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

                                   FORM 10-KSB
 (Mark One)

/X/  Annual report under section 13 or 15(d) of the  Securities  Exchange Act of
     1934 for the fiscal year ended December 31, 2002.
/ /  Securities   Exchange   Act  of  1934  for  the   transition   period  from
     ___________________ to ________________________.

Commission file number 0-28363

                              SBS Interactive Co.
                  [Formerly Inet Commerce Conduit Corporation]
                 (Name of Small Business Issuer in Its Charter)


            Florida                                         65-0705830
-------------------------------                  -------------------------------
(State or Other Jurisdiction of                  (I.R.S. Employer Identification
  Incorporation or Organization)                             Number)

200 Viceroy Road, Unit 5, Concord, Ontario, Canada                     L4K 3N8
    (Address of Principal Executive Offices)                          (Zip Code)

                                 (416) 216-4623
                            Issuer's Telephone Number

Securities to be registered pursuant to Section 12(b) of the Act:
         (Title of class)                   Name of exchange on which registered
             None

Securities to be registered under Section 12(g) of the Act:
                     $.001 Per Share Par Value Common Stock

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

Yes  X  No
    ---    ---

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 registrant'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. [X]

The revenue for its most fiscal year was $ -0-.

The aggregate market value of the Issuer's common stock held by non-affiliates
as of December 30, 2002 was $23,068,800.

The Issuer has never been involved in bankruptcy proceedings.

The number of shares outstanding of the Issuer's common stock as of March 31,
2003 was 10,198,184.

Documents incorporated by reference. There are no: (1) annual report to security
holders; (2) proxy or information statements; or (3) any prospectus filed
pursuant to Rule 424(b) or (c) of the Securities Act of 1933 ("Securities Act")
incorporated by reference herein.

                     Traditional Small Business Disclosures
                               Format (Check one):
                                 Yes  X  No
                                     ---    ---
<PAGE>


                                     PART I

The Issuer, a Florida corporation, is electing to furnish the information
required by Items 6-12 of Model B of Form 1-A under Alternative 2 of Form 10-SB.

Item 1A.  Company Risk Factors.
-------------------------------

     The operations of SBS Interactive, Co. ("Issuer" or "Company") and an
investment in its securities involve a high degree of risk and should be
considered very speculative. They are subject to risks including those set out
in this Item 1A. In addition, the discussion herein regarding the Issuer and its
business and operations contain "forward-looking statements". Forward-looking
statements are inherently subject to risk and uncertainties, some of which
cannot be predicted or qualified, and are necessarily speculative. There are
numerous factors and uncertainties that could cause events or results to differ
materially from those referred to in such forward-looking statements. Such
statements may include, but not be limited to, projections of revenue, income,
or loss, capital expenditures, plans for future operations, financing needs or
plans, and plans relating to products or services of the Issuer, as well as
assumptions relating to the foregoing. The words :believe", "expect",
"anticipate", "estimate", "project", and similar expressions identify
forward-looking statements, which speak only as of the date the statement was
made.

Our future is dependent upon our ability to raise substantial amounts of
------------------------------------------------------------------------
additional capital.
-------------------

     Neither the Issuer, nor any of its subsidiaries has any present source of
revenue. We will require substantial funds in order to fully implement our
operating plans. Our future is dependent upon the receipt of the proceeds from a
pending private pending placement and our ability to raise additional capital in
the future. We believe that the net proceeds of the pending placement will be
sufficient to meet the Issuer's operating expenses and capital requirements for
approximately three to four months. However, this expectation is based on our
current operating plan, which could change, and we could require additional
funding sooner than anticipated. We intend to seek additional funding through
private financings; however, there can be no assurance that additional financing
will be available. If we are unable to raise capital when needed we may be
required to delay or curtail our development and operation efforts or even cease
operations altogether.

Our future is dependent upon further development of the side by sideTM
----------------------------------------------------------------------
technology, future technological changes and consumer preferences.
------------------------------------------------------------------

     A significant portion of the net proceeds of the pending placement will be
used to implement the Issuer's Side by SideTM technology. The products we intend
to develop are characterized by rapidly changing technology and user
preferences, evolving industry standards and frequent new product introductions.
The success of our Side by SideTM Products will depend upon, among other things,
our ability to achieve and maintain technological edge in the industry and to
remain competitive in terms of price and product performance. To maintain
technological leadership, we must successfully develop products that are
technologically competitive, as well as develop and maintain relationships with
3rd party technology licensors for use in its Side by SideTM Products. There can
be no assurance that we will develop such relationships, that products or
technologies developed by others will not render obsolete our Side by SideTM
technologies, that we will be able to adapt to technological changes by
enhancing or expanding our products, or that we will not, despite utilizing a
substantial portion of the proceeds of the offering, experience difficulties
that could delay or prevent the successful development, licensing, introduction
and marketing of Side by SideTM Products, or that such products will adequately
meet the requirements of the marketplace and achieve market acceptance

We must assemble new management team.
-------------------------------------

     The Issuer's future success depends on our ability to attract and retain
highly qualified technical, sales and management personnel. We is actively
recruiting a new management team, including a new CEO, and is committed to
finding people that have industry experience and experience working with early
stage businesses. In addition, the Company is currently in discussions with
several other potential executive candidates; however, there is no assurance
that the Company will successfully hire, train and retain these candidates or
any highly skilled personnel. The Company may not be successful in attracting,


                                       2
<PAGE>


assimilating or retaining the necessary personnel, and the failure to do so
could have a material adverse effect on its business, results of operations and
financial condition.

Our ability to generate revenue from our products is dependent on building
--------------------------------------------------------------------------
relationships with consumer electronic, entertainment and telecommunication
---------------------------------------------------------------------------
product companies.
------------------

     The Issuer is currently not generating any revenues from its products. A
major component of our operating plan is to pursue licensing arrangements with
consumer electronic, entertainment and telecommunications businesses pursuant to
which they would license our technology for incorporation into their products
and then manufacture and sell them. We have demonstrated our products to
potential reseller licensees and have received positive responses, including
several letters of intent, we has not yet successfully closed any licensing
agreements and failure to close significant reseller licensing agreements for
sale and distribution of our products/technology would have a material adverse
effect on our proposed plan of operations

Inherent uncertainty of software/hardware systems development.
--------------------------------------------------------------

     Software/hardware systems development is an imprecise science, and there
are no assurances that work on any of the projects to be undertaken by us will
be completed on time or within established budgets. Research and development,
particularly in the area of new and sophisticated technologies, is inherently a
high risk investment and is dependent upon the capabilities of the engineering
organization executing the work. We will be entirely dependent upon third party
hardware manufacturers of our Side by SideTM hardware products, and there can be
no assurance that products described herein, will be completed or meet their
design specifications.

Our future revenues are dependent upon purchases from customer discretionary
----------------------------------------------------------------------------
funds.
------

     The Issuer's products will largely be used by our customers for
entertainment purposes and, as such, the purchase of the Side by SideTM Products
will come from potential customers' discretionary funds. Accordingly, a
continuation of a slow economy will adversely affect our potential sales.

We face extensive competition from established businesses.
----------------------------------------------------------

     The Issuer's products will face intense competition from other
entertainment, institutional and training products. Many of our potential
competitors have longer operating histories, larger customer bases and greater
brand recognition than the Issuer. Certain of these competitors have
significantly greater financial, marketing, technical and other resources than
the Issuer does. As a result, they may be able to secure retail agreements
and/or reseller licenses on more favorable terms than we is able to. In order to
respond to changes in the competitive environment, we may, from time to time,
make pricing, service or marketing decisions that could harm our financial
prospects. In addition, new technologies may increase the competitive pressures
by enabling our competitors to offer lower cost products. Increased competition
could result in reduced operating margins, loss of market share and a diminished
brand awareness, any of which could materially affect our business.

The elimination of OTC Bulletin Board may adversely impact market for our stock.
--------------------------------------------------------------------------------

     The Issuer's common stock has been quoted on the OTC Bulletin Board since
May 1997. The National Association of Securities Dealers, Inc. ("NASD") has
adopted regulations which state that the OTC Bulletin Board will cease to
operate as of June 30, 2003. The OTC Bulletin Board will be replaced by the
Bulletin Board Exchange ("BBX") and companies that wish to list our stock on the
BBX will have to satisfy (i) certain objectives standards and (ii) a subjective
requirement of a determination by NASDAQ that the listing of our stock is in the
"public interest." We intends to apply to list our common stock on the BBX,
however, there can be no assurance that we will be successful in acquiring BBX
listing. If our common stock is not listed on the BBX it will most likely be
quoted on the electronic pink sheets. Failure to acquire BBX listing could have
a materially adverse impact on our stock's marketability and liquidity.


