U. S. Securities and Exchange Commission

                             Washington, D. C. 20549


                                   FORM 10-KSB


[ ]  ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

     For the fiscal year ended
                               -----------------

[ ]  TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

     For the transition period from March 1, 2003 to December 31, 2003


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

                                   0-26695
                                   -------
                               Commission File No.


                              MICHELEX CORPORATION
                              --------------------
                 (Name of Small Business Issuer in its Charter)

           UTAH                                             87-0636107
           ----                                             ----------
(State or Other Jurisdiction of                          (I.R.S. Employer
 incorporation or organization)                          Identification No.)


                                63 Trade Road
                            Massena, New York 13662
                            -----------------------
                    (Address of Principal Executive Offices)

                    Issuer's Telephone Number: (315) 769-6616

Securities Registered under Section 12(b) of the Exchange Act:   None
Name of Each Exchange on Which Registered:                       None
Securities Registered under Section 12(g) of the Exchange Act:

                   $0.001 Par Value Common Voting Stock
                   ------------------------------------
                              Title of Class

     Check whether the Issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such
shorter period that the Company was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.

     (1)   Yes  X    No            (2)   Yes  X    No
               ---      ---                  ---      ---

     Check if there is no disclosure of delinquent filers in response to Item
405 of Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of Company's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-KSB or any amendment to this Form 10-KSB. [ ]

     State Issuer's revenues for its most recent fiscal year: December 31,
2003 - $17,712,237.

<PAGE>

     State the aggregate market value of the voting stock held by
non-affiliates computed by reference to the price at which the stock was sold,
or the average bid and asked price of such stock, as of a specified date
within the past 60 days.

     April 13, 2004 - $4,366,828. There are approximately 3,969,844 shares of
common voting stock of the Company held by non-affiliates.  These shares have
been valued at $1.10 per share, which was the closing bid price of the
Company's common stock on April 13, 2004Because there has
been no "public market" for the Company's common stock during the past five
years, the Company has arbitrarily valued these shares at par value of $0.001
per share.

                   (ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
                           DURING THE PAST FIVE YEARS)

     None; Not applicable

                      (APPLICABLE ONLY TO CORPORATE ISSUERS)

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

                                 April 13, 2004

                                   14,205,964

                       DOCUMENTS INCORPORATED BY REFERENCE

     A description of "Documents Incorporated by Reference" is contained in
Item 13 of this Report.

Transitional Small Business Issuer Format   Yes  X   No
                                                ---     ---


                                     PART I

Item 1.  Description of Business.
         ------------------------

Business Development.
---------------------

     Organization, Charter Amendments and General History
     ----------------------------------------------------

     Highway One-OWEB, Inc., a Utah corporation (the "Company"), was
organized under the laws of the State of Utah on March 17, 1999.  Copies of
the Company's Articles of Incorporation and Bylaws were attached as exhibits
to its Registration Statement on Form 10-SB, which was filed with the
Securities and Exchange Commission on July 13, 1999.  See Part III, Item 13 of
this Report.

Prior to December 31, 2002.
---------------------------

     For a discussion of the Company's history prior to December 31, 2002, see
its Annual Reports on Form 10-KSB for the years ended December 31, 2002, 2001,
2000, and 1999, which were previously filed with the Securities and Exchange
Commission and are incorporated herein by this reference.  See the Exhibit
Index, Part III, Item 13 of this Report.

     General History
     ---------------

     On February 7, 2003, the Company entered into a Purchase Agreement (the
"Agreement") with Pete Chandler and Benjamin Hansel.  At the time the parties
executed the Agreement, Mr. Chandler was the Company's sole director and
President and was the owner of 2,000,000 shares, constituting approximately
85.2% of our issued and outstanding common stock.  Under the Agreement, Mr.
Chandler, as our sole director, executed a resolution by which we issued
20,000,000 "unregistered" and "restricted" shares of our common stock to Mr.
Hansel in consideration of Mr. Hansel's agreement to serve as director and
executive officer of the Company and his payment of all of the Company's costs
and expenses incurred in connection with the Agreement.  For more information
regarding this Agreement, see the Company's Current Report on Form 8-K that
was filed with the Securities and Exchange Commission on February 12, 2003,
and which is incorporated herein by this reference.  See Part III, Item 13 of
this Report.

     On July 7, 2003, an Agreement and Plan of Merger(the "Plan") was executed
by and between the Company; Michele Audio, Inc., a Delaware corporation
("Michele Delaware"); and Michele Audio Corporation of America, a New Jersey
corporation ("Michele New Jersey"), by which Michele Delaware agreed to merge
with and into Michele New Jersey, with Michele New Jersey being the surviving
corporation. The merger became effective upon the filing of a Certificate of
Merger with the Secretary of State of the State of New Jersey on July 23,
2003. Prior to the execution of the Plan, each of the parties resolved to
rescind a separate first amended Agreement and Plan of Merger that they had
executed on May 8, 2003. Pursuant to the Plan, the stockholders of Michele New
Jersey received a total of 10,392,000 "unregistered" and "restricted" shares
of the Company's common stock in exchange for all of their shares of common
stock of Michele New Jersey. After the cancellation of 19,750,000 shares of
common stock held by Mr. Hansel pursuant to the Plan, these 10,392,000 shares
represent approximately 80% of the Company's issued and outstanding shares of
common stock.  For more information on the Plan, see the Company's Current
Report on Form 8-K dated July 23, 2003, which was filed with the
Securities and Exchange Commission on July 28, 2003, and which was amended on
October 6, 2003.  See Part III, Item 13 of this Report.

     As a result of the Plan, the operations of Michele New Jersey became the
Company's sole business operations.  Michele New Jersey changed its fiscal
year from February 28 to December 31.  On December 17, 2003, the Company filed
an Current Report on Form 8-K with respect to this change.  See Part III, Item
13 of this Report.

Subsequent Events.
------------------

     Effective March 9, 2004, which is subsequent to the period covered by
this Report, the Company entered into a Consulting Agreement with Stock
Communications Group, Inc., under which Stock Communications Group agreed to
provide various investor and public relations services to the Company in
consideration of the issuance of 400,000 "unregistered" and "restricted"
shares of the Company's common stock.  These shares have "piggyback"
registration rights and were issued on April 13, 2004.  The term of the
Consulting Agreement is one year.

     On April 8, 2004, the Company entered into a Consulting Agreement with
Argilus, LLC, a New York limited liability company.  Under the Consulting
Agreement, Argilus agreed to provide various financial consulting services to
the Company in consideration of a fee of $25,000.  In addition, Argilus is to
receive separate fees for various transactions in which Argilus may assist.

     The Company has recently negotiated an amendment to the existing credit
and security agreement between Michele New Jersey and its senior lender that
in summary waives existing covenant violations, the payment of currently
accrued and unpaid default interest, and the payment of the 2003 line fee.
Additionally, the senior lender has increased the availability of working
capital under the agreement through a restructuring of the advance rates on
eligible accounts receivable and finished goods inventories and amending the
reserve requirements on the term loan portion of the facility.  The senior
lender has also provided for potential interest rate reduction on the facility
based on the Company achieving certain financial performance criteria during
fiscal 2004 or obtaining prescribed levels of additional equity in the Company
during fiscal 2004.  As consideration, the Company has agreed to provide the
continuing personal guarantees of and Ginette Gramuglia and Thomas Gramuglia
our President and Vice President/Treasurer, respectively, an unconditional
guarantee of the Company, a security interest in the Company's intellectual
property and a general waiver and release of liability to the lender for any
and all claims the Company may have had against the lender as of the date of
the agreement.  The officers of the Company approved and signed the agreement
on April 13, 2004 and are confident it will be executed by the lender
imminently.

Business.
---------

Principal Products and Services.
--------------------------------

     Michelex is a fully integrated audio replication and multimedia
fulfillment company that provides quality products and professional grade
services through its three divisions to customers located throughout North
America.  The Company's primary markets are the entertainment, recording,
educational and computer software industries.

     *    Michelex Plastics Division   This division produces, imports, and
          distributes a complete line of plastic injection molded multimedia
          packaging products and offers complete fulfillment services for
          its customers.  The division's product lines include CD Jewel
          Cases, Trays, DVD Boxes, and C-Shells for CD and DVD based
          products; C-0's and Norelco Boxes for cassette based products; and
          Video Boxes and Poly Boxes for VHS based products.

     *    Michele Audio Division   This division provides state of the art
          duplication, packaging, and fulfillment services for Cassette, CD,
          and DVD based products.  The division also operates a both a
          recording and mastering studio through which it provides audio
          restoration, editing, and mastering services.  Additionally, this
          division libraries and controls the Company's catalog of music and
        spoken word recordings which it licenses to other companies.

     *    Michelex Media Products Division   This division sells and
          distributes a broad range of paper, vinyl, tyvek, and board mailer
          based multimedia packaging products.

Distribution Methods of the Products or Services.
-------------------------------------------------

     The Company sells and distributes its products primarily through Company
employed sales representatives.  The Company services its customers from
facilities it owns in Massena, New York and Salt Lake City, Utah, as well as
from several public warehouses located throughout the United States.

Status of any Publicly Announced New Product or Service.
--------------------------------------------------------

     The Company recently announced the start up of its Michelex Media
Products Division.  The division began operations in March of 2003, and has
grown steadily since its inception, accounting for approximately 6.1% of the
Company's total sales for the 10 months ended December 31, 2003.

Competitive Business Conditions.
--------------------------------

     Although the Plastics division is experiencing increasing competitive
pressure from offshore suppliers, the Company is still in the top 10% of
producers of plastic injection molded multi media packaging products.  The
Company has been in business for 32 years and is one of the few remaining US
owned and operated manufacturing companies in this industry segment.  Through
the years, the Company has developed a broad, diverse and loyal customer base,
and a wide network of reliable suppliers.  Coupling these factors with the
Company's emphasis on customer service and an ability to maintain a balance of
imported and domestically produced products enables the Company to compete
favorably in the areas of price, quality, and technology.

Sources and Availability of Raw Materials and Names of Principal Suppliers.
---------------------------------------------------------------------------

     The Company's primary raw materials in the manufacturing process are
polystyrene and polypropylene.  Both products have been readily available to
us.  During the period January through December 2003, our primary suppliers of
these products were Triad Plastics and Pyramid Plastics.

