U.S. SECURITIES AND EXCHANGE COMMISSION
                                 Washington, D.C. 20549

                                     FORM 10-QSB

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED
MARCH 31, 2005

                                           OR

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


                             COMMISSION FILE NUMBER: 0-30639


                                    WORLD AM, INC.
                   (Exact Name of Company as Specified in its Charter)

                 Nevada                                   90-0142757
(State or Other Jurisdiction of Incorporation          (I.R.S. Employer
              or Organization)                          Identification No.)

       1400 West 122nd Avenue, Suite 104, Westminster, Colorado 80234
                      (Address of Principal Executive Offices)

                                   (303) 452-0022
                             (Company's Telephone Number)

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

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

     As of March 31, 2005, the Company had 10,165,901 (1) shares
of common stock issued and outstanding.

     Transitional Small Business Disclosure Format (check one):
Yes          No    X   .

(1)  Adjusted for a one for one hundred reverse split of the
common stock that was effective on January 21, 2005.

                              TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION                                       PAGE

         ITEM 1.  FINANCIAL STATEMENTS (UNAUDITED)

                  CONDENSED CONSOLIDATED BALANCE
                  SHEET AS OF MARCH 31, 2005                            3

                  CONDENSED CONSOLIDATED STATEMENTS
                  OF OPERATIONS FOR THE THREE MONTHS
                  ENDED MARCH 31, 2005 AND MARCH 31, 2004               5

                  CONDENSED CONSOLIDATED STATEMENT
                  OF STOCKHOLDERS' DEFICIT FOR THE
                  THREE MONTHS ENDED MARCH 31, 2005                     6

                  CONDENSED CONSOLIDATED STATEMENTS
                  OF CASH FLOWS FOR THREE MONTHS ENDED
                  MARCH 31, 2005 AND MARCH 31, 2004                     8

                  NOTES TO CONDENSED CONSOLIDATED
                  FINANCIAL STATEMENTS                                 10

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

         ITEM 3.  CONTROLS AND PROCEDURES                              25

PART II - OTHER INFORMATION

         ITEM 1.  LEGAL PROCEEDINGS                                    26

         ITEM 2.  UNREGISTERED SALES OF EQUITY
                  SECURITIES AND USE OF PROCEEDS                       26

         ITEM 3.  DEFAULTS UPON SENIOR SECURITIES                      27

         ITEM 4.  SUBMISSION OF MATTERS TO A VOTE
                  OF SECURITY HOLDERS                                  27

         ITEM 5.  OTHER INFORMATION                                    27

         ITEM 6.  EXHIBITS                                             29

SIGNATURE                                                              29

PART I - FINANCIAL INFORMATION

ITEM 1.  FINANCAL STATEMENTS.

                               WORLD AM, INC.
                   CONDENSED CONSOLIDATED BALANCE SHEET
                              MARCH 31, 2005
                                (Unaudited)

                                   ASSETS

Current assets
Cash                                                            $    15,156
Accounts receivable, net                                             18,147
Inventory                                                            41,711

Total current assets                                                 75,014

Fixed assets, net                                                    19,855

Other assets                                                            650

Total assets                                                         95,519

                     LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities
Accounts payable and accrued liabilities                            123,330
Due to stockholders                                                 342,957
Payroll taxes payable                                               253,709
Line of credit                                                        7,222
Note payable                                                          8,000
Convertible note payable, net of discount of $15,897                 14,103
Capital lease obligation                                             10,093

Total current liabilities                                           759,414

Total liabilities                                                   759,414

Commitments and contingencies                                            --

Stockholders' deficit
Class A preferred stock; $0.0001 par value;
40,000,000 shares authorized 1,370 shares issued and no shares
outstanding                                                              --

Class B preferred stock; $0.0001 par value;
40,000,000 shares authorized no shares issued and outstanding            --

Common stock; $0.0001 par value; 1,500,000,000
shares authorized 10,165,901 (1) shares issued and outstanding        1,017

Additional paid-in capital                                        8,903,449

Receivable related to issuance of common stock                     (220,000)

Accumulated deficit                                              (9,348,361)

Total stockholders' deficit                                        (663,895)

Total liabilities and stockholders' deficit                          95,519

(1)  Adjusted for a one for one hundred reverse split of the
common stock that was effective on January 21, 2005.

The accompanying notes are an integral part of these financial statements


                                    WORLD AM, INC.
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                    (Unaudited)

                                                   Three Months Ended March 31,
                                                       2005           2004
                                                                    (Restated)

Revenues                                            $  185,308     $  137,201

Cost of revenues                                       109,962         60,670

Gross profit                                            75,346         76,531

General and administrative                             458,346        478,944

Loss from operations                                  (383,000)      (402,413)

Other income (expense)
Other income                                             3,407          5,243
Interest income                                             --            128
Interest expense                                       (14,686)            --

Total other income (expense)                           (11,279)         5,371

Loss before provision for income taxes                (394,279)      (397,042)

Provision for income taxes                                  --             --

Net loss                                              (394,279)      (397,042)

Basic and diluted loss per common share                  (0.04)         (0.08)

Basic and diluted weighted average common
shares outstanding                                   9,585,651 (1) 5,055,041(1)

(1)  Adjusted for a one for one hundred reverse split of the
common stock that was effective on January 21, 2005.

The accompanying notes are an integral part of these financial statements


                                  WORLD AM, INC.
         CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' DEFICIT
                   FOR THE THREE MONTHS ENDED MARCH 31, 2005
                                    (Unaudited)



<TABLE>
<CAPTION>
                                                                                       Total
                     Common Stock           Additional     Other     Accumulated    Stockholders'
                  Shares (1)     Amount      Paid-in    Receivables    Deficit        Deficit
                                             Capital
<S>               <C>            <C>         <S>          <C>          <C>           <C>

Balance,
December 31, 2004   8,321,053    $    832    $ 8,590,858  $  (220,000)  $(8,954,082)  $   (582,392)

Common stock
issued in
January 2005
for services,
weighted
average
$0.14 per share       668,934          67         96,811           --            --         96,878

Common stock
issued in
February 2005
for services,
weighted
average
$0.16 per share       816,965          82        134,323           --            --        134,405

Common stock
issued in
March 2005
for services,
weighted
average
$0.16 per share        89,299           9         14,458           --            --         14,467

Exercise of
employee stock
options in
January 2005          269,650          27         23,031           --            --         23,058

Options granted
to employees
for services               --          --         13,968           --            --         13,968

Warrants recorded
as discount on
convertible note
payable                    --          --         30,000           --            --         30,000

Net loss                   --          --             --           --      (394,279)      (394,279)

Balance,
March 31, 2005
(Unaudited)        10,165,901       1,017      8,903,449     (220,000)   (9,348,361)      (663,895)
</TABLE>


(1)  Adjusted for a one for one hundred reverse split of the
common stock that was effective on January 21, 2005.