                                       3
<PAGE>


Item 1.  Description of the Business
------------------------------------
(Item 6 of Model B of Form 1A)

     SBS Interactive, Co. ("Company" or "Issuer") was formed as a Florida
corporation named "Cosmetics Consultation Corporation" on September 20, 1996.
Its name was changed to "Lomillo Consulting Corp." on November 25, 1996 and then
to "Inet Commerce Conduit Corp." on July 17, 1997. On July 30, 2002, the Company
changed its name to "SBS Interactive, Co." in anticipation of the completion of
the Business Combination hereinafter described. From September of 1999 to the
summer of 2002, the Company initiated and conducted operations as a consultant
to Internet-related enterprises seeking capital. Due to a lack of any meaningful
response to these efforts, the Company concluded to terminate its consulting
business. On October 29th the Company completed a Business Combination in which
it acquired 100% ownership of SBS Interactive, Inc., a Nevada corporation
("Interactive") in exchange for 3,180,984 shares of common stock to be issued to
the stockholders of Interactive. The Company has concluded to concentrate its
operations on attempting to raise capital to fund and operate the business of
Interactive as a consumer electronics company focused on developing, marketing
and licensing products that enable the consumers to use their televisions as an
interactive medium.

     On July 16, 2002, Interactive, the Company and SBS Acquisition, Inc., a
Nevada corporation and a wholly owned subsidiary of the Company executed and
entered into a "Merger Agreement". The Merger Agreement was closed on October
29, 2002 for the Business Combination in which Interactive became a wholly owned
subsidiary of the Company and the present stockholders of Interactive will
become shareholders of the Company. The Merger Agreement provided that upon its
"Effective Time":

     o    Acquisition was merged into Interactive which was the surviving
          corporation in the merger;

     o    The 20,676,000 shares of the common stock of Interactive outstanding
          immediately prior to the Effective Time were canceled and the holders
          of that stock shall become shareholders of the Company with each 6.5
          old shares of Interactive stock becoming 1 share of the Company's
          common stock (no fractional shares of the Company's shares will be
          issued and each Interactive shareholder entitled to a fractional share
          will be issued a whole share therefore). A total of 3,180,984 shares
          will be issued by the Company in the transaction;

     o    Interactive issued 1,000 shares of the new common stock to the Company
          and thus Interactive became a wholly-owned subsidiary of the Company;

     o    The Business Combination was designed to constitute a "non-taxable"
          transaction under U.S. and Canadian tax laws; however, the parties
          have not obtained any tax ruling or opinion on its tax status and the
          shareholders of Interactive are advised and cautioned to seek their
          own tax advice and counsel on this issue;

     o    The stock of the Company being issued to the Interactive shareholders:
          (i) is being issued pursuant to exemptions from the registration
          requirements of the Securities Act of 1933 ("Securities Act") provided
          in Rule 506 of Regulation D and/or Regulation S adopted under the
          Securities Act; (ii) will be "restricted securities" as defined under
          the Securities Act; and (iii) will be subject to restrictions on their
          future transferability and/or sale.

     A copy of the Merger Agreement was filed with the Form 10-QSB Report for
the period ended June 30, 2002 as an Exhibit 10(A). A copy of the Articles and
Plan of Merger filed with Nevada on October 29, 2002 to complete the acquisition
of Interactive by the Company was filed as Exhibit 10(b) to the Form 10-QSB for
the Quarter ended September 30, 2002.

     Now that the Business Combination is completed, the Company will endeavor
to acquire a significant amount of additional equity capital to fund the
development and business operations of Interactive. This additional equity
capital would be acquired through the sale of restricted equity securities of
the Company in a "Private Placement" proposed to be made pursuant to an
exemption from the registration requirements of the Securities Act of 1933.
Although the Company and Interactive are aware of some potential investor
interest in the proposed Private Placement, there are no commitments or binding
arrangements for the acquisition of any additional capital nor any assurance
that such will become available to the Company or Interactive.


                                       4
<PAGE>


     Interactive was organized as a Nevada corporation on August 8, 2002. It was
formed to act as a consumer electronics company focused on acquiring,
developing, licensing and marketing products that turn televisions into an
interactive medium. During the period from August 2000 to October 2000,
Interactive raised $ 1,850,000 through the sale of 1,850,000 shares of its
common stock at $1.00 per share. Of this amount, $1,000,000 and 4,000,000 shares
of Interactive common stock was paid on May 30 2002 for the acquisition of all
the outstanding stock of High Plateau Holdings, Inc. ("High Plateau"). High
Plateau is an Ontario corporation which owns the U.S. Patent to Side by SideTM
the interactive video technology product which enables users to interact with
people, characters or objects on their television screens and which Interactive
plans to market. The balance of Interactive's capital has been expended on
operating expenses and development of the Side by SideTM product.

     The technology of Side by SideTM is based upon "blue screen" technology
which is widely used in the film and television industries. Side by SideTM uses
its patented reverse "blue screen" technology to seamlessly combine pre-recorded
program elements into the users' environment as captured by the digital camera
in the Side by SideTM set-top box. The Side by SideTM set-top box is connected
between the user's DVD Player (which is transmitting the pre-recorded program
elements) and the TV/Monitor. The TV Monitor then shows the combined
pre-recorded elements and the user's performance captured by the Side by SideTM
set-top box. The user can also add a VCR to record the combined image including
video.

     The Side by SideTM product incorporates the use of the Side by SideTM
patented software with a digital camera and a Keyer Unit developed under an
exclusive worldwide Design and Royalty Agreement between High Plateau and
Ultimatte Corporation, a leader in "blue screen" technology. The Side by SideTM
set-top box presently uses camera components from Omnivision, the world's
largest independent supplier of single-chip camera.

     If the Company is able to raise sufficient proceeds in its proposed private
placement, it will commence production of the Side by SideTM product and
initiate its marketing efforts.

     The potential uses for Side by SideTM in the consumer market includes but
is not limited to children's programs; instructional and training programs
(including fitness, sports, martial arts, exercise and self-help programs);
video karaoke; performance (including musical instrument training, acting
workshops, singing and dancing training); theme parties and adult entertainment.
In the business and institutional markets the potential uses include but are not
limited to: Product and procedural training and testing; military and security
training; language education, training and educating the learning disabled, and
public speaking training.

     Dependent upon the availability of additional capital to the Company, its
marketing program will include: completion of marketing research; initiation of
efforts to develop direct sales of the Side by SideTM hardware through existing
retail outlets and software products; and to pursue licensing arrangements under
which others in the electronic entertainment and telecommunications industries
would manufacture and/or sell the Side by SideTM hardware and software products.
The potential software licensees would include businesses involved in the filmed
entertainment and music industries, the fitness, exercise and martial arts
industries and adult entertainment industries. Potential hardware licensees
would include electronic and computer products manufacturers. Interactive has
demonstrated the Side by SideTM product to potential licensees and has received
numerous positive responses and indications of interests in it. However, the
Company does not have any firm licensing arrangements for either the software or
the hardware Side by SideTM products of any firm distribution arrangements with
any existing retailers.


Item 2.  Description of Property
--------------------------------
(Item 7 of Model B of Form 1A)

     The Company presently occupies approximately 1,800 square feet of office
facilities at 200 Viceroy Road, Unit 5, Concord, Ontario, Canada L4K 3N8. The
premises are occupied on a month-to-month tenancy at a rental of $1,200 per
month (US Funds). If the Company is successful in its efforts to raise
additional capital, acquire additional management and expand its operations, it
is anticipated that it may acquire additional facilities on terms not now known.

                                       5
<PAGE>


Item 3.  Directors, Executive Officers and Significant Employees.
-----------------------------------------------------------------
(Item 8 of Model B of Form 1A)

     The following table sets forth information regarding the directors and
executive officers of the Company

                                                                      Beginning
Name                     Age            Positions                      of Term
----                     ---            ---------                     ---------

Todd E. Gotlieb           37      President and Director               10/2002

Barry D. Alter            47      Vice President and Director          12/2002

Ralph Rubenstein          47      Director                             03/2003


     Todd E. Gotlieb graduated from the Osgoode Hall School of Law in 1989. He
was engaged in the private practice of law in Toronto, Ontario from 1992 through
early 1999. From early 1999 through July of 2002, he was employed as a Vice
President of Exclusive Auto Marketing in Toronto, Ontario. He has served as the
founder, President and a director of SBS Interactive, Inc., in Toronto, Ontario
since its formation in August of 2000.

