<PAGE>

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

                               Amendment No. 1 to
                                   FORM 10-KSB/A

(Mark One)
[X]      Annual Report Pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934 [Fee Required]


For the fiscal year ended December 31, 2000 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 33-7764-C

                Interactive Gaming and Communications Corp. Inc.
                ------------------------------------------------
               Exact name of registrant as specified in charter)


          DELAWARE                                              23-2838676
(State or other jurisdiction of                              (I.R.S. Employer
 incorporation or organization)                             Identification No.)



             1220 Valley Forge Road Bldg #19, Valley Forge PA 19462
             ------------------------------------------------------
               (Address of principal executive offices) (Zip Code)

Registrant's telephone number, including area code: (610) 941-0305


        Securities registered pursuant to Section 12(b) of the Act: NONE

           Securities registered pursuant to Section 12(g) of the Act:

                    Common Stock, $0.001/par value per share

                                (Title of class)



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

As of May 24, 2001, there were 23,084,903 shares of the Registrant's common
stock outstanding. The aggregate market value of the Registrant's voting stock
held by nonaffiliates of the Registrant was approximately $2,263,772 computed at
the closing price for the Registrant's common stock on the NASD Bulletin Board
on May 24, 2001.


<PAGE>

                                     PART I


ITEM I.  BUSINESS

GENERAL

HISTORY AND ORGANIZATION

Interactive Gaming & Communications Corp. and formerly, Sports International
Ltd.) the ("Company") was incorporated in the state of Delaware in June 1986
under the name of "Entertainment Tonight Video Express Ltd." to develop a market
for the home delivery of video cassette rentals, which effort was abandoned in
November 1987. From December 1987 until August 1994, the Company did not conduct
any operations, transactions or business activities. In August 1994, the Company
began negotiations to acquire Sports International, Ltd. (Antigua) and its
business from the stockholders of Sports International, Ltd. (Antigua), and
successfully closed the transaction in October 1994, in accordance with its Plan
of Reorganization.

PLAN OF REORGANIZATION

At the Special Meeting of Shareholders held on September 9, 1994, the
shareholders of the Company approved a Plan of Reorganization which required;
(1) the reverse split of one (1) for four (4) shares of the common stock of the
Company; (2) the acquisition of Sports International, Ltd. (Antigua) by the
exchange of Stock and Notes; (3) the election of former officers and directors
of Sports International, Ltd. (Antigua) to the Board of Directors of the
Company, and (4) the amendment of the Company's Certificate of Incorporation
changing the Company's name from Entertainment Tonight Video Express Ltd. to
Sports International, Ltd. Effective March 27, 1996, the Company changed its
name to Interactive Gaming & Communications Corp. to reflect its expanding
operations.

ACQUISITION - EXCHANGE OF STOCK AND NOTES

NONE

NATURE OF OPERATIONS

The Company is a holding company publicly trading on the National Association of
Securities Dealers Automated Over the Counter (OTC) Market Bulletin Board under
the trading symbol "IGAC". Intersphere Communications, Ltd. (PA) ("Intersphere")
and Interactive Gaming Corp. (Delaware) ("IGC"). Each of the Company's
subsidiaries provides several unique and proprietary products and services to
the emerging Internet, national and international marketplaces. The Company is
responsible for supplying its subsidiaries with administrative and management
assistance, accounting, consulting and necessary funding to complete projects or
initiate endeavors.

Intersphere is a software development, marketing and Internet Communications
Company specializing in the Internet market. Intersphere developed the
LiveAction Gaming Platform (formerly known as WiseGuy) wagering system, the
first wagering system that allows casino race & sports books to take a wager
from a customer over the Internet. The LiveAction Gaming Platform was first used
by Sports in 1995. Intersphere's revenues are derived from Web Page Development
and Design, traditional advertising, licensing of the LiveAction Gaming Platform
and the development of other related gaming software products and B to B
Internet solutions.

INDUSTRY SEGMENTS

The gaming industry is comprised of five separate service industries; (1)
traditional pari-mutuel wagering on horse and dog racing; (2) casino and
riverboat gambling; (3) lotteries; (4) charitable organization gambling (Bingo
and Las Vegas Nights); and (5) sports book.

The Company operates in all of the above segments via the Internet/Intranet,
telecommunications and broadband video streaming utilizing proprietary software
developed by its subsidiaries and joint venture affiliates. The Company derives
its revenues from licensing fees and royalties on its products, advertising
revenue from its portal web sites and Internet related Business to Business
development and design services.

                                       1
<PAGE>

MARKETING

The Company primarily advertises its products and services during peak periods
of sporting events (September through April) in both gaming and gambling related
magazines and newspapers, and will continue this method of advertising in the
future. The success of increased revenues is directly dependent upon the amount
of advertising in both conventional and Internet markets.

INTELLECTUAL PROPERTY

The Company currently holds no patents. However, the Company has applied for US
Trademark registration for several of its software products and marketing.

GOVERNMENT REGULATION

NONE

FUTURE DEVELOPMENTS

The Company also has plans to develop an Internet/Intranet based pari-mutuel
wagering system for the thoroughbred horse racing and greyhound racing industry.
The system when completed will also offer to pari-mutuel operators the ability
to Broadband video stream its live races to its customer while at the same time
making a wager. The system will be designed to replace existing pari-mutuel
systems while at the same time interface with existing systems until replacement
can be effectively accomplished. The finished product will be marketed to Horse
tracks, Greyhound tracks and Jai-Lai facilities worldwide through its subsidiary
IGC.

EMPLOYEES

As of December 2000, the Company had 4 full-time employees: 1 software
engineer; 1 marketing personnel; 2 HTML writer. The Company also utilizes
full-time and part-time consultants on an as-needed basis. None of the company's
employees is represented by a labor union and the Company believes its relations
with its employees are satisfactory.

BACKLOG

The nature of the Company's business does not involve any backlog.

INSURANCE

The Company maintains general liability and workers' compensation insurance,
which covers injury to employees.

COMPETITION

Many segments of the Internet, Internet gaming and pari-mutuel wagering industry
are characterized by intense competition, with a large number of companies and
syndicates offering similar wagering systems, Business to Business and Internet
solutions. All of these entities in most instances have vastly greater resources
than the Company.

The Company estimates that there are several companies that offer similar
Internet/intranet casino race & sports book products. However, since the
majority of these enterprises are privately owned, and financial information is
not publicly available, the Company is unable to evaluate its position among its
competitors.

ITEM 2. PROPERTIES

LEASES

The Company leases office space in Valley Forge, Pennsylvania on a month to
month basis. Rental expense under operating leases was $ 41,023 $ 46,088 in 2000
and 1999, respectively.