Dependence on One or a Few Major Customers.
-------------------------------------------

     The Company has a broad and diverse customer base with no one customer
accounting for a significant portion of the Company's total sales.

Patents, Trademarks, Licenses, Franchises, Concessions, Royalty Agreements
or Labor Contracts.
-------------------

    Through its Michele Audio Division, the Company is a party to numerous
royalty and licensing agreements of various dates and durations.

Need for any Governmental Approval of Principal Products or Services.
---------------------------------------------------------------------

     None, not applicable.

Effect of Existing or Probable Governmental Regulations on Business.
--------------------------------------------------------------------

     The primary governmental regulations affecting the Company's business
are related to tariffs on products the Company imports or those levied on
products which the Company's domestically produced products compete with in
its various market segments.  An increase in the tariffs on products produced
offshore would enhance the Company's domestically produced products ability to
more effectively compete on price; however it would also increase the cost of
the Company's import products.  Conversely, a decrease in tariffs on products
produced offshore would have the opposite effect.  Any change would require
the Company to evaluate and possibly adjust its product mix.

Small Business Issuer.
----------------------

     The integrated disclosure system for small business issuers adopted by
the Commission in Release No. 34-30968 and effective as of August 13,
1992, substantially modified the information and financial requirements of a
"Small Business Issuer," defined to be an issuer that has revenues of less
than $25 million; is a U.S. or Canadian issuer; is not an investment company;
and if a majority-owned subsidiary, the parent is also a small business
issuer; provided, however, an entity is not a small business issuer if it has
a public float (the aggregate market value of the issuer's  outstanding
securities held by non-affiliates) of $25 million or more.

Sarbanes-Oxley Act.
-------------------

     On July 30, 2002, President Bush signed into law the Sarbanes-Oxley Act
of 2002. The Sarbanes-Oxley Act imposes a wide variety of new regulatory
requirements on publicly-held companies and their insiders.  Many of these
requirements will affect us. For example:

     * Our chief executive officer and chief financial officer must now
   certify the accuracy of all of our periodic reports that contain financial
   statements;

     * Our periodic reports must disclose our conclusions about the
   effectiveness of our disclosure controls and procedures; and

     * We may not make any loan to any director or executive officer and we
   may not materially modify any existing loans.

     The Sarbanes-Oxley Act has required us to review our current procedures
and policies to determine whether they comply with the Sarbanes-Oxley Act and
the new regulations promulgated thereunder. We will continue to monitor our
compliance with all future regulations that are adopted under the
Sarbanes-Oxley Act and will take whatever actions are necessary to ensure that
we are in compliance.

Research and Development.
-------------------------

     None; Not applicable.

Cost and Effects of Compliance with Environmental Laws.
-------------------------------------------------------

     As the cost of compliance with environmental laws has not been
significant, the Company does not maintain detailed records of these expenses.

Number of Employees.
--------------------

     As of December 31, 2003 the Company had a total of 166 employees; of this
amount, 163 were employed full-time.

Item 2. Description of Property.
---------------------------------

Michelex Audio Division.
------------------------

     Through Michelex Audio, the Company owns a 6,800 square foot building on
4.5 acres in Massena, New York.  There are no liens on this property.  We rent
4,300 square feet of the property to one entity and 2,500 square feet to
another entity, for a total annual rent of $26,400.

     We also own a 5,400 square foot building on two acres in Massena.  There
are no liens on this property.  We rent 400 square feet of this building, for
$3,600 in rents annually.

     We own the Massena Theater, which is an 8,000 square foot building with a
400-seat movie theater and two retail stores, which we rent for an annual
amount of $10,800.

     We own 7.5 acres with a two-car garage and a mobile home in Massena.  The
mobile home is rented for $1,800 per year.  This property is part of the
security for a mortgage held by Pittsford Capital, LLC.

     We own 14 acres of land with 1,850 feet of frontage on Route 37 in
Massena.  The land connects to the mobile home and garage property discussed
above.  This property is also part of the security for a mortgage held by
Pittsford Capital, LLC.

     We also own 12 acres of land with 400 feet of frontage on Route 420 in
Massena.  This property is not subject to any liens.

     We have a 5,000 square foot metal building on three acres of land, also
located in Massena.  This property connects to the mobile home and garage
property identified above, and is also part of the security for the Pittsford
Capital, LLC. mortgage.

     The Company also owns 85.39 acres of farm land on Route 56 in Massena.
This parcel is also part of the security for the Pittsford Capital, LLC.
mortgage.

     We have a 20,000 square foot building, with 2,000 square feet of office
space located in Ogdensburg, New York.  This property is subject to a mortgage
on which we currently owe approximately $647,000.

     We own a 6,000 square foot building located in Massena.  This property is
not subject to any lien.

     We have a 5,000 square foot block building in an industrial park in
Massena.  We currently owe approximately $57,000 on a mortgage on this
building.

Michelex Plastics Division.
---------------------------

     Through the Michelex Plastics Division, we own a 8,750 square foot metal
building on one acre.  The building, located in Massena, has two loading dock
doors with 1,500 square feet in office space.  This property has been pledged
as security for our Wells Fargo Business Credit Term Loan.  This lot also
contains a 1,200 square foot metal building, which is not pledged as security
for any loans.

     We have a 9,800 square foot metal building on one acre with two loading
dock doors and 1,800 square feet of office space.  This property is also
located in Massena and is pledged as security for the Wells Fargo Business
Credit Term Loan.

     The Company has a 20,000 square foot metal building on one acre of land
with four loading dock doors and 1,200 square feet of office space.  This
property is also located in Massena and is being used as security for the
Wells Fargo Business Credit Term Loan.  There is also a 1,200 square foot
metal building on this lot which has not been pledged as security for any
loans.

     We also have a 26,000 square foot metal building with a brick front on
two acres of land located in Massena.  The building has four loading dock
doors and approximately 4,000 square feet in office space.  We owe
approximately $123,000 on this property.

     We own a 25,500 square foot block and metal building with six loading
dock doors located on two acres of land in Massena.  Approximately 15,500
square feet is rented to two entities, for an annual rental income of $86,875.
We currently owe approximately $96,755 on a mortgage on this property.

     We also own a vacant four acre lot in Massena.  This lot is subject to a
mortgage one which we currently owe approximately $2,025.

     We own an 83,864 square foot cement building located in Salt Lake City,
Utah.  The building has three dock doors and 25,000 square feet of office
space.  Michelex uses the un-rented space for office, warehouse and
manufacturing facilities.  This parcel has a first mortgage with Equitable
Life & Casualty and a second mortgage for $800,000 from First Interstate
Financial LLC, which is subordinate to the first mortgage.  The second
mortgage carries an interest rate of 9%, with a term of 18 months.  Our Vice
President and Treasurer, Thomas Gramuglia, holds a mortgage on this property
in the amount of $350,000 that is subordinate to the other two mortgages.  We
currently owe approximately $1,992,000 on this parcel.  We lease a total of
26,693 square feet to four entities.  We receive a total of $132,048 annually
from these leases.

     We also own a 16,000 square foot building in Salt Lake City.
Approximately 4,000 square feet is office space.  We currently owe
approximately $647,000 on a mortgage on this property.  We also lease this
building for $36,000 in annual lease income.

Item 3. Legal Proceedings.
---------------------------

     Except as indicated below, the Company is not a party to any pending
legal proceeding.  To the knowledge of management, no federal, state or local
governmental agency is presently contemplating any proceeding against the
Company. No director, executive officer or affiliate of the Company or owner
of record or beneficially of more than five percent of its common stock is a
party adverse to the Company or has a material interest adverse to the Company
in any proceeding.

     During the 2003 fiscal year, Michele New Jersey entered into a Consulting
Agreement with an investor relations consultant, and simultaneously entered
into a Personal Services Agreement with an individual.  The agreements were
effective June 1, 2003 and they both expire on May 31, 2004.  The agreements
called for certain services, to be provided by the consultants for the benefit
of the Michele New Jersey.  As compensation for these services, Michele New
Jersey agreed to issue to both consultants preferred shares of stock in
Michele New Jersey.

     In March of 2004, which is subsequent to the period covered by this
Report, the consultants filed for arbitration, as called for in the
agreements, against the Company, claiming they have not been compensated as
called for in the agreements.  The Company responded by indicating that it was
not a party to the agreement and was therefore not bound to the arbitration,
and the filing was dismissed.  In the event that the arbitration is re-filed
or that the consultants file a lawsuit, the Company, among other defenses,
will contend that neither consultant provided the quantity or quality of
services contemplated under the agreements.  The Company intends to vigorously
defend its position.

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

     On September 9, 2003, our Board of Directors and majority stockholders
voted to amend Article I of our Articles of Incorporation to change the
Company's name to "Michelex Corporation."  This amendment became effective
on September 29, 2003.  We filed a definitive information statement with
respect to this matter on September 8, 2003.  See Part II, Item 13 of this
Report.

                   PART II

Item 5. Market for Common Equity and Related Stockholder Matters.
------------------------------------------------------------------

Market Information.
-------------------

     The Company's common stock is quoted on the OTC Bulletin Board of the
National Association of Securities Dealers, Inc. (the "NASD") under the symbol
"MHXC."  However, the market for shares of our common stock is extremely
limited and only commenced in the third quarter of 2000.  No assurance can be
given that any established trading market for our common stock will develop or
be maintained.  If such a market develops in the future, resales of
"unregistered" and "restricted" shares of common stock by members of
management or others may have a substantial adverse impact on any such public
market.  See the heading "Recent Sales of Unregistered Securities," and the
caption "Security Ownership of Certain Beneficial Owners and Management" of
this Report.

     The high and low bid prices for the Company's common stock for the past
two years are as follows:

                                                      Bid
                                                      ---
Quarter ending:                         High                      Low
                                        ----                      ---
January 2, 2002 through
March 28, 2002                          $0.03                     $0.02

April 1, 2002 through
June 28, 2002                           $0.02                     $0.02

July 1, 2002 through
September 30, 2002                      $0.03                     $0.02

October 1, 2002 through
December 31, 2002                       $0.03                     $0.03

January 2, 2003, through
March 31, 2003                          $0.03                     $0.01

April 1, 2003, through
June 30, 2003                           $0.01                     $0.01

July 1, 2003, through
September 30, 2003                      $1.01                     $0.01

October 1, 2003 through
December 31, 2003                       $0.25                     $0.15

          These bid prices were obtained from Pink Sheets LLC and do not
necessarily reflect actual transactions, retail markups, mark downs or
commissions.