     Barry D. Alter has served as a director if SBS Interactive since July of
2002. From 1986 to 1999 he was employed as the President of Sweet Expressions
Foods, Inc., a confectionary business in the Toronto, Ontario area. He has been
self-employed as a financial consultant since 1999 in the Toronto, Ontario area.

     Ralph Rubenstein is a graduate of York University in Toronto from which he
received a degree with honors, in political science in 1978. From 1984 to 1998
he was employed by Premier Promotions, a marketing promotions business operating
out of Van Nuys, California. Premier Promotions was a family owned business
until its sale in 1998. He served as it President from 1984 until February of
1998. From February 1998 until 2001, he was employed by Halo Industries, a
marketing promotion business operating out of Los Angeles, California. From 2001
until the present, he has been employed by Rubenstein International, a firm
engaged in marketing and promotions in the Los Angeles area.

     It is anticipated that as the activities of the issuer increase in its new
business, additional officers, directors and employees will be appointed or
employed. The identity of such persons in not now known.

Item 4.  Remuneration of Directors and Officers.
-----------------------------------------------
(Item 9 of Model B to Form 1A)

     Information with respect to the only remuneration paid to any of the
officers and directors of the Issuer during the year 2002 is as follows:



                            Classification of
     Name                     Remunerations                 Amount
     ----                   -----------------               ------

     Todd Gotlieb           Consulting Services             $ 1,000

     Patti Cooke            Consulting Services             $21,474



                                       6
<PAGE>



     It is anticipated that remuneration will be paid during 2003 to the
Company's present officers and directors as follows:


                            Classification of
     Name                     Remunerations                 Amount
     ----                   -----------------               ------

     Todd Gotlieb           Consulting Services            $ 60,000

     Ralph Rubenstein       Salary                         $180,000


     If the Company is successful in its efforts to raise additional capital and
increase its activities, it is anticipated the Company will employ additional
officers and employees. The identity of such persons and terms of their
employment are not now known.

     The Board of Directors has under consideration the adoption of a Stock
Incentive Plan ("Plan") for submission to the Company's shareholders for their
approval. This Plan if adopted by the Board and approved by the shareholders
(within one year of the Board's approval) would provide for the grant of options
and the direct sale of common stock to the directors, officers, employees and
consultants of the Company. Options granted under the Plan may be either
"incentive stock options" under Section 422A of the Internal Revenue Code of
1986, as amended, or "non-statutory options". The Board of Directors intends to
reserve for issuance under the Plan 2,500,000 shares of Common Stock of the
Company.

     The Plan will be administered by the Company's Board of Directors. The
Board of Directors would have the sole discretion and authority, consistent with
the provisions of the Plan, to promulgate, amend and rescind rules and
regulations relating to the administration of the Plan and to select the
eligible participants to whom options will be granted or shares sold, the number
of shares covered by the option or to be sold, the exercise or purchase price,
and the form and term of agreement to be used. The Company intends to make
initial awards to sales personnel under the Plan at the time such personnel are
hired, and subsequent awards annually on the basis of the performance of such
sales personnel.

     In addition, the Company is considering issuing additional options outside
the proposed Plan to persons who become members of its management.


Item 5   Security Ownership of Management and Certain Securityholders.
---------------------------------------------------------------------
(Item 10 to Model B of Form 1A)

     The following table sets forth information as of April 11, 2003 with
respect to the ownership of the Issuer's Common Stock (it's only presently
authorized class of equity security) by its individual officers and directors,
the officers and directors as a group and any person owning 10% or more of its
common stock:

Name, Address and                          Number of           Percentage
Capacity of Owner                        Shares Owned(1)        of Class
-----------------                        ---------------       ----------

Todd Gotlieb
200 Viceroy Road, Unit 5
Concord, Ontario
Canada L4K 3N8
Officer and Director                       465,233(2)            4.56%


                                       7
<PAGE>


Barry Alter
200 Viceroy Road, Unit 5
Concord, Ontario
Canada L4K 3N8
Officer and Director                        465,847              4.56%


Ralph Rubenstein
14553 Delano Avenue
Van Nuys, CA 91401
Director                                     - 0 -                 0%


All Officers and Directors
As a Group                                  931,080              9.12%

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

(1)  Unless otherwise indicated, the Company believes that all persons named in
     the table have sole voting and investment power with respect to all shares
     of common stock beneficially owned by them. The table assumes a base of
     10,198,124 shares of common stock outstanding.

(2)  Of the 465,233 shares, 53,847 shares are held by Mr. Gotlieb as Trustee and
     38,462 shares are held by Mr. Gotlieb's wife. Mr. Gotlieb disclaims
     beneficial ownership of these 92,309 shares.


Item 6.  Interest of Management and Others in Certain Transactions.
-------------------------------------------------------------------
(Item 11 to Model B of Form 1A)

     In April of 1999, Hatchment Holdings, Inc., an Ontario corporation wholly
owned by the then President and sole director of the Issuer purchased 300,000
shares of its Common Stock for $0.05 per share. In addition, Wellington Cooke
Gallery, a company wholly owned by the then Secretary of the Issuer, also
purchased 300,000 shares at $0.05 per share. These shares were purchased in an
offering made by the Issuer under Rule 504 of Regulation D adopted under the
Securities Act of 1933. They were purchased on the same terms and conditions as
the non-affiliated purchasers in the offering.

     During the year 1999 the Issuer reimbursed Hatchment Holdings, Inc. $10,000
for legal fees of the Issuer which had been advanced by Hatchment. During 1999,
it also reimbursed Wellington Cooke Gallery $3,500 for printing expenses of the
Issuer for its Internet web site which had been advanced by Wellington Cooke.

     In May of 1999, the Issuer loaned Hatchment Holdings, Inc. $70,000 on an
unsecured demand loan. The loan was repaid in October of 1999 in full together
with $2,041.00 in interest.

     The Issuer paid its President salary of $1,500 during 1999. In 1999, it
paid consulting fees of $15,000 each to Hatchment Holdings, Inc. and Wellington
Cooke Gallery. In 2000, it paid its President a salary of $3,000; and it
reimbursed Wellington Cooke Gallery $12,390 for expenses advanced to the Issuer
on its Internet web site.

     During the year 2001, the Issuer paid its President a salary of $2,700. It
paid Wellington Cooke Gallery and its owner a total of $8,500 for consulting
fees in the year 2001.

     In November, 2001, the Issuer issued 250,000 shares each to Hatchment
Holdings, Inc. and Wellington Cooke Gallery for payment of consulting services.
These shares were issued as "restricted securities" under the exemption from the
registration requirements of Section 5 of the Securities Act of 1933 provided in
Section 4(2) of that Act.

     In the Business Combination completed on October 29, 2002 in which the
Company acquired Interactive, Messrs. Todd Gotlieb and Barry D. Alter, officers

                                       8
<PAGE>


and directors of the Company received shares of the Company's common stock in
exchange for the shares of Interactive held by them on the same basis as the
other Interactive shareholders, namely one share of the Company for each 6.5
shares of Interactive. Mr. Gotlieb received 465,233 shares of the Company and
Mr. Alter received 465,847 shares.


Item 7.   Description of Securities.
------------------------------------
(Item 12 of Model B of Form 1A)

     The Issuer's authorized capitalization consists of 50,000,000 shares of
$.001 par value common stock ("Common Stock"). As of April 11, 2003, there were
10,198,184 shares of Common Stock outstanding. Under applicable Florida law and
its Articles of Incorporation, the Issuer's Board of Directors may issue
additional shares of its stock to bring its outstanding stock up to the total
amount of authorized Common Stock without approval of its shareholders.

     On July 18, 1997 the Issuer completed a recapitalization in which its then
outstanding 1,034,400 shares of Common Stock were reverse split on the basis of
one new share for each two old shares. Thus the then outstanding 1,034,400
shares became 517,200 shares. All references to outstanding Common Stock
contained in this Form 10-SB have been adjusted to give effect to this reverse
stock split.

     The shares of Common Stock currently outstanding are fully paid and
non-assessable. The holders of Common Stock do not have any preemptive rights to
acquire shares of any capital stock of the Issuer. In the event of liquidation
of we, assets then legally available for distribution to the holders of Common
Stock (assets remaining after payment or provision for payment of all debts and
of all preferential liquidation payments to holders of any outstanding Preferred
Stock) will be distributed in pro rata shares among the holders of Common Stock
and the holders of any outstanding Preferred Stock with liquidation
participation rights in proportion to their stock holdings.