                                       2
<PAGE>

ITEM 3.  LEGAL PROCEEDINGS

The Company has filed suit against International Gaming to collect payments due
under a $4,990,000 note representing payment for the capital stock of Sports
International, Inc. and Global Casinos, Inc. (Note 19). International Gaming has
filed an Answer and Counterclaim asserting there were material misstatements,
misrepresentations and omissions from the warranties and representations
provided under the Stock Purchase Agreement between the two Companies. The
Company has been advised by competent legal counsel that they will receive a
judgment, though collection of the amount owed is still uncertain.

The Company was sued by, among others, Empire Corporation ("Empire"), who
claimed the Company improperly terminated an alleged Joint Venture Agreement,
appropriated certain funds belonging to Empire under the agreement and otherwise
refused to pay monies due to Empire. Empire also asserted claims of fraud and
breach of fiduciary duty. An answer, new matter and counterclaim has been filed
by the Company asserting that the Agreement had been properly terminated and
that funds are due the Company from Empire. Empire claims damages in excess of
$160,000 as well as punitive damage in the amount of $1,000,000. The Company's
counterclaim seeks damages in excess of $95,000.

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

NONE


                                       3
<PAGE>

                                     PART II

ITEM 5. MARKET PRICE FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
        MATTERS

After the Company completed a Plan of Reorganization, its Common Stock resumed
trading on the National Association of Securities Dealers Automated Over the
Counter Market (OTC) Bulletin Board on December 19, 1994, under the trading
symbol "SBET". The following table sets forth high and low closing sales prices
(in dollars) for the Company's Common Stock, as reported on the Bulletin Board,
since trading resumed.

                             2000                1999              1998
                       High      Low        High     Low       High     Low
First Quarter                               2.25     .18       .21      .13
Second Quarter         0.8438    0.1094      .875    .35       .16      .11
Third Quarter          0.1875    0.125      1.25     .3125     .44      .13
Fourth Quarter         0.0938    0.0156     1.41     .49       .08      .05

On May 24, 2001 the last reported sales price for the Common Stock was $0.03.

On May 24, 2001 the Company had approximately 1550 shareholders.

DILUTION AND ABSENCE OF DIVIDENDS

The Company has not paid any cash dividends on its common stock in the past and
does not anticipate paying any such cash dividends in the foreseeable future.
Earnings, if any, will be retained to finance future growth. The Company may
issue shares of its common stock in private and/or public offerings to obtain
financing, capital, or to acquire other businesses that can improve the
performance and growth of the Company. Issuance/sales of substantial amounts of
common stock could adversely affect prevailing market prices in the Common Stock
of the Company.

DESCRIPTION OF THE COMPANY'S SECURITIES

Common Stock

The authorized capital stock of the Company consists of 75,000,000 shares, $.001
par value ("Common Stock"), of which 23,084,903 shares are issued and
outstanding as at May 24, 2000.

Approximately 10,807,369 shares of Common Stock issued in connection with the
reverse merger acquisition, conversion of Notes, and for certain services and
the gaming license are "restricted" shares, as such term is used in Rule 144 of
the Securities Act of 1993, as amended.

The holders of Common Stock are entitled to one vote per share for the election
of directors and all other purposes and do not have cumulative voting rights.
The holders of Common Stock are entitled to receive dividends when, as, and if
declared by the Board of Directors and, in the event of the liquidation by the
Company, to receive prorata all assets remaining after payment of debts and
expenses. Holders of the Common Stock do not have any pre-emptive or other right
to subscribe for or purchase additional shares of capital stock. All the
outstanding shares of Common Stock are fully paid and non-assessable.

SALE OF UNREGISTERED COMMON STOCK AND COMMON STOCK WARRANTS

Effective June 26, 1996, the Company entered into a stock and warrant purchase
agreement with a software developer and issued 375,000 shares of restricted
common stock for $750,001 and a common stock purchase warrant for $1,000. The
common stock purchase warrant is for 100,000 shares at a purchase price of $1.00
per share and expires on June 30, 2001. The Company's private offering
represented 3.3% of the outstanding common stock at June 26, 1996.

On October 11, 1996, the Company issued 254,474 shares of restricted common
stock in settlement of accounts payable of $508,947 incurred in the development
of the "Virtual Casino" software.

On June 30, 1997, the Company issued 29,250 shares of restricted common stock in
settlement of service of $42,000 rendered in the development of the "Virtual
Casino" software.

On May 25,1999 the company issued a warrant for 4,000,000 shares of the
Company's common stock at a purchase price of $0.01 per share and expires on
December 31, 2004. The warrants were issued in connection with the Company's
sale Gamblenet Technologies, Ltd. ("Gamblenet") for $2,600,000 consisting of
$140,000 in cash and a five year note for $2,500,000.00

                                       4
<PAGE>

On December 30, 1999 the Company issued 7,500,000 shares of restricted common
stock pursuant to an agreement entered into on June 22, 1999 with Century
Industries, Inc. ("Century"). The agreement calls for certain control block
shareholders of Century to sell to the Company 53.26% of Century's issued and
outstanding Class A shares in exchange for the Company's common stock. As of May
24, 2000 the deal has not been completed. However, the Company anticipates the
finalization of the Century acquisition to take place in the immediate future.

PREFERRED STOCK

In May 1995, the shareholders approved an amendment of the Company's Certificate
of Incorporation to authorize the issuance of up to 10,000,000 shares of
preferred stock. The amendment permits the Board of Directors to issue from time
to time authorized but un-issued shares of preferred stock and to fix and
determine the terms, limitations, relative rights and preferences of such
shares.

On December 30,1999 the company's Board of Directors, in connection with the
Century control block acquisition, have approved the issuance of 1,000,000
shares of Series A Voting Convertible Preferred stock with each share having the
equivalent of fifteen (15) common stock votes. The shares may be converted into
shares of the Company at 15 shares Common stock for every 1 share Preferred. At
December 31, 1999, no preferred stock of the Company had been issued.


                                       5
<PAGE>

(1) See Note B to the consolidated financial statements of this Form 10-K.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

RESULTS OF OPERATIONS

YEARS ENDED DECEMBER 31, 2000 & 1999

The continuing operations for the Company as restated for both years and as
discussed prospectively herein reflect licensing fees, royalties and other
revenues earned from traditional advertising sources and Internet related
development and design fees. Accordingly, such revenues for 1999 were $1,199,900
as compared to $666,123 for 2000. The decrease in revenues for 2000 was resulted
from a decrease in software licensing agreements. Licensing and royalties fees
for gaming and software licenses accounted for 65% of the revenues in 1999. The
remaining revenues were generated from advertising and other Internet related
services. Expenses from continuing operations decreased from $1,675,305 in 1999
to $1,353,394 mainly as a result reduction on personal for ongoing system
development and decreased charges fordepreciation and doubtful accounts in 1999
amounting to $313,496. In addition, in 1999 the Company obtained computer
equipment under noncancelable leases.

LIQUIDITY AND CAPITAL RESOURCES


The Company's working capital deficit increased by $352,136, from $850,899 in
1999 to $1,203,035 in 2000. The increase was a result of trying to develop
further casino games.


