<Page>

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                              Washington D.C. 20549
                                   FORM 10-QSB

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

                  For Quarterly Period Ended December 31, 2002

                        Commission File Number 000-29433

                               USA BROADBAND, INC.
        (Exact name of small business issuer as specified in its charter)


             DELAWARE                                   84-1592698
(State or other jurisdiction of            (IRS Employer Identification No)
incorporation or organization)

                               1111 Orange Avenue
                           Coronado, California 92118
                    (Address of Principal Executive Offices)

                                 (619) 435-2929
                (Issuer's Telephone Number, Including Area Code)

                             -----------------------

(Former Name, Former Address, and Former Fiscal Year if Changed Since Last
Report)

Check whether the Issuer: (1) has filed all reports required to be filed by
Section 13 or 15 (d) of the Exchange Act during the past 12 months (or 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 |_|

State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: The issuer had 6,522,329 shares of
common stock outstanding as of January 31, 2003.



<Page>


                INFORMATION REGARDING FORWARD-LOOKING STATEMENTS

         THIS REPORT ON FORM 10-QSB CONTAINS FORWARD-LOOKING STATEMENTS WITHIN
THE MEANING OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. THE
FORWARD-LOOKING STATEMENTS ARE CONTAINED PRINCIPALLY IN THE SECTION ENTITLED
"MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS." THESE STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND
OTHER FACTORS WHICH MAY CAUSE OUR ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS TO
BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCES OR ACHIEVEMENTS
EXPRESSED OR IMPLIED BY THE FORWARD-LOOKING STATEMENTS.

         IN SOME CASES, YOU CAN IDENTIFY FORWARD-LOOKING STATEMENTS BY TERMS
SUCH AS "MAY," "WILL," "SHOULD," "COULD," "WOULD," "EXPECTS," "PLANS,"
"ANTICIPATES," "BELIEVES," "ESTIMATES," "PROJECTS," "PREDICTS," "POTENTIAL" AND
SIMILAR EXPRESSIONS INTENDED TO IDENTIFY FORWARD-LOOKING STATEMENTS. THESE
STATEMENTS REFLECT OUR CURRENT VIEWS WITH RESPECT TO FUTURE EVENTS AND ARE BASED
ON ASSUMPTIONS AND SUBJECT TO RISKS AND UNCERTAINTIES. GIVEN THESE
UNCERTAINTIES, YOU SHOULD NOT PLACE UNDUE RELIANCE ON THESE FORWARD-LOOKING
STATEMENTS. WE DISCUSS MANY OF THESE RISKS IN THIS REPORT IN GREATER DETAIL
UNDER THE HEADING "FACTORS AFFECTING FUTURE PERFORMANCE." THESE FORWARD-LOOKING
STATEMENTS REPRESENT OUR ESTIMATES AND ASSUMPTIONS ONLY AS OF THE DATE OF THIS
REPORT, AND WE DO NOT ASSUME ANY OBLIGATION TO UPDATE ANY OF THESE STATEMENTS.





                                       2
<Page>
                         PART I - FINANCIAL INFORMATION

ITEM 1 - FINANCIAL STATEMENTS

                                       USA BROADBAND, INC. AND SUBSIDIARIES
                                            CONSOLIDATED BALANCE SHEETS
                                                      $000's
<Table>
<Caption>
                                                                             DECEMBER 31,    JUNE 30,
                                                                                 2002           2002
                                                                            -------------  ------------
<S>                                                                          <C>             <C>
                                                                              (Unaudited)
                                           ASSETS
CURRENT ASSETS:
    Cash                                                                      $       25     $      88
    Restricted cash                                                                  500           500
    Accounts receivable, net                                                         113           171
    Prepaid expenses and other current assets                                          9            15
                                                                            -------------  ------------
             Total current assets                                                    647           774

PROPERTY AND EQUIPMENT:
    Cable properties                                                               2,952         9,831
    Cable equipment                                                                  775           975
    Leasehold improvements                                                             2             2
    Furniture and equipment                                                           34            34
    Computer software and equipment                                                  113           113
    Vehicles                                                                           7             7
                                                                            -------------  ------------
                                                                                   3,883        10,962
    Less accumulated depreciation                                                   (855)       (1,472)
                                                                            -------------  ------------
             Net property and equipment                                            3,028         9,490
NOTE RECEIVABLE                                                                      914           504
ASSETS HELD FOR SALE, NET                                                          1,041           925
OTHER ASSETS                                                                         191            87
                                                                            -------------  ------------
TOTAL ASSETS                                                                 $     5,822   $    11,780
                                                                            =============  ============
                       LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES:
    Line-of-credit                                                            $      100     $     100
    Current portion of long-term debt and capital lease obligations                5,146         5,096
    Accounts payable                                                               3,705         4,036
    Accrued liabilities                                                              859           735
    Deferred revenues                                                                259            11
                                                                            -------------  ------------
             Total current liabilities                                            10,069         9,978

DEFERRED REVENUES                                                                     24           457
OTHER LIABILITIES                                                                      -            15
COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY (DEFICIT):
    Preferred stock, $.001 par value; 50,000,000 shares authorized
         Series A convertible preferred stock; 7,000,000 shares designated;
            3,873,015 outstanding, liquidation preference of $5,844,000            5,550         5,550
         Series B preferred stock; 2,625,000 shares designated; 2,625,000
            outstanding, liquidation preference of $2,809,000                      2,391         2,391
         Series C preferred stock; 7,875,000 shares designated; 7,875,000
            outstanding, liquidation preference of $7,875,000                      7,875         7,875
    Common stock, $.001 par value; 100,000,000 shares authorized; 6,522,000
     and 6,299,000 outstanding                                                         6             6

    Additional paid in capital                                                     7,281         6,790
    Accumulated deficit                                                          (27,375)      (21,282)
                                                                            -------------  ------------
             Total stockholders' equity (deficit)                                 (4,272)        1,330
                                                                            -------------  ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)                         $     5,821   $    11,780
                                                                            =============  ============
</Table>

                           SEE ACCOMPANYING NOTES TO THESE FINANCIAL STATEMENTS.

                                                   3
<Page>


                                       USA BROADBAND, INC. AND SUBSIDIARIES
                                       CONSOLIDATED STATEMENTS OF OPERATIONS
                                                      $ 000's
<Table>
<Caption>


                                                       Three Months        Three Months         Six Months           Six Months
                                                          Ended               Ended               Ended                 Ended
                                                       December, 31        December 31,         December 31,          December 31,
                                                           2002                2001                2002                  2001
                                                     ------------------  ------------------  ------------------   ---------------
                                                        (Unaudited)         (Unaudited)         (Unaudited)          (Unaudited)

<S>                                                 <C>                  <C>                 <C>                 <C>

REVENUES                                                 $     179        $        499        $        344        $        1,209
COST OF REVENUES                                               141                 245                 230                   706
                                                     --------------  ------------------  ------------------   -------------------
  Gross profit                                                  38                 254                 114                   503

OPERATING EXPENSES:
Selling, general and administrative                          1,182               1,870               2,084                 4,929
Depreciation                                                   272                  69                 365                   253
                                                     --------------  ------------------  ------------------   -------------------
Total operating expenses                                     1,454               1,939               2,449                 6,391
Loss from operations                                        (1,416)             (1,685)             (2,335)               (4,679)
                                                     --------------  ------------------  ------------------   -------------------

OTHER INCOME (EXPENSE):
Interest expense, net                                         (210)               (121)               (353)                 (270)
Other income (expense), net                                     17                   6                  25                    58
                                                    ---------------  ------------------  ------------------   -------------------
Net Loss from Continuing Operations                         (1,609)             (1,800)             (2,663)               (4,891)

Discontinued Operations (Note 5)
     Income (loss) from discontinued operations                439                 142                 554                   253
     Income (loss) from disposal of assets                  (2,505)                (28)             (3,984)               (1,209)
                                                    ---------------  ------------------  ------------------   -------------------
NET LOSS                                                    (3,675)             (1,686)             (6,093)               (5,847)
                                                    ----------------  ------------------  ------------------   -------------------
ACCRUED CUMULATIVE PREFERRED STOCK DIVIDENDS                   116                 198                 232                   366

NET LOSS APPLICABLE TO COMMON SHAREHOLDERS            $     (3,791)      $      (1,884)      $      (6,325)       $       (6,213)
                                                    ================  ==================  ==================   ===================
NET LOSS PER COMMON SHARE                             $       (.58)      $        (.38)      $        (.98)       $        (1.25)
                                                    ================  ==================  ==================   ===================
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING               6,520,000           4,963,000           6,464,000             4,963,000
                                                    ================  ==================  ==================   ===================

</Table>

                           SEE ACCOMPANYING NOTES TO THESE FINANCIAL STATEMENTS.