The accompanying notes are an integral part of these financial statements


                                   WORLD AM, INC.
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                      (Unaudited)

                                                   Three Months Ended March 31,
                                                       2005           2004
                                                                    (Restated)

Cash flows from operating activities:
Net loss                                            $  (394,279)   $  (397,042)

Adjustments to reconcile net loss to net
cash used by operating activities:
Depreciation                                              1,098            614

Stock issued for services                               259,718        332,343

Amortization of discount on convertible note payable     14,103             --

Changes in operating assets and liabilities:
Change in accounts receivable, net                       12,442         12,290

Change in inventory                                     (12,588)            --

Change in other assets                                       --           (374)

Change in accounts payable and accrued liabilities        8,163        (75,356)

Change in taxes payable                                 (10,891)        10,041

Net cash used in operating activities                  (122,234)      (117,484)

Cash flows from investing activities:
Purchase of fixed assets                                 (1,041)        (1,270)

Net cash used in investing activities                    (1,041)        (1,270)

Cash flows from financing activities:
Change in due to related parties                         49,052             --
Proceeds from exercise of employee options               23,058             --
Proceeds (payments) from line of credit                   2,372         (2,669)
Proceeds from convertible note payable                   30,000             --
Principal payments on note payable                       (3,000)         3,000)
Principal payments on capital lease obligations          (1,046)            --
Proceeds related to stock options exercised in 2003
recorded as receivable related to the
issuance of common stock                                     --         60,000

Net cash provided by financing activities               100,436         54,331

Net change in cash                                      (22,839)       (64,423)

Cash, beginning of period                                37,995        229,069

Cash, end of period                                      15,156        164,646

Supplemental disclosure of cash flow information:
Cash paid for income taxes                                   --             --
Cash paid for interest                                       --             --

Schedule of non-cash operating, investing
and financing activities:
Warrants recorded as discount on
convertible note payable                                 30,000             --

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


                              WORLD AM, INC.
           NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               (Unaudited)

NOTE 1 - BASIS OF PRESENTATION

The interim consolidated financial statements present the balance
sheet, statements of operations, stockholders' equity and cash
flows of World Am Communications, Inc. and its subsidiary
("Company").  All significant intercompany balances have been
eliminated in consolidation.

The interim consolidated financial information is unaudited.  In
the opinion of management, all adjustments necessary to present
fairly the financial position as of March 31, 2005 and the
results of operations and cash flows presented herein have been
included in the consolidated financial statements. Interim
results are not necessarily indicative of results of operations
for the full year.

The accompanying consolidated financial statements have been
prepared in accordance with Securities and Exchange Commission
requirements for interim financial statements. Therefore, they do
not include all of the information and footnotes required by
accounting principles generally accepted in the United States for
complete financial statements. The financial statements should be
read in conjunction with the Form 10-KSB for the year ended
December 31, 2004 of the Company.

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

NOTE 2 - GOING CONCERN

The Company incurred a net loss of approximately $394,000 for the
three months ended March 31, 2005 and the Company's current
liabilities exceed its current assets by approximately $684,000.
The accumulated deficit was approximately $9,348,000 as of March
31, 2005.  These factors create substantial doubt about the
Company's ability to continue as a going concern.  The Company's
management has plans to promote its services, gain clients and
expand its relationships with current clients.  The Company will
also seek additional sources of capital through the issuance of
debt and equity financing, but there can be no assurance that the
Company will be successful in accomplishing its objectives.

The ability of the Company to continue as a going concern is
dependent on additional sources of capital and the success of the
Company's plan.  The financial statements do not include any
adjustments that might be necessary if the Company is unable to
continue as a going concern.

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Stock-based compensation - The Company applies Accounting
Principles Board ("APB") Opinion No. 25, "Accounting for Stock
Issued to Employees, and Related Interpretations", in accounting
for stock options issued to employees.  Under APB Opinion No. 25,
employee compensation cost is recognized when estimated fair
value of the underlying stock on date of the grant exceeds
exercise price of the stock option.  For stock options and
warrants issued to non-employees, the Company applies Statement
of Financial Accounting Standards ("SFAS") No. 123, "Accounting
for Stock-Based Compensation".  SFAS No 123 requires the
recognition of compensation cost using a fair value based method
whereby compensation cost is measured at the grant date based on
the value of the award and is recognized over the service period,
which is usually the vesting period.  The Company uses the Black-
Scholes pricing model to calculate the fair value of options and
warrants issued to non-employees.  Stock issued for compensation
is valued using the market price of the stock on the date of the
related agreement.

The fair value under SFAS No. 123 is the same as the value as
calculated under APB Opinion No. 25 due to the immediate
conversion by employees upon grant of options.

Stock split - In January 2005, the Company did a 100-to-one
reverse split of common shares authorized and outstanding.  All
share and per share amounts in the accompanying financial
statements of the Company and notes thereto, have been
retroactively adjusted to give effect to the stock splits.

Reclassification - Certain prior year balances have been
reclassified to conform to the current year presentation, which
have no effect on net income.

Inventory - Inventory is stated at the lower of cost or market.
Cost is principally determined by using the average cost method.
Inventory consists of raw materials as well as finished goods
held for sale.  The Company's management monitors the inventory
for excess and obsolete items and makes necessary valuation
adjustments when required.

NOTE 4 - INVENTORY

Inventory totaling $41,711 consists of finished goods.

NOTE 5 - DUE TO STOCKHOLDERS

Due to stockholder totaling $342,957 as of March 31, 2005 consist
of unreimbursed expenses and accrued wages to various
stockholders and employees.

NOTE 6 - PAYROLL TAXES PAYABLE

As of March 31, 2005, payroll taxes payable consists of late
payroll taxes for both payroll and stock option activity totaling
an estimated $253,700.  The Company is attempting to fully
resolve this payable to the Internal Revenue Service by the end
of 2005.

NOTE 7 - LINE OF CREDIT

The Company has a line of credit through a credit card company
with a credit line up to $8,260 with an annual variable rate
(24.91% at March 31, 2005).  As of March 31, 2005, the balance on
the line of credit totaled $7,222.

NOTE 8 - NOTE PAYABLE

In June 2003, pursuant to a dismissal of action by a certain
individual, the Company entered into a promissory note agreement
totaling $30,000 with the individual.  The note is unsecured,
bears no interest (1.25% interest in the event of default), is
payable in monthly principal only installments of $1,000, and
matures December 2005.  As of March 31, 2005, the remaining
portion of the note payable totals $8,000.