Further cost reductions and anticipated revenue growth from licensing as
described in the Prospective Outlook discussion that follows should contribute
to a gradual decrease in the working capital deficit.

If the outlook for greater revenues and reduced expenditures does not meet its
goals, then the Company will seek joint venture partners or private placement
funding to obtain capital to meet current working capital demands. The
continuation of the Company in its present form is dependent upon its ability to
obtain additional financing, if needed, and the eventual achievement of
sustained profitable operations. Although there can be no assurances that the
Company will be able to obtain such financing in the future, the Company did
demonstrate its ability to obtain such financing in 1996 with its strategic
alliances to develop new proprietary products and the sale of Sports and Casinos
in 1998. However, there are no assurances that management's future actions will
be successful or, if they are not successful, that the Company would be able to
continue as a going concern.

INFLATION

Inflation has not had a significant impact on the Company's comparative results
of operations.

PROSPECTIVE OUTLOOK

Certain matters discussed in this section contain forward-looking statements,
including without limitation, statements containing the Company's future revenue
and earnings. These forward-looking statements involve risks and uncertainties,
which could cause actual results to differ materially from those projected.

On February 23, 1999, the Company and Century Industries, Inc. ("Century")
entered into a joint effort agreement and formed Gamblenet Technologies, Ltd.
("Gamblenet"). The Company and Century each own 50% of Gamblenet's initially
outstanding common shares. In exchange for the Company's 50% interest, the
Company licensed certain gaming and software licenses to Gamblenet along with
4,000,000 restricted shares of the Company's Common Stock, which have been
reserved for, but have not been issued.

                                        6
<PAGE>

On June 22, 1999, the Company entered into a majority acquisition and
parent/subsidiary relationship agreement with Century Industries, Inc.
("Century"). The agreement calls for certain control block shareholders of
Century to sell to the Company 53.26% of Century's issued and outstanding shares
in exchange for 7,500,000 shares of the Company's common stock. The Company
expects to complete the transaction in the immediate future.

The Company will focus its efforts on software development such as pari-mutuel
wagering platform for Internet/Intranet horse racing and licensing its
proprietary products and exclusive licensing privileges for future revenues. The
Company has effectively exited the Internet gaming business involving the
acceptance of customers' wagers with the sale of its gaming subsidiaries Sports
and Casinos in March 1998 and will be engaged principally in its gaming and
entertainment software development business.

                                        7
<PAGE>

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549



                       FINANCIAL STATEMENTS AND SCHEDULES

                           DECEMBER 31, 2000 AND 1999



                         FORMING A PART OF ANNUAL REPORT
                 PURSUANT TO THE SECURITIES EXCHANGE ACT OF 1934



                    INTERACTIVE GAMING & COMMUNICATIONS CORP.



<PAGE>


                    INTERACTIVE GAMING & COMMUNICATIONS CORP.
                          INDEX TO FINANCIAL STATEMENTS



                                                                           Page

Report of Independent Certified Public Accountants                          F-3
Consolidated Balance Sheet at December 31, 2000 and 1999                    F-4
Consolidated Statements of Losses for the two years ended
      December 31, 2000 and 1999                                            F-5
 Consolidated Statements of  Stockholders' Equity for the two
      years ended December 31, 2000 and 1999                                F-6
  Consolidated  Statement of Cash Flows for the two years ended
       December 31, 2000 and 1999                                           F-7
  Notes to Consolidated Financial Statements                          F-8 - F-20




<PAGE>


                             Stefanou & Company, LLP
                          CERTIFIED PUBLIC ACCOUNTANTS
                                1360 Beverly Road
                                    Suite 305
                              McLean, VA 22101-3621
                                  703-448-9200
                               703-448-3515 (fax)
                                Philadelphia, PA

               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

Board of Directors
Interactive Gaming & Communications Corp.
Valley Forge, Pennsylvania

         We have audited the accompanying consolidated balance sheet of
Interactive Gaming & Communications Corp. and its subsidiaries at December 31,
2000 and 1999 and the related consolidated statements of losses, stockholders'
equity and cash flows for the years then ended. These financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audits.

         We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

         In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Interactive
Gaming & Communications Corp. and its subsidiaries as of December 31, 2000 and
1999, and the results of their operations and their cash flows for the years
then ended in conformity with generally accepted accounting principles.

         The accompanying consolidated financial statements have been prepared
on a going concern basis, which contemplates continuity of operations, the
realization of assets and the satisfaction of liabilities in the normal course
of business. As discussed in Note B to the financial statements, the Company has
negative working capital at December 31, 2000 and negative cash flows from
operations for the years ended December 31, 2000 and 1999 . The Company will
need to seek other financing or generate sufficient cash flows to pay the
current liabilities of continuing operations. The Company incurred a loss from
continuing operations of $687,255 in 2000 and $ 443,372 in 1999 and there is no
assurance that profitable operations will be achieved in the future. These
factors, among others, raise substantial doubt about the Company's ability to
continue as a going concern. The consolidated financial statements do not
include any adjustments that might result from the outcome of this uncertainty.

As discussed in Note M to the financial statements, the Company has restated the
consolidated financial statements referred to above.


                                                    /s/ STEFANOU & COMPANY, LLP
                                                    ----------------------------
                                                    Stefanou & Company, LLP
                                                    Certified Public Accountants

McLean, Virginia
May 23, 2001, except as to Note M,
 which is dated August 7, 2001



                                       F-3
<PAGE>
<TABLE>
                                   INTERACTIVE GAMING & COMMUNICATIONS CORP.
                                          CONSOLIDATED BALANCE SHEETS
                                          DECEMBER 31, 2000 AND 1999
                                                                                                  2000            1999
                                                                                              ------------   ------------
<S>                                                                                           <C>            <C>
                                      ASSETS
Current assets:
   Cash and equivalents                                                                       $         -    $    47,301
   Accounts receivable, net of allowance for doubtful
     accounts of $ 0 and  $ 25,550, respectively                                                    2,975         18,798
   Other accounts receivable                                                                            -          6,460
                                                                                              ------------   ------------
         Total Current Assets                                                                       2,975         72,559

Property and equipment, at cost, net of accumulated
   depreciation and amortization                                                                  144,710        224,585
Other assets:
   Systems development costs, net of accumulated amortization
      of $614,750 and $449,533                                                                  1,037,399      1,202,616
   Gaming and software licenses, net of accumulated amortization
      of $81,303 and $42,682                                                                      303,916        342,537
   Security deposits and other assets                                                                   -          1,118
                                                                                              ------------   ------------

                                                                                              $ 1,489,000    $ 1,843,415
                                                                                              ============   ============

                       LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
   Cash disbursed in excess of available balances                                             $     8,734    $         -
   Current portion of long-term debt (Note E)                                                     258,740        352,714
   Current portion of capitalized lease obligation (Note H)                                        39,166         21,747
   Accounts payable and accrued expenses                                                          899,370        548,997
                                                                                              ------------   ------------
         Total current liabilities                                                              1,206,010        923,458