                                                    4
<Page>
                                       USA BROADBAND, INC. AND SUBSIDIARIES
                                       CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                       $000
<Table>
<Caption>

                                                                            FOR THE SIX MONTHS       FOR THE SIX MONTHS
                                                                            ENDED DECEMBER 31,       ENDED DECEMBER 31,
                                                                                    2002                     2001
                                                                            ------------------------------------------
                                                                               (Unaudited)               (Unaudited)
<S>                                                                         <C>                  <C>
OPERATING ACTIVITIES:
Net Loss                                                                     $         (6,093)            $ (5,847)
Adjustments to reconcile net loss to net cash from operating activities:
   Depreciation                                                                           601                  843
   Loss on disposal of fixed assets                                                     3,984                1,209
   Amortization of deferred financing costs                                                34                  767
   Stock based compensation                                                                                    399
   Allowance for bad debt                                                                                      115
   Stock and warrants issued                                                                                   310
   Interest expense accrual                                                               329
   Gain on sale of assets                                                                                     (124)
   Amortization of note discount                                                                                61
Changes in operating assets and liabilities:
   Accounts receivable                                                                     58                  (46)
   Notes receivable                                                                                           (250)
   Prepaid expenses                                                                         6
   Accounts Payable                                                                        98                  353
   Accrued liabilities                                                                    124                   78
   Deferred revenues                                                                     (185)                 (32)
   Other liabilities                                                                                           (86)
                                                                                                               (39)
                                                                            ---------------------------------------
       Net cash used in operating activities                                           (1,044)              (2,289)
                                                                            ---------------------------------------

INVESTING ACTIVITIES:
   Cash acquired in DDC acquisition                                                                              6
   Advances to DDC prior to acquisition                                                                       (179)
   Purchases of property and equipment                                                                        (644)
   Advances to Las Americas                                                              (240)
   Net proceeds from sale of assets                                                                            291
   Acquisition costs                                                                                          (343)
   Increases in restricted cash                                                                               (500)
   Payment of life insurance premiums                                                                           (3)
                                                                            ---------------------------------------
       Net cash used in investing activities                                             (240)              (1,372)
                                                                            ---------------------------------------

FINANCING ACITIVITES:
   Proceeds from issuance of common stock                                                 306                1,666
   Net borrowing on line of credit                                                                             (55)
   Principal payments on long term debt and capital lease obligations                     (45)                (286)
   Borrowing of notes payable                                                             960                  475
   Proceeds from preferred stock issuances, net of costs                                                       781
                                                                            ---------------------------------------
       Net cash provided by financing activities                                        1,221                2,581
                                                                            ---------------------------------------

NET INCREASE (DECREASE) IN CASH                                                           (63)              (1,080)
                                                                            ---------------------------------------
CASH, at beginning of year                                                                 88                1,280

CASH, at end of period                                                                     25                  200
                                                                            =======================================

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
   Cash paid for interest                                                                  24                  270

NON-CASH TRANSACTIONS:
   Accounts payable converted to Notes Payable                                            600

</Table>
                           SEE ACCOMPANYING NOTES TO THESE FINANCIAL STATEMENTS.

                                                    5
<Page>


                      USA BROADBAND, INC. AND SUBSIDIARIES

                 NOTES TO THE CONCOLIDATED FINANCIAL STATEMENTS
          FOR THE THREE AND SIX MONTHS ENDED DECEMBER 31, 2002 AND 2001


1.      INTERIM FINANCIAL INFORMATION:
        The accompanying interim financial statements are unaudited. However, in
the opinion of management, the interim data includes all adjustments, consisting
of normal recurring adjustments, necessary for a fair presentation of the
results for the interim period. The results of operations for the interim
periods presented are not necessary indicative of those to be expected for the
fiscal year.

        The financial statements included herein have been prepared by the
Company pursuant to the rules and regulations of the Securities and Exchange
Commission. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules and
regulations.

        Management believes the disclosures made are adequate to make the
information not misleading and suggest that these condensed financial statements
be read in conjunction with the financial statements and notes thereto included
in the Company's Form 10KSB for the year ended June 30, 2002.


2.      LIQUIDITY AND BASIS OF PRESENTATION:
        The Company's financial statements have been presented on the going
concern basis, which contemplates the realization of assets and liquidation of
liabilities in the normal course of business. At December 31, 2002, the Company
had a working capital deficit of $9,422,000. The Company's net loss for the
three months ended December 31, 2002 was $3,675,000. At December 31, 2002, the
Company was in default of the terms of its debt and capital lease obligations.

        The Company's ability to continue as a going concern is dependent upon
its ability to raise the capital necessary to successfully implement its
business plan, and ultimately to achieve profitable operations. Management's
plans in this regard are set forth below.

        As a result of the Company's scheduled acquisition by February 28,
2003, of a significant interest in Cable California S.A. de C.V.("Cable"),
the Company's efforts will be concentrated on concession-based cable services
in Baja, Mexico (Note 4).

        The Company has begun a program to divest MDU operation assets outside
of the California market, with the intention of using the proceeds of these
sales to repay debt, with excess proceeds to be invested in the Company's new
business strategy. The Company has entered into letters of intent for the sale
of a portion of the non-strategic assets, and has retained various brokers and
advisors to assist in system sales.


              SEE ACCOMPANYING NOTES TO THESE FINANCIAL STATEMENTS.

                                       6
<Page>


3.      PROPOSED MERGER WITH LAS AMERICAS BROADBAND, INC.:
        The Company has decided not to close its proposed merger with Las
Americas Broadband, Inc. ("LABN"), and instead has negotiated a transaction,
which gives it control of Cable (Note 4). Neither the Company nor LABN were able
to complete the conditions precedent to the merger.


4.      ACQUISITION OF CABLE CALIFORNIA S.A. DE C.V.
        On January 10, 2003, the Company entered into an asset purchase
agreement with Dick Clark International Cable Ventures, Ltd. ("dcicv"), Cable
California SA de CV, a Mexican Corporation, Las Americas Broadband, Inc.
("LABN") and Carlos Bustamante, Sr.

        Cable is in the business of developing and marketing cable television
services in the Northern Baja California region of Mexico. Cable is managed by
LABN and has a 30-year advanced telecommunications broadband concession from the
Mexican government to construct and operate a 750-MHz fiber-optic network
providing high-speed Internet, telephone, data and multi-channel cable
television to residents and businesses. Cable is constructing a 1,300-mile
broadband network and has completed the first phase of this cable build,
including its head-end, central operations center, and over 100 miles of cable
plant now serving 2,000 customers.

        dcicv owns one hundred percent (100%) of the Class B stock of Cable,
which represents forty-nine percent (49%) of the voting stock of Cable and one
hundred percent (100%) of Class N stock of Cable, which represents ninety
percent (90%) of the economic interest in Cable.

        Under the terms of the agreement, the Company will issue 2,500,000 (two
million five hundred thousand) shares of it's common stock to dcicv in exchange
for the shares held by dcicv in Cable. Of these shares, 125,000 shares will be
held in escrow for 12 months after closing.

        In addition, LABN will transfer to the Company or a subsidiary, the
inventory, property, intellectual property, customer lists, receivables,
payables, trademarks, contracts, leases, equipment, and other tangible and
intangible assets used in the operations and normal course of business of Cable.
LABN will also assign to the Company a certain note payable by Cable in favor of
LABN, in the amount of $7,000,000 (seven million) and the rights to all future
payments owed to it under the note.

        As consideration, the Company will issue 2,250,000 (two million two
hundred fifty thousand) shares of it's common stock to LABN. Of these shares,
125,000 shares will be held in escrow for 12 months after closing. The Company
will also assume $1,250,000 (one million two hundred fifty thousand dollars) in
debt, liabilities, and other financial obligations of Cable and of LABN,
specifically related to operations in Mexico as agreed to by the parties.

        The Company will assume LABN's obligations, and receive an assignment of
its rights under a certain agreement dated as of September 26, 2002, among LABN,
Cable, Carlos Bustamante, Sr. and LABN Mexico, S.A. de C.V.. The Company will
also forgive $390,276 (three hundred ninety thousand two hundred seventy six
dollars) in debt owed by LABN to the Company under a previous note agreement. A
revised balance under the note agreement will be $500,000 (five hundred thousand
dollars) and will be extended until June 30, 2003. The revised and amended note
shall remain as presently collateralized by assets of LABN, including its cable
television system in Tehachapi, California.


              SEE ACCOMPANYING NOTES TO THESE FINANCIAL STATEMENTS.


                                       7
<Page>


        Within 5 business days of signing the Company will pay to LABN the sum
of $250,000 (two hundred fifty thousand dollars) to be used by LABN to pay
certain obligations and liabilities specifically related to Cable.

        The Company will issue 250,000 (two hundred fifty thousand shares) of
the Company common stock in the name of Carlos Bustamante, Sr.

Closing of the transaction is scheduled to occur by February 28, 2003.

5.      NOTES PAYABLE:
        In July 2002, a shareholder of the Company advanced $170,000 to the
Company under a proposed note arrangement the terms of which are still being
negotiated.

        On July 18, 2002, the Company entered into an unsecured note payable to
stockholders in the aggregate amount of $100,000.

        On August 21, 2002, the Company entered into an unsecured note payable
to a shareholder in the amount of $150,000.

        On October 30, 2002 The Company obtained a bridge loan from a
shareholder in the amount of $500,000. The note bears interest at 18% and is due
June 30, 2003 or at such earlier date pending consummation of permanent
financing in the amount of $3,000,000. In addition, the Company issued the
shareholder a warrant to purchase 250,000 shares of the Company's common stock
at an exercise price of $1.00 per share expiring in 2007.

