7564
                                 --------------
                            Issuer's telephone number

   -----------------------------------------------------------------------------
    Former name, former address, and former fiscal year, if changed since last
                                     report

Check whether the registrant (1) filed all reports required to be filed by
sections 13 or 15(d) of the Exchange Act during the past 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  [  ]

                APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
                  PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court.
YES [  ]    NO [  ] N/A

                      APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common
equity,  as  of  the  latest  practicable  date:

As of May 14, 2002, the registrant's outstanding common stock consisted of
14,420,000 shares.

Transitional Small Business Disclosure Format (Check one):   YES [ ]    NO [X]

<PAGE>

                             ONLINE INNOVATION, INC.

                               INDEX TO FORM 10QSB

PART I  -  FINANCIAL INFORMATION                              PAGE NO.

        Item 1.          Financial Statements

        Item 2.          Management Discussion and Analysis
                         or  Plan  of  Operation

PART II  -  OTHER INFORMATION

        Item 1.          Legal Proceedings

        Item 2.          Changes in Securities

        Item 3.          Defaults Upon Senior Securities

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

        Item 5.          Other Information

        Item 6.          Exhibits and Reports on Form 8-K


SIGNATURES


EXHIBITS

<PAGE>


PART 1 - FINANCIAL INFORMATION

Item 1 - Financial Statements

Attached are the registrant's unaudited financial statements for the nine month
period ended March 31, 2002, with comparative figures for the nine month period
ended March 31, 2001, and the Independent Accountant's Report thereon.

<PAGE>


                                    MOEN AND COMPANY
                                 CHARTERED ACCOUNTANTS

PO Box 10129                                           Telephone:  (604)662-8899
1400 - 701 West Georgia Street                         Fax:        (604)662-8809
Vancouver, BC V7Y 1C6                        Email: moenandcompany@attcanada.net
--------------------------------------------------------------------------------


                            INDEPENDENT ACCOUNTANTS' REPORT



To the Directors and Shareholders of
Online Innovation, Inc. (A Delaware Corporation)
(A Development Stage Company)

We have reviewed the accompanying Balance Sheets of Online Innovation, Inc. (A
Delaware Corporation) (A Development Stage Company) as of March 31, 2002 and
March 31, 2001, and the Statements of Income, Retained Earnings (Deficit), Cash
Flows and Stockholders' Equity for the nine month periods then ended. These
financial statements are the responsibility of the Company's management.

We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statements taken as a
whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should
be made to the accompanying financial statements for them to be in conformity
with U.S. generally accepted accounting principles.



                                                            /s/ Moen and Company


                                                           Chartered Accountants

Vancouver, British Columbia, Canada
May 14, 2002


<PAGE>


                            ONLINE INNOVATION, INC.
                           (A Delaware Corporation)
                         (A Development Stage Company)
                                 Balance Sheet
                                 March 31, 2002
                               (In U.S. Dollars)
                                  (Unaudited)
                  (With Comparative Figures at March 31, 2001)


                                     ASSETS               2002          2001
                                                       ----------    ----------
Current Assets
   Cash                                                $    8,044    $   61,003
   Prepaid expense                                          2,209         1,325
                                                       ----------    ----------
                                                           10,253        62,328
Deferred tax asset (Note 12b(ii) and 13(c))                52,500        52,500
Fixed Assets
   Computer equipment, at cost less accumulated
     depreciation (Note 5)                                 50,338        62,248
Computer software development (Note 6(B))
   Application development stage costs                    325,000       400,000
                                                       ----------    ----------
                                                       $  438,091    $  577,076
                                                       ==========    ==========

                     LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities
   Accounts payable                                    $   94,981    $   19,597
   Due to related parties (Notes 4)                        30,000        30,000
   Loans payable (Note 15)                                100,000          -
   Agreement payable - Stratford Internet
     Technologies (Note 6(b))                                -           75,000
                                                       ----------    ----------
                                                          224,981       124,597
                                                       ----------    ----------

Stockholders' Equity
  Capital Stock (Note 3)
     Authorized:
       75,000,000 common shares at $0.001 par
        value per share
     Issued and outstanding - 14,420,000 common shares
      (2001 - 13,705,000 common shares)                    14,420        13,705
     Paid in capital in excess of par value of stock    2,218,430     1,824,295
Deficit accumulated during development stage (note 1)  (2,020,014)   (1,385,601)
Cumulative translation adjustment                             274            80
                                                       ----------    ----------
                                                          213,110       452,479
                                                       ----------    ----------
                                                       $  438,091    $  577,076
                                                       ==========    ==========

/s/ Chad D. Lee        , Director
-----------------------

/s/ Marlene C. Schluter, Director
-----------------------


            See Accompanying Notes and Independent Accountants' Report

<PAGE>


                            ONLINE INNOVATION, INC.
                           (A Delaware Corporation)
                         (A Development Stage Company)
                         Statement of Profit and Loss
                               (In U.S. Dollars)
                                  (Unaudited)

<TABLE>
<CAPTION>
                                          Cumulative From
                                           Inception Date
                                           of Aug 1, 1997       Nine Months Ended                Three Months Ended
                                            to March 31,              March 31,                         March 31,
                                                           ------------------------------  ------------------------------
                                                2002            2002             2001           2002             2001
                                           --------------  --------------  --------------  --------------  --------------
<S>                                        <C>             <C>             <C>             <C>             <C>
Administration Costs
   Compensation on stock option                   150,000            -               -               -               -
   Commitment shares issued under
    funding agreement                             345,600            -               -               -               -
   Depreciation                                    66,316          13,250          24,105           4,082           8,035
   Filing and transfer agent fees                  19,751           2,086           2,945             317           2,383
   Financing costs                                 22,550            -               -               -               -
   Management and consulting fees                 490,245          61,659          63,067          19,665          22,325
   Office expenses, net                           146,491          21,374          31,812          11,738          11,546
   Option payment, mineral properties              30,000            -               -               -               -
   Professional fees                              201,347          19,054          64,551             963          43,719
   Promotion, investor relations,
    and investor communications                    84,504             227             985            -                505
   Computer technology and
    software development-preliminary
    development stage costs                       286,944         (43,811)           -              8,331            -
   Website marketing/Banner
    advertising costs                             192,378           7,782          63,571           1,089          11,316
   Travel expenses                                 36,388          15,456           8,404          15,456            -
                                           --------------  --------------  --------------  --------------  --------------
                                                2,072,514          97,077         259,440          61,641          99,829
Deferred income taxes                             (52,500)           -               -               -               -
                                           --------------  --------------  --------------  --------------  --------------
Net loss for the period                    $    2,020,014  $       97,077  $      259,440  $       61,641  $       99,829
                                           ==============  ==============  ==============  ==============  ==============
Net loss per share, basic and diluted                      $         0.01  $        (0.02) $         0.00  $        (0.01)
                                                           ==============  ==============  ==============  ==============
</TABLE>