Long term debt, less current liabilities ( Note E)                                                      -         81,026
Long term portion of capitalized lease (Note H)                                                         -         36,713

STOCKHOLDERS' EQUITY :
Preferred stock, 10,000,000 shares authorized none issued                                               -              -
   Common stock, $0.001 par value, 75,000,000 shares authorized,
   23,134,903 issued and outstanding  at December 31, 2000;
   23,084,903 shares issued and outstanding at December 31, 1999                                   23,135         23,085
Additional paid-in capital                                                                      5,462,839      7,464,184
Subscription and note receivable                                                               (1,875,000)    (4,044,322)
Deficiency  in retained earnings                                                               (3,327,984)    (2,640,729)
                                                                                              ------------   ------------
                       Total stockholders' equity                                                 282,990        802,218
                                                                                              ------------   ------------
                                                                                              $ 1,489,000    $ 1,843,415
                                                                                              ============   ============

                          See accompanying notes to consolidated financial statements

                                                       F-4
</TABLE>

<PAGE>
<TABLE>

                    INTERACTIVE GAMING & COMMUNICATIONS CORP.
                        CONSOLIDATED STATEMENTS OF LOSSES
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999

<CAPTION>

                                                            2000            1999
                                                        -------------   -------------
<S>                                                     <C>             <C>
Revenues:
    Software licensing and fees                         $    666,123    $  1,199,400

Operating expenses:
    Selling, general and administrative                    1,042,667       1,350,359
    Interest expense                                          27,120          37,000
    Depreciation and amortization                            283,607         287,946
                                                        -------------   -------------
                                                           1,353,394       1,675,305
Other Income
    Interest income and other income                              16          32,533
                                                        -------------   -------------
                                                                  16          32,533
Loss from continuing operations, before income taxes,
 discontinued operations and extraordinary item             (687,255)       (443,372)
    Provision for income taxes                                     -               -
                                                        -------------   -------------
Loss from continuing operations, before continued
  operations and extraordinary item                         (687,255)       (443,372)
Loss before extraordinary item                                     -        (443,472)
Extraordinary item - forgiveness of debt, net of
  related income taxes                                             -         115,509
                                                        -------------   -------------

Net Loss                                                $   (687,255)   $   (327,863)
                                                        =============   =============

Net loss per common share ( Note J):
Basic and diluted:
   Loss from continuing operations                      $      (0.03)   $      (0.02)
   Extraordinary income                                         0.00            0.00
   Net loss per share                                   $      (0.03)   $      (0.02)

Weighted average common shares outstanding:
   (Basic and assuming dilution)                          23,097,400      18,696,615

</TABLE>

           See accompanying notes to consolidated financial statements

                                       F-5
<PAGE>
<TABLE>

                                        INTERACTIVE GAMING & COMMUNICATIONS CORP.
                                     CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
                                      FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999
<CAPTION>

                                                                  Additional    Deficiency in
                                      Common                       Paid In        Retained        Note
                                      Shares         Amount        Capital        Earnings      Receivable       Total
                                   ------------   ------------   ------------   ------------   ------------   ------------
<S>                                 <C>           <C>            <C>            <C>            <C>            <C>
Balance at December 31, 1998        13,701,290    $    13,701    $ 2,676,296    $(2,312,866)   $         -    $   377,131

Sale of warrant ( Note I)                                          2,628,000                    (2,169,322)       458,678
Shares issued in exchange for
  services                           1,883,613          1,884        292,388              -              -        294,272
Shares issued in connection with
  acquisition ( Note K)              7,500,000          7,500      1,867,500              -     (1,875,000)             -
Net loss, 1999                               -              -              -       (327,863)             -       (327,863)
                                   ------------   ------------   ------------   ------------   ------------   ------------

Balance at December 31, 1999        23,084,903         23,085      7,464,184     (2,640,729)    (4,044,322)       802,218
Warrants issued in exchange for
  debt                                       -              -        165,527              -              -        165,527
Shares issued in exchange for
  services                              50,000             50          2,450              -              -          2,500
Write-off of subscription
  receivable (Note I)                        -              -     (2,169,322)             -      2,169,322              -
Net loss, 2000                               -              -              -       (687,255)             -       (687,255)
                                   ------------   ------------   ------------   ------------   ------------   ------------

Balance at December 31, 2000        23,134,903    $    23,135    $ 5,462,839    $(3,327,984)   $(1,875,000)   $   282,990
                                   ============   ============   ============   ============   ============   ============


                               See accompanying notes to consolidated financial statements

                                                          F-6
</TABLE>


<PAGE>

                    INTERACTIVE GAMING & COMMUNICATIONS, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                 FOR THE YEARS ENDED DECEMBER 31, 2000 AND 1999

                                                            2000         1999
                                                         ----------   ----------
Cash flows from operating activities:
   Net loss                                              $(687,255)   $(327,863)
   Adjustments to reconcile net loss to net cash
     (used in) provided by operating activities:
   Depreciation and amortization                           283,607      287,946
   Common stock issued for services                          2,500      294,272
   (Increase) decrease in assets:
       Accounts receivable                                  15,823      (11,864)
       Other assets                                          7,578        1,118
   Increase (decrease) in liabilities,
       Accounts payable and accrued expenses               350,192     (442,125)
                                                         ----------   ----------
Net cash (used in)provided by operating activities         (27,555)    (198,516)

Cash flows from investing activities:
   Purchase of equipment and software                            -     (276,291)
                                                         ----------   ----------
Net cash used in investing activities                            -     (276,291)
Cash flows from (used) financing activities:
   Cash disbursed in excess of available bank balances       8,734            -
   Payments of notes payable                              (175,000)    (190,479)
   Proceeds from notes payable, net                        165,814      187,718
   Proceeds form capital lease obligation, net                   -       60,483
   Payments of capitalized leases, net                     (19,294)
   Proceeds from warrant                                         -      458,678
                                                         ----------   ----------
Net cash from (used in) financing  activities              (19,746)    (516,400)
                                                         ----------   ----------
Increase (decrease) in cash                                (47,301)      41,593

Cash at beginning of year                                   47,301        5,708
                                                         ----------   ----------

Cash at end of year                                      $       -    $  47,301
                                                         ==========   ==========

Supplemental disclosures of  cash flow information
  Cash paid during the year for interest                 $  26,774    $  26,774
  Cash paid during the year for taxes                            -            -
  Warrants issued in exchange for debt                     165,527            -
  Common stock issued for services                           2,500      294,272
  Assets purchased under capital lease obligation, net           -       60,483

           See accompanying notes to consolidated financial statements

                                        F-7

<PAGE>

                    INTERACTIVE GAMING & COMMUNICATIONS CORP.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999


NOTE A - SUMMARY OF ACCOUNTING POLICIES

A summary of accounting policies applied in the preparation of the accompanying
consolidated financial statements follows.