        On November 4, 2002 The Company obtained a bridge loan from a
shareholder in the amount of $25,000. The note bears interest at 18% and is due
June 30, 2003 or at such earlier date pending consummation of permanent
financing in the amount of $3,000,000. In addition, the Company issued the
shareholder a warrant to purchase 12,500 shares of the Company's common stock at
an exercise price of $1.00 per share expiring in 2007.

        On November 5, 2002 The Company obtained a bridge loan from a firm in
the amount of $15,254. The note bears interest at 18% and is due June 30, 2003
or at such earlier date pending consummation of permanent financing in the
amount of $3,000,000. In addition, the Company issued the firm a warrant to
purchase 7,627 shares of the Company's common stock at an exercise price of
$1.00 per share expiring in 2007.

        As of December 31, 2002, the Company had two unsecured notes payable
outstanding in the amount of $150,000 each. The holders of these notes, Theodore
Swindells and Paul Moore, each beneficially own over 5% of the Company's common
stock. The notes were issued on March 4, 2002, bear interest at the rate of 10%
per year and have a due date of October 31, 2002. On October 18, 2002, the
Company entered into a new loan agreement with Mr. Swindells, which extended the
due date of the note payable to Mr. Swindells under the same terms and
conditions as the previous note. The Company is currently in default under the
note with Mr. Moore.

6.      STOCKHOLDERS' EQUITY:
        In July 2002, the Company commenced an offering of up to $10,000,000 of
common stock. To date they have raised $229,353 in the offering through the sale
of 114,676 shares at a price of $2.00 per share. The price per share of the
shares sold in the offering, was intended to be at a discount to the market
value of the Company's common stock, and may be reduced below $2.00. If the
price is reduced, the Company will increase the number of shares to be issued to
investors who have already made purchases in the offering.


              SEE ACCOMPANYING NOTES TO THESE FINANCIAL STATEMENTS.

                                       8

<Page>

        In July 2002, the Company issued a total of 23,161 shares of common
stock to RateXchange Corporation, the parent company of RTX Securities who acted
as the placement agent in a prior offering. Of the shares issued, 9,200 shares
were issued as compensation for the services of RTX Securities, and the
remaining 13,961 shares were issued in lieu of an $18,000 commission, which the
Company had agreed to pay RTX Securities in connection with the offering.

        In addition, on September 15, 2002, the Company issued a warrant to RTX
for 100,000 common shares for financial advisory services for the next year. The
exercise price is $1.50 per share.

        In September 2002, the Company agreed to issue 30,000 common shares to
The Research Works as consideration for research services. In addition, in
September 2002 we issued to Corporate Capital Management warrants to purchase
300,000 shares of our common stock in consideration for financial advisory
services.

        In October 2002, the company issued a total of 21,843 share of it's
common stock to three individuals. The shares were sold at a price of $1.60 per
share and the Company raised a total of $39,950 from the transactions.

7.      ASSETS HELD FOR SALE AND DISCONTINUED OPERATIONS:
        During the six months ended December 31, 2002 the Company decided to
change its business strategy to focus on providing video, data and internet
service in the state of California and in the Northern Baja region of Mexico.
As a result of this change in strategy, the Company plans to sell its assets
in regions outside of California and the Northern Baja region of Mexico.

        The related assets to be sold have been reclassified as Assets Held for
Sale as of December 31, 2002 at the lower of carrying amount or net realizable
value, and the results of operations for the three & six months ended December
31, 2002 have been presented as discontinued operations. Revenues from
discontinued operations for the three and six months ended December 31, 2002
were $602,000 and $ 1,106,000 respectively.

8.      SALE OF ASSETS:
        On December 23, 2002 USA Broadband, Inc. (USAB) through a wholly owned
subsidiary Cable Concepts, Inc. (CCI) entered into a contract for the sale of
certain Rights of Entry Agreements (ROE's) to Digital Service, Inc. (DSI). The
transaction was effective as of December 1, 2002, and covered 55 cable
properties in several states with approximately 1,900 subscribers.

        The aggregate purchase price is $1,685,268, which is comprised primarily
of debt assumption by DSI. DSI assumed the USAB note payable to Pacifica Bank in
the amount of $1,592,378 and assumed a credit card debt in the amount of
$14,471. Other debt assumed included accounts payable in the amount of $78,419.

        In addition, CCI transferred a property in Washington to DSI in exchange
for the assumption of a debt owed by CCI to a third party in the amount of
$120,732.

9.      SUBSEQUENT EVENTS:
        On January 3, 2002 The Company obtained a bridge loan from a firm in the
amount of $200,000. The note bears interest at 18% and is due June 30, 2003 or
at such earlier date pending consummation of permanent financing in the amount
of $3,000,000. In addition, the Company issued the firm a warrant to purchase
100,000 shares of the Company's common stock at an exercise price of $1.00 per
share expiring in 2007.

              SEE ACCOMPANYING NOTES TO THESE FINANCIAL STATEMENTS.

                                       9
<Page>

        On February 3, 2002 The Company obtained a bridge loan from a firm in
the amount of $50,000. The note bears interest at 18% and is due June 30, 2003
or at such earlier date pending consummation of permanent financing in the
amount of $3,000,000. In addition, the Company issued the firm a warrant to
purchase 25,000 shares of the Company's common stock at an exercise price of
$1.00 per share expiring in 2007.

        On February 3, 2002 The Company obtained a bridge loan from a firm in
the amount of $12,500. The note bears interest at 18% and is due June 30, 2003
or at such earlier date pending consummation of permanent financing in the
amount of $3,000,000. In addition, the Company issued the firm a warrant to
purchase 6,250 shares of the Company's common stock at an exercise price of
$1.00 per share expiring in 2007.

        In January, 2003, the Company advanced $250,000 to LABN as part of the
acquisition of Cable (Note 4).

        The Company has a bank line of credit in the amount of $100,000, which
expires in January 2003. This line of credit bears interest at the prime rate,
which as of December 31, 2002 was 4.25%. The line was extended to March 31, 2003
and a principal payment in the amount of $10,000 was made on February 21, 2003.

        In January 2003, the Company closed its previously disclosed sale of
several cable properties in North Dakota, which had a total of 129 basic
subscribers. The sale was for a total of $128,912 and the net proceeds were used
to pay down bank debt. In addition, the Company sold a small bulk property
located in Memphis for $33,000 and the proceeds went towards working capital.



              SEE ACCOMPANYING NOTES TO THESE FINANCIAL STATEMENTS.

                                       10




<Page>

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

GENERAL

         We are seeking to position ourselves as an industry leader in providing
digital television, entertainment, data, Internet and broadband services. Our
current operations consist of providing video service to multiple dwelling
units, or "MDU," subscribers through Cable Concepts, Inc. which we acquired in
July 2001. We receive revenues from subscriber fees and revenue-sharing payments
from DirectTV.

ACQUISITION OF ASSETS OF CABLE CALIFORNIA S.A. DE C.V.

         On April 23, 2002, we entered into a definitive merger agreement with
Las Americas Broadband, Inc. under which Las Americas would merge with and into
us, with Las Americas' shareholders receiving approximately .125 shares of our
common stock for each share of Las Americas' common stock. Las Americas develops
and operates cable television systems and broadband networks for video, data,
and Internet.

         We have decided not to close our proposed merger with Las Americas
Broadband, Inc. and instead have negotiated a transaction, which gives us an
interest in Cable California S.A. de C.V. ("Cable California"). Neither we
nor Las Americas were able to complete the conditions precedent to the merger.

         On January 10, 2003, we entered into an asset purchase agreement with
Dick Clark International Cable Ventures, Ltd. ("DCICV"), Cable California SA de
CV, a Mexican Corporation, Las Americas Broadband, Inc. ("LABN") and Carlos
Bustamante, Sr.

                                      11
<Page>

         Cable California is in the business of developing and marketing cable
television services in the Northern Baja California region of Mexico. Cable
California is managed by LABN and has a 30-year advanced telecommunications
broadband concession from the Mexican government to construct and operate a
750-MHz fiber-optic network providing high-speed Internet, telephone, data and
multi-channel cable television to residents and businesses. Cable California is
constructing a 1,300-mile broadband network and has completed the first phase of
this cable build, including its head-end, central operations center, and over
100 miles of cable plant now serving 2,000 customers.

         DCICV owns one hundred percent (100%) of the Class B stock of Cable
California, which represents forty-nine percent (49%) of the voting stock of
Cable California and one hundred percent (100%) of Class N stock of Cable
California, which represents 90% of the economic interest in Cable California.

         Under the terms of the asset purchase agreement, we will issue
2,500,000 shares of its common stock to DCICV in exchange for the shares held by
DCICV in Cable California. Of these shares, 125,000 shares will be held in
escrow for 12 months after closing.

         The asset purchase agreement also provides that LABN will transfer to
us, or a subsidiary, the inventory, property, intellectual property, customer
lists, receivables, payables, trademarks, contracts, leases, equipment, and
other tangible and intangible assets used in the operations and normal course of
business of Cable California. LABN will also assign to us a note payable by
Cable California in favor of LABN, in the amount of $7,000,000 and the rights to
all future payments owed to it under the note.

         As consideration for the asset purchase, we will issue 2,250,000 shares
of our common stock to LABN. Of these shares, 125,000 shares will be held in
escrow for 12 months after closing. We will also assume $1,250,000 in debt,
liabilities, and other financial obligations of Cable California and of LABN,
specifically related to operations in Mexico, as agreed to by the parties.