Holders.
--------

     The number of record holders of the Company's securities as of the date
of this Report is approximately 16.  This figure does not include an
indeterminate number of stockholders who may hold their shares in "street
name."

Dividends.
----------

     The Company has not declared any cash dividends with respect to its
common stock and does not intend to declare dividends in the foreseeable
future.  There are no material restrictions limiting, or that are likely to
limit, the Company's ability to pay dividends on its common stock.

Recent Sales of Unregistered Securities.
----------------------------------------

     The following table reflects all sales of "unregistered" and "restricted"
securities of the Company during the three most recently completed fiscal
years:

                     Date                 Number of         Aggregate
     Name            Acquired             Shares            Consideration
     ----            --------            ---------          -------------

Benjamin Hansel        2/7/03            20,000,000 (1)     Payment of all
                                                            costs and expenses
                                                            incurred in
                                                            connection with
                                                            the Plan.

Ginette Gramuglia     7/28/03             5,196,000         (2)

Thomas Gramuglia      7/28/03             5,040,120         (2)

Michele Stone         7/28/03                51,960         (2)

Patrick Gramugila     7/28/03                51,960         (2)

     (1) All but 250,000 of these shares were canceled under the Plan.  See
Part I, Item 1 of this Report.

     (2) These shares were issued to these former stockholders of Michele New
Jersey under the Plan.  See Part I, Item 1 of this Report.

     The offers and sales of these securities are believed to have been exempt
from the registration requirements of Section 5 of the Securities Act of 1933,
as amended, pursuant to Sections 3(b) and/or 4(2) thereof, and from similar
applicable states' securities laws, rules and regulations exempting the offer
and sale of these securities by available state exemptions from registration.

Securities Authorized for Issuance under Equity Compensation Plans.
-------------------------------------------------------------------

     The Company has not adopted any equity compensation plans.

Item 6.  Management's Discussion and Analysis or Plan of Operation.
         ----------------------------------------------------------

Plan of Operation.
------------------

     The Company recorded a net loss of $914,417 during the period from March
1, 2003, to December 31, 2003.  Management has recently performed a critical
review of the Company's strengths to determine what will be required to return
the Company to profitability.  The Company's strengths include:

     *  a loyal and diverse customer base;

     *  infrastructure capable of producing, importing and selling at more
than double the current volumes;

     *  well established channels of distribution;

     *  management and technical personnel with a broad base of diverse
industry experience;

     *  a diverse and well established network of industry contacts, vendors
and suppliers; and

     *  a broad range of products with strong market demand.

     To facilitate the Company's return to profitable operations, management
has formulated the following turnaround plan for the 2004 fiscal year:

     *  Increase the percent of import products in the overall product mix;

     *  Increase profit margins on low margin products;

     *  Focus financial and operational resources on high margin products;

     *  Increase sales to existing customers through cross selling of
products;

     *  Implement divisional sales plans to increase sales to new customers;

     *  Reduce operating expenses through increased operational
efficiencies;

     *  Optimize asset utilization through diversification and disposition
of non-productive assets; and

     *  Maximize the utility of technology-based operational and sales
tools.

     Each of these strategies is discussed in greater detail below as they
apply to each of the Company's three divisions.  The elements of the plan
incorporate fundamental business practices; however, the success of the plan
depends on the implementation and monitoring of each strategy and the success
of management in securing sufficient working capital and import letters of
credit to facilitate the plan.

Michelex Plastics Division.
---------------------------

     The Michelex Plastic Division imports, manufactures and sells plastic
injection molded media packaging products.  This is the largest of the three
divisions in terms of revenues, personnel, and infrastructure.  Actual
revenues for this division accounted for 71.2%, 65.1%, and 66.4% of the total
company revenues for the 12 month periods ended February 28, 2002, February
28, 2003 and December 31, 2003 respectively.  Given the relative size of this
division and the impact it has on the overall Company, returning it to
profitability is a key objective of the Company's turnaround plan.  Following
is a brief description of the strategic elements of the plan devised for the
Michelex Plastics Division.

     Increase Product Imports.  Although management identified the benefits of
augmenting domestically produced products with a balance of imported products
years ago, cash flow constraints have impaired the Company's ability to import
products.  However, since 1999, a period in which raw material prices and
production related expenses have increased dramatically, import product sales
have declined from approximately 32.9% of the plastic division sales for the
12 months ended February 28, 2000 to approximately 24.5% of the plastic
division sales for the 12 months ended December 31, 2003.  Typically the
imported products are specialty items that sell for higher prices per piece
and produce higher profit margins.

     Management believes increasing the amount of import products as a percent
of the total Michelex Plastic Division sales is one of the most critical
elements of the Company's overall turnaround strategy.  For the 12 months
January through December, 2004, the Company has projected total product sales
of approximately $15,042,800 for this division.  This represents an increase
of approximately 10.8% as compared to the same period for 2003.
Of this increase, approximately 73.7% is from import product
sales.  Management has projected import product sales will constitute
approximately 25.8% of the total division product sales for the 12 months
ending December 31, 2004.

     The advantage of import products varies within each product line of this
division.  Management has focused on changing the mix of imports and
domestically produced products on the product lines where it believes the most
benefit can be derived.

     The most significant changes have been made in the Jewel Box and Tray
product lines.  Production of domestically produced Jewel Boxes and Trays are
forecasted to decrease while imported pieces are projected to increase.  The
projected declines in pieces of import C-0's and domestically produced Norelco
Boxes are the result of a shrinking market for these products.  Management has
projected a small growth in Video boxes (3.4%) for 2004 due to the declining
overall market.  However, the Company is currently evaluating an opportunity
that could result in a dramatic increase in domestically produced Video Box
sales.

     The projected increase in the domestically produced C-Shell product line
(approximately 5,112,500 pieces) is based on a strong market demand for the
product.  To meet the current demand the Company has ordered and will
take delivery of two new molds in the first and second quarters of 2004 to
enhance production.

     Within the DVD product line management has projected an increase of both
domestically produced pieces and imported pieces.  As with the C-Shell product
line, demand for the DVD boxes remains strong.  The imported DVD boxes are
being produced on molds owned by Michelex.  The cost of these molds is being
amortized in the cost of the imported pieces purchased.  It is anticipated
this cost will be completely amortized in the third quarter of 2004 and the
cost of imported DVD Boxes will drop significantly.  No adjustment has been
made in the projections to reflect the impact of this change.  Management is
confident that with import letters of credit available, the Company has the
infrastructure and resources in place to effect the projected changes.

     Increase Product Prices.   A preliminary review of customer pricing in
conjunction with a recent review of domestic and import product costs has
indicated the need to selectively implement a price increase.  Given the
nature of the Company's existing customer base, management believes an across
the board price increase on all products to all customers is not feasible.
Management has initiated a program to review each customer to determine the
cross section of products the customer purchases, the volume purchased of each
product line and the customer's current pricing structure.  Price increases
will be based on the results of this review.  Price increases have already
been initiated on several customers, including two of the Company's largest
customers.  In conjunction with the price increase program, new guidelines
have been established for new customer product pricing and two new accounts
have been acquired at significantly better pricing than has been historically
achieved.  Management has included modest price increases in the sales
projections for certain product lines.

     Increase Sales to Existing Accounts.   In conjunction with the customer
file review noted above, each customer file is being reviewed for the
potential to sell additional product lines from the plastic division as well
as products from the other divisions.  Management believes this will prove to
be an efficient and cost effective tool to generate additional sales and
promote improved customer relations.  An important aspect of this and the
other strategies related to increasing sales is a constant supply of all
product lines.  This aspect ties directly into the revisions of the import and
production strategies.

     Increase Sales Through New Business.  Included as integral elements of
this turnaround plan are the addition of two new sales staff positions,
production of a new product catalog, upgrades to the Company's website,
additional media advertising and trade show related expenses.  The primary
focus of these positions will be the acquisition of new accounts.
Additionally, the Company is currently evaluating the feasibility and cost
effectiveness of diversifying and domestically producing two new specialty
products for two large retailers.

     Reduce Production Related Expenses.  Management is currently in the
process of completing a comprehensive review of the Company's production
operations and the costs associated with these operations.  Although styrene
prices are projected to continue to increase, management believes reducing
inefficiencies in operations coupled with a consistent supply of styrene
will result in reductions in the cost per unit of the Company's domestically
 produced products.

     Management's plan contemplates a reduction in the number of units of
certain domestically produced products, securing a consistent supply, grade
and quality of raw materials, and closer monitoring of the production
processes.  Management is continuing to monitor and evaluate the potential for
future increases in the cost of styrene.  In conjunction with this, management
is also evaluating the feasibility and cost of importing a percentage of the
standard jewel box and tray requirements that are currently produced
domestically.  Importing a portion of these product lines will reduce the
Company's exposure to availability and price fluctuations of styrene and
increasing production related expenses.  Additionally, reducing the number of
domestically produced units would enable the Company to contract and
consolidate its production operations and concentrate on producing higher
margin products (such as C-Shells and DVD Boxes) thereby optimizing the cost
per unit of the remaining domestically produced products.

     Reduce and Control Sales and Administrative Expenses.   Management is
currently in the process of reviewing all sales, general and administrative
expenses.  The Company intends to consolidate certain overlapping
administrative functions within the divisions and streamline its financial
and management reporting processes.  The purpose of this review is not to
arbitrarily eliminate expenses but rather to improve the productivity for the
resources expended on these functions.  This is especially true with respect
to the sales and marketing expenses where management has projected increased
expenses for fiscal 2004 to add additional personnel and increase media
exposure.  Management believes it is important for the Company to re-establish
itself as a reliable supplier of quality products within the media packaging
industry with existing, previous and new customers.