NOTE 9 - CONVERTIBLE NOTE PAYABLE

During February 2005, the Company issued a $30,000 convertible
note payable to an individual.  The convertible note payable
matures during June 2005, is unsecured, and bearing interest at
10%.  The note is convertible by the holder prior to maturity, in
multiples of $1,000 principal amount, into shares of the
Company's common stock.  The number of shares of the Company's
common stock shall be determined by dividing the principal amount
to be converted by the lowest bid price of the Company's common
stock during the 180-day period following the issuance of the
note.  In the event the holder converts prior to the end of the
pricing period, the number of shares of the Company's common
stock shall be determined by dividing the principal amount to be
converted by the lowest reported bid price of the Company's
common stock between the date of issuance of the note and date of
conversion.

The holder of the convertible note also received a warrant to
purchase shares of the Company's common stock that expire during
February 2008.  The number of shares to be received by the holder
shall be determined by dividing the purchase price by the lowest
bid price of the Company's common stock during the thirty day
period following the pricing period.  In the event the holder
exercises prior to the end of the pricing period, the number of
shares of the Company's common stock that may be acquired upon
exercise of the warrant shall be determined by dividing the
purchase price of the warrant by the lowest reported bid price of
the Company's common stock between the date of grant and the date
of exercise of the warrant.  The Company recorded the value of
the warrants totaling $10,000 as a discount on the convertible
note payable ($15,897 net of accretion of $4,710) and is
accreting the discount through the maturity date of the
convertible note payable.

NOTE 10 - CAPITAL LEASE OBLIGATION

The Company is obligated under a capital lease for manufacturing
equipment.  For financial reporting purposes, minimum lease
payments relating to the equipment have been capitalized.  The
capital lease obligation totaling $10,300 requires twelve minimum
monthly lease payments of $425 and a final payment of $9,450,
with an imputed interest rate of 8.5%.  The future minimum lease
payments required under the capital lease obligation as of March
31, 2005, are as follows:

April 1, 2005 through December 31, 2005                         $10,300
Less: amount representing interest                                  207

Present value of minimum lease payments                         $10,093

NOTE 11 - EMPLOYEE STOCK INCENTIVE PLAN

During July 2004, the Company adopted the Amended and Restated
Employee Stock Incentive Plan (Amendment No. 2) ("Plan:").  The
Plan is intended to allow designated officers and employees of
the Company to receive options to purchase the Company's common
stock.  The purpose of this plan is to provide the officers and
employees with equity-based compensation incentives to make
significant and extraordinary contributions to the long-term
performance and growth of the Company, and to attract and retain
Employees of exceptional ability.  The Plan established an
exercise price of 65% of the fair market value of the Company's
common stock on the date the stock option is granted.

During the three months ended March 31, 2005, the Company granted
options to purchase 269,650 shares of the Company's common stock
valued at $13,968 under APB Opinion No.25.  All options were
immediately exercised for cash totaling $23,058.

NOTE 12 - PREFERRED STOCK

During June 2004, the Company entered into a loan agreement with
Mercatus & Partners, LLC ("Lender") whereby the Lender agreed to
use its best efforts to provide the Company a loan in the maximum
amount of $2,000,000 subject to certain terms and conditions. The
Company agreed to issue 1,370 shares of Class A Preferred stock
that is convertible to common stock at a ratio of 1-to-1,000,000
as collateral on the loan.  The shares were issued during June
2004 and recorded them as issued but not outstanding as of March
31, 2005. The lender did not fund the loan and accordingly, the
Company provided a written demand for the return of the shares,
as provided in the loan agreement.  Subsequently, the shares were
returned to the Company.

During May 2005, the Lender assigned all rights set forth in the
loan agreement to Coldwater Capital Partners, LLC, including the
1,370 shares of Class A Preferred stock held as collateral on the
loan.  The Company has approved this assignment.  Through the
date of this filing, the Company has not received funding under
the terms of this loan agreement.

NOTE 13 - RESTATED FINANCIAL STATEMENTS

Subsequent to the issuance of the Company's financial statements
for the year ended December 31, 2004, management became aware
that those financial statements did not reflect certain account
balances properly for the three months ended March 31, 2004.
Properly accounting of these items in the revised financial
statements has the following effect:



<TABLE>
<CAPTION>
                                                    Three Months Ended     Three Months Ended     Restated
                                                     March 31, 2004          March 31, 2004       Increase
                                                                                 (Restated)      (Decrease)
<S>                                                    <C>                      <C>             <C>
Revenues                                               $  137,201               $  137,201      $       --

Cost of revenues                                           60,670                   60,670              --

Gross profit                                               76,531                   76,531              --

Operating expense                                         409,844                  478,944         (69,100)

Loss from operations                                     (333,313)                (402,413)        (69,100)

Other income                                                5,371                    5,371              --

Net loss                                                 (327,942)                (397,042)        (69,100)

Basic and diluted loss per common share                     (0.06)                   (0.08)          (0.02)
</TABLE>


During 2003, shares of the Company's common stock issued for
options exercised were recorded as operating expenses, as
discussed in Footnote 14 to the financial statements included in
Form 10-KSB for the year ended December 31, 2004. The cash
consideration, totaling $60,000, for the shares issued was
received during the three months ended March 31, 2004 and
reported as a reduction to operating expenses. The restatement of
the statement of operations for the three months ended March 31,
2004 was primarily related to properly reporting the cash
received for options exercised as a reduction to receivable
related to common stock. Additionally, the Company understated
stock based compensation by approximately $9,100.

NOTE 14 - SUBSEQUENT EVENTS

Stock issuance - During April 2005, the Company issued 1,335,979
shares of its common stock for services totaling $134,254.

During May 2005, the Company issued 831,695 shares of its common
stock for services totaling $58,219.

Factoring and Security Agreement - On April 25, 2005, the Company
entered into a Factoring and Security Agreement ("Agreement") to
factor its accounts receivable up to $75,000 (with recourse) with
J.J. Ellis, LLC, a Florida limited liability company ("JJE").
Under the terms of the Agreement, the Company is required to pay
JJE a one-time factoring and documentation origination fee of
$2,500 payable the equivalent of free trading stock and warrants
to purchase shares of the Company's common stock totaling $25,000
for a period of three years.  The number of warrants to be
received by JJE is to be determined by dividing $25,000 by the
lesser of a 20% discount on the bid price on the day of execution
or the lowest reported bid price of the Company's common stock
during a 365 day period following the date of the Agreement
("Pricing Period").  If JJE wished to exercise the warrants prior
to the termination of the Pricing Period, then the number of
warrants to be received will be calculated based on the lesser of
the lowest reported bid price of the Company's common stock since
the date of the Agreement or a 20% discount on the bid price on
the day of execution.  The purchase price for each accepted
account is equal to (i) the face amount of such accepted account
less (ii) the commission, and less (iii) JJE's fee (discount),
and less (iv) the amount of any trade or cash discounts, credits
or allowances, or any other reductions or adjustments to such
accepted accounts.  Through May 13, 2005, the Company has
factored approximately $29,000 of its accounts receivable.