         Under the Asset purchase agreement, we will assume LABN's obligations,
and receive an assignment of its rights under an agreement dated as of September
26, 2002, among LABN, Cable California, Carlos Bustamante, Sr. and LABN Mexico,
S.A. de C.V. We will also forgive $390,276 in debt owed by LABN to us under a
previous note agreement. A revised balance under the note agreement will be
$500,000, and the note and will be extended until June 30, 2003. The revised and
amended note will remain as presently collateralized by assets of LABN,
including its cable television system in Tehachapi, California.

         We agreed that within five business days of signing the asset purchase
agreement we would pay LABN the sum of $250,000, to be used by LABN to pay
certain obligations and liabilities specifically related to Cable California. We
paid this amount in January 2003. We will issue 250,000 of our common stock in
the name of Carlos Bustamante, Sr. Closing of the transaction is expected to
occur before February 28, 2003.

         After the asset purchase of Cable California, we will continue to
manage the approximately 3,600 MDU subscribers we presently serve in California.
Las Americas founder Richard G. Lubic, a thirty-year cable veteran, will serve
as our Chairman. We also are moving our headquarters to Coronado, California.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

         Our condensed financial statements have been prepared in accordance
with accounting principles generally accepted in the United States, which
require us to make estimates and judgments that affect the reported amounts of
assets, liabilities, revenues and expenses, and related disclosures. A summary
of those significant accounting policies can be found in our Notes to the
Consolidated Financial Statements included in our Report on Form 10-KSB for the
transition period ended June 30, 2002. The estimates we

                                     12

<Page>

use are based upon our historical experiences combined with management's
understanding of current facts and circumstances. Some of our accounting
policies are considered critical because they are important to the portrayal
of our financial condition and the results of our operations and because they
require significant or complex judgments on the part of management. We
believe that the following represent our critical accounting policies as
described in Financial Reporting Release No. 60, "Cautionary Advice Regarding
Disclosure About Critical Accounting Policies," which was issued by the
Securities and Exchange Commission: deferred income taxes; allowance for
doubtful accounts; and recoverability of long-lived assets.

         Deferred income taxes are recognized for the expected tax consequences
in future years stemming from differences between the tax bases of assets and
liabilities and their financial reporting amounts, based upon enacted tax laws
and statutory tax rates applicable to the periods in which the differences are
expected to affect taxable income. Our significant deferred tax assets are
related to net operating loss carryforwards, allowance for bad debts and
deferred revenue. We have established a valuation allowance to reduce deferred
tax assets to the net amount expected to be recovered in future periods. The
estimates for deferred tax assets and the corresponding valuation allowance
require management to exercise complex judgments. We periodically review and
adjust those estimates based upon the most current information available.
However, because the recoverability of deferred tax assets is directly dependent
upon our future operating results, actual recoverability of deferred tax assets
may differ materially from our estimates.

         Our allowance for doubtful accounts reflects a reserve that reduces
customer accounts receivable to the net amount estimated to be collectible.
Estimating the credit worthiness of customers and the recoverability of customer
accounts requires us to exercise considerable judgment. In estimating
uncollectible amounts, we consider factors such as general economic and
industry-specific conditions, historical customer performance and anticipated
customer performance. While we consider our processes to be adequate to
effectively quantify our exposure to doubtful accounts, changes in economic,
industry or specific customer conditions may require us to adjust our allowance
for doubtful accounts.

         Our long-lived assets will from time to time be analyzed for impairment
as events and conditions indicate that an analysis be performed. Factors that we
consider in performing an impairment analysis are current and historical
agreements to sell comparable assets, our current business strategy and our
expectations of future cash flows for the asset or asset group being analyzed.
Future changes in the economic conditions, the regulatory environment and our
strategies may materially affect our estimate of the recoverability of fixed
assets.

RESULTS OF OPERATIONS

         The following table sets forth our selected operations data for the
six-month periods ended December 31, 2002 and December 31, 2001. This data
should be read in conjunction with our financial statements in Item 1 of this
Form 10-QSB.


                                     13
<Page>

SELECTED FINANCIAL DATA FOR USA BROADBAND, INC.

<Table>
<Caption>
                                                                                                         % Change from
                                                                                                          December 31,
                                    Six Months Ended                    Six Months Ended                     2001 to
                                      December 31,          % of          December 31,         % of       December 31,
                                         2002             Revenues            2001           Revenues         2002
                                    ----------------      --------      ----------------     --------     ------------
<S>                                <C>                   <C>           <C>                  <C>          <C>
Revenues                                 $   344             100%            $ 1,209            100%          -71.5%

Cost of Revenues                             230            66.9%                706           58.4%          -67.4%

Gross Profit                                 114            33.1%                503           41.6%          -77.3%

Selling, General &                         2,804           815.1%              4,929          407.7%          -43.1%
    Administrative Expenses

Depreciation                                 365           106.1%                253           20.9%           44.3%

Total Operating Expenses                   2,449           711.9%              5,182          428.6%          -52.7%

Loss from Continuing Operations          $(2,663)         (774.1)%           $(4,891)        (404.6)%         -45.6%
</Table>

COMPARISON OF SIX-MONTH PERIOD ENDED DECEMBER 31, 2002 TO THE SIX-MONTH PERIOD
ENDED DECEMBER 31, 2001

         The decline in our revenue for the six months ended December 31, 2002
from the six months ended December 31, 2001 is the result of several factors.
First, in the past year we have sold ROE agreements governing many of our
properties and had some of our lease contracts terminated. We also changed our
business strategy to focus on providing video, data and internet service in the
State of California and in the Northern Baja region of Mexico. As a result of
this change in strategy all of our revenue derived from assets outside of
California or the Baja region of Mexico has been presented as discontinued
operations and not as revenue. Our cost of revenues also declined as the result
of the reduction in the number of subscribers served.

         Our selling, general and administrative expenses were lower for the
six months ended December 31, 2002 than for the comparable period in 2001
because we reduced personnel and staff as a result of the change in our
business focus. We also closed one of our office facilities in the State of
Washington.

         On November 29, 2002, we entered into an agreement in principle with
Direct Services Inc. ("DSI"), a Washington corporation, to exchange debt for
subscribers. This agreement was subsequently modified on December 19, 2002 to
reflect a reduction in number of subscribers. Under the modified agreement, we
exchanged the right to serve approximately 1,800 subscribers located in Texas,
Arizona, Louisiana, and a small number of subscribers in Sacramento, California,
in exchange for an assumption of $1,685,000 in our debt, including the note
payable with a principal balance of $1,543,000. In addition to eliminating
$1,685,000 in liabilities from our balance sheet, we believe that this
transaction will reduce operating deficits at our operating subsidiary, Cable
Concepts, Inc., and allow us to focus on California operations.

                                     14
<Page>

<Table>
<Caption>
                                                                                                            % Change from
                                      Three Months                                                          December 31,
                                          Ended                        Three Months Ended                      2001 to
                                      December 31,        % of             December 31,        % of         December 31,
                                          2002          Revenues              2001           Revenues           2002
                                     --------------     --------       ------------------    --------       ------------
<S>                                 <C>                <C>            <C>                   <C>            <C>
Revenues                                  $  179            100%              $ 499            100%           -64.1%

Cost of Revenues                             141           78.8%                245           49.1%           -42.5%

Gross Profit                                  38           21.2%                254           50.9%           -85.0%

Selling, General &                         1,182          660.3%              1,870          374.8%           -36.8%
    Administrative Expenses

Depreciation                                 272          152.0%                 69           13.8%           294.2%

Total Operating Expenses                   1,454          812.3%              1,939          388.6%           -25.0%

Loss from Continuing Operations          $(1,609)        (898.9)%           $(1,800)        (360.7)%          -10.6%
</Table>

COMPARISON OF THREE-MONTH PERIOD ENDED DECEMBER 31, 2002 TO THE THREE-MONTH
PERIOD ENDED DECEMBER 31, 2001

         The decline in our revenue for the three months ended December 31, 2002
from the three months ended December 31, 2001 is the result of several factors.
First, in the past year we have sold ROE agreements governing many of our
properties and had some of our lease contracts terminated. We also changed our
business strategy to focus on providing video, data and internet service in the
State of California and in the Northern Baja region of Mexico. As a result of
this change in strategy all of our revenue derived from assets outside of
California or the Baja region of Mexico has been presented as discontinued
operations and not as revenue. Our cost of revenues also declined as the result
of the reduction in the number of subscribers served.

         Our selling, general and administrative expenses were lower for the
three months ended December 31, 2002 than for the comparable period in 2001
because we reduced personnel and staff as a result of the change in our business
focus. We also closed one of our office facilities in the State of Washington.

         During the three months ending December 31, 2002 we received notices of
default from a number of property owners due to non-payment of franchise fees.
Due to our continuing severe liquidity problem, a total of 15 properties were
lost when the property owners switched to new providers. As a result the we had
to write off approximately $1,400,000 of net asset value related to these
properties. To date for the six months ending December 31, 2002, we have lost a
total of 28 properties, resulting in asset write-offs exceeding $2,900,000.