     Optimize Asset Utilization.  Although the Company has a substantial asset
base, several of the assets are not currently generating revenues for the
Company.  Management has initiated a review of all of the Company's assets and
will evaluate each one with respect to its potential to profitably generate
revenues.  Thus far, management has identified three properties that are being
considered for disposition.  Selling these three parcels could eliminate
up to approximately 10% to 15% of the total debt from the Company's balance
sheet.  Management is fairly confident two of three properties can be disposed
of.  However, the third parcel is located in Salt Lake City and may be more
difficult to sell in the immediate future.  The premises are leased however,
and the lease payments help offset the carrying costs of the facility.  The
Company is also evaluating the feasibility and cost effectiveness of selling
certain of its current production assets and replacing them with newer, more
efficient and less labor-intensive equipment.

Michele Audio Division.
-----------------------

     This division is involved primarily in the duplication and packaging of
music and spoken word communication products.  During the fiscal year ended
February 28, 2003 this division accounted for approximately 34.5% of the total
company sales. For the 12 months ended December 31, 2003 this declined to
approximately 28.0% of total company sales, a level that more accurately
reflects recent historical sales.  The elements of the turnaround strategy for
this division are in many ways similar to those proposed for the Michelex
Plastics Division and are described below.

     Revise The Divisions Product Mix.  This is the single most important
element of this division's turnaround strategy.  Historically the principal
product line for this division has been cassette-based products.  For the 12
months ended February 28, 2002; February 28, 2003; and December 31, 2003,
cassette-based products have accounted for 83.3%, 79.9%, and 72.5%
respectively of the total division sales.  Although management identified
the changing market dynamics several years ago, the Company did not
aggressively pursue the CD and DVD market segments.

     Starting with the 2004 fiscal year, the Company has adopted a strategy to
aggressively pursue the CD and DVD market segments and has projected an
increase of approximately 23.5% in CD/DVD product sales for the 12 months
ending December 31, 2004, as compared to actual sales for the same period
ending December 31, 2003.  No increase was projected for cassette-based sales.
Management has established 2004 as the base year for aggressively initializing
this shift in product mix and contemplates the 2005 fiscal year will involve a
far more dramatic shift in the product mix.  The items discussed in the next
paragraph are an integral part of this overall strategy.

     Increase New Customer Accounts.  In order to achieve the objectives set
forth in the previous paragraph it is imperative that the Company initiates a
sales and marketing program to aggressively pursue new accounts in the CD and
DVD marketplace.  The Division is currently in the process of restructuring
its catalog and updating the Company's website to emphasize the Company's CD
and DVD replicating and packaging capabilities.  Additionally management is
currently interviewing candidates for two new sales positions, one each on the
East and West coast to specifically pursue new accounts.  Management believes
it can also use the reputation it has established as a high-speed quality
replication and packaging source for cassette products as an effective
marketing tool in this strategy.

     Increase Product Pricing.  Simultaneously with the review of the Plastics
division customer base previously discussed, management initiated a review of
the Audio division customer account base.  To date, price increases have been
obtained from several existing Audio division accounts.  Management believes
there may also be another opportunity on the horizon for cassette-based
products.  Although the market for these products is shrinking, so is the
source of reliable quality suppliers.  Although this may be a short duration
opportunity, it could prove to be a profitable source of revenue during the
transition period.

     Reduce and Control Production and Operating Expenses.  Management is in
the process of revising and implementing changes for controlling, monitoring
and reporting cost and production data.  Additionally, the Company is
reviewing its production scheduling process to more efficiently and
cost-effectively facilitate the production of customer orders.  As with
the plastics division, management is reviewing all administrative functions to
eliminate duplication and overlap with other divisions.

     Management believes the turnaround strategies applicable to the Michele
Audio Division are going to be the most difficult to successfully implement
and integrate into the Company's operations.  Although the Company has
experience in CD replication and packaging, this element of the strategy is
the most aggressive in terms of changing existing operation strategies and
deviation from existing business practices within this division.

Michelex Media Products Division.
---------------------------------

     This division began operations in February, 2003, when Michele Audio
Corporation took over the operations of the Enpack Company.  Since that time,
this division has been the fastest growing and most profitable division of the
Company.  This division's products consist primarily of paper, vinyl, tyvek
and board mailer-based media packaging products for use with CD and DVD media.
Although the strategies outlined below are not technically categorized as
turnaround strategies for this division, they are an integral part of the
overall corporate turnaround plan.

     Increase Website Related Sales.  The Company has contracted a website
design Company to assist in designing and implementing an upgrade to the
Company's website and its links to other websites.  Various market survey data
reviewed by the Company and contact with new and existing customers have
indicated the website is a very effective tool in this segment of the media
packaging industry.  The Company contemplates the website will be fully
functional by the end of the second quarter 2004 and has projected sales
generated through this venue will constitute approximately 27.8% of the total
projected sales for 2004.

     Continue the Growth of Wholesale Sales.  Management is confident the
growth in this area will continue.  Demand for the product remains strong and
the Company believes it can successfully cultivate additional business from
its existing customer base in the other two divisions as well as pursue new
customers.  Additionally, management has projected adding two additional
personnel in the sales department, allocated resources to create a new product
catalog, and projected an increase in advertising and trade show expenses.
The critical element in this particular strategy will be the ability of the
Company to secure ample quantities of inventory to satisfy the customer's
demands in a timely manner.

     The primary focus in this business segment will be to maintain the sales
momentum the Company has generated during the first year of operation and
capitalize on the opportunities that currently exist.

     Forward-Looking Information.
     ----------------------------

     Statements made in this Form 10-KSB which are not purely historical are
forward-looking statements with respect to the goals, plan objectives,
intentions, expectations, financial condition, results of operations, future
performance and business of our Company, including, without limitation,
statements preceded by, followed by or that include the words "may", "would",
"could", "should", "expects", "projects", "anticipates", "believes",
"estimates", "plans", "intends", "targets" or similar expressions.

     Forward-looking statements involve inherent risks and uncertainties, and
important factors (many of which are beyond our Company's control) that could
cause actual results to differ materially from those set forth in the
forward-looking statements, including the following, in addition to those
contained in our Company's reports on file with the Securities and Exchange
Commission: (i) general economic or industry conditions, nationally and/or in
the communities in which our Company may conduct business; (ii) changes in the
interest rate environment, legislation or regulatory requirements; (iii)
conditions of the securities markets; (iv) changes in the industries in which
the Company competes; (v) the development of products or services that may be
superior to products or services offered or developed by our Company; (vi)
competition; (vii) changes in the quality or composition of products or
services developed by our Company; (viii) our ability to develop new products
or services; (ix) our ability to raise capital; (x) changes in accounting
principals, policies or guidelines; (xi) financial or political instability;
(xii) acts of war or terrorism; (xiii) other economic, competitive,
governmental, regulatory and technical factors affecting our Company's
operations, products, services and prices.

     Accordingly, results actually achieved may differ materially from
expected results in these statements.  Forward-looking statements speak only
as of the date they are made.  The Company does not undertake, and
specifically disclaims, any obligation to update any forward-looking
statements to reflect events or circumstances occurring after the date of such
statements.

Item 7.  Financial Statements.
         ---------------------

<PAGE>
               MICHELEX CORPORATION AND SUBSIDIARY

            Index to Consolidated Financial Statements
              for the Period Ended December 31, 2003





     Independent Auditors' Reports                          F - 2

     Balance Sheet                                          F - 3

     Statements of Operations                               F - 5

     Statements of Changes in Shareholders' Equity          F - 6

     Statements of Cash Flows                               F - 7

     Notes to Financial Statements                          F - 9

<PAGE>

                   INDEPENDENT AUDITORS' REPORT



To The Board of Directors and Shareholders
Michelex Corporation

We have audited the accompanying balance sheet of Michelex Corporation
as of December 31, 2003 and the related statements of operations,
changes in shareholders' equity and cash flows for the period March 1,
2003 to December 31, 2003 and the year ended February 28, 2003. 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 auditing standards generally
accepted in the United States of America.  Those standards require that
we plan and perform the audits 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 financial statements enumerated above present
fairly, in all material respects, the financial position of Michelex
Corporation as of December 31, 2003 and the results of their operations
and their cash flows for period March 1, 2003 to December 31, 2003 and
the year ended February 28, 2003 in conformity with accounting
principles generally accepted in the United States of America.

/s/Seligson & Giannattasio, LLP
Seligson & Giannattasio, LLP
N. White Plains, New York
April 2, 2004
<PAGE>
<TABLE>
                MICHELEX CORPORATION AND SUBSIDIARY

                    CONSOLIDATED BALANCE SHEET

                        December 31, 2003

               ASSETS

<S>                                                  <S>
Current assets:
  Cash                                            $     225,825
  Accounts receivable                                 3,575,495
  Accounts receivable   related party                   760,748
  Inventory, net                                      2,446,633
  Prepaid expenses and income taxes                     160,840
                                                  -------------
     Total current assets                             7,169,541

Fixed assets   net of accumulated depreciation
     and amortization of $20,318,859                  9,573,153

Other assets:
     Land and building held for investment              148,429
     Loans receivable   related party                    90,772
     Other assets                                       286,730
     Deferred taxes                                     622,509
                                                  -------------
          Total assets                            $  17,891,134
                                                  =============
</TABLE>
See notes to financial statements.
                               F-3
<PAGE>
<TABLE>
<CAPTION>

                 MICHELEX CORPORATION AND SUBSIDIARY

                   CONSOLIDATED BALANCE SHEET

                        December 31, 2003


                    LIABILITIES AND SHAREHOLDERS' EQUITY
<S>                                                 <C>
Current liabilities:
  Note payable to bank                            $   2,724,291
  Current portion of long-term debt                     755,646
  Current portion of capital leases                     528,385
  Accounts payable                                    3,720,150
  Accrued expenses                                      615,311
                                                  -------------
     Total current liabilities                        8,343,783

Other liabilities:
     Long-term debt less current maturities           5,448,912
     Note payable   officers                            385,979
     Capital leases less current maturities             889,597
     Note payable   related parties                     199,997
                                                   ------------
          Total liabilities                          15,268,268

Commitments and contingencies

Shareholders' equity
  Common stock - no par value stock,
     100,000,000 shares authorized,
     12,990,000 shares issued and outstanding      $     12,990
  Additional paid-in-capital                              4,850
  Retained earnings                                   2,605,026
                                                   ------------
     Total shareholders' equity                       2,622,866
                                                   ------------
     Total liabilities and shareholders' equity    $ 17,891,134
                                                   ============
</TABLE>

See notes to financial statements
                               F-4
<PAGE>
<TABLE>
<CAPTION>
               MICHELEX CORPORATION AND SUBSIDIARY