            See Accompanying Notes and Independent Accountants' Report

<PAGE>


                            ONLINE INNOVATION, INC.
                           (A Delaware Corporation)
                         (A Development Stage Company)
                            Statement of Cash Flows
                               (In U.S. Dollars)
                                  (Unaudited)

<TABLE>
<CAPTION>
                                          Cumulative From
                                           Inception Date
                                           of Aug 1, 1997       Nine Months Ended                Three Months Ended
                                            to March 31,              March 31,                         March 31,
                                                           ------------------------------  ------------------------------
                                                2002            2002             2001           2002             2001
                                           --------------  --------------  --------------  --------------  --------------
<S>                                        <C>             <C>             <C>             <C>             <C>
Cash Provided by (Used for)
Operating Activities
   Net loss for the period                 $   (2,020,014) $      (97,077) $     (259,440) $      (61,641) $      (99,829)
   Item not requiring use of cash:
    Common shares issued for computer
     technology and website costs                 345,600            -               -               -               -
   Shares issued for services,
     (shares cancelled)                            11,750         (82,250)           -               -               -
   Depreciation                                    66,316          13,250          24,105           4,082           8,035
   Compensation on stock options                     -               -               -               -               -
   Cumulative translation adjustment                  274             194             592             194            -
Changes in non-cash working capital items
   Deferred income tax                            (52,500)           -               -               -               -
   Prepaid expense (increase)                      (2,209)         (2,209)             18            -             (1,325)
   Accounts payable (decrease)                     94,981          65,758          (3,610)         30,543          (5,826)
   Agreement payable                                 -            (75,000)        (25,000)           -               -
                                           --------------  --------------  --------------  --------------  --------------
                                               (1,555,802)       (177,334)       (263,335)        (26,822)        (98,945)
                                           --------------  --------------  --------------  --------------  --------------
Investing Activities
   Computer software development
    Application development stage costs          (325,000)         75,000            -               -               -
    Fixed assets purchased                       (116,654)         (2,460)           -               -               -
                                           --------------  --------------  --------------  --------------  --------------
                                                 (441,654)         72,540            -               -               -
                                           --------------  --------------  --------------  --------------  --------------

Financing Activities
   Capital stock subscribed                     1,875,500            -            200,000            -            150,000
   Loan payable                                   100,000         100,000            -             33,548            -
   Due to related parties                          30,000            -             30,000          (5,161)         10,000
                                           --------------  --------------  --------------  --------------  --------------
                                                2,005,500         100,000         230,000          28,387         160,000
                                           --------------  --------------  --------------  --------------  --------------

(Decrease) in Cash during the period                8,044          (4,794)        (33,335)          1,565          61,055
Cash, Beginning of period                            -             12,838          94,338           6,479             (52)
                                           --------------  --------------  --------------  --------------  --------------

Cash, End of Period                        $        8,044  $        8,044  $       61,003  $        8,044  $       61,003
                                           ==============  ==============  ==============  ==============  ==============
</TABLE>


            See Accompanying Notes and Independent Accountants' Report

<PAGE>


                            ONLINE INNOVATION, INC.
                           (A Delaware Corporation)
                         (A Development Stage Company)
                   Statement of Retained Earnings (Deficit)
                                 March 31, 2002
                                (In U.S. Dollars)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                          Cumulative From
                                           Inception Date
                                           of Aug 1, 1997       Nine Months Ended                Three Months Ended
                                            to March 31,              March 31,                         March 31,
                                                           ------------------------------  ------------------------------
                                                2002            2002             2001           2002             2001
                                           --------------  --------------  --------------  --------------  --------------
<S>                                        <C>             <C>             <C>             <C>             <C>
Balance (deficit), beginning of period     $         -     $   (1,922,937) $   (1,126,161) $   (1,958,373) $   (1,285,772)

Net loss for the period                        (2,020,014)        (97,077)       (259,440)        (61,641)       (99,829)
                                           --------------  --------------  --------------  --------------  --------------

Balance (deficit), end of period           $   (2,020,014) $   (2,020,014) $   (1,385,601) $   (2,020,014) $   (1,385,601)
                                           ==============  ==============  ==============  ==============  ==============
</TABLE>






            See Accompanying Notes and Independent Accountants' Report

<PAGE>


                            ONLINE INNOVATION, INC.
                           (A Delaware Corporation)
                         (A Development Stage Company)
                       Statement of Stockholders' Equity
            From Date of Inception on August 1, 1997 to March 31, 2002
                               (In U.S. Dollars)
                                  (Unaudited)
<TABLE>
<CAPTION>
===================================================================================================================================
                                Number of                    Additional         Total         Retained                   Total
                                 Common          par           Paid-in         Capital       Earnings    Cumulative   Stockholders'
                                 Shares         Value          Capital          Stock        (Deficit)   Translation     Equity
                              -----------------------------------------------------------------------------------------------------
<S>                           <C>              <C>           <C>           <C>           <C>           <C>           <C>
Net loss for eleven month
 period ended June 30, 1998                                                              $  (144,175)         -      $  (144,175)
Issued for cash, @$0.01
 October 23, 1997              1,500,000       $     1,500   $    13,500   $    15,000          -             -           15,000
Issued for cash, @$0.001
 May 8, 1997                     500,000               500          -              500          -             -              500
Issued for assignment of
 option on mineral
 properties, @$0.0035
 September 30, 1997            8,500,000             8,500        21,500        30,000          -             -           30,000
                              -----------------------------------------------------------------------------------------------------
                              10,500,000            10,500        35,000        45,500      (144,175)         -          (98,675)
Shares subscribed and
 fully paid and issued,
 @$0.50 April 6, 1999             85,000                85        42,415        42,500          -             -           42,500
                              -----------------------------------------------------------------------------------------------------
Balance, June 30, 1998        10,585,000            10,585        77,415        88,000      (144,175)         -          (56,175)
Net loss for year ended
 June 30, 1999                      -                 -             -             -         (478,497)         -         (478,497)
Compensation on stock
 options                            -                 -          120,000       120,000          -             -          120,000
Cumulative translation              -                 -             -             -             -           (1,055)       (1,055)
Issued for cash, @$0.50
 April 6, 1999                    20,000                20         9,980        10,000          -             -           10,000
Issued for cash, @$0.50
 April 6, 1999                   100,000               100        49,900        50,000          -             -           50,000
Issued for private business
 (note 7), @$0.50
 April 2, 1999                   400,000               400       199,600       200,000          -             -          200,000
Issued for cash(note 14),
 @$0.50 April 15, 1999         1,600,000             1,600       798,400       800,000          -             -          800,000
                              -----------------------------------------------------------------------------------------------------
Balance, June 30, 1999        12,705,000            12,705     1,255,295     1,268,000      (622,672)       (1,055)      644,273