     Each stockholder is entitled to one vote for each share of Common Stock
held by such shareholder. A quorum for a meeting of the stockholders is one-half
of the shares of capital stock entitled to vote at that meeting. There is no
right to cumulate votes for the election of directors. This means that holders
of more than 50% of the shares voting for the election of directors can elect
100% of the directors if they choose to do so; and, in such event, the holders
of the remaining shares voting for the election of directors will not be able to
elect any person or persons to the Board of Directors.

     Holders of Common Stock are entitled to dividends when, and if, declared by
the Board of Directors out of funds legally available therefore; and then, only
after all preferential dividends have been paid on any outstanding Preferred
Stock. We have not had any earnings and it does not presently contemplate the
payment of any cash dividends in the foreseeable future.

     The Issuer's Common Stock does not have any mandatory redemptive
provisions, sinking fund provisions or conversion rights. The Company does not
have any outstanding stock options, warrants or other rights to purchase any
shares of its common stock.

     The Board of Directors has under consideration the adoption of a Stock
Incentive Plan for submission to the Company's shareholder for their approval.
This Plan if adopted by the Board and approved by the shareholders (within one
year of the Board's approval( would provide for the grant of options and the
direct sale of common stock to directors, officers, employees and consultants of
the Company. Options granted under the Plan may be either "incentive stock
options" under Section 422A of the Internal Revenue Code of 1986, as amended, or
"non-statutory options". The Board of Directors intends to reserve for issuance
under the Plan 2,500,000 shares of common stock of the Company.

     The Plan will be administered by the Company's Board of Directors. The
Board of Directors would have the sole discretion and authority, consistent with
the provisions of the Plan, to promulgate, amend and rescind rules and
regulations relating to the administration of the Plan and to select the
eligible participants to whom options will be granted or shares sold, the
numbers of shares covered by the option or to be sold, the exercise or purchase
price, and the form and terms of agreement to be used. The Company intends to
make initial awards to sales personnel under the Plan at the time such personnel
are hired, and subsequent awards annually on the basis of the performance of
such sales personnel. In addition, the Company is considering issuing additional
options outside the proposed Plan to persons who become members of its
management.


                                       9
<PAGE>


                                     PART II

Item 1.  Market Price of and Dividends on the Registrant's Common Equity and
----------------------------------------------------------------------------
Other Related Shareholder Matters.
----------------------------------

     The Issuer's Common Stock has been quoted on the OTC Bulletin Board under
the symbol ICMC from May 1997 to October 22, 1999 and, after it's name change in
2002, under the symbol SBSS from June of 2000 to the present. To the knowledge
of the Issuer there have been very few trading transactions in its Common Stock

     The following table sets forth high and low bid prices of the Common Stock
on the OTC Bulletin Board for the periods indicated. The bid prices represent
prices between dealers, which do not indicate retail markups, markdowns or
commissions and the bid prices may not represent actual transactions:

     Quarter Ending:                                High             Low
     --------------                                 ----             ---

     January - March, 2001                           6.75            4.25
     April - June, 2001                              7.75            6.50
     July - September, 2001                          8.50            6.25
     October - December, 2001                        9.25            6.75
     January - March, 2002                          10.00            3.75
     April - June, 2002                              4.25            3.75
     July - September, 2002                          3.70            3.25
     October - December, 2002                        3.70            2.75

     The number of record holders of Common Stock of the Issuer at March 31,
2003 was 195. Additional owners of the Common stock hold their shares at street
name with various brokerage and depository firms (there are three such firms
included in the list of record owners).

     The holders of Common Stock are entitled to receive dividends as may be
declared by the Board of Directors out of funds legally available therefore. The
Issuer had never had any material earnings and does not presently have any
capability to generate any such earnings. The Issuer has never declared any
dividend. It does not anticipate declaring and paying any cash dividend in the
foreseeable future. See Item 7 in Part I.

Item 2.  Legal Proceedings.
---------------------------

     Neither the Issuer nor any of its property is a party or subject to any
pending legal proceeding. The Issuer is not aware of any contemplated or
threatened legal proceeding against it by any governmental authority or other
party.

Item 3.  Changes in and Disagreements with Accountants.
-------------------------------------------------------

     The Company did not have any independent Accounting until 1999. Since that
date, principal independent accountant of the Issuer or any subsidiary thereof
has ever resigned, been dismissed or declined to stand for re-election.

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

     No matters were submitted during the calendar quarter ending December 31,
2002 to a vote of securities holders through the solicitation of proxies or
otherwise.


Item 5.  Compliance with Section 16(a) of the Exchange Act.
-----------------------------------------------------------

     On April 14, 2003, two officers and directors filed late or amended
ownership reports under Section 16(a) of the Securities Exchange Act as follows:



                                       10
<PAGE>



    Filing Person or Entity                             Report
    -----------------------                             ------

    Todd Gotlieb                                Form 3 for October, 2002

    Barry D. Alter                              Form 3 for October, 2002


Item 6.  Reports on Form 8-K.
-----------------------------

     The Issuer was not required to and did not file any reports on Form 8-K for
the calendar quarter ended December 31, 2002.









                                       11
<PAGE>


                                    PART III


1.   Index to Exhibits
     -----------------

     Exhibit No.               Description of Exhibits
     -----------               -----------------------

     2(a)           Issuer's Amended and Restated Articles of Incorporation
                    filed as Exhibit 2(a) to the Issuer's Registration Statement
                    on Form 10-SB is hereby incorporated herein by this
                    reference.

     2(b)           Issuer's Bylaws filed as Exhibit 2(b) to the Issuer's
                    Registration Statement on Form 10-SB is hereby incorporated
                    herein by this reference.

     10(b)          Articles and Plan of Merger of SBS Acquisition, Inc. with
                    and Into SBS Interactive, Inc. filed as Exhibit 10(b) to the
                    Issuer's Report of Form 10-QSB for the Quartered Ended
                    September 30, 2002 is hereby incorporated herein by this
                    reference.

     99.1           Officer's Certifications of Financial Statements.

     99.2           U.S. Letters Patent No 6,072,933 and Assignment thereof
                    filed as Exhibit 99.2 to the Issuer's Report of Form 10-QSB
                    for the Quartered Ended September 30, 2002 is hereby
                    incorporated herein by this reference.









                                       12
<PAGE>


                                   Signatures

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

                                  SBS INTERACTIVE, CO.

                                  By:      /s/ Todd Gotlieb
                                           ----------------
                                           Todd Gotlieb, President and principal
                                           Executive, Financial and Accounting
                                           Officer and Director

                                  Date:    April 14, 2003
                                           ---------------

                                  By:      /s/ Barry D. Alter
                                           ------------------
                                           Barry D. Alter, Vice President
                                           and Director

                                  Date:    April 14, 2003
                                           ---------------

                                  By:      /s/ Ralph Rubenstein
                                           --------------------
                                           Ralph Rubenstein, Director

                                  Date: April 14, 2003



     Supplemental information to be furnished With Reports Filed Pursuant to
           Section 15(d) of the Exchange Act by Non-reporting Issuers


     No annual report, proxy statement, proxy form or other proxy soliciting
material was sent to the Issuer's securities holders for or during the year
2002; nor is any such material to be sent to them subsequent to the filing of
this Form 10-KSB.








                                       13
<PAGE>

                                  CERTIFICATION

1.   Todd Gotlieb certifies that:

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

3.   Based on my knowledge,  the financial  statement and other financial Annual
     Reports  included  in this Annual  Report  fairly  present in all  material
     respects the financial  condition,  results of operations and cash flows of
     the registrant as of, and for, the periods presented in this Annual report.

4.   The  registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

     a)   designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  registrant,   including  its
          consolidated  subsidiaries,  is made known to us by others within this
          entities,  particularly  during the period in which this Annual Report
          is being prepared;

     b)   evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this annual date (the "Evaluation Date"); and

     c)   Presented   in  this   Annual   report  our   conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date.

5)   The registrant's other certifying  officers and I have disclosed,  based on
     our most recent  evaluation,  to the  registrant's  auditors  and the audit
     committee of  registrant's  board of directors (or persons  performing  the
     equivalent functions):

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

     b)   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          controls; and

6)   The  registrant's  other  certifying  officers and I have indicated in this
     Annual  Report  whether or not there were  significant  changes in internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent  to the date f most recent  evaluation  including  any
     corrective  actions with regard to  significant  deficiencies  and material
     weaknesses.