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

     The following discussion and analysis of financial condition
and results of operations of the Company is based upon, and
should be read in conjunction with, its unaudited condensed
consolidated financial statements and related notes included
elsewhere in this Form 10-QSB, which have been prepared in
accordance with accounting principles generally accepted in the
United States.

Overview.

     The Company has developed and or is in the process of
developing innovative systems and processes in the field of
"Transparent Security" and "Automated Passage Control."  Company
personnel have installed systems for Lawrence Livermore Labs,
Mellon Bank, Wells Fargo Bank and the United States Air Force and
United States Department of Energy to name just a few.  The
principal markets for our products and services remain government
and financial institutions.

     The Company believes that its planned growth and
profitability will depend in large part on the ability to promote
its services, gain clients and expand its relationship with
current clients.  Accordingly, the Company intends to focus its
attention and investment of resources in marketing, strategic
partnerships, and development of its client base.  In addition to
development of our own products and services, we are also
exploring opportunities to broaden our product offering by
becoming distributors of additional products in our core
marketplace in order to generate additional revenues.  If the
Company is not successful in promoting its services and expanding
its client base, this may have a material adverse effect on its
financial condition and the ability to continue to operate the
business.

Results of Operations.

     Subsequent to the issuance of the Company's financial
statements for the year ended December 31, 2004, management
became aware that those financial statements did not reflect
certain account balances properly for the three months ended
March 31, 2004.  Properly accounting of these items in the
revised financial statements has the following effect:



<TABLE>
<CAPTION>
                                                    Three Months Ended     Three Months Ended     Restated
                                                     March 31, 2004          March 31, 2004       Increase
                                                                                 (Restated)      (Decrease)
<S>                                                    <C>                      <C>             <C>
Revenues                                              $   137,201            $   137,201      $         --

Cost of revenues                                           60,670                 60,670                --

Gross profit                                               76,531                 76,531                --

Operating expense                                         409,844                478,944           (69,100)

Loss from operations                                     (333,313)              (402,413)          (69,100)

Other income                                                5,371                  5,371                --

Net loss                                                 (327,942)              (397,042)          (69,100)

Basic and diluted loss per common share                     (0.06)                 (0.08)            (0.02)
</TABLE>



During 2003, shares of the Company's common stock issued for
options exercised were recorded as operating expenses, as
discussed in Footnote 14 to the financial statements included in
Form 10-KSB for the year ended December 31, 2004. The cash
consideration, totaling $60,000, for the shares issued was
received during the three months ended March 31, 2004 and
reported as a reduction to operating expenses. The restatement of
the statement of operations for the three months ended March 31,
2004 was primarily related to properly reporting the cash
received for options exercised as a reduction to receivable
related to common stock. Additionally, the Company understated
stock based compensation by approximately $9,100.

(a)  Revenues.

     Revenues for the three months ended March 31, 2005 were
$185,308 as compared to $137,201 (as restated) for the three
months ended March 31, 2004, an increase of $48,107 or
approximately 35%  This increase is primarily attributed to the
continued efforts by the Company in the acquisition of sales,
marketing, advertising, business and legal talent to complete
product development and continue marketing activities to increase
the dealer network and position the Company to participate in
market growth expected in the future.  Although the increased
operating revenue represents a significant increase in sales,
with the absence of additional operational funding, the Company's
ability to continue as a going concern is still in doubt.

(b)  General and Administrative Expense.

     The Company was able to reduce the amount of general
and administrative expenses during the three months ended March
31, 2005 by $20,598 (to $458,346), a reduction of approximately
4% as compared to $478,944 (as restated) for the three months
ended March 31, 2004.  The general and administrative expenses
reflect the impact of the use of S-8 stock to compensate needed
services by various professionals in the absence of equity
funding.  Although this is a significant reduction in operating
expenses, the Company plans to continue to pursue revenue growth
and expects to utilize a private placement or other equity
offering during 2004, in addition to utilization of S-8 stock to
compensate for certain needed services.

(c)  Net Operating Loss.

     The net loss from operations for the three months ended
March 31, 2005 was $394,279 as compared to $397,042 (as restated)
for the three months ended March 31, 2004, a decrease of $2,763
or approximately 1%.  Management believes these results are a
direct reflection of continued efforts to control expenses and to
increase the net results of operations.  Although the operations
are still losing money, management continues to attempt to slow
the rate of loss.

(d)  Net Operating Loss Carryforward.

     For the fiscal year ending December 31, 2004, the
Company had net operating loss carry forward of $8,954,082  as
compared with $7,094,140 for the previous fiscal year.
Realization of deferred tax assets is dependent upon future
earnings, if any, the timing and amount of which are uncertain.
Accordingly, the net deferred tax assets have been fully offset
by a valuation allowance.  The increase in net operating loss
carry forward is the result of the Company's operating loss
experienced in fiscal 2004.  These carryforwards, if not utilized
to offset taxable income begin to expire in 2009.  Utilization of
the net operating loss may be subject to substantial annual
limitation due to the ownership change limitations provided by
the Internal Revenue Code and similar state provisions.  The
annual limitation could result in the expiration of the net
operating loss before utilization.

Factors That May Affect Operating Results.

     The operating results of the Company can vary significantly
depending upon a number of factors, many of which are outside its
control.  General factors that may affect the Company's operating
results include:

     - market acceptance of and changes in demand for products and
       services;

     - a small number of customers account for, and may in future
       periods account for, substantial portions of the Company's
       revenue, and revenue could decline because of delays of
       customer orders or the failure to retain customers;

     - gain or loss of clients or strategic relationships;

     - announcement or introduction of new services and products by
       the Company or by its competitors;

     - the ability to build brand recognition;

     - timing of sales to customers;

     - price competition;

     - the ability to upgrade and develop systems and
       infrastructure to accommodate growth;

     - the ability to introduce and market products and services in
       accordance with market demand;

     - changes in governmental regulation; and

     - reduction in or delay of capital spending by clients due to
       the effects of terrorism, war and political instability.

     The Company believes that its planned growth and
profitability will depend in large part on the ability to promote
its services, gain clients and expand its relationship with
current clients.  Accordingly, the Company intends to invest in
marketing, strategic partnerships, and development of its client
base.  If the Company is not successful in promoting its services
and expanding its client base, this may have a material adverse
effect on its financial condition and the ability to continue to
operate the business.

     The Company is also subject to the following specific
factors that may affect its operating results:

(a)  Competition.

     The market for products and services offered by the
Company is highly competitive.  The Company's future success will
depend on its ability to adapt to rapidly changing technologies,
evolving industry standards, product offerings and evolving
demands of the marketplace.

     Some of our competitors have:

     - longer operating histories;

     - larger customer bases;

     - greater name recognition and longer relationships with
       clients; and

     - significantly greater financial, technical, marketing,
       public relations and managerial resources than the Company.