Cumulative translation              -                 -             -             -             -               543          543
Shares subscribed and
 fully paid, @$0.50
 January 4, 2000                 450,000               450       224,550       225,000          -              -         225,000
Net loss for year
 ended June 30, 2000                -                 -             -             -         (503,489)          -        (503,489)
Cumulative translation
Issued for exercise of
 option @ $0.50
 March 13, 2000                  100,000               100        49,900        50,000          -              -          50,000
Compensation on stock
 options                            -                 -           30,000        30,000          -              -          30,000
Exercise of warrants
 @ $0.50 May 9, 2000              50,000                50        24,950        25,000          -              -          25,000
Exercise of warrants
 @ $0.60 June 16, 2000            66,667                67        39,933        40,000          -              -          40,000
                              -----------------------------------------------------------------------------------------------------
Balance, June 30, 2000        13,371,667            13,372     1,624,628     1,638,000    (1,126,161)          (512)     511,327
Exercise of warrants
 @$0.60 August 17, 2000           83,333                83        49,917        50,000          -              -          50,000
Exercise of warrants
 @$0.60 February 9, 2001         250,000               250       149,750       150,000          -              -         150,000
Issued for services at
 an ascribed price of
 $0.47 per share on
 June 11, 2001                   200,000               200        93,800        94,000          -              -          94,000
Issue for cash,
 @$0.75 June 19,
 2001                             50,000                50        37,450        37,500          -              -          37,500
Issued as commitment
 shares at an
 ascribed price of
 $0.54 per share on
 June 25, 2001                   640,000               640       344,960       345,600          -              -         345,600
Net loss for year
 ended June 30, 2001                -                 -             -             -         (796,776)          -        (796,776)
Cumulative translation              -                 -             -             -             -               592          592
                              -----------------------------------------------------------------------------------------------------
Balance, June 30, 2001        14,595,000            14,595     2,300,505     2,315,100    (1,922,937)            80      392,243

Cancellation of
 175,000 shares on
 August 23, 2001                (175,000)             (175)      (82,075)      (82,250)        -               -         (82,250)
Cumulative translation
 adjustment                         -                 -             -             -            -                194          194
Net income for period
 ended March 31, 2002               -                 -             -             -         (97,077)           -         (97,077)
                              -----------------------------------------------------------------------------------------------------
Balance, March 31, 2002       14,420,000       $    14,420   $ 2,218,430   $ 2,232,850   $(2,020,014)  $        274  $   213,110
                              =====================================================================================================
</TABLE>

            See Accompanying Notes and Independent Accountants' Report

<PAGE>

                            ONLINE INNOVATION, INC.
                           (A Delaware Corporation)
                         (A Development Stage Company)
                         Notes to Financial Statements
                                March 31, 2002
                               (In U.S. Dollars)
                                  (Unaudited)


Note 1.   BUSINESS OPERATIONS

          a)  The Company was incorporated on May 7, 1997 under the Company Act
              of the State of Delaware, U.S.A. and commenced inception of
              business on August 1, 1997. The Company changed it's name from
              Micro Millennium, Inc. to Sinaloa Gold Corp. on October 16, 1997
              and subsequently changed it's name from Sinaloa Gold Corp. to
              Online Innovation, Inc. on April 8, 1999.

          b)  The Company is in its development stage in the internet/e-commerce
              industry as a website development company and was previously in
              the mining resource industry and has not generated any revenues
              from its planned operations. The deficit has been accumulated
              during the development stage.

Note 2.   SIGNIFICANT ACCOUNTING POLICIES

          a)  Administration Costs

              Administration costs are written off to operations when incurred.

          b)  Translation of Foreign Currency

              The functional currency of the Company is the Canadian Dollar and
              the reporting currency is the United States Dollar.

              The assets, liabilities, and operations of the Company are
              expressed in the functional currency of the Company, the Canadian
              Dollar, in conformity with US GAAP, before they are translated
              into the reporting currency, the United States Dollar.

              Monetary assets and liabilities are translated at the current rate
              of exchange.

              The weighted average exchange rate for the period is used to
              translate revenue, expenses, and gains or losses from the
              functional currency to the reporting currency.

              The gain or loss on translation is reported as a separate
              component of stockholders' equity and not recognized in net
              income. Gains or losses on remeasurement are recognized in current
              net income.

              Gains or losses from foreign currency transactions are recognized
              in current net income.

              Fixed assets are measured at historical exchange rates that
              existed at the time of the transaction.

<PAGE>

                            ONLINE INNOVATION, INC.
                           (A Delaware Corporation)
                         (A Development Stage Company)
                         Notes to Financial Statements
                                March 31, 2002
                               (In U.S. Dollars)
                                  (Unaudited)


Note 2.   SIGNIFICANT ACCOUNTING POLICIES (cont'd)
          b)  Translation of Foreign Currency (cont'd)

              Depreciation is measured at historical exchange rates that existed
              at the time the underlying related asset was acquired.