LIQUIDITY AND CAPITAL RESOURCES

         Our financial statements are presented on a going-concern basis. This
contemplates the realization of assets and liquidation of liabilities in the
normal course of business. At December 31, 2002, we had a working capital
deficit of approximately $9,163,000. Our ability to continue as a going concern
depends on our ability to raise the capital necessary to successfully implement
our business plan and ultimately achieve profitable operations. During the
three-month period ended December 31, 2002, we continued to implement
cost-cutting measures designed to increase operational efficiency, focus the
geographic concentration of our operations and dispose of assets that are not
consistent with our plan, either from a geographic or operational perspective.
We intend to use the proceeds of asset sales to repay debt and other
obligations, and to reinvest the remaining net proceeds, if any, in existing or
new assets.

         During the three-month period ended December 31, 2002, we sold
contracts under which we received a fee from property owners to provide video
services using equipment owned by the property owner. Under the terms of the
sale the purchaser assumed various debt of ours in the amount of $1,685,000.

         In recent periods, we have had limited access to investment capital to
support working capital deficits or to expand existing operations. Consequently,
the financial conditions of our operating subsidiaries deteriorated in the three
months ended December 31, 2002 and have continued to deteriorate since then. We
have been focused on negotiations with prospective lenders and investors as we
seek to refinance all outstanding loans and liabilities in order to provide
working capital. These negotiations are continuing. We require working capital
for existing operations pending their sale or disposition and in connection with
the purchase of assets of Cable California.

         We also have a bank line of credit in the amount of $100,000, which
originally expired in January 2003. This line of credit bears interest at the
prime rate, which as of December 31, 2002 was 4.25%. The line was extended to
March 31, 2003 and a principal payment in the amount of $10,000 was made on
February 21, 2003.

         We have previously announced our focus on developing a cable television
system in Northern Baja, California, and to divest ourselves of some of our
operating assets in the United States in order to enhance our balance sheet and
reduce debt associated with the acquisition of our MDU assets in July, 2001. In
addition, we are in continued discussions with certain creditors, including key
advisors and consultants, for the conversion of liabilities owed to them into
our common stock in exchange for negotiated cash settlements. In total, we are
seeking to eliminate or convert approximately $1.5 to 2.0 million of our
obligations, however, there is no guarantee that these discussions will lead to
a reduction in our liabilities.

         As of December 31, 2002, we had two unsecured notes payable outstanding
in the amount of $150,000 each. In addition we owed approximately $25,000 in
accrued interest on these notes at December 31, 2002. The holders of these
notes, Theodore Swindells and Paul Moore, each beneficially own over 5% of our
common stock. The notes were issued on March 4, 2002, bear interest at the rate
of 10% per year and have a due date of October 31, 2002. On October 18, 2002, we
entered into a new loan agreement with Mr. Swindells, which extended the due
date of his note payable under the same terms and

                                     15
<Page>

conditions as the previous note. In consideration of the note extension we
assigned service and access agreements to certain properties as a security
interest.

         As of December 31, 2002, we had a note payable to a bank in the amount
of approximately $1,477,000 which matures in April 2004 and which bears interest
at a annual rate equal to prime plus two hundred basis points, or 6.25% as of
December 31, 2002. This debt is secured by all of our assets and, in addition, a
$500,000 certificate of deposit. We are in default under the loan agreement
relating to the note payable and are seeking a waiver of some of the agreements'
covenants from the bank.

         As of December 31, 2002, we had a note payable to a vendor in the
amount of approximately $225,000. Principal and interest, at 18%, on this note
are due in monthly installments with the final payment due March 2003. The
payments due under the note are past due and we are currently in default under
the note agreement.

         As of December 31, 2002, we owed a total of approximately $1,213,000 to
Geneva Associates Merchant Banking Partners, an entity in which Russell Myers,
one of our directors, has an interest. Of this $1,213,000, $832,000 is due under
a promissory note held by Geneva Associates Merchant Banking Partners,
consisting of the $750,000 principal value of the note and $109,000 in accrued
interest. This note was due in October 2002 and bears interest at the rate of
14%. We are currently in default under this note. The remaining $354,000 owed to
Geneva Associates Merchant Banking Partners is due under a reimbursement
agreement under which Geneva Associates Merchant Banking Partners, through a
financial institution, issued a letter of credit to a bank to be used as
security for a line of credit we have with the bank. Of this $354,000, $300,000
represents the principal owed under the agreement, $24,000 represents accrued
and unpaid interest, and $30,000 represents an unpaid 10% fee in connection with
the issuance of the letter of credit. The outstanding balance under the
reimbursement agreement bears interest at a rate of 16% per year. We are
currently in default under the reimbursement agreement.

         The following table sets forth information regarding our contractual
obligations as of December 31, 2002 and the periods in which payments are due.

<Table>
<Caption>
Contractual Obligations                                              Payments Due By Period
-----------------------                                              ----------------------
                                              Less than                                    After 5
                                              One Year       1-3 Years      4-5 Years       Years         Total
                                              --------       ---------      ---------       -----         -----
<S>                                         <C>             <C>            <C>            <C>         <C>
Lines of Credit and Notes Payable            $4,807,622          0              0             0        $4,807,622

Capital Lease Obligations                       437,986          0              0             0           437,986

Operating Lease Obligations                           _          _              _             _                 _

Total Contractual Cash Obligations           $5,245,608                                                $5,245,608
                                             ==========                                                ==========
</Table>

         In addition to the above obligations, we may have an obligation
under an asset purchase agreement with Verizon Media Ventures, Inc. and GTE
Southwest Incorporated. Before the quarter ended December 31, 2002, we
decided not to complete the purchase of the rights for some of the
properties, located in Texas, included in this asset purchase agreement. We
believe that Verizon Media Ventures and GTE Southwest are attempting to sell
the properties in question to third parties, and that these entities may seek
to collect from us any difference between the price we agreed to pay and the
prices received in connection with these sales to third parties. We have also
signed a performance

                                     16
<Page>

guarantee in the amount of $250,000 with regard to the asset purchase agreement.
This guarantee is in the form of a deposit note bearing an interest rate of 19%
which will become payable if we fail to perform under the agreement. Verizon
Media Ventures and GTE Southwest may seek to hold us liable for the amount of
the performance guarantee. Neither entity has made any claim against us as a
result of our decision not to purchase the rights for the properties in
question.

         In September, 2002, we issued a promissory note for $600,000 to our
outside counsel in connection with unpaid legal fees. This promissory note is
secured by all of the assets of USAB Video Corp. II, Inc., one of our
subsidiaries.

         Between October 30, 2002 and November 5, 2002, we issued three bridge
notes in the total amount of $540,254 to two of our shareholders and a firm. The
holder of the $500,000 bridge note is Theodore Swindells, who beneficially owns
over 5% of our common stock. In connection with the bridge loans evidenced by
these notes, we issued to the investors warrants to purchase a total of 270,127
shares of our common stock at an exercise price of $1.00 per share. Each of the
bridge notes bears interest at 18% and is due on June 30, 2003, or on the date
we receive permanent financing in the amount of at least $3,000,000, if earlier.
If we obtain permanent financing, each note holder has the right to convert all,
but not part, of the principal amount and accrued interest on their note into
shares of our common stock or preferred stock in connection with the permanent
financing at a discount of 10% to the offering price. Additionally, for every
month that any principal payment is overdue, each note holder will receive
10,000 warrants per $100,000 in principal under the note, or pro-rata portion
thereof, with a strike price of the lower of $1.00 or the average bid price for
our common stock for the 20 trading days preceding issuance of warrants.

         Effective December 1, 2002, we entered into a six-month consulting
agreement with Edward Mooney, a director and our former interim CEO, under which
Mr. Mooney has agreed to provide general corporate advisory and development
services. We will pay Mr. Mooney $3,000 per month plus reimbursement for
expenses. As of the date of this filing, we owe Mr. Mooney approximately
$225,000 in unpaid expenses, contractual bonuses and salary.

CASH FLOWS FROM OPERATING ACTIVITIES

         Our operations utilized net cash of approximately $1,044,000 for the
six-month period ended December 31, 2002. The use of cash was related primarily
to funding the net losses from our operations, reduced by adjustments for
non-cash expenses such as depreciation and loss on disposal of fixed assets and
an increase in accounts payable and accrued liabilities.

CASH FLOWS FROM INVESTING ACTIVITIES

         During the six-month period ended December 31, 2002, investing
activities resulted in a reduction of cash of approximately $240,000. This
was a result of advances to Las Americas in connection with our proposed
merger. An affiliate advanced an additional $170,000 to Las Americas on our
behalf. This amount is included in accounts payable. We have decided not to
proceed with this merger, and instead have entered into an asset purchase
agreement with a related entity. See the information under the caption
"Acquisition of Assets of Cable California S.A. de C.V."

CASH FLOWS FROM FINANCING ACTIVITIES

         During the six-month period ended December 31, 2002, financing
activities generated approximately $1,221,000. This resulted primarily from
proceeds from the sale of stock and from long-term borrowings, offset by
reductions in principal payments on long-term debt and capital lease
obligations.