              CONSOLIDATED STATEMENTS OF OPERATIONS

                                   March 1, 2003
                                        to             Year Ended
                                   December 31,        February 28,
                                     2 0 0 3             2 0 0 3
<S>                               <C>                <C>
Net sales   unrelated parties      $17,300,668         $20,894,728
Net sales   related parties            411,569             793,285
                                   -----------         -----------
Net sales                           17,712,237          21,688,013
Cost of goods sold                  11,109,140          11,999,244
                                   -----------         -----------
Gross profit                         6,603,097           9,688,769
                                   -----------         -----------
Operating expenses:
  Selling and shipping                 501,808             709,581
  General and administrative         5,929,784           7,958,425
  Depreciation                       1,126,004           1,371,934
                                   -----------         -----------
     Total operating expenses        7,557,596          10,039,940
                                   -----------         -----------
Loss before other income (expense)
and income taxes                      (954,499)           (351,171)
                                   -----------         -----------
Other income (expense):
  Other income                         127,866             117,316
  Interest expense, net               (619,409)           (939,212)
  Gain on sale of assets                34,352               8,387
  Net income (loss) from rental
  properties                           (13,181)             39,629
                                   -----------         -----------
     Other income (expenses)          (470,372)           (773,880)
                                   -----------         -----------
Loss before income taxes            (1,424,871)         (1,125,051)

Income tax (benefit)                  (510,454)           (338,904)
                                   -----------         -----------
Net loss before extraordinary gain    (914,417)           (786,147)

Extraordinary gain:
     Forgiveness of debt, net of
     income tax of $466,665                 --             829,628
                                   -----------         -----------
Net (loss) income                  $  (914,417)        $    43,481
                                   ===========         ===========
Weighted shares outstanding:
  Primary and diluted               12,990,000          12,990,000

Earnings per share:
  Primary and diluted              $      (.07)        $        --
</TABLE>
See notes to financial statements
                               F-5
<PAGE>
<TABLE>
<CAPTION>

                MICHELEX CORPORATION AND SUBSIDIARY

    CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

            PERIOD MARCH 1, 2003 TO DECEMBER 31, 2003
               AND THE YEAR ENDED FEBRUARY 28, 2003

                                             Additional
                           Common stock       Paid-in   Retained
                         Shares       Amount  Capital   Earnings     Total
<S>                      <C>         <C>      <C>       <C>       <C>
Balance-March 1, 2002     12,990,000  $12,990   $4,850  $3,475,962 $3,493,802

Net income                        --       --       --      43,481     43,481
                          ----------  -------   ------  ---------- ----------
Balance-February 28, 2003 12,990,000   12,990    4,850   3,519,443  3,537,283

Net loss                          --       --       --    (914,417)  (914,417)
                          ----------  -------   ------  ---------- ----------
Balance-December 31, 2003 12,990,000  $12,990   $4,850  $2,605,026 $2,622,866
                          ==========  =======   ======  ========== ==========
</TABLE>
See notes to financial statements.

                               F-6
<PAGE>
<TABLE>
<CAPTION>
                 MICHELEX CORPORATION AND SUBSIDIARY

                CONSOLIDATED STATEMENTS OF CASH FLOWS

                                   March 1, 2003
                                        to             Year Ended
                                   December 31,        February 28,
                                     2 0 0 3             2 0 0 3
<S>                               <C>                <C>

CASH FLOWS FROM OPERATING ACTIVITIES:
  Net (loss) income                         $  (914,417)    $     43,481
  Adjustments to reconcile net (loss)
  income to net cash provided by
  operating activities:
   Depreciation and amortization              1,126,004        1,406,649
   Provision for losses on inventory                 --           26,182
   Gain on sale of assets                       (34,352)          (8,387)
   Deferred taxes                              (511,479)         126,535
CHANGES IN OPERATING ASSETS AND LIABILITIES:
   Accounts receivable                          143,874         (198,251)
   Inventory                                    186,732         (391,655)
   Refundable income taxes                           --          289,860
   Prepaid expenses and taxes                   114,190           21,025
   Other assets                                (239,509)         (28,557)
   Accounts payable                             353,020         (119,630)
   Accrued expenses and taxes                   103,223          (32,890)
                                            -----------     ------------
NET CASH FLOWS FROM OPERATING ACTIVITIES        327,286        1,134,362
                                            -----------     ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Proceeds from the sale of land and
  building held for Investment                       --          825,000
  Proceeds from sale of fixed assets                 --               --
  Acquisition of fixed assets                  (854,231)      (1,515,185)
                                            -----------     ------------
NET CASH FLOWS FROM INVESTING ACTIVITIES       (854,231)        (690,185)
                                            -----------     ------------
</TABLE>

See notes to financial statements
                               F-7
<PAGE>
<TABLE>
<CAPTION>
                MICHELEX CORPORATION AND SUBSIDIARY

               CONSOLIDATED STATEMENTS OF CASH FLOWS

                                          March 1, 2003
                                                to             Year Ended
                                           December 31,        February 28,
                                             2 0 0 3             2 0 0 3
<S>                                    <C>                <C>
CASH FLOWS FROM FINANCING ACTIVITIES:
  Repayment of long-term debt                $ (902,504)      $(3,177,416)
  Proceeds from long-term debt                  950,000         4,400,000
  Net borrowings from loan payable              250,559        (1,666,917)
  Net borrowings from loans to related parties  189,159           107,626
                                             ----------       -----------
NET CASH FLOWS BY FINANCING ACTIVITIES          487,214          (336,707)
                                             ----------       -----------
NET INCREASE (DECREASE) IN CASH                 (39,731)          107,470

CASH AT BEGINNING OF YEAR                       265,556           158,086
                                             ----------       -----------
CASH AT END OF YEAR                          $  225,825       $   265,556
                                             ==========       ===========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

  Income taxes paid                          $    1,025       $       325
                                             ==========       ===========
  Interest paid                              $  622,153       $ 1,087,879
                                             ==========       ===========
NONCASH INVESTING AND FINANCING ACTIVITIES:
  Purchase of fixed assets through issuance
  of Notes and leases payable                $       --       $   721,500
                                             ==========       ===========

</TABLE>

See notes to financial statements.
                               F-8
<PAGE>
               MICHELEX CORPORATION AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                        DECEMBER 31, 2003

NOTE 1   SIGNIFICANT ACCOUNTING POLICIES

Business Activity

Michele Audio Corporation of America began business in March 1972.  As a
result of the merger discussed in note 4, Michele Audio Corporation of America
became a wholly owned subsidiary of Highway One-Oweb, Inc.  Subsequent to the
merger Highway One-Oweb, Inc. changed its name to Michelex Corporation.
Michelex is a fully integrated audio replication and multimedia fulfillment
company that provides quality products and professional grade services to
customers throughout North America.  Through its Plastics division the Company
provides a broad range of plastic injection molded multimedia packaging
products and fulfillment services.  The product offerings include Jewel Boxes,
Trays, DVD Boxes, and C-Shells for CD and DVD based products, Norelco Boxes
and C-0's for cassette based products and Video Boxes and Poly Boxes for VHS
based products.  Through its audio division the Company provides replication
services for cassette, CD and DVD based products.  Additionally, the audio
division owns exclusive rights to an extensive library of music and spoken
word program material it licenses to customers and also operates both a
recording and mastering studio which provides audio restoration, editing and
mastering services to its customers.  Through its newest division the Company
offers a broad range of paper, vinyl, tyvek, and board mailer based multimedia
packaging products.  In addition to servicing customers from its headquarters
and manufacturing facilities in Massena, NY in 1999 the Company opened a
manufacturing and distribution facility in Salt Lake City, UT to better serve
customers in the western half of the United States.

Cash Equivalents

The Company considers all highly liquid debt instruments with a maturity
of three months or less to be cash equivalents.

Accounts Receivable
The Company estimates an allowance for bad debts based on a periodic
review of its accounts which are charged to operations at the time they
are deemed to be uncollectible.

Inventory
Inventory is valued at the lower of cost (first-in first-out method) or
market.  Merchandise shipped from overseas is inventoried, and the
corresponding liability recorded, upon the Company's taking title to the
inventory. Components of inventories at December 31, 2003 are as
follows:

     Raw materials    $  346,250
     Work in process          --
     Finished goods    2,100,383
                       ----------
                      $2,446,633
                       ==========

Revenue recognition
Revenues are recognized when product is shipped from the Company's
facilities.
                               F-9
<PAGE>
               MICHELEX CORPORATION AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                        DECEMBER 31, 2003


NOTE 1   SIGNIFICANT ACCOUNTING POLICIES (Continued)

Concentration of Credit Risks
The Company's financial instruments that are exposed to concentrations
of credit risk consist primarily of temporary cash investments and trade
accounts receivable.

The Company maintains its cash in bank deposit accounts at high credit
quality financial institutions.  The balances are insured by the Federal
Deposit Insurance Corporation up to $100,000.  At December 31, 2003, the
Company's uninsured cash totaled $88,956.

Most of the Company's business activity is with customers located in the
United States.  Consequently, the Company's ability to collect the
amounts due from customers is affected by economic fluctuations in the
country.

The Company routinely assesses the financial strength of its customers,
and as a consequence, believes that its trade accounts receivable credit
risk exposure is limited.

Fixed Assets
The value of fixed assets is at historical cost as required by generally
accepted accounting principles.  Depreciation is calculated on a
straight-line over the expected useful life of the asset as follows:

  Building and improvements     10 to 31 years
  Equipment                       5 to 7 years
  Vehicles                             5 years
  Masters                              3 years

Included in fixed assets is $1,771,077 in equipment and $1,010,920 in
land and buildings under capital leases.

Land and Building Held for Investment
Property held for investments consists of land not used in the business
in Massena, NY as well as property for which the Company plans to
renovate and rent.
                               F-10
<PAGE>
               MICHELEX CORPORATION AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                        DECEMBER 31, 2003

NOTE 1   SIGNIFICANT ACCOUNTING POLICIES (Continued)

Use of Estimates
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America 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.
Accordingly, actual results could differ from those estimates.

Income Taxes
The Company reports income taxes based upon Statement of Financial
Accounting Standards No. 109 (FAS 109) "Accounting for Income Taxes",
which requires the recognition of deferred tax liabilities and assets
for the expected future tax consequences of temporary differences
between the carrying amounts and the tax bases of other assets and
liabilities.