     Competitors may develop or offer services that provide
significant (technological, creative, performance, price) or
other advantages over the products offered by the Company .  If
the Company fails to gain market share or lose existing market
share, its financial condition, operating results and business
could be adversely affected and the value of an investment in the
Company could be reduced significantly.   The Company may not
have the financial resources, technical expertise or marketing,
distribution or support capabilities to compete successfully.

(b)  Technological and Market Changes.

     The markets in which the Company competes are
characterized by rapid technological change, frequent new product
introductions, evolving industry standards and changing needs of
customers.  There can be no assurance that the Company's existing
products will continue to be properly positioned in the market or
that the Company will be able to introduce new or enhanced
products into the market on a timely basis, or at all.
Currently, the Company is focusing on upgrading and introducing
new products.  There can be no assurance that enhancements to
existing products or new products will receive customer
acceptance.  As competition in the electronic payments industry
increases, it may become increasingly difficult for the Company
to be competitive.

     Risks associated with the development and introduction
of new products include delays in development and changes in
payment processing, and operating system technologies that could
require the Company to modify existing products.  There is also
the risk to the Company that there may be delays in initial
shipments of new products. Further risks inherent in new product
introductions include the uncertainty of price-performance
relative to products of competitors, competitors' responses to
the introductions and the desire by customers to evaluate new
products for longer periods of time.

(c)  New Versions of Company's Products May Contain Errors
or Defects.

     The Company's products are complex and, accordingly,
may contain undetected errors or failures when first introduced
or as new versions are released.  This may result in the loss of,
or delay in, market acceptance of the Company's products.  The
Company may in the future discover errors and additional
scalability limitations in new releases or new products after the
commencement of commercial shipments or be required to compensate
customers for such limitations or errors, as a result of which
our business, cash flow, financial condition and results of
operations could be materially adversely affected.

(d)  Protection of Proprietary Rights.

     The Company's success and ability to compete will be
dependent in part on the protection of its potential patents,
trademarks, trade names, service marks and other proprietary
rights.  The Company intends to rely on trade secret and
copyright laws to protect the intellectual property that it plans
to develop, but there can be no assurance that such laws will
provide sufficient protection to us, that others will not develop
a service that are similar or superior to ours, or that third
parties will not copy or otherwise obtain and use our proprietary
information without authorization.  In addition, certain of the
Company's know-how and proprietary technology may not be patentable.

     The Company may rely on certain intellectual property
licensed from third parties, and may be required to license
additional products or services in the future, for use in the
general operations of its business plan.  The Company currently
has no licenses for the use of any specific products.  There can
be no assurance that these third party licenses will be available
or will continue to be available to the Company on acceptable
terms or at all.  The inability to enter into and maintain any of these
licenses could have a material adverse effect on the Company's business,
financial condition or operating results.

     There is a risk that some of the Company's products may
infringe the proprietary rights of third parties.  In addition,
whether or not the Company's products infringe on proprietary
rights of third parties, infringement or invalidity claims may be
asserted or prosecuted against it and it could incur significant
expense in defending them.  If any claims or actions are asserted
against us, wet may be required to modify its products or seek
licenses for these intellectual property rights.  The Company may
not be able to modify its products or obtain licenses on
commercially reasonable terms, in a timely manner or at all.  The
Company's failure to do so could have a negative affect on its
business and revenues.

(e)  Economic Conditions.

     The Company's business can be affected by the general
condition of the world economy, as well as by social, political
and military conditions.  In light of the current economic
environment these factors could have a material adverse impact on
the Company's business, operating results, and financial
condition and we may continue to incur losses for the foreseeable
future.

(f)  Key Personnel.

     The Company's success is largely dependent on the
personal efforts and abilities of the Company's senior
management.  The loss of certain members of the Company's
management, including its chief executive officer, could have a
material adverse effect our business and prospects.

     The Company intends to recruit in fiscal year 2005
employees who are skilled in the products of the Company.  The
failure to recruit these key personnel could have a material
adverse effect on the Company's business. As a result, the
Company may experience increased compensation costs that may not
be offset through either improved productivity or higher revenue.
There can be no assurances that the Company will be successful in
retaining existing personnel or in attracting and recruiting
experienced qualified personnel.

Operating Activities.

     The net cash used by operating activities was $122,234 for
the three months ended March 31, 2005 as compared to $117,484 (as
restated) for the three months ended March 31, 2004, an increase
of $4,750 or approximately 4%.  There were several contributors
to this increase, including an increase in amortization of
discount on convertible note payable.

Liquidity and Capital Resources.

     As of March 31, 2005, the Company had total current assets
of $75,014 and total current liabilities of $759,414, resulting
in a working capital deficit of $684,400; as of that date, the
Company had cash of $15,156.  During the three months ended March
31, 2005 and 2004, the Company incurred losses of $394,279 and
$397,042, respectively, and the Company had an accumulated
deficit of $9,348,361 as of March 31, 2005.  These factors raise
substantial doubt as to the Company's ability to continue as a
going concern.  In fact, the Company's independent accountants'
audit report included in the Form 10-KSB for the year ended
December 31, 2004 includes a substantial doubt paragraph
regarding the Company's ability to continue as a going concern.

     The accompanying financial statements have been prepared
assuming that the Company continues as a going concern that
contemplates the realization of assets and the satisfaction of
liabilities in the normal course of business assuming the Company
will continue as a going concern.  However, the ability of the
Company to continue as a going concern on a longer-term basis
will be dependent upon its ability to generate sufficient cash
flow from operations to meet its obligations on a timely basis,
to retain its current financing, to obtain additional financing,
and ultimately attain profitability.

     Our current cash flow from operations will not be sufficient
to maintain our capital requirements for the next twelve months.
Accordingly, the Company will need to continue raising capital
through either debt or equity instruments.  The Company believes
it will need to raise up to $5,000,000 during the next twelve
months so it may continue executing its business plans.  Whereas
the Company has in the past raised capital (in the absence of any
equity investment, the Company has previously relied upon short-
term borrowings in the form of purchase order and invoice
factoring), no assurance can be given that these sources of
financing will continue to be available to us and/or that demand
for our equity/debt instruments will be sufficient to meet its
capital needs, or that financing will be available on terms
favorable to the Company.  As of March 31, 2005, the Company had
no significant sources of liquidity.  The financial statements do
not include any adjustments relating to the recoverability and
classification of liabilities that might be necessary should the
Company be unable to continue as a going concern.

     If funding is insufficient at any time in the future, the
Company may not be able to take advantage of business
opportunities or respond to competitive pressures, or may be
required to reduce the scope of its planned product development
and marketing efforts, any of which could have a negative impact
on its business, operating results and financial condition.  In
addition, insufficient funding may have a material adverse effect
on the Company's financial condition, which could require it to:

     - curtail operations significantly;

     - sell significant assets;

     - seek arrangements with strategic partners or other parties
       that may require the Company to relinquish significant
       rights to products, technologies or markets; or

     - explore other strategic alternatives including a merger or
       sale of the Company.