                                     17
<Page>

SUBSEQUENT EVENTS

         Between January 3, 2003 and February 3, 2003, we issued three bridge
notes in the total amount of $262,500 to a shareholder and two individuals. The
holder of a $12,500 bridge note is Paul Moore, who beneficially owns over 5% of
our common stock. In connection with the bridge loans evidenced by these notes,
we issued to the investors warrants to purchase a total of 131,250 shares of our
common stock at an exercise price of $1.00 per share. Each of the bridge notes
bears interest at 18% and is due on June 30, 2003, or on the date we receive
permanent financing in the amount of at least $3,000,000, if earlier. If we
obtain permanent financing, each note holder has the right to convert all, but
not part, of the principal amount and accrued interest on his note into shares
of our common stock or preferred stock in connection with the permanent
financing at a discount of 10% to the offering price. Additionally, for every
month that any principal payment is overdue, each note holder will receive
10,000 warrants per $100,000 in principal under the note, or pro-rata portion
thereof, with a strike price of the lower of $1.00 or the average bid price for
our common stock for the 20 trading days preceding issuance of warrants.

         On January 10, 2003, we entered into an asset purchase agreement with
Dick Clark International Cable Ventures, Ltd., Cable California SA de CV, a
Mexican Corporation, Las Americas Broadband, Inc. and Carlos Bustamante, Sr. See
the information under the caption "Acquisition of Assets of Cable California
S.A. de C.V."

         We have a bank line of credit in the amount of $100,000, which expired
in January 2003. This line of credit bears interest at the prime rate, which as
of December 31, 2002 was 4.75%. The line was extended to March 31, 2003 and a
principal payment in the amount of $10,000 was made on February 21, 2003.

         In January 2003, we closed our previously-disclosed sale of several
cable properties in North Dakota, which had a total of 129 basic subscribers.
The sale was for a total of $128,912 and a portion of the proceeds were used to
pay down bank debt. Also in January 2003, we sold a small bulk property located
in Memphis for $33,000 and used the proceeds for working capital.

         The agreement relating to our acquisition of Cable Concepts on July 16,
2001, called for a potential downward adjustment to the purchase price based on
the amount of Cable Concepts' accounts payable and other obligations as of the
effective date. Accordingly, some of the shares we issued in consideration for
the merger were placed in escrow, and were not to be released unless it was
determined that a downward adjustment was not appropriate.

         We conducted an analysis of the liabilities of Cable Concepts as of
July 16, 2001, which indicated that a downward adjustment is appropriate, and
that a portion of the shares of our common stock in escrow should revert back to
us rather than being released to the former shareholders of Cable Concepts. Our
review indicates that a total of 940,393 shares of our common stock and 206,571
shares of our Series C Preferred Stock should revert back to us.

         In October 2002, a draft of our finding was sent to one of the
representatives of the former owners of Cable Concepts. In February 2003, the
final draft of our findings, completed on January 27th, was sent to all three
representatives of the former owners of Cable Concepts, notifying them of our
findings, and instructions were issued to the escrow agent to withhold
distribution of these shares pending a resolution of the issue.

IMPACT OF RECENTLY ISSUED ACCOUNTING PRINCIPLES

         In July 2002, the FASB issued Statement of Financial Accounting
Standards No. 146, Accounting for Costs Associated with Exit or Disposal
Activities ("SFAS 146"). SFAS 146 requires a company to recognize costs
associated with exit or disposal activities when they are incurred rather than
when the company makes a commitment to an exit or disposal plan. Examples of
costs covered by SFAS 146 include lease termination costs and certain employee
severance costs that are associated with a restructuring, discontinued
operation, plant closing, or other exit or disposal activity. SFAS 146 is to be
applied prospectively to exit or disposal activities initiated after December
31, 2002. We do not expect the adoption of SFAS 146 to have a material effect on
our financial position or results of operations.

         In August 2002, the FASB issued Statements of Financial Accounting
Standards No. 147, "Acquisitions of Certain Financial Institutions" (SFAS 147).
SFAS 147 requires financial institutions to follow the guidance in SFAS 141 and
SFAS 142 for business combinations and goodwill and intangible assets, as
opposed to the previously applied accounting literature. This statement also
amends SFAS 144 to include in its scope long-term customer relationship
intangible assets of financial institutions. The provisions of SFAS 147 do not
apply to us.

         In December 2002, the FASB issued Statements of Financial Accounting
Standards No.148, "Accounting for Stock-Based compensation - Transition and
Disclosure - an amendment of FASB Statement 123" (SFAS 123). For entities that
change their accounting for stock-based compensation from the intrinsic method
to the fair value method under SFAS 123, the fair value method is to be applied
prospectively to those awards granted after the beginning of the period of
adoption. This is known as the

                                     18
<Page>

"prospective method." The amendment permits two additional transition methods
for adoption of the fair value method. In addition to the prospective method,
the entity can choose to either (i) restate all periods presented
("retroactive restatement method") or (ii) recognize compensation cost from
the beginning of the fiscal year of adoption as if the fair value method had
been used to account for awards ("modified prospective method"). For fiscal
years beginning December 15, 2003, the prospective method will no longer be
allowed. We currently account for our stock-based compensation using the
intrinsic value method as proscribed by Accounting Principles Board Opinion
No. 25, "Accounting for Stock Issued to Employees" and plans on continuing
using this method to account for stock options. Therefore, we do not intend
to adopt the transition requirements as specified in SFAS 148.

                      FACTORS AFFECTING FUTURE PERFORMANCE

THE MARKET FOR OUR COMMON STOCK IS LIMITED AND PRICE CHANGES MAY BE VOLATILE.

         The shares of our common stock are not traded on an exchange or through
the Nasdaq National Market or the Nasdaq SmallCap Market. Instead, our shares
are traded over-the-counter and the market for these shares is not as developed
as it would be if our shares were listed on an exchange or included in the
Nasdaq National or SmallCap markets.

         The market price of our common stock is expected to be volatile for the
foreseeable future. Factors such as quarterly fluctuations in results of
operations, the announcement of new contracts or changes in either earnings
estimates or investment recommendations by stock market analysts, among others,
may cause the market price of our common stock to fluctuate, perhaps
substantially. In addition, in recent years the stock market in general, and the
shares of companies in the technology sector in particular, have experienced
extreme price fluctuations, which may continue for the foreseeable future. These
broad market and industry fluctuations may adversely affect the market price of
our common stock. Further, a share of our common stock currently falls within
the SEC's definition of a "penny stock." The SEC has special disclosure
requirements, which broker-dealers must follow for most transactions in penny
stocks. In addition, many broker-dealers will not deal in penny stocks. These
factors may further limit the market for our common stock.

OUR CREDIT ARRANGEMENTS LIMIT OUR ABILITY TO PAY DIVIDENDS

         We do not anticipate paying cash dividends on our common stock in the
foreseeable future. In addition, our debt instruments restrict our ability to
pay cash dividends on our common stock. Moreover, we are a holding company and
our ability to pay dividends is dependent upon the receipt of dividends from our
direct and indirect subsidiaries.

OUR SUBSTANTIAL INDEBTEDNESS COULD ADVERSELY AFFECT ANY INVESTMENT IN SECURITIES
OUTSTANDING FROM TIME TO TIME

         We have incurred significant indebtedness and may incur significant
additional amounts of indebtedness in acquiring other assets or companies. Our
operations do not provide enough cash to service our indebtedness. Our
indebtedness could have important consequences. For example, it could:

              o  make it more difficult for us to pay our obligations;
              o  increase our vulnerability to general adverse economic and
                 industry conditions;
              o  require us to dedicate a substantial portion of our cash flow
                 from operations to payments on our indebtedness, thereby
                 reducing the availability of our cash flow to fund working
                 capital, capital expenditures, acquisitions and other
                 activities;

                                     19
<Page>

              o  limit our flexibility in planning for, or reacting to, changes
                 in our business and the industries in which we operate; and
              o  place us at a competitive disadvantage compared to our
                 competitors that have less debt.

         Our ability to make payments on and to refinance our indebtedness or
preferred stock and to fund capital expenditures and other activities depends on
our ability to generate cash either from operations or from investing or other
financing activities. To date, we have generated the bulk of our cash flow from
the sale of securities or by borrowing money. There is no assurance that we will
be able to continue generating cash in this fashion, particularly if our
operating subsidiaries do not begin generating cash. Our ability to generate
cash is subject to general economic, financial, competitive, legislative,
regulatory and other factors that are beyond our control. We may need to
refinance all or a portion of our indebtedness on or before maturity. We cannot
assure you that we will be able to refinance any of our indebtedness, including
our credit facilities, on commercially reasonable terms, if at all.

A CHANGE OF CONTROL MAY BE DIFFICULT

         Our certificate of incorporation contains, among other things,
provisions authorizing the issuance of "blank check" preferred stock. We are
also subject to provisions of Delaware law, which affect merger, and other
change of control transactions. These provisions could delay, deter or prevent a
merger, consolidation, tender offer, or other business combination or change of
control involving us that our stockholders may consider to be in their best
interests.

THE SALE OF A SUBSTANTIAL NUMBER OF SHARES OF OUR COMMON STOCK IN THE PUBLIC
MARKET COULD ADVERSELY AFFECT THE MARKET PRICE OF OUR COMMON STOCK

         As of January 31, 2003, a total of over 10 million shares of our common
stock were issuable on exercise of options or warrants previously issued by us
or on conversion of outstanding preferred stock or reserved for issuance under a
stock grant plan approved by our board of directors in June 2002. Sales or the
expectation of sales of a substantial number of shares of our common stock,
including shares issuable upon exercise or conversion of outstanding options,
warrants or preferred stock, likely would have an adverse effect on the
prevailing trading price of our common stock.