Advertising:
The Company expenses advertising costs as they are incurred.

Earnings (Loss) Per Share:

The Company calculates earnings (loss) per share in accordance with SFAS
No. 128, "Earnings Per Share".  Basic earnings (loss) per share was
computed by dividing net income (loss) by the weighted average number of
common shares outstanding.  Diluted earnings per share is computed by
dividing net income by the weighted average number of common shares
outstanding and is adjusted for the dilutive effect of shares issuable
upon the exercise of options and warrants. The Company had a net loss
for the period March 1, 2003 to December 31, 2003 and the year ended
February 28, 2003, and accordingly, potential common share equivalents
are excluded from this computation, as the effect would be anti-
dilutive.

NOTE 2   RELATED PARTIES

Note Payable - Key Bank/Officers
In August 2002, the officers of the corporation borrowed $50,000
personally from Key Bank.  Proceeds were then lent to the corporation
which is making scheduled monthly payments of $5,000 principal plus
interest at the Bank's Prime Rate plus 2%.  This loan was repaid in
2003.

Loans Receivable-Media Books, LLC, Hindsight Records, Inc.,
Michelex Plastics Corp. and Michelex Trimark:
The Company has made interest free advances to these companies, which
are owned principally by certain shareholders of the Company.
                               F-11
<PAGE>
                MICHELEX CORPORATION AND SUBSIDIARY

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                        DECEMBER 31, 2003

NOTE 3   CREDIT LINES

Wells Fargo Business Credit, Inc.
In March 2002, the Company entered into a $7,000,000 revolving note
agreement with Wells Fargo Business Credit, Inc. for working capital and
issuance of letters of credit.  Interest is payable monthly at the
Bank's base rate plus 3%.  The note is payable on demand.  Borrowings
under the credit facility at December 31, 2003 totaled $1,949,291.  The
Company is currently in default of the credit facility.  The Company is
currently in negotiations with the bank to amend certain of the
provisions of the agreement and to settle the default charges.

Pittsford Capital Mortgage Partners
In September 2003, the Company entered into a short-term note agreement
with a lender for $775,000.  The note which is due September 17, 2004,
unless repaid sooner, bears interest at the rate of sixteen percent
(16%) per annum.  Interest only payments are due monthly.

Credit Facility A-Key Bank
The corporation had a credit line of $1,150,000 to support the issuance
of Letters of Credit for the purpose of buying inventory.  As of March
31, 2002, the line was closed.

Credit Facility B-Key Bank
The corporation had a note line in the amount of $4,100,000 to support
its working capital needs. This line was closed for further borrowing
purposes as of March 31, 2002.

These credit lines are collateralized by all accounts receivable,
inventory, furniture, fixtures, equipment and general intangibles.  Key
Bank also held a collateral security mortgage interest in the Lake of
the Isles Golf Course (Oak Ridge Investment).  All obligations were
guaranteed by Thomas Gramuglia and Ginette Gramuglia.

In August 2002, Key Bank forgave $1,296,293 of outstanding debt owed by
the Company, thus eliminating all Key Bank related debt except for the
$50,000 note dated August 2002 (note 2).

NOTE 4 - MERGER WITH HIGHWAY ONE-WEB, INC.

In July 2003, the Company merged with Highway One-Web, Inc. ("Highway").
In exchange for the shares of the Company outstanding on the date of the
merger, the shareholders received 10,392,000 shares of Highway stock.
In addition, 19,750,000 Highway shares previously issued were cancelled.
The merger has been reflected as a reverse acquisition, and as such, the
historical information presented reflects those of the operating
Company, Michele Audio.  The effect of this recapitalization has been
reflected retroactively.
                               F-12
<PAGE>
               MICHELEX CORPORATION AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                        DECEMBER 31, 2003

NOTE 5   LONG-TERM DEBT

Long-term debts consists of the following:

                                         Interest  Due  December 31,
                                            Rate   Date     2003

Secured mortgage payable in monthly
  installments of $16,800 including
  interest, secured by certain Utah
  facilities                               8.75%   2018 1,641,878

Secured mortgage to Mountain America in
  monthly installments of $4,594
  including interest, secured by
  certain Utah facilities                    7%    2015   646,535

Secured note payable to bank in monthly
  installments of $45,833 plus
  interest, secured by certain
  property                           Prime + 3%    2010 3,437,500

Secured note payable to bank in monthly
  installments of $2,416 plus
  interest, secured by certain
  equipment                          Prime + 1%    2005    41,109

Secured mortgage payable in monthly
  installments of $2,146
  including interest, secured by
  certain property in Massena, NY         5.25%    2009   122,780

Note payable to Massena Industrial
  Development Corp. payable in
  annual installments of $2,025            0.0%   2004     2,025

Secured note payable to Associates
  Commercial Corporation payable
  in monthly installments of $730
  including interest, secured by
  certain transportation
  equipment                               10.5%   2005    12,731

Note payable in monthly installments of
  $2,897 including interest, secured
  by certain property and guaranteed
  by certain officers                        3%   2013   300,000
                                                       ---------
                                                       6,204,558
                 Less current maturities                 755,646
                                                       ---------
                                                      $5,448,912
                                                       =========
                               F-13
<PAGE>
               MICHELEX CORPORATION AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                        DECEMBER 31, 2003

NOTE 5   LONG-TERM DEBT (Continued)

Long-term debt matures as follows:
       Fiscal year ending December 31,
       2004                $   755,646
       2005                    691,018
       2006                    683,384
       2007                    692,805
       2008                    702,962
       After                 2,678,743
                           -----------
       Total               $ 6,204,558
                           ===========

NOTE 6   CAPITAL LEASE OBLIGATIONS

St. Lawrence County Industrial Development Agency
The Company leases a building and land located on Lot 18 in the Massena
Industrial Park from the St. Lawrence County Industrial Development
Agency.  Pursuant to the lease, the lessor retains actual title to the
leased property until the termination of the lease, at which time the
property can be purchased for one dollar.

The lease dated May 1, 1992 is for 20,000 square feet of manufacturing
space and the land on which the building is constructed.  The lease
calls for 120 monthly payments of $2,220 beginning June 1, 1992 and
includes interest at a rate of 6% per annum. The Company made the final
lease payments and assumed ownership of the property in 2002.

Heller Financial Leasing, Inc.
The Company leases equipment under capital lease arrangements with
Heller Financial.  The terms and amounts are described below.  Pursuant
to the lease, the lessor retains actual title to the leased property
until the termination of the lease, at which time the property can be
purchased for one dollar.

The leases dated August 9, 1999 are for thirteen Nissei injection mold
machines.  The term of the leases is sixty months with monthly payments
of $27,362 which is equal to the cost to amortize $1,323,850 over a 5-
year period at an interest rate of 8% per annum.
                               F-14
<PAGE>
                MICHELEX CORPORATION AND SUBSIDIARY

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                        DECEMBER 31, 2003



NOTE 6   CAPITAL LEASE OBLIGATIONS (Continued)

St. Lawrence County Industrial Development Agency
The Company leases a building and land located on Lot 16 in the Massena
Industrial Park from the St. Lawrence County Industrial Development
Agency.  Pursuant to the lease, the lessor retains actual title to the
leased property until the termination of the lease, at which time the
property can be purchased for one dollar.  The lease dated November 6,
1998 is for 84 monthly payments of $4,431 beginning November 1998.

The Company leases a second building in the Massena Industrial Park from
the St. Lawrence County Industrial Development Agency.  Pursuant to the
lease, the lessor retains actual title to the leased property until the
termination of the lease, at which time the property can be purchased
for one dollar.  The lease dated October 30, 2003 is for 96 monthly
payments of $724 beginning November 1, 2003.

US Bancorp Leasing
The Company leases Sumitomo injection molding machines under capital
lease arrangements with US Bancorp Leasing.  The Lease, dated September
11, 2001, is for 48 months with monthly payments of $10,012, which is
equal to the cost to amortize $420,490 over a four-year period at an
interest rate of 6.125% per annum.  Pursuant to the leases the lessor
retains actual title to the leased property until the termination of the
lease, at which time the property can be purchases for one dollar.

Yale Financial Services
The Company leases a used 1999 Yale forklift under capital lease
arrangements with Yale Financial Services.  The lease has been
classified as a capital lease since the payments represent in excess of
90% of the equipment's cost.

The lease dated November 13, 2001 includes 24 monthly payments of $644
beginning January 2002.  This is equal to the cost to amortize the cost
of the equipment over 2 years with no interest payable.
                               F-15
<PAGE>
                MICHELEX CORPORATION AND SUBSIDIARY

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                        DECEMBER 31, 2003



NOTE 6   CAPITAL LEASE OBLIGATIONS (Continued)

Ogdensburg Bridge and Port Authority
The Company leased a building and land located at 820 Commerce Park
Drive, Ogdensburg from the Ogdensburg Bridge and Port Authority dated
March 29, 2002.    The lease is for 180 months with monthly payments of
$5,907, which is equal to the cost to amortize $700,000 over 15 years at
an interest rate of 6% per annum.

Yale Financial Services
The Company leased two reconditioned 1997 Yale lift trucks under capital
lease arrangements with Yale Financial Services on April 25, 2002.
Pursuant to the leases, the lessor retains actual title to the leased
property until the termination of the lease, at which time the property
can be purchased at fair market value.  The lease has been classified as
a capital lease since the payments represent in excess of 90% of the
equipment's cost. The lease is for 24 monthly payments of $674 beginning
April 2002, which is equal to the cost to amortize the cost of the
equipment over two years with no interest payable.

Future minimum lease payments are as follows:

Year Ended
December 31,
  2004                  $   585,666
  2005                      310,480
  2006                       79,572
  2007                       79,572
  2008                       78,124
  After                     584,793
                        -----------
                          1,718,207
  Less interest portion     300,225
                        -----------
  Present value of net
  minimum lease payments  1,417,982
  Less current portion      528,385
                        -----------
                        $   889,597
                        ===========
                               F-16
<PAGE>
               MICHELEX CORPORATION AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                        DECEMBER 31, 2003


NOTE 7   RETIREMENT PLAN

401(k) Plan
Effective March 1, 1993, the Company established a Deferred Savings and
Profit Sharing Plan that covers substantially all employees.  The plan
expense was $13,414 and $21,729 for fiscal periods ended December 31,
2003 and February 28. 2003.  The pension plan contributions were in
accordance with requirements of the pension plan trustee. The net assets
of the plan as of December 31, 2003 were $913,064.