BASIS OF PRESENTATION

The consolidated financial statements include the accounts of Interactive Gaming
& Communications Corp., The "Company" and its wholly-owned subsidiaries, Play
For Fun, Inc. and Intersphere Communications, Ltd. (PA Corp.) ("Intersphere").
Significant intercompany transactions have been eliminated in consolidation.

FINANCIAL INSTRUMENTS

The carrying amounts of cash, accounts receivable, notes payable, long-term
debt, and accounts payable approximate fair value at December 31, 2000 and 1999.

SYSTEM DEVELOPMENT COSTS

The Company capitalizes the cost of developing certain software products it
plans to market in accordance with Statement of Financial Accounting Standards
No. 86, "Accounting for the Costs of Computer Software to be Sold, Leased, or
Otherwise Marketed" (Note D). Amortization is computed on an individual product
basis and is the greater of: (a) the ratio of current gross revenues for a
product to the total amount and anticipated future gross revenues for the
product or (b) the straight-line method over the estimated economic life of the
product. The Company is using an estimated economic life of ten years.

GAMING AND SOFTWARE LICENSES

Through its subsidiaries Global and Intersphere, the Company licenses its gaming
operations and sports wagering software. The Company has valued these licensing
agreements at their fair value as determined by the present value of anticipated
future cash flows. Amortization is provided using the straight-line method over
10 to 12 years and was $38,591 and $42,247 in 2000 and 1999 respectively.
Accumulated amortization at December 31, 2000 was $81,303.

REVENUE RECOGNITION

Software revenue is recognized when an arrangement exists, installation has
occurred, fees are determinable and collection is probable.

                                       F-8
<PAGE>

                    INTERACTIVE GAMING & COMMUNICATIONS CORP.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999


NOTE A - SUMMARY OF ACCOUNTING POLICIES (continued)

PROPERTY AND EQUIPMENT

For financial statement purposes, property and equipment are depreciated using
the straight-line method over their estimated useful lives (five years for
furniture, fixtures and equipment). Depreciation and amortization expense for
2000 and 1999 was $287,942 and $31,770, respectively. An accelerated method of
depreciation is used for tax purposes. Property and equipment at December 31,
2000 and 1999 is comprised of the following:
<TABLE>
<CAPTION>

                                                                2000              1999
                                                             ------------     ------------
<S>                                                          <C>              <C>
      Furniture and fixtures                                 $    19,521      $    19,521
      Machinery & equipment                                      269,161          269,161
      Computer software                                            4,780            4,780
      Transportation equipment                                    97,789           97,789
                                                             ------------     ------------
                                                                 391,251          391,251
      Less: accumulated depreciation and amortization           (246,541)        (166,666)
                                                             ------------     ------------
                                                             $   144,710      $   224,585
                                                             ============     ============
</TABLE>

INCOME TAXES

The Company accounts for income taxes in accordance with Statement of Financial
Accounting Standards No. 191, "Accounting for Income Taxes." Under the method,
deferred tax assets and liabilities are determined based on differences between
the financial reporting and tax basis of assets, and liabilities are measured
using the enacted tax rates expected to be in effect when the differences are
settled.

CASH EQUIVALENTS

For purposes of the Statements of Cash Flows, the Company considers all highly
liquid debt instruments purchased with a maturity date of three months or less
to be cash equivalents.

LONG-LIVED ASSETS

The Company accounts for its long-lived assets under the provision of Statement
of Financial Accounting Standards No. 121 Accounting for the Impairment of
Long-Lived assets and for Long-Lived Assets to be Disposed of (SFAS 121).


                                       F-9
<PAGE>

                    INTERACTIVE GAMING & COMMUNICATIONS CORP.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999

NOTE A - SUMMARY OF ACCOUNTING POLICIES (continued)

The Company's long-lived assets are reviewed for impairment whenever events or
changes in circumstances indicate that the carrying amount of such assets may
not be recoverable. Events relating to recoverability may include significant
unfavorable changes in business conditions, recurring losses, or a forecasted
inability to achieve break-even operating results over an extended period. The
Company evaluates the recoverability of long-lived assets based upon forecasted
undercounted cash flows. Should an impairment in value be indicated, the
carrying value of intangible assets will be adjusted, based on estimates of
future discounted cash flows resulting from the use and ultimate disposition of
the asset.

STOCK BASED COMPENSATION

The Company accounts for stock based compensation using the intrinsic value
method prescribed in Accounting Principle Board Opinion No. 25, "Accounting for
Stock Issued to Employees." The Company has adopted the disclosure-only
provisions of Statement of Financial Accounting Standards No. 123, "Accounting
for Stock Based Compensation" with respect to options and warrants granted to
employees.

ADVERTISING

The Company follows the policy of charging the costs of advertising to expenses
incurred. Advertising costs charged to expenses in 2000 and 1999 was $ 42,364
and $ 27,437, respectively.

USE OF ESTIMATES

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect certain reported amounts and disclosures. Accordingly actual results
could differ from those estimates.

The Company has recognized the value of its gaming and software licensing
agreements based on the anticipated future revenues. Additionally, the Company
believes that certain capitalized software development costs are also
recoverable through anticipated future revenues. These anticipated future
revenues are management's best estimates of future cash flows to be derived from
these products. The Company's value of these products is based on certain
assumptions management has made based on information available at December 31,
2000. Capitalized software development costs of approximately $ 1,652,149 at
December 31, 2000 are still under development and realization will be dependent
upon the ability to market the software. It is reasonably possible that these
estimates and assumptions may change within one year from the balance sheet date
based on changes in operations and revenues.

Concentrations of Credit Risk

Financial instruments and related items which potentially subject the Company to
concentrations of credit risk consist primarily of cash, cash equivalents and
trade receivables. The Company places its cash and temporary cash investments
with high credit quality institutions.

                                      F-10
<PAGE>

                    INTERACTIVE GAMING & COMMUNICATIONS CORP.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999


NOTE A - SUMMARY OF ACCOUNTING POLICIES (continued)

At times, such investments may be in excess of the FDIC insurance limit. The
Company has a broad customer base and it routinely assesses the financial
strength of its customers. The Company periodically reviews its trade
receivables in determining its allowance for doubtful accounts. The allowances
for doubtful accounts was $0 and $25,550 at December 31, 2000 and 1999,
respectively.

EARNINGS PER SHARE

The Company has adopted Statement of Financial Accounting Standard No. 128,
"Earnings Per Share," specifying the computation, presentation and disclosure
requirements of earnings per share information. Basic earnings per share has
been calculated based upon the weighted average number of common shares
outstanding. Stock options and warrant's have been excluded as common stock
equivalents in the diluted earnings per share because they are either
antidilutive, or their effect is not material.