Date:    April 14, 2003                     /s/ Todd Gotlieb
                                            ------------------------------------
                                            Todd Gotlieb
                                            President and Principal Executive
                                            Financial and Accounting Officer




                                       14
<PAGE>

                                    PART F/S


                              SBS INTERACTIVE, CO.
                  (formerly Inet Commerce Conduit Corporation)



                                      Index
                                      -----


                                                                            Page
                                                                             No.
                                                                            ----

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS                          F-2

CONSOLIDATED BALANCE SHEETS                                                 F-3

CONSOLIDATED STATEMENTS OF OPERATIONS                                       F-4

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY                   F-5

CONSOLIDATED STATEMENTS OF CASH FLOWS                                       F-6

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES                                  F-7

SUPPLEMENTARY CONSOLIDATING BALANCE SHEETS                                  F-10




                                      F-1
<PAGE>




                             BARRY I. HECHTMAN, P.A.
                           Certified Public Accountant

                                    Member of
                     Florida and American Institute of CPAs
                  Private Comapnies and Sec Practice Sections


8100 SW 81 Drive                                       Telephone: (305) 270-0014
Suite 210                                                    Fax: (305) 598-3695
Miami Florida, 33143-6603                            email: barrycpa@netzero.net



REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS


To the Board of Directors of
SBS Interactive, Co.
Concord Ontario

We have audited the accompanying consolidated balance sheets of SBS Interactive,
Co. and subsidiary as of December 31, 2002 and 2001, and the related
consolidated statements of operations, stockholders' equity and cash flows for
the years ended December 31, 2002 and 2001 and for the period September 20, 1996
(inception) to December 31, 2002. These consolidated financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated financial statements based on our audit.

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

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of SBS Interactive, Co.
and subsidiary as of December 31, 2002 and 2001, and the results their
operations and cash flows for the periods then ended in conformity with
accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 1 to the
consolidated financial statements, the Company has operated at a loss since
inception and has an excess of current liabilities over current assets that
raise substantial doubt about its ability to continue as a going concern.
Management's plans in regard to these matters are also described in Note 1. The
consolidated financial statements do not include any adjustments that might
result from the outcome of this uncertainty.

                                        /s/ Barry I. Hechtman, P.A.
Miami, Florida                          Certified Public Accountants
April 10, 2003

<PAGE>
<TABLE>
<CAPTION>


                                        SBS Interactive, Co.

                                     Consolidated Balance Sheets



December 31                                                                2002             2001
-----------                                                           -----------------------------
<S>                                                                   <C>               <C>
Current Assets
   Cash and cash equivalents                                          $      7,419      $   107,721
                                                                      ------------      -----------

Total current assets                                                         7,419          107,721

Property and equipment, net                                                  8,999
Non-compete agreement, net                                                 265,000
Patent, net                                                              2,407,834
Deposits                                                                     1,086            6,974
                                                                      ------------      -----------

                                                                      $  2,690,338      $   114,695
                                                                      ============      ===========

Liabilities, and Stockholders' Equity

Current Liabilities
   Accounts payable                                                   $    195,570      $     8,723
   Accrued interest                                                          2,218
   Notes payable                                                           172,000
                                                                      ------------      -----------

Total current liabilities                                                  369,788            8,723

   Notes payable shareholders                                               63,310
                                                                      ------------      -----------

Total liabilities                                                          433,098            8,723

Commitments and Contingencies

Stockholders' Equity
Common stock, $0.001 par value; 50,000,000 shares authorized;
  10,198,184 and 7,017,200 shares issued and outstanding                    10,198            7,017
Additional paid-in capital                                              14,551,160        4,183,143
Deficit accumulated during the development stage                       (12,304,118)      (4,084,188)
                                                                      ------------      -----------

Total stockholders' equity                                               2,257,240          105,972
                                                                      ------------      -----------

                                                                      $  2,690,338      $   114,695
                                                                      ============      ===========


</TABLE>

                 See accompanying summary of significant accounting policies and
                                  notes to financial statements.

                                                  F-3
<PAGE>
<TABLE>
<CAPTION>


                                                         SBS Interactive, Co.

                                                 Consolidated Statements of Operations


                                                                                                                       From
                                                                               For the             For the         Sep. 20, 1996
                                                                              year ended          Year ended       (inception) to
                                                                             December 31,        December 31,       December 31,
                                                                                 2002                2001               2002
                                                                             ------------------------------------------------------

<S>                                                                           <C>                 <C>               <C>
Development stage expenses:
     Selling, general and administrative,                                     $   241,170         $    66,791       $    452,596
     Non-cash compensation                                                                          3,875,000          3,875,000
     Acquisition expenses - research and development                            7,943,080                              7,943,080
                                                                              -----------         -----------       ------------

Total development stage expenses                                                8,184,250           3,941,567         12,270,676
                                                                              -----------         -----------        -----------

Loss from operations                                                           (8,184,250)         (3,941,567)       (12,270,676)

     Interest income                                                                                                       2,238
     Interest expense                                                              (2,221)                                (2,221)
     Non-cash interest, beneficial conversion feature                             (33,000)                               (33,000)
     Other expenses                                                                  (459)                                  (459)
                                                                              -----------         -----------       ------------

Net loss                                                                      $(8,219,930)        $(3,941,567)      $(12,304,118)
                                                                              ===========         ===========       ============

Net loss per common share (basic and diluted)                                 $     (1.09)        $      (.60)
                                                                              ===========         ===========

Weighted average number of common shares outstanding                            7,567,755           7,017,200
                                                                              ===========         ===========


</TABLE>

                 See accompanying summary of significant accounting policies and
                                  notes to financial statements.

                                                  F-4


<PAGE>
<TABLE>
<CAPTION>
                                                    SBS Interactive, Co.

                                        Consolidated Statements of Stockholders' Equity

                                                                                                         Deficit
                                                                                                       Accumulated
                                                                    Common Stock         Additional     During the
                                                            ------------------------      Paid-In      Development        Total
                                                              Shares         Amount       Capital         Stage          Capital
                                                            ----------    ---------     -----------    ------------   -------------

 <S>                                                        <C>           <C>            <C>             <C>            <C>
Common stock issued for cash (09/20/1996)                      500,000     $    500      $     9,500                   $    10,000
Common stock issued for cash (10/01/1996 to 12/31/1996)         17,200           17            5,143                         5,160
                                                            ----------     --------      -----------                   -----------
Balance December 31, 1996                                      517,200          517           14,643                        15,160
Net Loss 1997                                                                                           $    (15,160)      (15,160)
                                                            ----------     --------      -----------    ------------   -----------
Balance December 31, 1997                                      517,200          517           14,643         (15,160)            0
Net Loss 1998                                                                                                (17,087)      (17,087)
                                                            ----------     --------      -----------    ------------   -----------
Balance December 31, 1998                                      517,200          517           14,643         (32,247)      (17,087)
Common stock issued for cash                                 6,000,000        6,000          294,000                       300,000
Net Loss 1999                                                                                                (54,829)      (54,829)
                                                            ----------     --------      -----------    ------------   -----------
Balance December 31, 1999                                    6,517,200        6,517          308,643         (87,076)      228,084
Net Loss 2000                                                                                                (55,545)      (55,545)
                                                            ----------     --------      -----------    ------------   -----------
Balance December 31, 2000                                    6,517,200        6,517          308,643        (142,621)      172,539
Common stock issued for services (11/30/2001)                  500,000          500        3,874,500                     3,875,000
Net Loss 2001                                                                                             (3,941,567)   (3,941,567)
                                                            ----------     --------      -----------    ------------   -----------
Balance December 31, 2001                                    7,017,200        7,017        4,183,143      (4,084,188)      105,972
Common stock issued for business acquisition (10/29/2002)    3,180,984        3,181       10,335,017                    10,335,198
Non-cash interest, beneficial conversion feature                                              33,000                        33,000
Net loss 2002                                                                                             (8,219,930)   (8,219,930)
                                                            ----------     --------      -----------    ------------   -----------
Balance at December 31, 2002                                10,198,184     $ 10,198      $14,551,160    $(12,304,118)  $ 2,257,240
                                                            ==========     ========      ===========    ============   ===========


</TABLE>

                 See accompanying summary of significant accounting policies and
                                  notes to financial statements.

                                                  F-5

<PAGE>
<TABLE>
<CAPTION>

                                                         SBS Interactive, Co.