NOTE 8   SALE OF ASSETS

Sale of Oak Ridge Investment
On  August 1, 2002, the Company sold its Oak Ridge Investment, the Lake
of the Isles Golf Course, for $825,000.  Proceeds from this sale were
used to reduce liability owing to Key Bank, prior to its forgiving the
remaining debt (Note 3).

NOTE 9   INCOME TAXES

Deferred income taxes reflect the net tax effects of temporary
differences between the carrying amount of assets and liabilities for
financial reporting purposes and the amounts used for income tax
purposes using the enacted tax rates in effect in the years in which the
differences are expected to reverse.  Deferred income tax liabilities
and assets are comprised as follows:
                                 December 31,
                                   2 0 0 3
  Deferred tax assets:
       Net operating loss          $868,145
       Inventory reserves             7,527
                                   --------
       Gross deferred tax assets    875,672

  Deferred tax liability:
       Depreciation                 253,163
                                   --------
  Net deferred tax assets          $622,509
                                   ========
                               F-17
<PAGE>

               MICHELEX CORPORATION AND SUBSIDIARY

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                        DECEMBER 31, 2003

NOTE 9   INCOME TAXES (Continued)

The Company believes it is more likely than not that this net deferred
tax asset will be realized in future periods and, accordingly, no
valuation allowance has been recorded.  The Company's income tax expense
before extraordinary items consists of the following:

                                       March 1, 2003       Fiscal
                                             to          Year Ended
                                        December 31,     February 28,
                                           2 0 0 3         2 0 0 3
    Current:
       Federal                        $         --     $         --
       State                                  1,025            5,719
                                       ------------     ------------
                                              1,025            5,719
  Deferred:
       Federal                             (475,678)        (320,501)
       State                                (35,801)         (24,122)
                                       ------------     ------------
                                           (511,479)        (344,623)
                                       ------------     ------------
       Benefit for income taxes        $   (510,454)    $   (338,904)
                                       ============     ============

A reconciliation of the difference between the expected income tax rate
using the statutory Federal tax rate and the Company's effective rate is
as follows:
                                      March 1, 2003          Fiscal
                                            to             Year Ended
                                       December 31,        February 28,
                                         2 0 0 3             2 0 0 3

U.S. Federal income tax statutory rate      (34)%             (34)%

State income tax, net of Federal income
tax benefit                                  (7)               (7)

Other   primarily net operating losses        5                11
                                            ---               ---
Effective tax rate                          (36)%             (30)%
                                            ===               ===

The Company has available approximately $3,382,000 of net operating loss
carryforwards available to reduce future taxable income expiring through
2023.
                               F-18
<PAGE>

                MICHELEX CORPORATION AND SUBSIDIARY

            NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                        DECEMBER 31, 2003

NOTE 10   MANAGEMENT'S PLAN OF OPERATION AND GOING CONCERN MATTERS

The Company has reported losses from operations for the last couple years.  In
addition, the Company has a working capital deficiency and has been notified
by its lender that it is in default of its credit facility.  The Company is
negotiating an amendment with its bank to address the default issues and the
terms of the loan.  Although the amendment is expected to provide a waiver for
past defaults, there is no assurance the Company will not be in default in the
future or that the will be successfully completed, at which time the bank
could exert any and all of its default rights.  Exerting these rights could
put the Company in a severe liquidity crisis.  There were also changes to the
formula determining the maximum amount to be borrowed.  The Company estimates
that the changes being negotiated on the formula will provide an additional
$400,000 in available borrowing.  As part of these negotiations, the Company
is attempting to obtain additional financing allowing the Company to purchase
additional molds increasing its capacity to produce DVD products.  Management
believes that the costs associated with the production from these molds will
be minimal as currently idle equipment would be able to be utilized.

In addition, the Company obtained $800,000 of additional financing through a
second mortgage on its Utah facilities in January 2004.

The financial statements have been prepared assuming Company is able to
continue as a going concern.  The financial statements do not include any
adjustments relating to the recoverability and classification of assets or
liabilities that might be necessary should the Company be unable to continue
as a going concern.

NOTE 11   CONTINGENCIES

During the 2003 fiscal year, Michele Audio Corporation of America (the
"Company") entered into a Consulting Agreement with Investor Relations
Services, Inc., a Delaware corporation whose address is 120 Flagler Avenue,
New Smyrna Beach, Florida and simultaneously a Personal Services Agreement
with Mr. Charles Arnold located at 2 Spur Lane, Rolling Hills, California.
The agreements were effective June 1, 2003 and they both expire on May 31,
2004.  The agreements called for certain services, which are enumerated in the
agreements, to be provided by Mr. Arnold and Investor Relations Services for
the benefit of the Company.  As compensation for these services the Company
agreed to issue both Investor Relations Services and Mr. Arnold preferred
shares of stock in Michele Audio Corporation of America.  Additionally, the
preferred shares were to have conversion rights allowing Mr. Arnold and
Investor Relations Services, Inc. each to convert their preferred shares to
4.9% undiluted of the common stock issued and outstanding following the first
round of financing after the Company became a public entity.  It was further
agreed the stock when issued would be restricted pursuant to Rule 144.

In March of 2004 Mr. Arnold and Investor Relations Services filed for
arbitration, as called for in the agreements, against Michelex Corporation
claiming they have not been compensated as called for in the agreements.  The
Company responded indicating that Michelex Corporation was not a party to the
agreement and was therefore not bound to the arbitration and the filing was
dismissed.  The Company among other defenses contends that neither Mr. Arnold
nor Investor Relations Services, Inc. provided the quantity or quality of
services contemplated under the agreements and intends to vigorously defend
its position.

                               F-19



                        MICHELEX CORPORATION
                           AND SUBSIDIARY

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                         DECEMBER 31, 2003

NOTE 12   SUBSEQUENT EVENTS

Second Mortgage on Utah Property

In January 2004, the Company obtained a second mortgage totaling $800,000 on
its Utah facilities from a mortgage lender.  The Company is required to make
interest only payments at the rate of 9% for 18 months, at which time, the
mortgage is due.

Financial Consulting Agreement

In March 2004, the Company entered into an agreement with a company which is
to provide financial consulting services to the Company for one year.  Fees
for the services are comprised of 400,000 shares of the Company's common stock
which the Company has valued at $100,000, the market value of the shares on
the date of the agreement.

Financial Advisory Agreement

In March 2004, the Company entered into a financial advisory agreement with an
investment banking firm.  The financial advisory fees to be rendered include
capital raising and business acquisition and sale.  The fees for these
services are to be based upon a schedule as set out in the agreement as
services are performed.

<PAGE>

Item 8.  Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
---------------------

       On August 19, 2003, our Board of Directors resolved to engage Seligson
& Giannattasio, LLP, Certified Public Accountants, of North White Plains, New
York, to review our financial statements for the quarterly period ended
September 30, 2003, and to audit our financial statements for the ten months
ended December 31, 2003.  The change in our auditors was reported in a Current
Report one Form 8-K dated August 19, 2003, which was filed with the Securities
and Exchange Commission on August 21, 2003.  See Part III, Item 13 of this
Report.

                             PART III

Item 9.  Directors, Executive Officers, Promoters and Control Persons;
Compliance with Section 16(a) of the Exchange Act.
--------------------------------------------------

Identification of Directors and Executive Officers
--------------------------------------------------

     The following table sets forth the names of our Company's directors and
executive officers.  These persons will serve until the next annual meeting of
the stockholders or until their successors are elected or appointed and
qualified, or their prior resignation or termination.

<TABLE>
<CAPTION>
                                  Date of         Date of
                    Positions    Election or     Termination
Name                  Held       Designation   or Resignation
----                  ----       -----------   --------------
<S>                   <C>             <C>            <C>
Benjamin Hansel       Director        2/03           7/23/03
                      President       2/03           7/23/03
                      Secretary       2/03           7/23/03

Ginette Gramuglia     President       7/23/03          *
                      Director        7/23/03          *

Thomas Gramuglia      Vice President  7/23/03          *
                      Treasurer       7/23/03          *
                      Director        7/23/03          *

Sharon Bishop         Secretary       7/23/03          *
                      Director        7/23/03          *

</TABLE>

          * These persons presently serve in the capacities indicated.

Business Experience.
--------------------

     Ginette Gramuglia, President and director.  Ms. Gramuglia, age 57, was
born in Quebec, Canada. She has dual citizenship (Canada and USA). Ms.
Gramuglia began been working at Michele Audio Corporation at its inception in
1972 and oversees all aspects of the business and its operations. She studied
at the University of Quebec, and has a Bachelor degree in Business
Administration.

     Thomas Gramuglia, Vice President, Treasurer and Director. Mr. Gramuglia
is 54 years of age. He was born in Englewood, New Jersey. He is the founder of
Michele Audio Corporation and Michele Audio Corporation of Canada, which was
sold in 1979. Mr. Gramuglia is also the owner-operator of Hindsight Records.
He attended schools in Fort Lee, New Jersey, graduating in 1967. Mr. Gramuglia
attended New York Institute of Technology, majoring in Behavioral Science. He
has networked extensively throughout Europe, the Far East, and South America
in a continuing effort to expand international relations with industry majors.

     Sharon Bishop, Secretary and Director. Ms. Bishop, age 41, was born in
Torrance, California. She began working for Michele Audio in December, 1980,
evolving with the music and plastics industry from LP/8 track in the early
1980's to audio and video cassettes later that decade, CD's in the 1990's and
to the present day, in which DVD's are prevalent.

Significant Employees.
----------------------

     None, not applicable.

Family Relationships.
---------------------

     Ginette Gramuglia and Thomas Gramulia are ex-spouses.