COMPREHENSIVE INCOME

Statement of Financial Accounting Standards No.130, "Reporting Comprehensive
Income" ("SFAS 130"), establishes standards for reporting and display of
comprehensive income, its components and accumulated balances. Comprehensive
income is defined to include all changes in equity except those resulting from
investments by owners and distributions to owners. Among other disclosures, SFAS
130 requires that all items that are required to be recognized under current
accounting standards as components of comprehensive income be reported in a
financial statement that is displayed with the same prominence as other
financial statements. The Company adopted SFAS 130 during the year ended
December 31, 1998 and has no items of comprehensive income to report.

NEW ACCOUNTING PRONOUNCEMENTS

The Company adopted Statement of Financial Accounting Standards No. 132,
Employers' Disclosures about Pension and Other-Post Employment Benefits ("SFAS
132") in the year ended December 31, 1999. SFAS No. 132 establishes disclosure
requirements regarding pension and post employment obligations. SFAS No. 132
does not effect the Company as of December 31, 1999.

The Company adopted Statement of Financial Standards No. 133, Accounting for
Derivative Instruments and for Hedging Activities ("SFAS No. 133") in the year
ended December 31, 1999. SFAS No. 133 requires that certain derivative
instruments be recognized in balance sheets at fair value and for changes in
fair value to be recognized in operations. Additional guidance is also provided
to determine when hedge accounting treatment is appropriate whereby hedging
gains and losses are offset by losses and gains related directly to the hedged
item. SFAS No. 133's impact on the Company's consolidated financial statements
is not expected to be material as the Company has not historically used
derivative and hedge instruments.

                                      F-11
<PAGE>

                    INTERACTIVE GAMING & COMMUNICATIONS CORP.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999


NOTE A - SUMMARY OF ACCOUNTING POLICIES (continued)

In December 1999, the Securities and Exchange Commission issued Staff Accounting
Bulletin No. 101 (" SAB 101"), Revenue Recognition in Financial Statements,
which will become effective December 31, 2000. The Company does not expect the
standard to have a material effect on its financial condition or operating
results.

In March 2000, the Financial Accounting Standards Board issued interpretation
No. 44 ("FIN 44"), "Accounting for Certain Transactions Involving Stock
Compensation, an Interpretation of APB Opinion No. 25". FIN 44 clarifies the
application of APB No. 25 for (a) the definition of employee for purposes of
applying APB No. 25, (b) the criteria for determining whether a plan qualifies
as a noncompensatory plan, (c) the accounting consequences of various
modifications to previously fixed stock option or award, and (d) the accounting
for an exchange of stock compensation awards in a business combination. FIN 44
is effective July 2, 2000 but certain conclusions cover specific events that
occur after either December 15, 1998 or January 12, 2000. The adoption of FIN 44
did not have an affect on the Company's financial statements but may impact the
accounting for grants or awards in future periods

RECLASSIFICATIONS

Certain balances and amounts in the 1999 financial statements have been
reclassified to conform with the 2000 presentation.

NOTE B - BASIS OF PRESENTATION AND CERTAIN SIGNIFICANT RISKS AND UNCERTAINTIES

The accompanying statements have been prepared on a going concern basis, which
contemplates the realization of assets and the satisfaction of liabilities in
the normal course of business. As shown in the financial statements during the
years ended December 31, 2000 and 1999, the Company incurred loses from
operations of $687,255 and $443,372, respectively. These factors among others
may indicate that the Company will be unable to continue as a going concern for
a reasonable period of time.

The Company's existence is dependent upon management's ability to develop
profitable operations and resolve it's liquidity problems. Management
anticipates the Company will attain profitable status and improve it liquidity
through the continued developing, marketing and selling of its products and
additional equity investment in the Company. The accompanying financial
statements do not include any adjustments that might result should the Company
be unable to continue as a going concern.

The Company had a working capital deficiency of $1,203,035 at December 31, 2000,
and negative cash flows from operating activities of $27,555 and $198,616 in
2000 and 1999, respectively. The Company continues to seek other financing or
generate sufficient cash flows to pay the current liabilities of continuing
operations. These factors, among others, indicate the Company's ability to
continue in existence is dependent

                                      F-12
<PAGE>

                    INTERACTIVE GAMING & COMMUNICATIONS CORP.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999

NOTE B - BASIS OF PRESENTATION AND CERTAIN SIGNIFICANT RISKS AND UNCERTAINTIES
         (continued)

Upon favorable governmental regulations, its ability to achieve adequate
profitable operations and/or obtain additional debt or equity financing. The
financial statements do not include any adjustments relating to the
recoverability and classification of recorded assets amounts that might be
necessary should the Company be unable to continue in existence.

Management anticipates generating revenue and cash flows from its software
licensing agreements. Additionally, management plans to continue to refine its
operations, control expenses, evaluate alternative methods to conduct its
business, and seek available and attractive sources of debt or equity financing
through a combination of a private placement, and sharing of development costs,
or other resources. There can be no assurance that the Company's efforts will be
successful. If operations and cash flows continue to improve through these
efforts, management believes that the Company can continue to operate. However,
no assurance can be given that management's actions will result in profitable
operations or the resolution of its liquidity problems.

NOTE C - RELATED PARTY TRANSACTIONS

Included in accounts payable and accrued expenses is $99,045 and $55,369 at
December 31, 2000 and 1999, respectively, which represents advances from
stockholders or officers of the Company. No formal agreements or repayment terms
exist. In December 1999, the Company issued an aggregate of 5,000,000 warrants
to purchase the Company's common stock at $.001 per share to certain company
shareholders who had previously advance funds to the Company in exchange for
those obligations totaling $165,527.

NOTE D - SYSTEMS DEVELOPMENT COSTS

In May 1995, the Company signed a definitive letter of intent with a major
software developer to produce and market a "virtual casino" by offering its
customers the opportunity to play classic casino games, such as blackjack,
craps, roulette, baccarat and slot machine games, on their personal computers
using the internet world wide web, with the Company managing the wagering.
Additionally in September 1996, the Company entered into a software development
and licensing agreement with another software developer to develop a "global
casino" to provide services similar to the above on a state-of-the-art operating
platform.

After the economic and technical feasibility of the projects had been
established, the Company began funding them. Costs incurred subsequent to the
establishment of technological feasibility and directly related to the project
have been capitalized. Capitalized project costs were $1,652,149 at December 31,
2000. The "global casino" project was completed in 1997 and amortization expense
was $165,217 and $190,931 in 2000 and 1999, respectively. Accumulated
amortization was $614,750 at December 31, 2000. As management has made
estimates in determining the net realizable value of system development costs,
it is reasonably possible that these values will change in the near term.