     To the extent that the Company raises additional capital
through the sale of equity or convertible debt securities, the
issuance of such securities will result in dilution to existing
stockholders.  If additional funds are raised through the
issuance of debt securities, these securities may have rights,
preferences and privileges senior to holders of common stock and
the terms of such debt could impose restrictions on the Company's
operations.  Regardless of whether the Company's cash assets
prove to be inadequate to meet the Company's operational needs,
the Company may seek to compensate providers of services by
issuance of stock in lieu of cash, which will also result in
dilution to existing shareholders.

Off Balance Sheet Arrangements.

     The Company does not engage in any off balance sheet
arrangements that are reasonably likely to have a current or
future effect on our financial condition, revenues, results of
operations, liquidity or capital expenditures.

Inflation.

     The impact of inflation on our costs and the ability to pass
on cost increases to its customers over time is dependent upon
market conditions. We are not aware of any inflationary pressures
that have had any significant impact on our operations over the
past quarter, and the Company does not anticipate that
inflationary factors will have a significant impact on future
operations.

Critical Accounting Policies.

     The Securities and Exchange Commission ("SEC") has issued
Financial Reporting Release No. 60, "Cautionary Advice Regarding
Disclosure About Critical Accounting Policies" ("FRR 60"),
suggesting companies provide additional disclosure and commentary
on their most critical accounting policies.  In FRR 60, the SEC
has defined the most critical accounting policies as the ones
that are most important to the portrayal of a company's financial
condition and operating results, and require management to make
its most difficult and subjective judgments, often as a result of
the need to make estimates of matters that are inherently
uncertain.  Based on this definition, the Company's most critical
accounting policies include: (a) use of estimates in the
preparation of financial statements; (b) stock based compensation
arrangements; and (c) revenue recognition.  The methods,
estimates and judgments the Company uses in applying these most
critical accounting policies have a significant impact on the
results the Company reports in its financial statements.

(a)  Use of Estimates in the Preparation of Financial Statements.

     The preparation of these financial statements requires the
Company to make estimates and judgments that affect the reported
amounts of assets, liabilities, revenues and expenses, and
related disclosure of contingent assets and liabilities.  On an
on-going basis, the Company evaluates these estimates, including
those related to revenue recognition and concentration of credit
risk.  The Company bases its estimates on historical experience
and on various other assumptions that is believed to be
reasonable under the circumstances, the results of which form the
basis for making judgments about the carrying values of assets
and liabilities that are not readily apparent from other sources.
Actual results may differ from these estimates under different
assumptions or conditions.

(b)  Stock-Based Compensation Arrangements.

     The Company intends to issue shares of common stock to
various individuals and entities for management, legal,
consulting and marketing services.  These issuances will be
valued at the fair market value of the service provided and the
number of shares issued is determined, based upon the open market
closing price of common stock as of the date of each respective
transaction.  These transactions will be reflected as a component
of selling, general and administrative expenses in the
accompanying statement of operations.

(c)  Revenue Recognition.

     Sales of commercial products under long-term contracts and
programs are recognized in the accounts as deliveries are made.
The estimated sales value of fixed price contracts in process is
recognized under the percentage-of-completion method of
accounting in which the estimated sales value is determined on
the basis of physical completion to date.

Forward Looking Statements.

     Information in this Form 10-QSB contains "forward looking
statements" within the meaning of Rule 175 of the Securities Act
of 1933, as amended, and Rule 3b-6 of the Securities Act of 1934,
as amended.  When used in this Form 10-QSB, the words "expects,"
"anticipates," "believes," "plans," "will" and similar
expressions are intended to identify forward-looking statements.
These are statements that relate to future periods and include,
but are not limited to, statements regarding our adequacy of
cash, expectations regarding net losses and cash flow, our need
for future financing, our dependence on personnel, and our
operating expenses.

     Forward-looking statements are subject to certain risks and
uncertainties that could cause actual results to differ
materially from those projected.  These risks and uncertainties
include, but are not limited to, those discussed above as well as
risks set forth above under "Factors That May Affect Operating
Results."  These forward-looking statements speak only as of the
date hereof.  The Company expressly disclaims any obligation or
undertaking to release publicly any updates or revisions to any
forward-looking statements contained herein to reflect any change
in its expectations with regard thereto or any change in events,
conditions or circumstances on which any such statement is based.

ITEM 3.  CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures.

     The Company maintains disclosure controls and procedures (as
defined in Rule 13a-15(e) and Rule 15d-15(e) under the Securities
Exchange Act of 1934, as amended) that are designed to ensure
that information required to be disclosed in our periodic reports
filed under the Exchange Act is recorded, processed, summarized
and reported within the time periods specified in the SEC's rules
and forms, and that such information is accumulated and
communicated to our management, including our principal executive
officer, to allow timely decisions regarding required disclosure.

     As of the end of the period covered by this report, our
management carried out an evaluation, under the supervision and
with the participation of our principal executive officer, of our
disclosure controls and procedures (as defined in Rule 13a-15(e)
and Rule 15d-15(e) of the Exchange Act).  Based upon the
evaluation, our principal executive officer concluded that our
disclosure controls and procedures are effective to ensure that
information required to be disclosed by us in the reports that we
file or submit under the Exchange Act is recorded, processed,
summarized and reported, within the time periods specified in the
Commission's rules and forms.

     Because of the inherent limitations in all control
systems, no evaluation of controls can provide absolute assurance
that all control issues and instances of fraud, if any, will be
or have been detected.  These inherent limitations include the
realities that judgments in decision-making can be faulty, and
that breakdowns can occur because of simple error or mistake.
Additionally, controls can be circumvented by the individual acts
of some persons, by collusion of two or more people, and/or by
management override of the control.  The design of any system of
controls also is based in part upon certain assumptions about the
likelihood of future events, and there can be no assurance that
any design will succeed in achieving its stated goals under all
potential future conditions; over time, controls may become
inadequate because of changes in conditions, and/or the degree of
compliance with the policies and procedures may deteriorate.
Because of the inherent limitations in a cost-effective internal
control system, misstatements due to error or fraud may occur and
not be detected.

Changes in Disclosure Controls and Procedures.

     There were no significant changes in the Company's
disclosure controls and procedures, or in factors that could
significantly affect those controls and procedures since their
most recent evaluation.

PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS.

     Other than as set forth below, the Company is not a party to
any material pending legal proceedings and, to the best of its
knowledge, no such action by or against the Company has been
threatened.