SATELLITE AND DIRECT BROADCAST SATELLITE TECHNOLOGY COULD FAIL OR BE IMPAIRED

         Direct broadcast satellite technology is highly complex and is still
evolving. As with any similar product or system, this technology might not
function as expected or may not last for its expected life. If any of the
DirecTV satellites are damaged or stop working partially or completely for any
of a number of reasons, DirecTV customers would lose programming. In turn, we
likely would lose customers, which could materially and adversely affect our
operations, financial performance and the trading price of our common stock.

WE DO NOT CONTROL DIRECTV

         We are an intermediary for DirecTV and do not control DirecTV or have
any input on its programming. DirecTV generally purchases its programming from
third parties. DirecTV's success, and therefore ours, depends in large part on
DirecTV's making good judgments about programming sources and ability to obtain
programming on favorable terms. We have no control or influence over DirecTV.

INCREASES IN PROGRAMMING COSTS COULD ADVERSELY AFFECT OUR DIRECT BROADCAST
SATELLITE BUSINESS

         Programmers could increase the rates that DirecTV pays for programming.
As a result, our costs would increase. We would be faced with either increasing
our rates and potentially losing customers or suffering a reduction in our
margins. Further, the rules implementing the law requiring programming

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suppliers that are affiliated with cable companies to provide programming to
all multi-channel distributors, including DirecTV, on nondiscriminatory terms
are scheduled to expire in 2002. If these rules are not extended, these
programmers could increase DirecTV's costs, and therefore our costs. If our
costs increase and we therefore increase our rates, we may lose customers. If
we do not increase our rates, our costs, revenues and financial performance
could be adversely affected.

REPLACEMENT OF THE CURRENT DIRECTV SATELLITES COULD ADVERSELY AFFECT OUR
BUSINESS

         We may or may not be able to continue in the direct broadcast satellite
business after the current DirecTV satellites are replaced. If we can continue,
we cannot predict what it will cost us to do so. Our revenues and financial
performance would be adversely affected if we are not able to continue in the
direct broadcast business or if we cannot locate suitable replacement
programming for our customers.

THE EFFECT OF NEW FEDERAL SATELLITE TELEVISION LEGISLATION ON OUR BUSINESS IS
UNCLEAR

         On November 29, 1999, former President Clinton signed the Satellite
Home Viewer Improvement Act of 1999. This act contains provisions that will be
phased in over time. In addition, the FCC and other federal agencies have
undertaken rulemakings and studies in connection with this legislation. We
cannot predict the effect of this new law on our business.

         The Satellite Home Viewer Improvement Act resolved many of the issues
between the networks and the direct broadcast satellite industry regarding
retransmission of network programming to direct broadcast satellite subscribers.
Generally, the act preserves the satellite industry's right to retransmit
distant network programming to subscribers in "unserved" areas. It also extends,
through December 31, 2004, the satellite industry's right to retransmit, for a
royalty, independent programming, from so-called "superstations," to subscribers
as "distant" signals. Further, satellite carriers are required to deliver
signals only to households that cannot clearly receive over-the-air network
signals with a rooftop antenna.

         The Satellite Home Viewer Improvement Act also directs the FCC to take
actions to prescribe the picture quality standard that the FCC uses to predict
what households do not receive a strong enough network broadcast signal
over-the-air and therefore are eligible to receive distant network signals. The
FCC has initiated a rulemaking proceeding to consider this standard. The effect
on our business of these FCC actions and other studies and rulemakings that the
FCC will undertake cannot be predicted at this time. The FCC may define these
standards in a manner that negatively affects our business.

WE COULD LOSE MONEY BECAUSE OF SIGNAL THEFT

         Each year, the unauthorized receipt of direct broadcast or cable
signals, or "signal theft," costs the industry significant revenues. To date,
signal theft has been contained. If, however, signal theft becomes widespread,
our revenues likely would suffer. DirecTV uses encryption technology in an
effort to prevent people from receiving programming without paying for it.
However, the technology is not foolproof, and there is no assurance that we will
be protected from signal theft.

DIRECT BROADCAST SATELLITE SERVICES FACE COMPETITION FROM CABLE OPERATORS

         Direct broadcast satellite services compete directly with cable
operators. Although direct broadcast satellite systems have enjoyed certain
competitive advantages, many cable television operators are making significant
investments to upgrade their systems from analog to digital. This upgrade will
significantly increase the number of channels that cable television operators
can provide to their customers and the quality of the transmission, potentially
eroding the advantages inuring to direct broadcast satellite systems. In
addition, many cable television operators are upgrading their systems to provide
their customers with high-speed Internet access. These upgrades could make cable
television a

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<Page>

more attractive alternative for property owners and consumers, which could
have an adverse effect on our direct broadcast satellite business.

DIRECT BROADCAST SATELLITE EQUIPMENT SHORTAGES COULD ADVERSELY AFFECT OUR DIRECT
BROADCAST BUSINESS

         There have been periodic shortages of direct broadcast satellite
equipment. These shortages may occur in the future. During periods of shortage,
we may be unable to accept new subscribers and, as a result, potential revenue
could be lost. If we are unable to obtain direct broadcast satellite equipment
in the future, or if we cannot obtain this equipment on favorable terms, our
business and results of operations could be adversely affected.

WE FACE OTHER REGULATORY RISKS

         The direct broadcast satellite, television broadcast, and cable
industries are subject to regulation by the FCC under the Communications Act of
1934 and, to a certain extent, by state and local authorities. If the
Communications Act is amended or abolished, it may adversely affect our
business. In addition, DirecTV depends on FCC licenses to operate its digital
broadcast satellite service. If the FCC cancels, revokes, suspends, or fails to
renew any of these licenses, our results of operations and financial condition
and, hence, the trading price of our common stock would be adversely affected.

WE HAVE A HISTORY OF SUBSTANTIAL LOSSES; WE EXPECT THEM TO CONTINUE; LOSSES
COULD ADVERSELY AFFECT OUR STOCK PRICE AND ACCESS TO CAPITAL MARKETS

         We have never made a profit. Our administrative costs and interest on
our debt exceeds our revenues. Continuing losses could adversely affect our
access to capital markets and the trading price of our common stock.

WE FACE SIGNIFICANT COMPETITION; THE COMPETITIVE LANDSCAPE CHANGES CONSTANTLY

         We compete with other multichannel programming distributors, including
other direct broadcast satellite operators, direct-to-home distributors, cable
operators, wireless cable operators, Internet providers and local and
long-distance telephone companies. These competitors may be better capitalized
than we are and may be able to offer more competitive packages or pricing than
we or DirecTV can offer. Many of our competitors have substantially greater
financial, technical and marketing resources, larger customer bases, longer
operating histories, greater name recognition and more established relationships
in the industry. In addition, a number of these competitors may combine or form
strategic partnerships. As a result, our competitors may be able to offer, or
bring to market earlier, products and services that are superior to our own in
terms of features, quality, pricing or other factors. Our failure to compete
successfully with any of these companies would have a material adverse effect on
our business and the trading price of our common stock.

         Increased competition also may result in reduced commissions and loss
of market share. Further, as a strategic response to changes in the competitive
environment, we may from time to time make certain pricing, service or marketing
decisions or acquisitions that could have a material adverse effect on our
business and the trading price of our common stock.

WE EXPECT TO NEED ADDITIONAL CAPITAL IN THE FUTURE AND IT MAY NOT BE AVAILABLE
ON ACCEPTABLE TERMS

         We anticipate incurring substantial costs to install, operate and
maintain our direct broadcast satellite systems and to further implement our
business plan, including our expansion into Mexico if our proposed merger with
Las Americas Broadband is approved. We expect to need significant amounts of

                                     22
<Page>

working capital for infrastructure, marketing, personnel and general and
administrative costs, and to fund existing losses.

         We will need to raise additional capital, either in the form of debt or
equity. There is no assurance that additional capital will be available to us on
favorable terms, if at all. If we are not able to fund our capital needs, this
would adversely affect our business and financial condition and, therefore, the
trading price of our common stock.

OUR FUTURE PROFITABILITY IS DEPENDENT ON THE INTRODUCTION AND ACCEPTANCE OF OUR
BROADBAND AND OTHER ONLINE SERVICES IN GENERAL AND THE INTEGRATION OF CABLE
CALIFORNIA AND EXECUTION OF ITS BUSINESS PLAN IN PARTICULAR.

         We anticipate generating revenues in the future from broadband and
other Internet services. Demand and market acceptance for these recently
introduced services and products delivered over the Internet is highly
uncertain. Critical issues concerning the use of the Internet, such as ease of
access, security, reliability, cost and quality of service, exist and may affect
the growth of Internet use or the attractiveness of conducting commerce online.
In addition, the Internet and online services may not be accepted as viable for
a number of reasons, including potentially inadequate development of the
necessary network infrastructure or delayed development of enabling technologies
and performance improvements. To the extent that the Internet and online
services continue to experience significant growth, there can be no assurance
that the infrastructure of the Internet and online services will prove adequate
to support increased user demands. In addition, the Internet or online services
could lose their viability due to delays in the development or adoption of new
standards and protocols required to handle increased levels of Internet or
online service activity. Changes in, or insufficient availability of,
telecommunications services to support the Internet or online services also
could result in slower response times and adversely affect usage of the Internet
and online services generally and us in particular. If use of the Internet and
online services does not continue to grow or grows more slowly than expected, if
the infrastructure for the Internet and online services does not effectively
support growth that may occur, or if the Internet and online services do not
become a viable commercial marketplace, our business and the trading price of
our common stock could be adversely affected.