                                                 Consolidated Statements of Cash Flows

                                                                                                                       From
                                                                               For the             For the         Sep. 20, 1996
                                                                              year ended          Year ended       (inception) to
                                                                             December 31,        December 31,       December 31,
                                                                                 2002                2001               2002
                                                                             ------------------------------------------------------

<S>                                                                           <C>                 <C>               <C>
Operating activities:
   Net loss                                                                  $(8,219,931)         $(3,941,567)      $12,304,118)

   Adjustments to reconcile net loss to net cash used
     in operating activities:
       Depreciation and amortization                                              34,079                                 34,079
       Cash from acquired subsidiaries                                             1,980                                  1,980
       Research & development from acquisition                                 7,943,080                              7,943,080
       Non-cash interest, beneficial conversion feature                           33,000                                 33,000
       Issuance of equity instruments for services                                                  3,875,000         3,875,000
   Change in assets and liabilities:
         Deposits                                                                  6,982                 (224)                8
         Accrued interest                                                          2,218                                  2,218
         Accounts payable                                                         25,623                7,823            34,346
                                                                             -----------          -----------       -----------
Net cash used in operating activities                                           (172,968)             (58,968)         (380,407)
                                                                             -----------          -----------       -----------
Investing activities:
   Purchase of property and equipment                                               (388)                                  (388)
                                                                             -----------          -----------       -----------
Net cash used in investing activities                                               (388)                                  (388)
                                                                             -----------          -----------       -----------
Financing activities:
   Proceeds from issuance of common stock                                                                               315,160
   Proceeds from issuance of debt to shareholders                                  1,054                                  1,054
   Proceeds from issuance of debt                                                 72,000                                 72,000
                                                                             -----------          -----------       -----------
Net cash provided by financing activities                                         73,054                                388,214
                                                                             -----------          -----------       -----------
Net increase (decrease) in cash and cash equivalents                            (100,302)             (58,968)            7,419

Cash and equivalents, beginning of year                                          107,721              166,689                 0
                                                                             -----------          -----------       -----------
Cash and equivalents, end of year                                            $     7,419          $   107,721       $     7,419
                                                                             ===========          ===========       ===========


</TABLE>

                 See accompanying summary of significant accounting policies and
                                  notes to financial statements.

                                                  F-6


<PAGE>


                              SBS INTERACTIVE, CO.

                   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


NATURE OF OPERATIONS
--------------------

SBS Interactive, Co. (the "Company") was incorporated on September 20, 1996
under the laws of the State of Florida as Cosmetics Consultants Corp. for the
purpose of marketing sales and support services to retailers of cosmetic
companies. In November of 1999 the Company changed its activities to acting as a
consultant to internet related enterprises that are seeking capital. In July,
2002 the Company changed its activities to operate as a consumer electronics
company focused on developing, marketing and licensing products that enable the
consumers to use their televisions as an interactive medium.

On November 25, 1996, Cosmetics Consultants Corp. changed its name to Lomillo
Consultants Corp.

On July 17, 1997, the Company amended and restated its articles of incorporation
and changed its name to Inet Commerce Conduit Corp.

On July 30, 2002, the Company amended and restated its articles of incorporation
and changed its name to SBS Interactive, Co.

The Company has been operating as a development stage enterprise since its
inception and is devoting substantially all its efforts to the ongoing
development of the Company.

SBS Interactive, Inc. ("SBS, Inc."), its wholly owned subsidiary, was
incorporated on August 3, 2000 under the laws of the State of Nevada. SBS, Inc.
designs, develops and manufactures technology which captures the user's image
and local background environment and composites that image side-by-side with a
pre-recorded image. SBS, Inc. has been operating as a development stage
enterprise since its inception and is devoting substantially all its efforts to
the ongoing development of the SBS, Inc..

High Plateau Holdings, Inc., its wholly owned subsidiary, was incorporated on
April 3, 1974 under the laws of Canada. High Plateau Holdings has been operating
as a development stage enterprise since its inception and is devoting
substantially all its efforts to its ongoing development. High Plateau Holdings,
Inc. has had no significant transactions since inception other than the
acquisition of United States Patent Number 6,072,933.



                                      F-7
<PAGE>


                              SBS INTERACTIVE, CO.

                   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES



CASH AND CASH EQUIVALENTS
-------------------------

The Company considers all highly liquid investments with a maturity of three
months or less when purchased to be cash equivalents.


FAIR VALUE OF FINANCIAL INSTRUMENTS
-----------------------------------

The carrying amounts of the Company's financial assets, including cash and cash
equivalents and of certain financial liabilities (accounts payable and accrued
expenses and due to related parties), approximate fair value because of their
short maturities.

Based on the Company's estimate of its current incremental borrowing rate for
loans with similar terms and average maturities, the carrying amounts of loans
payable to shareholders approximate fair value.


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. Actual results could differ from those estimates.


PROPERTY AND EQUIPMENT
----------------------

Property and equipment is stated at cost, maintenance and repairs are charged to
operations. Property and equipment consists principally of office equipment.
Depreciation and amortization is computed using the straight-line method based
on the estimated useful lives of the related assets of 3 years.


LONG-LIVED ASSETS
-----------------

The Company evaluates the recoverability of long-lived assets by measuring the
carrying amount of the assets against the estimated undiscounted future cash
flows associated with them. At such time the evaluations indicate that the
future undiscounted cash flows of the long-lived assets would not be sufficient
to recover the carrying value of such assets, the assets would be adjusted to
their fair values.


PATENTS
-------

The patent is stated at cost and is being amortized on a straight-line basis
over the estimated future periods to be benefited (18 years).


NON-COMPETE AGREEMENT
---------------------

The non-compete agreement is stated at cost and is being amortized on a
straight-line basis over the stated life of the agreement (5 years).




                                      F-8
<PAGE>


                              SBS INTERACTIVE, CO.

                   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES



BUSINESS ACQUISITIONS
---------------------

On October 29, 2002 the Company acquired 100% of the stock of SBS Interactive,
Inc., a Nevada corporation, and it's subsidiary High Plateau Holdings, Inc., a
Canadian corporation, through the issuance of 3,180,984 shares of common stock
(see Note 10). Prior to the acquisition SBS Interactive, Inc. and subsidiary had
devoted all of its efforts in the development of its sole asset, United States
Patent Number 6,072,933.


ADVERTISING
-----------

The Company conducts advertising for the promotion of its products. Advertising
costs are charged to operations when incurred; such amounts aggregated $5,903 in
2002 and $0 in 2001.


INCOME TAXES
------------

The Company accounts for income taxes pursuant to the provisions of Statement of
Financial Accounting Standards (SFAS) No. 109, "Accounting for Income Taxes,"
which requires, among other things, a liability approach to calculating deferred
income taxes. The asset and liability approach 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 assets
and liabilities.


RECLASSIFICATIONS
-----------------

Certain prior year amounts have been reclassified to conform to the fiscal year
2002 presentation.


LOSS PER SHARE
--------------

Basic loss per share is computed on the basis of the weighted average number of
common shares outstanding during each year. Diluted loss per share is computed
on the basis of the weighted average number of common shares and dilutive
securities outstanding. Dilutive securities having an antidilutive effect on
diluted loss per share are excluded from the calculation.


PRINCIPLES OF CONSOLIDATION
---------------------------

The consolidated financial statements include the accounts of SBS Interactive,
Co. and its wholly owned subsidiaries, SBS Interactive, Inc. and High Plateau
Holdings, Inc. All material intercompany accounts and transactions are
eliminated.


NEW ACCOUNTING PRONOUNCEMENTS
-----------------------------

In June 2001, the Financial Accounting Standards Board (FASB) finalized SFAS No.
141, "Business Combinations," and SFAS No. 142, "Goodwill and Other Intangible
Assets." SFAS 141 requires the use of the purchase method of accounting for



                                      F-9
<PAGE>


                              SBS INTERACTIVE, CO.

                   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES



business combinations initiated after December 31, 2001. SFAS 141 also requires
that the Company recognize acquired intangible assets apart from goodwill if the
acquired intangible assets meet certain criteria. SFAS 141 applies to all
business combinations initiated after December 31, 2001 and for purchase
business combinations completed on or after July 1, 2001. It also requires, upon
adoption of SFAS 142 that the Company reclassify the carrying amounts of
intangible assets and goodwill based on the criteria in SFAS 141.

SFAS 142 requires, among other things, that companies no longer amortize
goodwill, but instead test goodwill for impairment at least annually. In
addition, SFAS 142 requires that the Company identify reporting units for the
purposes of assessing potential future impairments of goodwill, reassess the
useful lives of other existing recognized intangible assets, and cease
amortization of intangible assets with an indefinite useful life. An intangible
asset with an indefinite useful life should be tested for impairment in
accordance with the guidance in SFAS 142. SFAS 142 is required to be applied in
fiscal years beginning after December 15, 2001 to all goodwill and other
intangible assets recognized at that date, regardless of when those assets were
initially recognized. SFAS 142 requires the Company to complete a transitional
goodwill impairment test six months from the date of adoption. The Company is
also required to reassess the useful lives of other intangible assets within the
first interim quarter after adoption of SFAS 142. The adoption of SFAS 142 did
not impact the Company's financial position and results of operations.