              An analysis of the changes in the cumulative translation
              adjustment as disclosed as part of stockholders' equity, is as
              follows:

                                                        Nine Months
                                                        December 31,
                                                ----------------------------
                                                     2002          2001
                                                ------------    ------------
              Beginning balance,
                 June 30, 2001 & 2000           $         80    $       (512)
              Changes during the period                  194             592
                                                ------------    ------------
              Ending balance,
                 March 31, 2002 & 2001          $        274    $         80
                                                ============    ============

              Capital accounts are translated at their historical exchange
              rates when the capital stock is issued.

              The effect of exchange rate changes on cash balances is reported
              in the statement of cash flows as a separate part of the
              reconciliation of change in cash and cash equivalents during the
              year.

          c)  Amortization of Computer Software
              Development - Application Development Stage Costs

              The company is in the application development stage relating to
              the development of computer software, and accordingly, costs are
              capitalized. When the company is in the post-implementation/
              operation stage, costs will be expensed as incurred.

              Amortization of computer software costs of $325,000 will commence
              when the software service is available to be marketed. The
              amortization period is for twenty-six months on a straight-line
              basis. The software is not available to be marketed as at March
              31, 2002, and therefore no amortization of this cost has been
              charged to operations for the period ended March 31, 2002.

<PAGE>

                            ONLINE INNOVATION, INC.
                           (A Delaware Corporation)
                         (A Development Stage Company)
                         Notes to Financial Statements
                                March 31, 2002
                               (In U.S. Dollars)
                                  (Unaudited)


Note 3.   CAPITAL STOCK

          a)  Authorized: 75,000,000 common shares at $0.001 par value per
              share.

          b)  Common shares issued and outstanding are as follows:

                                                        Shares           $
                                                    ------------   ------------
              Balance, June 30, 2001                  14,595,000   $  2,315,100
                Cancelled on August 23, 2001            (175,000)       (82,250)
                                                    ------------   ------------
              Balance, March 31, 2002                 14,420,000   $  2,232,850
                                                    ============   ============

          c)  Options for National Financial Communication Group, and Fordee
              Management Company. (See Note 13(b) and Note 14)

Note 4.   RELATED PARTY TRANSACTIONS:

          a)  (i)  Pursuant to a management agreement effective November 1,
                   1998, the Company pays $2,500 per month to MCS Management
                   Ltd., a company wholly owned by Ms. Marlene C. Schluter,
                   Director, Secretary, and Treasurer of the Company, for
                   management services provided to the Company by MCS Management
                   Ltd. Unpaid management fee for Ms. Marlene C. Schluter, as
                   at March 31, 2002, is $25,000.

              (ii) Pursuant to a management agreement effective July 1, 1999,
                   the Company pays $2,500 per month to Netgain Management
                   Solutions Inc., a company wholly owned by Mr. Chad D. Lee,
                   President, Chief Financial Officer, CEO, and Director of the
                   Company. Unpaid management fee for Chad D. Lee, as at March
                   31, 2002, is $20,000

          b)  Directors and Officers of the Company are beneficial owners of
              common shares of the Company, as follows, at March 31, 2002:

                            Chad D. Lee           5,500,000 common shares
                            Marlene C. Schluter   2,500,000 common shares
                                                  ---------
                                                  8,000,000
                                                  =========

          c)  Loans to the Company unpaid as at March 31, 2002 are as follows:

                            Chad D. Lee           $  20,000
                            Marlene C. Schluter      10,000
                                                  ---------
                                                  $  30,000
                                                  =========

              These loans are non interest bearing, are unsecured, and have no
              specific terms of repayment.

<PAGE>

                            ONLINE INNOVATION, INC.
                           (A Delaware Corporation)
                         (A Development Stage Company)
                         Notes to Financial Statements
                                March 31, 2002
                               (In U.S. Dollars)
                                  (Unaudited)


Note 5.   FIXED ASSETS - COMPUTER EQUIPMENT

          The Company depreciates its computer equipment using the declining-
          balance basis at the rate of 30% per annum.

          The cost and accumulated depreciation are as follows:

                                                           March 31,
                                                   --------------------------
                                                       2002           2001
                                                   -----------    -----------
                    Cost                           $   116,654    $   107,138
                    Accumulated depreciation           (66,316)       (44,890)
                                                   -----------    -----------
                    Net balance                    $    50,338    $    62,248
                                                   ===========    ===========

Note 6.   COMPUTER TECHNOLOGY AND WEBSITE COSTS

          a)  Acquisition From Online Innovation

              i)    The Company by resolution dated April 2, 1999, acquired from
                    Online Innovation, a non-reporting private Canadian
                    unincorporated entity, 100% interest in all of its
                    proprietary and intellectual property associated with its
                    business plan and concepts and its world wide web site
                    domain name: www.virtuallydating.com.

              ii)   Consideration for this purchase is the issuance of 400,000
                    common shares of the Company at a price of $0.50 per share.
                    These shares were issued on June 2, 1999 and the amount of
                    $200,000 has been included as an expense of operations for
                    the year ended June 30, 1999.

              iii)  Online Innovation has not had any historical revenue or
                    expenses; it also has no liabilities and the only asset is a
                    business plan and concepts and the abovementioned world wide
                    web site domain name.

          b)  Computer Software Costs capitalized

              By agreement dated July 30, 1999 between the Company and Stratford
              Internet Technologies ("Stratford"), Stratford had been engaged to
              create, maintain, upgrade and supply artwork, computer files, and
              coding for a website at www.virtuallydating.com for the amount of
              $400,000 US, less unpaid amount of $75,000 reversed in these
              financial statement for the quarter ended September 30, 2001, due
              to bankruptcy of Stratford for a net amount of $325,000, which is
              capitalized in these financial statements.

<PAGE>

                            ONLINE INNOVATION, INC.
                           (A Delaware Corporation)
                         (A Development Stage Company)
                         Notes to Financial Statements
                                March 31, 2002
                               (In U.S. Dollars)
                                  (Unaudited)


Note 7.   LEASE OBLIGATIONS

          a)  Computer Lease
              On June 1, 1999, the Company entered into a 36 month lease with
              Leasing Solution (Canada) Inc. for computer equipment to be used
              by the Company. Lease payments are expensed as they are incurred.
              Lease obligations for balance of the fiscal year ending June 30,
              2002 total CAD$304.

          b)  Lease of Premises
              The Company entered into leases for offices located at #118-1118
              Homer Street, Vancouver and #119-1118 Homer Street, respectively,
              effective November 1, 2001 with S & W 97 Enterprises Ltd. for the
              term of one year for monthly rent and costs of CAD$900 and
              CAD$700, respectively, with options to renew the leases for a
              further term of one year, each.