Involvement in Certain Legal Proceedings.
-----------------------------------------

     During the past five years, no present or former director, executive
officer or person nominated to become a director or an executive officer of
our Company:

          (1) was a general partner or executive officer of any business
against which any bankruptcy petition was filed, either at the time of the
bankruptcy or two years prior to that time;

          (2) was convicted in a criminal proceeding or named subject to a
pending criminal proceeding (excluding traffic violations and other minor
offenses);

          (3) was subject to any order, judgment or decree, not subsequently
reversed, suspended or vacated, of any court of competent jurisdiction,
permanently or temporarily enjoining, barring, suspending or otherwise
limiting his involvement in any type of business, securities or banking
activities; or

          (4) was found by a court of competent jurisdiction (in a civil
action), the Commission or the Commodity Futures Trading Commission to have
violated a federal or state securities or commodities law, and the judgment
has not been reversed, suspended or vacated.

Compliance with Section 16(a) of the Exchange Act
-------------------------------------------------

     Each of our current directors and executive officers filed a Form 3
Initial Statement of Beneficial Ownership of Securities with the Securities
and Exchange Commission on July 28, 2003.  There have been no changes in any
of these persons' stock ownership since that time.

Code of Conduct.
---------------

     The Company has adopted a Code of Conduct which is attached to this
Report as Exhibit 14.  See Part III, Item 13 of this Report.

Audit Committee.
----------------

     The Board of Directors does not have an audit committee.  Due to each
member's involvement in the day-to-day operations of the Company and their
intimate familiarity with the financial condition and controls inherent in the
Company, each member of the Board regularly monitors, reviews and makes
suggestions regarding the Company's financial and operating procedures and
control mechanisms.

Item 10. Executive Compensation.
         -----------------------

Cash Compensation
-----------------

          The following table sets forth the aggregate compensation paid by
the Company for services rendered during the periods indicated:

<TABLE>
<CAPTION>
                         SUMMARY COMPENSATION TABLE

                           Long Term Compensation

                    Annual Compensation   Awards  Payouts

(a)             (b)   (c)   (d)   (e)   (f)   (g)   (h)    (i)

                                              Secur-
                                              ities        All
Name and   Year or               Other  Rest- Under- LTIP  Other
Principal  Period   Salary Bonus Annual rictedlying  Pay- Comp-
Position   Ended      ($)   ($)  Compen-Stock Optionsouts ensat'n
-----------------------------------------------------------------
<S>         <C>       <C>   <C>   <C>   <C>    <C>   <C>  <C>

Ginette
Gramuglia,
Director,   12/31/03 $82,915  0     0      0       0     0   $2,166
President

Thomas
Gramuglia,
Director,   12/31/03 $82,915  0     0      0       0     0   $2,188
V. Pres,
Treasurer

Sharon
Bishop,
Director,   12/31/03 $90,009  0     0      0       0     0   $2,684
Secretary

Benjamin
Hansel      12/31/02    0     0     0      0       0     0   0
Former
Director,
President,
Secretary
</TABLE>

     No cash compensation, deferred compensation or long-term incentive plan
awards were issued or granted to the Company's management during the years
ended December 31, 2002 or 2001.  None of our officers or directors have been
granted any option or stock appreciation rights; accordingly, no tables
relating to such items have been included within this Item.

Compensation of Directors.
--------------------------

     There are no standard arrangements pursuant to which the Company's
directors are compensated for any services provided as a director.  No
additional amounts are payable to the Company's directors for committee
participation or special assignments.

Employment Contracts and Termination of Employment and Change-in-Control
Arrangements.
-------------

    There are no employment contracts, compensatory plans or arrangements,
including payments to be received from the Company, with respect to any
director or executive officer of the Company which would in any way result in
payments to any such person because of his or her resignation, retirement or
other termination of employment with the Company, any change in control of the
Company, or a change in the person's responsibilities following a change
in control of the Company.

Item 11. Security Ownership of Certain Beneficial Owners and Management.
         ---------------------------------------------------------------

Security Ownership of Certain Beneficial Owners.
------------------------------------------------

     The following table sets forth the share holdings of those persons who
own more than five percent of the Company's common stock as of the date
hereof:

<TABLE>
<CAPTION>
                      Number of Shares           Percentage
Name and Address     Beneficially Owned           of Class
----------------     ------------------           --------
<S>                        <C>                       <C>
Ginette Gramuglia          5,196,000                 36.58%
50 Westwood Drive
Massena, NY 13662

Thomas Gramuglia           5,040,120                 35.48%
12 Sierra Lane
Massena, NY 13662
</TABLE>

Security Ownership of Management.
---------------------------------

          The following table sets forth the share holdings of the Company's
directors and executive officers as of the date hereof:

<TABLE>
<CAPTION>

                          Number of Shares       Percentage of
Name and Address         Beneficially Owned        of Class
----------------         ------------------      -------------
<S>                         <C>                      <C>

Ginette Gramuglia          5,196,000                 36.6%
50 Westwood Drive
Massena, NY 13662

Thomas Gramuglia           5,040,120                 35.5%
12 Sierra Lane
Massena, NY 13662

Sharon Bishop                      0                     0

All directors and         10,236,120                 72.1%
executive officers
as a group

</TABLE>

Changes in Control.
-------------------

     There are no present arrangements or pledges of the Company's securities
which may result in a change in control thereof.

Item 12. Certain Relationships and Related Transactions.
         -----------------------------------------------

Transactions with Management and Others.
----------------------------------------

     The only transactions between our Company and members of management,
nominees to become a director or executive officer, five percent stockholders,
or promoters or persons who may be deemed to be parents of our Company were:
(i) in August, 2002, the officers of Michele New Jersey borrowed $50,000
personally from Key Bank and then lent to Michele New Jersey, which was making
scheduled monthly payments of $5,000 principal plus interest at the Bank's
Prime Rate plus 2%; this loan was repaid in 2003; (ii) we have made interest
free advances to Media Books, LLC, Hindsight Records, Inc. Michelex Plastics
and Michelex Trimark, which are owned principally by certain shareholders of
the Company.

Parents of the Issuer.
----------------------

     Our Company has no parents, except to the extent that Ms. Gramuglia and
Mr. Gramuglia may be deemed to be a parent by virtue of their beneficial
ownership of approximately 72% of its outstanding common stock.  See the
caption "Security Ownership of Certain Beneficial Owners and Management" of
this Report.

Item 13. Exhibits and Reports on Form 8-K.
         ---------------------------------

Reports on Form 8-K

         8-K Current Report dated July 23, 2003, as amended, filed July 28,
         2003 and October 6, 2003, respectively

         8-K Current Report dated August 19, 2003, filed August 21, 2003

         8-K Current Report dated July 23, 2003, filed December 17, 2003

Exhibits*

          (i)
                                          Where Incorporated
                                            in this Report
                                            --------------

Registration Statement on Form 10-SB,          Part I
filed July 13, 1999**

Registration Statement on Form 10-SB-A1,       Part I
filed September 10, 1999**

Registration Statement on Form 10-SB-A2,       Part I
filed October 18, 1999**

Annual Report on Form 10KSB for the year
ended December 31, 1999**                      Part I

Annual Report on Form 10KSB for the year
ended December 31, 2000**                      Part I

Annual Report on Form 10KSB for the year
ended December 31, 2001**                      Part I

Annual Report on Form 10KSB for the year
ended December 31, 2002**                      Part I

Definitive Information Statement               Part I
regarding name change

          (ii)

Exhibit
Number            Description
------            -----------

14                Code of Ethics

31.1              302 Certification of Ginette Gramuglia

31.2              302 Certification of Thomas Gramuglia

32                906 Certification

          *    Summaries of all exhibits contained within this
               Report are modified in their entirety by reference
               to these Exhibits.

          **   These documents and related exhibits have been
               previously filed with the Securities and Exchange
               Commission and are incorporated herein by reference.

Item 14.  Controls and Procedures.
          ------------------------

     As of the end of the period covered by this Annual Report, we carried out
an evaluation, under the supervision and with the participation of our
President and Treasurer, of the effectiveness of the design and operation of
our disclosure controls and procedures.  Based on this evaluation, our
President and Treasurer concluded that our disclosure controls and procedures
are effective in timely alerting them to material information required to be
included in our periodic Securities and Exchange Commission reports.  It
should be noted that the design of any system of controls 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, regardless of how remote.  In addition,
we reviewed our internal controls, and there have been no significant changes
in our internal controls or in other factors that could significantly affect
those controls subsequent to the date of our last evaluation.

Item 15.  Principal Accountant Fees and Services.
          ---------------------------------------

     The following is a summary of the fees billed to Michelex by its
principal accountants during the calendar years ended December 31, 2003, and
December 31, 2002:

     Fee category                      2003           2002
     ------------                      ----           ----

     Audit fees                        $47,331        $ 5,298

     Audit-related fees                $ -0-          $ -0-

     Tax fees                          $ -0-          $ -0-

     All other fees                    $ -0-          $ -0-

     Total fees                        $47,331        $ 5,298

     Audit fees.  Consists of fees for professional services rendered by our
principal accountants for the audit of our annual financial statements and the
review of financial statements included in our Forms 10-QSB or services that
are normally provided by our principal accountants in connection with
statutory and regulatory filings or engagements.

     Audit-related fees.  Consists of fees for assurance and related services
by our principal accountants that are reasonably related to the performance of
the audit or review of our financial statements and are not reported under
"Audit fees."

     Tax fees.  Consists of fees for professional services rendered by our
principal accountants for tax compliance, tax advice and tax planning.

     All other fees.  Consists of fees for products and services provided by
our principal accountants, other than the services reported under "Audit
fees," "Audit-related fees" and "Tax fees" above.

                                SIGNATURES

     In accordance with Section 13 or 15(d) of the Exchange Act, the Company
has caused this Report to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                        MICHELEX CORPORATION


Date: 4/14/04                           By: /s/ Ginette Gramuglia
     ----------                            ----------------------
                                           Ginette Gramuglia
                                           Director and President

     In accordance with the Exchange Act, this Report has been signed below by
the following persons on behalf of the Registrant and in the capacities and on
the dates indicated.


Date: 4/14/04                               /s/ Ginette Gramuglia
     ----------                            ----------------------
                                           Ginette Gramuglia
                                           Director and President


Date: 4/14/04                               /s/ Thomas Gramuglia
     ----------                            ---------------------
                                           Thomas Gramuglia
                                           Director, Vice President and
                                           Treasurer


Date: 4/14/04                               /s/ Sharon Bishop
     ----------                            ------------------
                                           Sharon Bishop
                                           Director and Secretary