     (a)  On January 30, 2004, a complaint was filed in the
District Court of Adams County, Colorado: Robert Hainey and
Internet Marketing Solutions, Inc. v. World Am Communications,
Inc. and Isotec, Inc.  The complaint, which has causes of action
for breach of contract and unjust enrichment, alleges that the
defendants failed to pay the plaintiffs for certain consulting
and public relations and related work, reimbursement of certain
business expenses incurred on behalf of the defendants, and to
repay a loan made by the plaintiffs to the defendants.  The
complaint seeks total monetary damages of approximately $308,000.
The Company has retained counsel in the matter and is preparing
an answer and cross-complaint for filing. The Company intends to
vigorously defend the matter.  The Company does not believe the
outcome of this matter will have an adverse effect on the Company.

     (b)  On October 25, 2004, a complaint was filed in the
United States District Court, District of Colorado: Mitchell
Vince V. Isotec, Inc. and World Am, Inc.  The complaint alleges
that Isotec terminated Mr. Vince without cause prior to the
expiration of the term of an alleged employment agreement.  The
complaint seeks monetary damages of $240,000.  The Company has
retained counsel in the matter and responsive pleadings have been
filed. The Company intends to vigorously defend the matter.  The
Company does not believe the outcome of this matter will have an
adverse effect on the Company.

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

     The Company sold the following unregistered (restricted)
equity securities during the quarter ended March 31, 2005:

     (a)  Between January 6, 2005 and January 20, 2005, the
Company granted options covering a total of 269,650 (26,965,000
pre-split) shares of common stock to certain Company employees
and consultants, including its chief executive officer and his
wife.  These options were granted under the Company's Amended and
Restated Employee Stock Incentive Plan.  These options, which are
exercisable into free trading shares of common stock under that
plan, are exercisable at 65% of the fair market value of the
Company's common stock on the date the stock option is granted.
All these option were immediately exercised resulting in proceeds
to the Company of $23,058.

     (b)  During February 2005, the Company issued a $30,000
convertible note payable to an individual.  The convertible note
payable matures during June 2005, is unsecured, and bearing
interest at 10%.  The note is convertible by the holder prior to
maturity, in multiples of $1,000 principal amount, into shares of
the Company's common stock.  The number of shares of the
Company's common stock shall be determined by dividing the
principal amount to be converted by the lowest bid price of the
Company's common stock during the 180-day period following the
issuance of the note.  In the event the holder converts prior to
the end of the pricing period, the number of shares of the
Company's common stock shall be determined by dividing the
principal amount to be converted by the lowest reported bid price
of the Company's common stock between the date of issuance of the
note and date of conversion.

     The holder of the convertible note also a warrant to
purchase shares of the Company's common stock that expire during
February 2008.  The number of shares to be received by the holder
shall be determined by dividing the purchase price by the lowest
bid price of the Company's common stock during the thirty day
period following the pricing period.  In the event the holder
exercises prior to the end of the pricing period, the number of
shares of the Company's common stock that may be acquired upon
exercise of the warrant shall be determined by dividing the
purchase price of the warrant by the lowest reported bid price of
the Company's common stock between the date of grant and the date
of exercise of the warrant.

     No commissions were paid in connection with these sales.
These sales were undertaken under Rule 506 of Regulation D under
the Securities Act of 1933, as amended ("Act").  These
transactions did not involve a public offering and the Alexanders
represented that they were "sophisticated" investors as defined
in Rule 502 of Regulation D.

     There were no purchases of common stock of the Company by
the Company or its affiliates during the three months ended March
31, 2005.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES.

     Not Applicable.

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

     None

ITEM 5.  OTHER INFORMATION.

Subsequent Events.

(a)  Stock Issuances.

     During April 2005, the Company issued 1,335,979 shares of
its common stock for services totaling $134,254.

     During May 2005, the Company issued 831,695 shares of its
common stock for services totaling $58,219.

(b)  Factoring and Security Agreement.

     On April 25, 2005, the Company entered into a Factoring and
Security Agreement ("Agreement") to factor its accounts
receivable up to $75,000 (with recourse) with J.J. Ellis, LLC, a
Florida limited liability company ("JJE").  Under the terms of
the Agreement, the Company is required to pay JJE a one-time
factoring and documentation origination fee of $2,500 payable the
equivalent of free trading stock and warrants to purchase shares
of the Company's common stock totaling $25,000 for a period of
three years.  The number of warrants to be received by JJE is to
be determined by dividing $25,000 by the lesser of a 20% discount
on the bid price on the day of execution or the lowest reported
bid price of the Company's common stock during a 365 day period
following the date of the Agreement ("Pricing Period").  If JJE
wished to exercise the warrants prior to the termination of the
Pricing Period, then the number of warrants to be received will
be calculated based on the lesser of the lowest reported bid
price of the Company's common stock since the date of the
Agreement or a 20% discount on the bid price on the day of
execution.  The purchase price for each accepted account is equal
to (i) the face amount of such accepted account less (ii) the
commission, and less (iii) JJE's fee (discount), and less (iv)
the amount of any trade or cash discounts, credits or allowances,
or any other reductions or adjustments to such accepted accounts.
Through May 13, 2005, the Company has factored approximately
$29,000 of its accounts receivable.

(c)  Loan Agreement.

     During June 2004, the Company entered into a loan agreement
with Mercatus & Partners, LLC ("Lender") whereby the Lender
agreed to use its best efforts to provide the Company a loan in
the maximum amount of $2,000,000 subject to certain terms and
conditions. The Company agreed to issue 1,370 shares of Class A
Preferred stock that is convertible to common stock at a ratio of
1-to-1,000,000 as collateral on the loan.  The shares were issued
during June 2004 and recorded them as issued but not outstanding
as of March 31, 2005. The lender did not fund the loan and
accordingly, the Company provided a written demand for the return
of the shares, as provided in the loan agreement.

     During May 2005, the Lender assigned all rights set forth in
the loan agreement to Coldwater Capital Partners, LLC, including
the 1,370 shares of Class A Preferred stock held as collateral on
the loan. The Company has approved to this assignment. Through
the date of this filing, the Company has not received funding
under the terms of this loan agreement.

(d)  Payroll Taxes Payable.

     As of March 31, 2005, payroll taxes payable consists of late
payroll taxes for both payroll and stock option activity totaling
an estimated $253,700.  The Company is attempting to fully
resolve this payable to the Internal Revenue Service by the end
of 2005.

ITEM 6.  EXHIBITS.

     Exhibits included or incorporated by reference herein are
set forth in the attached Exhibit Index.

                                   SIGNATURE

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

                                       World Am, Inc.



Dated: May 24, 2005                    By: /s/ James H. Alexander
                                       James H. Alexander
                                       President/Chief Executive Officer


                                      EXHIBIT INDEX

Number           Description

2.1     Agreement and Plan of Merger between the Company and
        Allmon Corporation, dated May 11, 2000 (incorporated by
        reference to Exhibit 2.1 of the Form 8-K12g-3 filed on
        May 16, 2000).