Note 8.   COMPENSATION/STOCK OPTION/DEFERRED COMPENSATION ARRANGEMENT

          a)  At the Annual General Meeting of the Company, the 2000 Incentive
              Stock Plan was approved that provides for the grant, at the
              discretion of the Board of Directors, or a Committee appointed by
              it, of options and rights to purchase an aggregate of not to
              exceed 1,500,000 common shares of common shares of the Company to
              officers, directors, employees and consultants of the Company.

          b)  There are no liabilities for pension costs at March 31, 2002.

Note 9.   NET LOSS PER SHARE

          Net loss per common share is computed by dividing net loss by the
          weighted average of shares outstanding during the period.

Note 10.  INCOME TAXES

          The Company has losses carried forward to future years of $1,999,395.
          The potential tax benefit has not been recorded, as an equivalent
          reserve has been provided due to uncertainty of application of the
          losses.

Note 11.  FINANCIAL INSTRUMENTS

          The Company's financial instruments consist of cash, accounts payable,
          loans payable, and due to related parties. 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 approximates their carrying values.

<PAGE>

                            ONLINE INNOVATION, INC.
                           (A Delaware Corporation)
                         (A Development Stage Company)
                         Notes to Financial Statements
                                March 31, 2002
                               (In U.S. Dollars)
                                  (Unaudited)


Note 12.  CONSULTING AGREEMENTS

          National Financial Communications Corp.
          a)  By agreement dated February 1, 2000, the company engaged National
              Financial Communications Corp., an arm's length company, to render
              public relations and communication services for a period of one
              year commencing February 1, 2000 and terminating February 1, 2001,
              at $10,000 per month. The amount of $20,000 has been incurred to
              March 31, 2000. By mutual agreement the services were suspended in
              April 2000 until the company becomes fully reporting. As part of
              the agreement, National Financial Communications Corp. is granted
              options on February 1, 2000 to purchase shares of the company,
              exercisable, commencing February 1, 2000, and expiring January 31,
              2003. February 1, 2000 is the measurement date and the vesting
              date. There are five options for 50,000 shares each at prices of
              $2.00, $3.00, $4.00, $5.00, $7.00 per share, respectively.

          b)  The compensation of $30,000 was expensed in the year ended June
              30, 2000. The options are nonforfeitable.
                    Option price of 50,000 shares at $2.00 per share  $ 100,000
                    Market price at date of issuance of option
                      - 50,000 shares at $2.60                          130,000
                    Compensation added to paid-in capital             $  30,000
                                                                      ---------
                    Deferred income tax - 35% of $30,000              $  10,500
                                                                      =========

Note 13.  FORDEE MANAGEMENT COMPANY

          a)  As at February 2, 1999 the Company granted to Fordee Management
              Company with stock options to purchase 400,000 common share of the
              Company at a price of $0.20 per share with the expiry date of
              October 3, 2002. These options are outstanding as at March 31,
              2002.

          b)  Fordee Management Company is an unrelated third party

          c)  The compensation of $120,000 applicable to issuance of this option
              was expensed in the year ended June 30, 1999, and was added to
              paid-in capital, computed as follows:

                  Option price of 400,000 shares at $0.20 per share  $   80,000
                  Market price at date of issuance of option
                     400,000 shares at $0.50 per share                  200,000
                                                                     ----------
                  Compensation added to paid-in capital              $  120,000
                                                                     ==========

                  Deferred income tax - 35% of $120,000              $   42,000
                                                                     ==========

<PAGE>

                            ONLINE INNOVATION, INC.
                           (A Delaware Corporation)
                         (A Development Stage Company)
                         Notes to Financial Statements
                                March 31, 2002
                               (In U.S. Dollars)
                                  (Unaudited)


Note 14.  COMMON STOCK PURCHASE AGREEMENT WITH FUSION CAPITAL FUND II, LCC

          On June 25, 2001, Online Innovation, Inc. entered into a Common Stock
          Purchase Agreement with Fusion Capital Fund II, LLC, a Chicago based
          institutional investor. Pursuant to the Agreement, and subject to
          certain terms and conditions, Fusion has agreed to purchase $6,000,000
          of the Company's common stock. The stock will be purchased at a rate
          of $10,000 per trading day, or $200,000 every 20 trading days. The
          purchase price of the stock will be based on the market price of the
          Company's common shares at the time of purchase.

          The Company will have the right to decrease the daily purchase rate of
          $10,000 at any time. In the event of such a decrease, it will also
          have the right to increase the daily purchase rate back to $10,000 at
          any time. In addition, if the closing price of the Company's shares is
          above $3.00 for five consecutive trading days, the Company will have
          the right to increase the daily purchase rate above $10,000. If the
          Company chooses to increase the daily purchase rate above $10,000 and
          the closing price of the Company's shares falls below $3.00, the daily
          purchase rate will be reduced to $10,000. The Company may, at any
          time, suspend purchases under the Agreement. In addition, no purchase
          will be made if such purchase would cause Fusion, together with any of
          its affiliates, to own in excess of 9.9% of the Company's common
          stock.

          The Company will not be obligated to sell and Fusion will not be able
          to purchase any common stock under the Agreement if the purchase price
          for the stock (based on the market price of the Company's shares at
          the time of purchase) would be less than $0.75. The Company may, at
          its discretion, increase this "floor price". The Company may also,
          with the consent of Fusion, decrease the floor price. Fusion is
          prohibited, during the term of the Agreement, from effecting any short
          sales of the Company's common stock or entering into any hedging
          transaction which establishes a net short position with respect to the
          Company's common stock.

          As consideration for entering into the Agreement, the Company has
          agreed to issue 640,000 shares of its common stock to Fusion. In
          addition, the Company has agreed to issue to Fusion share purchase
          warrants entitling Fusion to purchase up to 320,000 shares of the
          Company's common stock at a price of $0.75. The warrants are
          exercisable for a period of 5 years from the date of issue. Subject to
          certain conditions, Fusion has agreed not to transfer or sell any of
          these shares for 600 trading days from the date of the Agreement.