In August 2001, the FASB issued SFAS No. 144, "Accounting for the Impairment or
Disposal of Long-lived Assets." This Statement addressed financial accounting
and reporting for the impairment or disposal of long-lived assets. This
Statement supersedes FASB Statement No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed Of," and the
accounting and reporting provisions of Accounting Principles Board (APB) Opinion
No. 30, "Reporting the Results of Operations-Reporting the Effects of Disposal
of a Segment of a Business, and Extraordinary, Unusual and Infrequently
Occurring Events and Transactions," (as previously defined in that Opinion).

The provisions of this Statement are effective for financial statements issued
for fiscal years beginning after December 15, 2001, and interim periods within
those fiscal years, with early adoption encouraged. The provisions of this
Statement generally are to be applied prospectively. The adoption of SFAS 144
did not impact the Company's financial position and results of operations.



                                      F-10
<PAGE>


                              SBS INTERACTIVE, CO.

                   SUPPLEMENTARY CONSOLIDATING BALANCE SHEETS


1.   GOING CONCERN
     -------------

     The accompanying financial statements were prepared assuming that the
     Company will continue as a going concern. This basis of accounting
     contemplates the realization of assets and the satisfaction of its
     liabilities in the normal course of operations. Since inception, the
     Company has incurred losses of approximately $12.3 million and, at December
     31, 2002, has a working capital deficiency of $362,369. The Company
     presently has no revenues of operations. All of these factors raise
     substantial doubt about the Company's ability to continue as a going
     concern.

     The Company's continued existence is dependent upon its ability to resolve
     its liquidity problems, principally by obtaining additional debt financing
     and equity capital. Accordingly, there are no assurances that the Company
     will be successful in achieving the above plans, or that such plans, if
     consummated, will enable the Company to obtain profitable operations or
     continue as a going concern.

     The financial statements do not include any adjustments to reflect the
     possible future effects on the recoverability and classification of assets
     or the amounts and classification of liabilities that may result from the
     possible inability of the Company to continue as a going concern.


2.   PROPERTY AND EQUIPMENT
     ----------------------

     Property and equipment consist of the following:

                                             Estimated
                                               Useful
     December 31,                               Life           2002
     ------------                            ---------       ---------

     Office equipment                          3 years       $ 10,037
                                                             --------

                                                               10,037
     Less accumulated depreciation                             (1,038)
                                                             --------

                                                             $  8,999
                                                             ========

3.   NON-COMPETE AGREEMENT
     ---------------------

     A five year, non-compete agreement was acquired by the company through its
     acquisition of SBS Interactive, Inc. and subsidiary on October 29, 2002
     (see Note 9). The fair value (as defined by SFAS 141) of the non-compete
     agreement was determined to be approximately $275,000 at the date of




                                      F-11
<PAGE>


                              SBS INTERACTIVE, CO.

                   SUPPLEMENTARY CONSOLIDATING BALANCE SHEETS

     acquisition. The valuation was established through the use of the
     non-compete agreement's original cost ($300,000) on May 29, 2002 paid by
     the acquired subsidiary less the expired portion of its useful life
     ($25,000).

                                             Estimated
                                               Useful
     December 31,                               Life           2002
     ------------                            ---------       ---------

     Non-compete agreement                    5 years         $275,000
                                                              --------
                                                               275,000
     Less accumulated amortization                             (10,000)
                                                              --------
                                                              $265,000
                                                              ========

     At December 31, 2002 future amortization charges were as follows:

     Years ending December 31,
     -------------------------

     2003                                                     $ 60,000
     2004                                                       60,000
     2005                                                       60,000
     2006                                                       60,000
     2007                                                       35,000
     Thereafter                                                      -
                                                              --------

     Total                                                    $265,000
                                                              ========


4.   PATENT
     ------

     United States Patent Number 6,072,933 was acquired by the company through
     its acquisition of SBS Interactive, Inc. and subsidiary on October 29, 2002
     (see Note 10). The fair value (as defined by SFAS 141) of the patent was
     determined to be approximately $2,430,875 at the date of acquisition. The
     valuation was established through the use of an independent valuation
     service.

                                             Estimated
                                               Useful
     December 31,                               Life            2002
     ------------                            ---------       ----------

     Patent                                  17.5 years      $2,430,875
                                                             ----------
                                                              2,430,875
     Less accumulated amortization                              (23,041)
                                                             ----------
                                                             $2,407,834
                                                             ==========


                                       F-12
<PAGE>


                              SBS INTERACTIVE, CO.

                   SUPPLEMENTARY CONSOLIDATING BALANCE SHEETS


     At December 31, 2002 future amortization charges were as follows:

     Years ending December 31,
     -------------------------

     2003                                                    $  138,889
     2004                                                       138,889
     2005                                                       138,889
     2006                                                       138,889
     2007                                                       138,889
     Thereafter                                               1,713,389
                                                             ----------

     Total                                                   $2,407,834
                                                             ==========


5.   NOTES PAYABLE
     -------------

     Notes payable consist of the following:

     December 31,                                          2002           2001
     ------------                                      -----------     ---------

     Note payable Karlgar Limited, due May 15,         $   72,000      $
     2003, secured by all assets of the
     company, convertible immediately at the
     holders discretion into 32,000 shares of
     restricted common stock.

     Note payable to unrelated party, due                 100,000
     August 31, 2003, bearing interest at 5%
     per annum, unsecured.

                                                       ----------      ---------
                                                          172,000

     Less current portion                                 172,000
                                                       ----------      ---------
                                                       $        -      $       -
                                                       ==========      =========

     The note payable to Karlgar Limited in lieu of a stated interest rate, had
     the option upon execution to be converted into restricted common shares
     equal to an exchange rate of $2.00 per share. At the date of execution
     management estimated the fair value of the restricted stock to be $2.93 per
     share, causing the note to contain a beneficial conversion feature upon
     issuance. The Company, in accordance with applicable accounting rules,
     recognized interest expense in the amount of $33,000 for this beneficial
     conversion feature interest component of the note at issuance.


6.   Notes Payable Shareholders

     Notes payable to shareholders consist of the following:

     December 31,                                          2002           2001
     ------------                                      -----------     ---------

     Unsecured notes payable to shareholders
     bearing interest at 5% per annum,                   $ 63,310      $
     principle and interest due at maturity of
     October 29, 2007.

                                                         --------      ---------
                                                           63,310

     Less current portion                                       -
                                                         --------      ---------

                                                         $ 63,310      $       -
                                                         ========      =========


                                      F-13
<PAGE>


                              SBS INTERACTIVE, CO.

                   SUPPLEMENTARY CONSOLIDATING BALANCE SHEETS


7.   COMMON STOCK
     ------------

     Shares Issued for Services
     --------------------------

     On November 30, 2001, the Company issued 500,000 shares of restricted,
     unregistered common stock to two consultants in exchange for services
     rendered. These issuances were valued at approximately $3,875,000 or $7.75
     per share, which equals management's estimate of the fair value of the
     stock issued to the consultants. The value of these issuances are reflected
     as a component of development stage expenses in the 2001 income statement.

     Acquisition of Subsidiary
     -------------------------

     On October 29, 2002, the Company issued 3,180,984 shares in the acquisition
     of SBS Interactive, Inc. and High Plateau Holdings, its wholly owned
     Canadian subsidiary (see Note 10). These shares were recorded by management
     at an estimated fair value of $10,338,198 ($3.25 per share).

     Loss per Share
     --------------

     The following reconciles the components of the loss per share computation:
<TABLE>
<CAPTION>

     For the year ended December 31,
                                                2002                                   2001
                               -------------------------------------   -------------------------------------
                                  Income       Shares      Per-Share     Income        Shares      Per-Share
                               (Numerator)  (Denominator)    Amount    (Numerator)  (Denominator)    Amount
                               -----------  -------------  ---------   -----------  -------------  ---------
     <S>                        <C>           <C>            <C>        <C>           <C>            <C>

     Loss per common share
       Net (loss)
       available to
       common                   $(8,219,930)  7,567,755      $(1.09)    $(3,941,567)  7,017,200      $(0.60)
       shareholders

     Effect of Dilutive
     Securities:
       Stock
       options/warrants                   -           -           -               -           -           -
                                -----------   ---------      -------    -----------   ---------      ------
     Net (loss) available
       to common
       shareholders plus
       assumed conversions      $(8,219,930)  7,567,755      $ (1.09)   $(3,941,567)  7,017,200      $(0.60)
                                ===========   =========      =======    ===========   =========      ======
</TABLE>




                                      F-14
<PAGE>


                              SBS INTERACTIVE, CO.