         We intend to complete the acquisition of Cable California shortly after
the filing of this report, and in order to achieve profitability we are
dependent on our ability, to execute the Company's business plan calling for,
among other things, an expansion into Northern Mexico.

WE NEED TO HIRE AND RETAIN QUALIFIED PERSONNEL TO SUSTAIN OUR BUSINESS

         We are currently managed by a small number of key management and
operating personnel. Our future success depends, in part, on our ability to
recruit and retain qualified personnel. Failure to do so likely would have an
adverse impact on our business and the trading price of our common stock. In
addition, we do not maintain "key man" insurance on any employee.

         WE HAVE RECENTLY CHANGED OUR STRATEGY TO FOCUS ON A LIMITED NUMBER OF
MARKETS, WHICH INCREASES OUR REGULATORY RISK AND WILL CAUSE ANY DOWNTURN IN
THESE MARKETS TO HAVE A GREATER ADVERSE EFFECT ON OUR OPERATIONS THAN IS
CURRENTLY THE CASE.

         We have recently changed our strategy to focus on providing video, data
and Internet service in the State of California and in the Northern Baja region
of Mexico. As part of this strategy, we have sold assets located in the Pacific
Northwest, Midwest and Southeastern United States, and intend to make similar
sales in the future. As a result, our success will be tied more closely to the
economic prospects of a relatively small number of regions. If the economies of
these regions experience difficulties, this will have a greater adverse effect
on our operations and financial condition than would be the case if we continued
to serve more markets. In addition, we have not previously operated in Mexico,
and operating

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<Page>

there involves regulatory hurdles not present in the United States and with
which we are not familiar. If we are unable to overcome these hurdles, we
will not be able to achieve our anticipated revenues from our operations in
Mexico, which will have a material adverse effect on our financial condition
and results of operations.

ITEM 3 - CONTROLS AND PROCEDURES

         Based on the evaluation by Mr. Grant Miller, who is both our principal
executive officer and chief financial officer, of the effectiveness of our
disclosure controls and procedures conducted as of a date within 90 days of the
filing date of this quarterly report, Mr. Miller concluded that, as of the
evaluation date, (i) there were no significant deficiencies or material
weaknesses in our disclosure controls and procedures, (ii) there were no
significant changes in the internal controls or in other factors that could
significantly affect internal controls after the evaluation date and (iii) no
corrective actions were required to be taken. There were no significant changes
in our internal controls or in other factors that could significantly affect our
internal controls after the date of this evaluation of the controls. We continue
to monitor our controls and procedures on an on-going basis and will make any
adjustments necessary to produce effective disclosure.

                           PART II - OTHER INFORMATION

ITEM 1 - LEGAL PROCEEDINGS

         We are involved in various proceedings and subject to various claims as
described in our Transition Report on Form 10-KSB for the transition period
ended June 30, 2002, and our Quarterly Report on Form 10-QSB for the three-month
period ended September 30, 2002. This report describes only proceedings
instituted or claims arising during or subsequent to the quarter ended December
31, 2002, or material events that occurred during or subsequent to the quarter
in connection with previously-reported proceedings or claims.

         On August 16, 2002, L.A. Commercial Group, Inc., which does business
under the name Continental Commercial Group, filed a lawsuit against Cable
Concepts, Inc., seeking a judgment in the amount of approximately $62,000 for
money allegedly owed to the plaintiff for television programming. On October 24,
2002, the plaintiff made a request for entry of default and entry of judgment in
the amount of approximately $67,000, which includes the money allegedly owed,
plus interest, costs and attorneys' fees. Judgment was served upon us in
February 2003.

         In early February 2003, we received an eviction notice from our
landlord, Knobb Family Trust, due to non-payment of past due rents and common
area maintenance charges. We owe rent and maintenance charges from October 2002
and the arrearage amounts to $25,996. On February 12, 2003, Federal Express
Corp. filed a complaint against Direct Digital for past due services, interest
and fees. The amount sought in the complaint is $30,000.

ITEM 2 - CHANGES IN SECURITIES

         In July, 2002, we commenced an offering of up to $10,000,000 of our
common stock. To date we have raised $229,353 in the offering through the sale
of 114,676 shares at a price of $2.00 per share. The price per share of the
shares sold in the offering, which is intended to be at a discount to the market
value of our common stock, may be reduced below $2.00. If the price is reduced,
we will increase the number of shares to be issued to investors who have already
made purchases in the offering.

         We are also in the process of issuing 30,000 shares of common stock to
The Research Works as consideration for $39,900 worth of research services. The
effective price per share of the issuance is $1.33.

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<Page>

         In October 2002, we issued a total of 21,843 share of our common stock
to three individuals. The shares were sold at a price of $1.60 per share and we
raised a total of $39,950 from the transactions.

         No underwriting commissions or discounts were paid in connection with
any of the above transactions. We relied upon the exemption from the
registration requirements of the Securities Act under Section 4(2) of the
Securities Act with respect to the offer and sale of the unregistered securities
described above. We conducted no general solicitation or advertising in
connection with any of the transactions described above. Each of the persons
that acquired unregistered securities had a preexisting relationship with us or
one of our placement agents or founders. In addition, each purchaser was
required to complete a subscription document and confirm their status as a
"sophisticated investor." We provided each potential investor with an
opportunity to meet with, and ask questions of, our management.

ITEM 3 - DEFAULTS UPON SENIOR SECURITIES

         We are required to use 10% of the net proceeds from future sales or
grants of equity through July, 2004, toward payment of a note payable held by
Geneva Associates Merchant Banking Partners, then for redemption of our Series B
Preferred Stock, followed by redemption of our Series C Preferred Stock. We are
not currently in compliance with this requirement as it relates to either the
note payable or the preferred stock.

         As of December 31, 2002, we are in default on both principal and
interest of a note payable to a bank in the amount of approximately $1,477,000.
The note matures in April 2004 and we are currently seeking a waiver of some of
the note's provisions. There is no guarantee that we will obtain a waiver.

         We are also in default to Geneva Associates Merchant Banking Partners
for both principal and interest due on notes totaling approximately $1,213,000.
As of December 31, 2002, we have yet to make a payment of either principal or
interest on our obligations to the entity.

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

         None.

ITEM 5 - OTHER INFORMATION

         None.

ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K

(a)      Exhibits List

<Table>
<Caption>
        NUMBER                                   DESCRIPTION OF DOCUMENT
        ------                                   -----------------------
       <S>        <C>
         99.1      Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-
                   Oxley Act of 2002.

         99.2      Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-
                   Oxley Act of 2002.
</Table>

(b)      Reports on Form 8-K

         None.

                                     25
<Page>


                                   SIGNATURES

         Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized.

Dated: February 25, 2003                  USA BROADBAND, INC.


                                          By: /s/ Grant Miller
                                              ----------------------------------
                                              Its:  Principal Executive Officer







                                     26
<Page>

                                 CERTIFICATIONS

         I, Grant Miller, certify that:

         1. I have reviewed this quarterly report on Form 10-QSB of USA
Broadband, Inc.;

         2. Based on my knowledge, this quarterly report does not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this
quarterly report;

         3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of USA
Broadband, Inc. as of, and for, the periods presented in this quarterly report;

         4. USA Broadband, Inc.'s other certifying officer and I are responsible
for establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for USA Broadband, Inc. and we have:

              (a)  designed such disclosure controls and procedures to ensure
                   that material information relating to USA Broadband, Inc.,
                   including its consolidated subsidiaries, is made known to us
                   by others within those entities, particularly during the
                   period in which this quarterly report is being prepared;

              (b)  evaluated the effectiveness of USA Broadband, Inc.'s
                   disclosure controls and procedure as of a date within 90 days
                   prior to the filing date of this quarterly report (the
                   "Evaluation Date"); and

              (c)  presented in this quarterly report our conclusions about the
                   effectiveness of the disclosure controls and procedures based
                   on our evaluation as of the Evaluation Date;

         5. USA Broadband, Inc.'s other certifying officer and I have disclosed,
based on our most recent evaluation, to USA Broadband, Inc.'s auditors and the
audit committee of USA Broadband, Inc.'s board of directors:

              (a)  all significant deficiencies in the design or operation of
                   internal controls which could adversely affect USA Broadband,
                   Inc.'s ability to record, process, summarize and report
                   financial data and have identified for USA Broadband, Inc.'s
                   auditors any material weaknesses in internal controls; and

              (b)  any fraud, whether or not material, that involves management
                   or other employees who have a significant role in USA
                   Broadband, Inc.'s internal controls; and

         6. USA Broadband, Inc.'s other certifying officer and I have indicated
in this quarterly report whether or not there were significant changes in
internal controls or in other factors that could significantly affect internal
controls subsequent to the date of our most recent evaluation, including any
corrective actions with regard to significant deficiencies and material
weaknesses.

Date: February 25, 2003                /s/  GRANT MILLER
                                       -----------------------------------------
                                       Grant Miller, PRINCIPAL EXECUTIVE OFFICER
                                       AND CHIEF FINANCIAL OFFICER


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