<PAGE>

                            ONLINE INNOVATION, INC.
                           (A Delaware Corporation)
                         (A Development Stage Company)
                         Notes to Financial Statements
                                March 31, 2002
                               (In U.S. Dollars)
                                  (Unaudited)


Note 14.  COMMON STOCK PURCHASE AGREEMENT WITH FUSION CAPITAL FUND II, LCC
          (cont'd)

          Under the Agreement, the Company is not obligated to commence sales of
          its common stock to Fusion, and Fusion is not obligated to make any
          purchases of the Company's common stock, until the Company has filed a
          registration statement under the Securities Act of 1933 with the
          Securities and Exchange Commission respecting at least 2,000,000 of
          the shares of the Company's common stock to be issued pursuant to the
          Agreement. The registration statement must also register the 640,000
          commitment shares issued by the Company and any shares to be acquired
          by Fusion pursuant to the exercise of the warrants described above.

          The Company intends to use the proceeds of the financing to fund
          ongoing operations. Funds will be utilized for general and
          administrative expenses, ongoing development of the Company's internet
          based products and services and for marketing of those products and
          services.

          The 640,000 commitment shares are recorded as issued at an ascribed
          price of $0.54 per share, as at the preceding fiscal year ended June
          30, 2001.

NOTE 15.  LOANS PAYABLE

          Summary:
          --------
             Progressive Contracting Ltd.                        $   30,000
             CK Dragon Trust                                         30,000
             Richard L. Coglon                                       40,000
                                                                 ----------
                                                                 $  100,000
                                                                 ==========

          a)  The Company received Convertible Bridge Financing from Progressive
              Contracting Ltd. of $30,000 and this loan is secured by a
              Promissory Note dated August 29, 2001, with interest payable of
              10% per annum, maturing August 31, 2002.

              The Promissory Note has conversion terms, as follows:

              (i)    After August 31, 2002 (the "Maturity Date"), Progressive
                     Contracting Ltd. shall have the right, at his option, on or
                     after the Maturity Date to convert the principal amount of
                     this Note, together with all accrued interest thereon in
                     accordance with the provisions of and upon satisfaction of
                     the conditions contained in this Note, into fully paid and
                     nonassessable shares of the Company's Common Stock at a
                     conversion price of $0.30 per share (the "Conversion
                     Shares").

<PAGE>

                            ONLINE INNOVATION, INC.
                           (A Delaware Corporation)
                         (A Development Stage Company)
                         Notes to Financial Statements
                                March 31, 2002
                               (In U.S. Dollars)
                                  (Unaudited)


NOTE 15.  LOANS PAYABLE (cont'd)

              (ii)   The conversion rights of Progressive Contracting Ltd. set
                     forth in this Section may be exercised only on the
                     "Maturity Date" and at any time thereafter but prior to
                     payment in full of the principal amount of and accrued
                     interest on this Note.

              The directors and officers of Progressive Contracting Ltd. are
              arm's length third parties.

          b)  The Company received Convertible Bridge Financing from CK Dragon
              Trust of $30,000 and this loan is secured by a Promissory Note
              dated November 7, 2001, with interest payable of 10% per annum,
              maturing April 7, 2002. The Promissory Note has conversion terms,
              as follows:

              (i)    After April 7, 2002 (the "Maturity Date"), CK Dragon Trust
                     shall have the right, at their option, on or after the
                     Maturity Date to convert the principal amount of the Note,
                     together with all accrued interest thereon in accordance
                     with the provisions of and upon satisfaction of the
                     conditions contained in this Note, into fully paid and non-
                     assessable shares of the Company's Common Stock at a
                     conversion price of $0.20 per share (the "Conversion
                     Shares").

              (ii)   The conversion rights of CK Dragon Trust set forth in this
                     Section may be exercised only on the "Maturity Date" and at
                     any time thereafter but prior to payment in full of the
                     principal amount of and accrued interest on this Note.

                     CK Dragon Trust is not a director or officer of the Company
                     and is an arm's length third party.

          c)  The Company received a loan from Richard L. Coglon of $40,000 and
              this loan is secured by a Promissory Note dated January 10, 2002,
              with interest rate payable of 7% per annum, maturing January 10,
              2003.
              The Promissory Note has conversion terms, as follows:

              (i)    After January 10, 2003 (the "Maturity Date"), Richard L.
                     Coglon shall have the right, at his option, on or after the
                     Maturity Date to convert the principal amount of this Note,
                     together with all accrued interest thereon in accordance
                     with the provisions of and upon satisfaction of conditions
                     contained in this Notes into Units, with each unit
                     consisting of one fully paid and non-assessable share of
                     the Company's Common Stock at a conversion price of $0.25
                     per share, and one share purchase warrant entitling the
                     holder to acquire one additional fully payable and non-
                     assessable common share of the company at a purchase price
                     of $0.25 per share expiring on January 10, 2004.

<PAGE>

                            ONLINE INNOVATION, INC.
                           (A Delaware Corporation)
                         (A Development Stage Company)
                         Notes to Financial Statements
                                March 31, 2002
                               (In U.S. Dollars)
                                  (Unaudited)


NOTE 15 LOANS PAYABLE (cont'd)

              (iii)  The conversion right of Richard L. Coglon may be exercised
                     only on the "Maturity Date" and at any time thereafter but
                     prior to payment in full of the principal amount and
                     accrued interest on the Promissory Note.

                     Richard L. Coglon is not a director or officer of the
                     Company and is an arm's length third party.



<PAGE>

Item 2 - Management Discussion and Analysis or Plan of Operation

General

The Company's business is conducted through its website,
www.VirtuallyDating.com. The primary focus of the www.VirtuallyDating.com
website is matchmaking. In addition to providing matchmaking services for
single adults through a specialized search engine for members, the site provides
various interactive, entertainment related components that facilitate social
interaction between members. While membership is currently being offered free
of charge, the Company intends to generate revenues by charging membership fees
once the site is fully operational.