                                      F-13
<PAGE>

                    INTERACTIVE GAMING & COMMUNICATIONS CORP.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999
<TABLE>

NOTE E - LONG TERM DEBT

LONG-TERM DEBT AT DECEMBER 31, 2000 AND 1999 CONSISTS OF THE FOLLOWING:
<CAPTION>

                                                                          2000           1999
                                                                      -----------    -----------
<S>                                                                   <C>            <C>
Bank loan payable in monthly installments of accrued
interest at the bank's prime lending rate plus 1%.
The note is unsecured and guaranteed by a Company officer
and Director.                                                         $  199,929     $  195,980

Bank loan payable in monthly installments of $4,606,
plus accrued interest at the bank's prime lending rate
plus 1.5% The note is guaranteed by a Company officer and
Director and collateralized by 1,000,000 shares of company
stock owned by the Company's President.                                   58,811         68,403

Shareholder loan payable in monthly installments of $950
including interest at 9.75 % per annum, unsecured                              -         41,444

Shareholder loan payable in monthly installments of $950
including interest at 9.75 % per annum, unsecured                              -         41,848

Shareholder demand note payable, interest at bank prime
lending rate, plus 1.5%, unsecured                                             -         86,065

                                                                      -----------    -----------
                                                                         258,740        433,740
Less current portion                                                     258,740        352,714
                                                                      -----------    -----------
Long-term debt                                                        $        -     $   81,026
                                                                      ===========    ===========

</TABLE>


                                      F-14
<PAGE>

                    INTERACTIVE GAMING & COMMUNICATIONS CORP.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999

NOTE F - INCOME TAXES

The Company has adopted Financial Accounting Standard number 109 which requires
the recognition of deferred tax liabilities and assets for the expected future
tax consequences of events that have been included in the financial statement or
tax returns. Under this method, deferred tax liabilities and assets are
determined based on the difference between financial statements and tax bases of
assets and liabilities using enacted tax rates in effect for the year in which
the differences are expected to reverse. Temporary differences between taxable
income reported for financial reporting purposes and income tax purposes are
insignificant.

For income tax reporting purposes, the Company's aggregate unused net operating
losses approximate $ 3,200,000 which expire through 2015. The deferred tax asset
related to the carryforward is approximately $ 1,088,000. The Company has
provided a valuation reserve against the full amount of the net operating loss
benefit, since in the opinion of management based upon the earning history of
the Company, it is more likely than not that the benefits will be realized.

COMPONENTS OF DEFERRED TAX ASSETS AS OF DECEMBER 31, 2000 ARE AS FOLLOWS:

Non Current:
       Net Operating Loss Carryforward             $    1,088,000
       Valuation Allowance                             (1,088,000)
                                                   ---------------
Net Deferred Tax Asset                             $            -
                                                   ================


NOTE G -STOCK OPTION PLANS

The following table summarizes the changes in options outstanding and the
related prices for the shares of the Company's common stock issued to a former
officer of the Company.
<TABLE>
<CAPTION>

                                                      NUMBER       WEIGHTED AVERAGE          NUMBER OF
                                                     OF SHARES      EXERCISE PRICE       SHARES EXERCISABLE
                                                     ---------      --------------       ------------------
<S>                                                   <C>               <C>                   <C>
Outstanding at December 31, 1998                       50,000           $   -                  50,000
Granted                                                     -               -
Exercised                                                   -               -                       -
Cancelled                                             (50,000)                                (50,000)
                                                     ---------        ----------             ---------

Outstanding at December 31, 1999                            -               -                       -
Granted                                                     -               -                       -
Exercised                                                   -               -                       -
Cancelled                                                   -               -                       -
                                                     ---------        ----------             ---------
                                                            -                 -                     -
Outstanding at December 31, 2000                                              -                     -
                                                     =========        ==========             =========

</TABLE>


                                      F-16
<PAGE>

                    INTERACTIVE GAMING & COMMUNICATIONS CORP.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999


NOTE G - STOCK OPTION PLANS (continued)

The fair value of the options at the date of grant was nominal. The options were
not exercised . Accordingly, no compensation expense related to the options
granted has been recognized by the Company.

In June 1996, the Company entered into a stock and warrant purchase agreement
with a software developer and issued 375,000 shares of restricted common stock
for $750,001 and a common stock purchase warrant for $1,000. The common stock
purchase warrant is for 100,000 shares at a purchase price of $1.00 per share
and expires on June 30, 2001. The warrant is outstanding at December 31, 2000.

NOTE H - COMMITMENTS

As of December 31, 2000, the Company had computer equipment and software
purchased under non-cancelable leases with an original cost of $ 67,393 included
in the Company's consolidated balance sheet. Depreciation and amortization of $
13,478 and $5,616 has been charged to operations in 2000 and 1999, respectively.
The Company is in default under the terms of the lease and the aggregate balance
due of $ 39,166 is included in current liabilities at December 31, 2000.

LITIGATION

In May, 2001, the Company was named as a defendant in the United States
Bankruptcy Court, District of New Jersey in connection with the alleged
fraudulent transferor of assets in connection with the contemplated business
combination of the Company with an entity whose principal assets were formerly
owned by Century Industries, Inc.

The Company denies liability in all respects and vigorously intends to defend.
In addition, the Company believes that the outcome of the litigation will not in
any event have a material adverse effect on the Company's financial condition or
results of operations.



                                      F-17
<PAGE>

                    INTERACTIVE GAMING & COMMUNICATIONS CORP.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999

NOTE H - COMMITMENTS (continued)

The Company was sued by, among others, Empire Corporation ("Empire"), who
claimed the Company improperly terminated an alleged joint venture agreement,
appropriated certain funds belonging to Empire under the agreement and otherwise
refused to pay monies due to Empire. Empire also asserted claims of fraud and
breach of fiduciary duty. An answer, new matter and counterclaim has been filed
by the Company asserting that the agreement had been properly terminated and
that funds are due the Company from Empire. Empire claims damages in excess of
$160,000 as well as punitive damage in the amount of $1,000,000. The Company's
counterclaim seeks damages in excess of $95,000. In the opinion of management,
the ultimate outcome of this case in unknown.

OTHER LITIGATION

The Company, in the normal course of business, is subject to litigation and is
presently involved as a defendant in several lawsuits. In the opinion of
management, the ultimate outcome of these cases is unknown and any exposure to
liability, if any, cannot be estimated at this time. Consequently, no amounts
have been accrued at December 31, 2000.

NOTE I - DISPOSITION OF GAMBLENET TECHNOLOGIES, LTD.

In February 1999, the Company and Century Industries, Inc. ("Century") formed
Gamblenet Technologies, Ltd. ("Gamblenet"). The Company and Century each owned
50% of Gamblenet's initially outstanding common shares. In exchange for the
Company's 50% interest in Gamblenet, the Company licensed certain gaming and
software licenses to Gamblenet and, as further consideration, issued a warrant
to purchase 4,000,000 shares of the Company's restricted common stock at the
stock's par value of $.001 per share. The warrant expires December 31, 2004.