2.2     Stock Purchase Agreement between the Company, Isotec,
        Incorporated, and selling shareholders, dated February
        22, 2000 (incorporated by reference to Exhibit 2.2 of
        the Form 10-QSB filed on May 21, 2001).

2.3     Share Exchange Agreement between the Company and World
        Am Security Venture Company, Ltd., dated May 18, 2004
        (incorporated by reference to Exhibit 2 of the Form 8-K
        filed on May 26, 2004).

3.1     Articles of Incorporation, dated July 5, 2002
        (incorporated by reference to Exhibit 3.1 of the Form
        10-QSB/A filed on February 5, 2004).

3.2     Certificate of Amendment to Articles of Incorporation,
        dated August 20, 2002 (incorporated by reference to
        Exhibit 3.2 of the Form 10-QSB/A filed on February 5, 2004).

3.3     Certificate of Amendment to Articles of Incorporation,
        dated December 20, 2002 (incorporated by reference to
        Exhibit 3.3 of the Form 10-QSB/A filed on February 5, 2004).

3.4     Certificate of Amendment to Articles of Incorporation,
        dated August 2, 2004 (incorporated by reference to
        Exhibit 3.4 of the Form 10-QSB filed on August 20, 2004).

3.5     Certificate of Amendment of Articles of Incorporation,
        dated November 8, 2004 (incorporated by reference to
        Exhibit 3.1 of the Form 8-K filed on November 16, 2004).

3.6     Certificate of Amendment of Articles of Incorporation,
        dated November 8, 2004 (incorporated by reference to
        Exhibit 3.2 of the Form 8-K filed on November 16, 2004).

3.7     Bylaws, dated May 15, 2000 (incorporated by reference
        to Exhibit 3.2 of the Form 8-K12g-3 filed on May 16, 2000).

4.1     Employee Stock Incentive Plan, dated January 22, 2001
        (incorporated by reference to Exhibit 4.1 of the Form
        S-8 filed on January 29, 2001).

4.2     Non-Employee Directors and Consultants Retainer Stock
        Plan, dated January 5, 2001 (incorporated by reference
        to Exhibit 4.2 of the Form S-8 filed on January 29, 2001).

4.3     Common Stock Purchase Agreement between the Company and
        Four Way Associates, Inc., dated June 1, 2001
        (incorporated by reference to Exhibit 4.3 of the Form
        SB-2 filed on August 28, 2001).

4.4     Amended and Restated Employee Stock Incentive Plan,
        dated November 20, 2001 (incorporated by reference to
        Exhibit 4.1 of the Form S-8 POS filed on January 31, 2002).

4.5     Amended and Restated Non-Employee Directors and
        Consultants Retainer Stock Plan, dated November 20,
        2001 (incorporated by reference to Exhibit 4.2 of the
        Form S-8 POS filed on January 31, 2002).

4.6     2002 Non-Employee Directors and Consultants Retainer
        Stock Plan, dated September 12, 2002 (incorporated by
        reference to Exhibit 4 of the Form S-8 filed on
        September 18, 2002).

4.7     2002 Stock Compensation Plan, dated December 16, 2002
        (incorporated by reference to Exhibit 4 of the Form S-8
        filed on December 23, 2002)

4.8     2003 Consultants Stock Compensation Plan dated August
        19, 2003 (incorporated by reference to Exhibit 4 of the
        Form S-8 filed on August 22, 2003).

4.9     2003  Non-Qualified  Stock  Option  Plan, dated
        September 29, 2003  (incorporated by reference to
        Exhibit 4 of the Form S-8 filed on October 1, 2003).

4.10    Amended and Restated Non-Employee Directors and
        Consultants Retainer Stock Plan (Amendment No. 2),
        dated February 10, 2004 (incorporated by reference to
        Exhibit 4 of the Form S-8 POS filed on February 13, 2004).

4.11    Amended and Restated Non-Employee Directors and
        Consultants Retainer Stock Plan (Amendment No. 3),
        dated June 1, 2004 (incorporated by reference to
        Exhibit 4 of the Form S-8 POS filed on June 10, 2004).

4.12    Amended and Restated Employee Stock Incentive Plan
        (Amendment No. 2), dated July 15, 2004 (incorporated by
        reference to Exhibit 4 of the Form S-8 POS filed on
        August 6, 2004).

4.13    Amended and Restated Non-Employee Directors and
        Consultants Retainer Stock Plan (Amendment No. 4),
        dated October 12, 2004 (incorporated by reference to
        Exhibit 4 of the Form S-8 POS filed on October 19, 2004).

4.14    Amended and Restated Non-Employee Directors and
        Consultants Retainer Stock Plan (Amendment No. 5),
        dated December 1, 2004 (incorporated by reference to
        Exhibit 4 of the Form S-8 POS filed on December 13, 2004).

10.1    Employment Agreement between the Company and James
        Alexander, dated February 20, 2002 (incorporated by
        reference to Exhibit 10.4 of the Form 10-QSB filed on
        May 14, 2002).

10.2    Amendment A to Employment Agreement between the Company
        and James Alexander, dated as of February 20, 2002
        (incorporated by reference to Exhibit 10.1 of the Form
        10-KSB filed on April 11, 2003).

10.3    Amendment B to Employment Agreement between the Company
        and James Alexander, dated January 15, 2004
        (incorporated by reference to Exhibit 10.3 of the Form
        10-KSB fled on April 20, 2004).

14      Code of Business Conduct and Ethics, adopted by the
        Company's board of directors (incorporated by reference
        to Exhibit 14 of the Form 10-KSB filed on April 20, 2004).

16      Letter on Change in Certifying Accountant (incorporated
        by reference to Exhibit 16 of the Form 8-K/A filed on
        July 12, 2004).

21      Subsidiaries of the Company (incorporated by reference
        to Exhibit 21 of the Form 10-KSB filed on April 16, 2002).

23      Consent of Independent Registered Public Accounting
        Firm (incorporated by reference to Exhibit 23 of the
        Form 10-KSB filed on April 21, 2005).

31      Rule 13a-14(a)/15d-14(a) Certification of James H.
        Alexander (filed herewith).

32      Section 1350 Certification of James H. Alexander (filed herewith).

99.1    Press release issued by the Company, dated October 7,
        2003 (incorporated by reference to Exhibit 99 of the
        Form 8-K filed on December 30, 2003).

99.2    Text of press release issued by the Company, dated May
        26, 2004 (incorporated by reference to Exhibit 99 of
        the Form 8-K filed on May 26, 2004).

99.3    Confirmation of Provisional Patent Application, dated
        September 2, 2004 (incorporated by reference to Exhibit
        99.3 of the Form 10-KSB filed on April 21, 2005).

99.4    Confirmation of Provisional Patent Application, dated
        September 2, 2004 (incorporated by reference to Exhibit
        99.4 of the Form 10-KSB filed on April 21, 2005).