The website was operational for beta testing in February, 2000. While limited
member services became available to the public in July, 2000 (the search engine
and matching functions, for example), the e-commerce portion of the website and
certain key value added components (such as member chat and video conferencing
services) are not yet fully operational. Since the e-commerce portion of the
website will include the payment infrastructure for merchandise and membership
fees, the Company is not currently charging membership fees. The Company is
currently working with a group of web development consultants to complete the
development and deployment of the e-commerce and additional value added
components of the website. These components are currently operational and
functioning internally for beta testing purposes but have not been launched for
public use. The Company currently anticipates that the e-commerce and
additional value added components will be fully operational by June 1, 2002.
(see "additional website development" below).

In addition to finalizing the development of its website, it will be necessary
for the Company to raise additional capital over the next 12 months. (see "Cash
Requirements" below) To the extent that sufficient capital is available, the
Company also intends to engage in a range of marketing activities to promote the
use of its website.

Forward Looking Statements

All statements, other than statements of historical facts, included in this
report that address activities, events or developments that the Company expects,
believes, intends or anticipates will or may occur in the future, are
forward-looking statements. Forward-looking statements are inherently subject
to risks and uncertainties, many of which cannot be predicted with accuracy and
some of which might not even be anticipated. Future events and actual results,
financial and otherwise, could differ materially from those set forth in or
contemplated by the forward-looking statements herein. These risks and
uncertainties include, but are not limited to, the Company's reliance on current
revenues; the uncertainties associated with the introduction of new
products/services; management of growth, including the ability to attract and
retain qualified employees; the ability to integrate acquisitions made by the
Company and the costs associated with such acquisitions; dependence on its chief
executive officer; substantial competition from larger companies with greater
financial and other resources than the Company; the success of its marketing
strategy; its dependence on suppliers for some of its products; currency
fluctuations and other risks associated with foreign sales and foreign
operations; quarterly fluctuations in revenues, income and overhead expense; and
potential product liability risk associated with its existing and future
products. Readers are cautioned not to put undue reliance on forward-looking
statements. The Company disclaims any intent or obligation to update publicly
these forward-looking statements, whether as a result of new information, future
events or otherwise.

<PAGE>

Additional Website Development

The Company's focus with respect to website development during the upcoming
months will be to complete the launch of the e-commerce and additional value
added components of the website. The e-commerce functions are currently
operating internally for beta testing purposes. They have not been launched for
public use. The Company has also developed certain new value added features for
the website, including several new greeting cards, a member chat area,
video/voice chat functions and photograph upload and management functions.
These features are also operational internally for beta testing and the Company
will be attempting to launch them with the e-commerce functions. The Company
anticipates that all of these functions will be launched by June 1, 2002 and
will require an additional $25,000 in development expenditures.
After the e-commerce and other functions listed above have been added to the
website, the Company intends to continue to develop new features which will make
the website more attractive to prospective members. The Company intends to
create a webpage entitled "Hey Bartender" which would provide recipes for
alcoholic cocktails. Members would be invited to post their own favorite
recipes on the page. Another section entitled "Postcards From Stanley" may be
created. This section would feature travel reviews of destinations geared
towards singles.

Marketing Strategies

    General
    -------

Management believes that marketing will be the key to the Company's success in
the short term and in the long term. As a result, management intends to focus
as much of its energies as possible in the upcoming 12 months on marketing
activities. Its ability to do so, however, will be dependent on its ability to
raise adequate financing. (see "Cash Requirements" below)

The Company intends to advertise online, through print media and possibly,
depending on the resources available, through television, radio and billboards.
The Company's goal has been to capture 50,000 subscribing members in each of the
three years following the launch of the website, for a total of 150,000 members
within three years of launch. The target market for the Company's service is
single adults, aged 18-49, with basic computer skills and access to the
internet. The Company intends to focus on the North American market in the
short term and consider other markets at a later date.

As of May 13, 2002, the Company's website had 38,391 members. The current
membership numbers are below the goal of 50,000 per year set by the Company. In
management's view, this shortcoming is the result of delays in finalizing the
website and inability to allocate significant funds to marketing activities. To
date, available funds have been allocated primarily towards administrative costs
and costs associated with website development. The Company hopes to be more
successful in attaining membership goals once funds have been secured and are
available for increased marketing. (see "Cash Requirements" below)

    Online Advertising
    ------------------

Online advertising can take a number of different forms. Banner advertising is
the most common form. The Company intends to place banner advertisements on
those websites which management believes will enable the Company to most
effectively reach its target market. Affiliations with other websites also
provide an avenue for marketing for internet companies. Companies with similar

<PAGE>

markets can form various types of strategic alliances to promote one another's
products and services. The key component is usually a link to the affiliate
company's website. In the upcoming 12 months, the Company will continue with
its efforts to forge strategic partnerships with key industry players. The
Company hopes that by doing so it will be able to increase traffic on its
website.

Another form of online advertising being considered by the Company involves
sponsoring e-mails or newsletters sent by other internet companies. Through
payment of a sponsorship fee, the Company would be shown as the sponsor of a
particular e-mail or newsletter sent by an entity to its members. By selecting
an entity with a large membership, the Company can reach large target markets.
A message identifying the sponsor and a link to the sponsor's website are
provided.

Management is exploring the various forms of online advertising available and
focusing its initial energy on this sector because of the relatively low cost
and the ability to reach its target market (i.e. personal computer users)
effectively. It will, however, assess other marketing tools and utilize those
which it feels will enable it to reach its target market in the most efficient
and cost effective manner.

    Print Media, T.V., Radio and Billboards
    ---------------------------------------

While management is of the view that online advertising is the most
cost-effective marketing tool, it also believes that other, more traditional
methods of marketing will be effective and must be developed to the fullest
extent possible. Management envisions placing advertisements in the personals
sections of major newspapers and in high circulation magazines with general
readership to brand the VirtuallyDating name and to expose the Company to a
wider audience. Determination as to whether these types of advertisements will
be placed will depend on funds available in the upcoming 12 months. In
addition, advertisements on television, radio and on billboards will be
considered and utilized if the Company has the capital available to purchase
advertising space/time from these sources.

Cash Requirements

The Company currently has sufficient working capital to meet its operating
requirements until July 31, 2002. In order to fund business activity beyond
this date, the Company will need to arrange additional financing. Website
development and marketing efforts will be dependent on the Company's ability to
raise such additional financing. Specific plans related to marketing and any
additional website development which may occur in the upcoming months will be
devised once financing has been completed and management knows what funds will
be available for these purposes.