In May, 1999, Gamblenet, whose principal asset was the warrant to purchase
4,000,000 shares of the Company's restricted common stock, was sold to an
unrelated third party in exchange for $2,628,000, comprised of $128,000 in cash
and a promissory note payable to the Company in the amount of $2,500,000. The
note, which bears interest at 6% per annum, matures in May, 2004 with principal
payments of $500,000 due annually prior thereto. The Company received an
aggregate of $458,678 in 1999 in connection with this transaction and was
accounted for as additional paid in capital. The amount of the promissory note
outstanding at December 31, 1999 was $2,169,322 and is shown on the balance
sheet as a reduction in stockholders' equity.

In 2000, the maker of the note defaulted under the terms of the note and the
Company's management deemed the balance of the obligation to be uncollectible.
Accordingly, the unpaid balance of $2,169,322 was written off as uncollectible
and additional paid in capital was reduced. In May 2001, certain holders of the
warrant exercised their rights to acquire 2,630,051 shares of the company's
restricted common stock underlying the warrant.

                                      F-18
<PAGE>

                    INTERACTIVE GAMING & COMMUNICATIONS CORP.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999


NOTE J - LOSSES PER COMMON SHARE

The following table presents the computation of basic and diluted loss per
share:

                                                       2000           1999
                                                   ------------   ------------
Net loss available for common shareholders         $   687,255    $ ( 327,863)
Basic and fully diluted loss per share             $      (.03)   $     (0.02)
Weighted average common shares outstanding          23,097,400     18,696,615
                                                   ============   ============


Net loss per share is based upon the weighted average number of shares of common
stock outstanding.

NOTE K - RESCISSION OF BUSINESS COMBINATION

In June, 1999, the Company issued 7,500,000 shares of its restricted common
stock in exchange for a subscription receivable valued at $1,875,000 for the
purpose of acquiring a controlling interest in certain assets formerly owned by
Century Industries, Inc. ("Century").

In December, 1999, the Company authorized a series of 1,000,000 shares of the
Company's preferred stock as convertible preferred stock ("series a voting
convertible preferred stock"). After five years, each share of the preferred
stock is convertible into 15 shares of the Company's common stock. In addition,
the holders of the preferred stock may not convert their shares to the Company's
common stock unless the Company earns $.25 per share on a fully diluted basis
for the year ended prior to the conversion; the market value of the Company's
common shares has averaged $5.00 per share for 30 days prior to the conversion;
and the shares will reamin intact as a class, and shall remain restricted as a
control block, salable pursuant to SEC Rule 144 in the event of liquidation,
dissolution, or winding up of the Company, the holders of the preferred stock
have a liquidation preference of $1.00 per share.

In December 1999, the Company entered into a share and lock up agreement
whereby, if consummated, the Company agreed to exchange its common and
convertible preferred stock for assets formerly held by Century. The purpose of
the agreement was to allow the Company and the entity controlling the assets
formerly held by Century to combine their respective financial statements.

In 2000, the Company authorized its stock transfer agent to issue 1,000,000
shares of its convertible preferred stock in connection with the proposed
transaction.

The business combination was not consummated and the certificate representing
the 1,000,000 shares of the Company's convertible preferred stock was returned
to the Company and cancelled in April, 2001. Since the Company did not
consummate the transaction and the shares were not delivered by the escrow agent
the accompanying financial statements reflect the convertible preferred shares
as never being issued. In addition, the 7,500,000 shares of restricted common
stock previously issued in connection with this agreement were returned to the
Company in May, 2001 and the subscription receivable of $1,875,000 was
cancelled.

                                      F-19
<PAGE>

                    INTERACTIVE GAMING & COMMUNICATIONS CORP.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           DECEMBER 31, 2000 AND 1999


NOTE L - SUBSEQUENT EVENT

In January 2001, the Company entered into a non-binding Letter of Intent to
license certain Company software and sell the Company's wholly owned subsidiary,
Play for Fun, Inc.

The proposed terms of the license agreement are as follows:

         o        $ 200,000, payable at closing

         o        $1,800,000 in the form of a promissory note, bearing interest
                  at the prime lending rate plus 2% per annum

         o        The term of the $ 1,800,000 note shall be for 36 months, with
                  monthly payments of interest accruing and commencing 60 days
                  after closing. The unpaid principal, together with unpaid
                  interest shall be due and payable in full at the due date of
                  the Loan.

The proposed  terms of the sale of Play for Fun, Inc. are as follows:

         o        At closing, the Company shall receive a 9.9% equity interest
                  in the Purchaser's company

         o        The Company shall receive 50% of all profits earned by Play
                  For Fun, Inc. for a period of 3 years from the date of
                  closing. Profits are defined as earnings before interest
                  expense, taxes, depreciation and amortization.


NOTE M - RESTATEMENT OF FINANCIAL STATEMENTS

The Company has restated its consolidated financial statements for the years
ended December 31, 2000 and 1999 to correct certain misprints in the electronic
version previously filed with the Company's Annual Report on Form 10KSB for the
year ended December 31, 2000 filed with the Securities and Exchange Commission.
The correction of the errors did not change the Company's financial condition,
results of operations or cash flows for the years ended December 31, 2000 and
1999.



                                      F-20
<PAGE>

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

PRINCIPAL SHAREHOLDERS

The table below sets forth information as to each person owning of record or who
was known by the Company to own beneficially more than 5% of the 23,084,903
shares of issued and outstanding Common Stock of the Company as of December 31,
1998 and information as to the ownership of the Company's Common Stock by each
of its directors and executive officers and by the directors and executive
officers as a group. Except as otherwise indicated, all shares are owned
directly, and the persons named in the table have sole voting and investment
power with respect to shares shown as beneficially owned by them.
<TABLE>
<CAPTION>

NAME AND ADDRESS OF BENEFICIAL OWNER        NATURE OF OWNERSHIP       NUMBER OF SHARES     PERCENT
------------------------------------        -------------------       ----------------     -------
<S>                                             <C>                   <C>
MICHAEL F. SIMONE
4065 REDBUD LANE
DOYLESTOWN, PA 18901                            COMMON STOCK          4,487,713              19.4%
                                                DIRECT

JOSEPH MUSTILLI
1220 VALLEY FORGE ROAD
VALLEY FORGE, PA 19482                          COMMON STOCK          1,000.000               0.4%

LAWRENCE ELLIOT HIRSCH
PARK TOWN PLACE #1111
22ND & PARKWAY
PHILADELPHIA, PA 19104                          COMMON STOCK          1,000,000               0.4%

HARVEY A. CARR
1220 VALLEY FORGE ROAD
VALLEY FORGE, PA 19482                          COMMON STOCK            300,000              0.01%


All Executive Officers and
Directors, as a Group
(4 Persons)                                                           6,787,713                30%

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                                   SIGNATURES


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



                                   Interactive Gaming and Communications Corp.


Dated:  May 24th, 2001



By: /s/ Lawrence Elliott Hirsch,
President and Chief Executive Officer


Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities indicated on this 24th day of May, 2001.


Interactive Gaming and Communications Corp.