As disclosed in the Company's most recent 8-K filing, the Company has entered
into a Common Stock Purchase Agreement (the "Stock Purchase Agreement") with
Fusion Capital Fund II, LLC, a Chicago based institutional investor ("Fusion").
Pursuant to the Stock Purchase Agreement, subject to certain terms and
conditions discussed further below, Fusion has agreed to purchase $6,000,000 of
the Company's common stock. The stock will be purchased at a rate of $10,000
per trading day, or $200,000 every 20 trading days. The purchase price of the
stock will be based on the market price of the Company's common shares at the
time of purchase. Under the Stock Purchase Agreement, the Company is not
obligated to commence sales of its common stock to Fusion and Fusion is not
obligated to make any purchases of the Company's common stock, until the Company
has filed a registration statement under the Securities Act of 1933 with the
Securities and Exchange Commission respecting at least 2,000,000 of the shares

<PAGE>

of the Company's common stock to be issued pursuant to the Stock Purchase
Agreement. In order to secure the funds available under the Stock Purchase
Agreement, therefore, it will be necessary for the Company prepare and file a
registration statement with the Securities and Exchange Commission. The
Company anticipates that this process will cost approximately $100,000 and take
approximately 6 months to complete.

In order to complete the registration process, the Company will have to secure
intermediate financing. The Company has negotiated a number of bridge
financings since its financial year end on June 30, 2001.

On August 29, 2001, the Company negotiated a $30,000 loan, due and payable on
August 31, 2002 and secured by a convertible promissory note. The loan bears
interest at a rate of 10% per annum. The promissory note is convertible at the
option of the noteholder at any time after August 31, 2002 into common shares of
the Company at a conversion price of $0.30 per share. The conversion rights may
be exercised at any time after August 31, 2002, but must be exercised prior to
payment in full of the principal amount of the loan and any accrued interest.

On November 7, 2001, the Company negotiated a $30,000 loan, due and payable on
April 7, 2002 and secured by a convertible promissory note. The note bears
interest at a rate of 10% per annum. It is convertible at the option of the
noteholder at any time after April 7, 2002 into common shares of the Company at
a conversion price of $0.20 per share. The conversion rights may be exercised
at any time after April 7, 2002 but must be exercised prior to payment in full
of the principal amount of the loan and any accrued interest.

On November 7, 2001, the Company received a loan of $10,000 (CDN) from Snowy
Creek Resources, Ltd. This loan was unsecured and had no specific interest or
repayment terms. Snowy Creek Resources is a private company for which Marlene
C. Schluter acts as president and director. Ms. Schluter is also a director of
the Company. This loan was repaid by the Company during the most recent quarter
(see "Other Information").

On January 10, 2002, the Company negotiated a $40,000 loan, due and payable on
January 10, 2003 and secured by a convertible promissory note. The loan bears
interest at a rate of 7% per annum. The promissory note is convertible at the
option of the noteholder at any time after January 10, 2003 into units of the
Company at a conversion price of $0.25 per unit. The conversion rights may be
exercised at any time after January 10, 2003, but must be exercised prior to
payment in full of the principal amount of the loan and any accrued interest.
Each unit will consist of one common share of the Company and one share purchase
warrant. Each share purchase warrant will entitle the holder to purchase one
additional common share of the Company at a price of $0.25. The warrants will
be exercisable until January 10, 2004.

The loans described above were applied primarily to general and administrative
expenses and to website development. The Company will require significant
additional funding to prepare and file a registration statement and access the
funds available under the Stock Purchase Agreement. In addition, the Company
will need additional funding in order to meet its ongoing obligations past July
31, 2002. The Company is, therefore, currently exploring various financing
options. There is no guarantee that adequate financing will be arranged.
Without additional financing, the Company may be unable to access the funds that
are to be made available under the Stock Purchase Agreement and may be unable to
continue operations.

<PAGE>

The Company intends to use the proceeds of any financing to fund ongoing
operations. Specifically, funds will be utilized for general and administrative
expenses and expenses related to the filing and preparation of a registration
statement respecting the stock to be issued under the Stock Purchase Agreement.
Funds will also be utilized for ongoing development of the Company's internet
based products and services and, if possible, for marketing of those products
and services.

Purchase of Equipment

At this time, the Company does not anticipate the purchase of any significant
equipment.

Employees

The Company currently has no full or part time employees. The Company retains
consultants to provide it with services related to the administration,
management and development of the Company. At this time, the Company does not
anticipate any significant changes in staffing.

PART II - OTHER INFORMATION

Item 1 - Legal Proceedings

There are no legal proceedings reportable pursuant to this section. As of the
date of this report, the Company has not been served with notice of any legal
proceedings and does not contemplate undertaking any legal proceedings.

Item 2 -Change in Securities

No instruments defining the rights of the holders of any class of registered
securities were modified during the period covered by this report. No rights
evidenced by any class of registered securities were materially limited or
qualified by the issuance or modification of any other class of securities
during the period covered by this report.

Item 3 - Defaults Upon Senior Securities

There have been no material defaults in the payment of principal, interest,
sinking or purchase fund installments or any other material defaults with
respect to indebtedness of the Company exceeding 5% of the total assets of the
Company. No material arrearage in the payment of dividends and no delinquency
with respect to any preferred stock of the Company has occurred.

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

No matters have been submitted to a vote of security holders during the period
covered by this report, through the solicitation of proxies or otherwise.

Item 5 - Other Information

During the most recent quarter, the Company repaid a loan of $10,000 previously
made by Snowy Creek Resources Ltd., a private company for which Marlene C.
Schluter acts as President and Director. During the quarter the Company also
repaid loans to Marlene Schluter ($5,000) and Chad Lee ($3,000). Ms. Schluter
and Mr. Lee are both directors of the Company.

<PAGE>

Item 6 - Exhibits and Reports on Form 8-K

(a)  Exhibits

     15  Letter on Unaudited Financial Information

(b)  No reports on form 8-K were filed during the period covered by this report.



<PAGE>

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.


Date: May 15, 2002                     ONLINE INNOVATION, INC.
     ------------------
                                                  (Registrant)


                                          By:  /s/ Chad D. Lee
                                             ------------------------
                                             Chad D. Lee, President

<PAGE>