                   SUPPLEMENTARY CONSOLIDATING BALANCE SHEETS


8.   INCOME TAXES

     Deferred income taxes reflect the net tax effects of temporary differences
     between the carrying amounts of assets and liabilities for financial
     reporting purposes and the amounts used for income tax purposes. At
     December 31, 2002, the Company had United States net operating losses (NOL)
     of approximately $1,068,469. The United States NOL expires during the years
     2020 to 2022. In the event that a change in ownership of the Company of
     greater than 50 percent occurs/occurred as a result of the Company's
     issuance of common and preferred stock, the utilization of the United
     States NOL carryforward will be subject to limitation under certain
     provisions of the United States Internal Revenue Code.

     Realization of any portion of the approximate $363,280 of deferred tax
     assets at December 31, 2002 that arise from the NOL carryforwards is not
     considered more likely than not by management; accordingly, a valuation of
     allowance has been established for the full amount of such asset.

     The reconciliation of income tax benefit computed at the United States
     federal tax rate of 34% is as follows:

     December 31,                                        2002           2001
     ------------                                    -----------    ------------

      Tax benefit at the United States
      statutory rate                                 $ 2,934,445    $ 1,407,219
      Valuation allowance   adjustment
                                                      (2,934,445)    (1,407,219)
                                                     -----------    -----------

      Income tax benefit                             $         -    $         -
                                                     ===========    ===========


     Significant components of the Company's deferred tax assets and liabilities
     are as follows:

     December 31,                                        2002             2001
     ------------                                    -----------       ---------

     Deferred tax assets:
         Net operating loss carryforwards                363,280    $    140,635
         Compensation related to equity
           instruments issued for services             1,317,500       1,317,500
         Compensation related to equity
           instruments issued for acquisitons          2,700,851
         Compensation related to equity
           instruments issued for debt                    11,220
     Valuation allowance for deferred
         tax assets                                   (4,392,580)    (1,458,135)
                                                     -----------    -----------

     Net deferred tax assets                         $         -    $        -
                                                     -----------    -----------





                                      F-15
<PAGE>


                              SBS INTERACTIVE, CO.

                   SUPPLEMENTARY CONSOLIDATING BALANCE SHEETS



     Subsidiaries of the Company have net operating loss carryovers that are
     subject to limitation under certain provisions of the United States
     Internal Revenue Code. The NOLs total approximately $1,119,706 and expire
     during the years 2021 to 2022. The Company also has an NOL carryover in
     Canada that totals approximately $40,364 and expires during the years 2002
     to 2009 at December 31, 2002.


9.   RESEARCH AND DEVELOPMENT
     ------------------------

     Research and development cost related to both future and present products
     are charged to operations as incurred. The Company recognized research and
     development costs of $7,942,885 related to the acquisition of SBS,
     interactive, Inc. (See Note 10) and $4,790 in 2002 and 2001 respectively.


10.  BUSINESS ACQUISITION
     --------------------

     On October 29, 2002, SBS Interactive, Co. (SBS, Co) acquired 100 percent of
     the outstanding common shares of SBS Interactive, Inc. (SBS, Inc.) and its
     subsidiary High Plateau Holdings, Inc. (High Plateau). At the time of the
     transaction, SBS, Inc. and subsidiary had been operating as a development
     stage company and its assets consisted of cash, property and equipment, a
     non-compete agreement and, a patent. The results of SBS, Inc and subsidiary
     operations have been included in the consolidated financial statements
     since that date. High Plateau's patent is crucial to SBS, Inc.'s intended
     product, technology which captures the user's image and local background
     environment and composites that image side-by-side with a pre-recorded
     image.

     On July 16, 2002, SBS, Co, SBS, Inc. and SBS Acquisition, Inc., a Nevada
     corporation and a wholly owned subsidiary of SBS, Co. executed and entered
     into a "Merger Agreement". The Merger Agreement was closed on October 29,
     2002 for the Business Combination in which the SBS, Inc. became a wholly
     owned subsidiary of SBS, Co. and the stockholders of the SBS, Inc. became
     shareholders of SBS, Inc. The Merger Agreement provided that upon its
     "Effective Time":

     Acquisition was merged into the SBS, Inc. which is the surviving
     corporation in the merger.

     The 20,676,000 shares of the common stock of SBS, Inc. outstanding
     immediately prior to the Effective Time was cancelled and the holders of
     that stock became shareholders of SBS, Co. with each 6.5 old shares of SBS,



                                      F-16
<PAGE>


                              SBS INTERACTIVE, CO.

                   SUPPLEMENTARY CONSOLIDATING BALANCE SHEETS



     Inc. stock becoming 1 share of SBS, Co.'s common stock (no fractional
     shares of SBS Co's shares were issued and each shareholder of the Company
     entitled to a fractional share was issued a whole share therefor).

     The Business Combination was designed to constitute a "non-taxable"
     transaction under U.S. and Canadian tax laws; however, the parties have not
     obtained any tax ruling or opinion on its tax status and the shareholders
     of the Company were advised and cautioned to seek their own tax advice and
     counsel on this issue;

     The stock of SBS, Co. issued to the Company shareholders was: (i) issued
     pursuant to exemptions for the registration requirements of the Securities
     Act of 1933 ("Securities Act") provided in Rule 506 of Regulation D and/or
     Regulation S adopted under the Securities Act; (ii) "restricted securities"
     as defined under the Securities Act; and (iii) subject to restrictions on
     their future transferability and/or sale.

     The aggregate purchase price was $10,338,198, and was acquired by the
     issuance of 3,180,984 shares of restricted stock. The value of the
     3,180,984 shares issued was determined based on the trading value SBS,
     Co.'s freely trading stock on October 29, 2002 which was $3.25 per share.

     The following table summarizes the estimated fair values of the assets
     acquired and liabilities assumed at the date of acquisition.

                                                              At Oct. 29, 2002
                                                              ----------------

     Cash                                                       $     1,980
     Equipment                                                        9,649
     Deposits                                                         1,094
     Non-compete agreement                                          275,000
     Patent                                                       2,430,875
     Accounts payable                                              (161,224)
     Loan payable                                                    (5,000)
     Note payable                                                   (94,969)
     Notes payable shareholders                                     (62,286)
                                                                 ----------

     Net assets acquired                                        $ 2,395,118

     Value of stock issued                                       10,338,198
                                                                -----------

     Charge to research and development                         $ 7,943,080
                                                                ===========



                                      F-17
<PAGE>


                              SBS INTERACTIVE, CO.

                   SUPPLEMENTARY CONSOLIDATING BALANCE SHEETS



     The in-process research and development acquired included:

     o    Development of the Side by SideTM technology which is based upon "blue
          screen" technology which is widely used in the film and television
          industries.

     o    Integration of the Side by SideTM technology with a Keyer Unit
          developed under an exclusive worldwide Design and Royalty Agreement
          between High Plateau and Ultimatte Corporation.

     o    The production of test units of the Side by SideTM set-top box
          incorporating a digital camera and DVD connections to show the
          combined pre-recorded elements and the user's performance and
          demonstration of the units at various trade shows.

     o    Construction of pre-production units, documentation of the unit and
          initiating the process of obtaining necessary FCC approvals and
          licenses


11.  RELATED PARTY TRANSACTIONS
     --------------------------

     Consulting Services
     -------------------

     Fees totaling $22,474 and $11,200 have been paid to officers and companies
     owned by shareholders during the years ended December 31, 2002 and 2001 for
     administrative fees, consulting services rendered and, expenses paid on
     behalf of the Company. The officers and directors of the Company are
     involved in other business activities and may, in the future, become
     involved in other business opportunities.

     Lease rent expense for the periods ended December 31, 2002 and 2001
     amounted to $4,718 and $3,361. At December 31, 2002, the Company was
     subleasing the office space under a month-to-month lease from a related
     company for monthly payments of $1,715 Canadian.



12.  MAJOR VENDORS AND CONCENTRATIONS
     --------------------------------

     Royalty Agreement
     -----------------

     On September 9, 1999 High Plateau Holdings, Inc. entered into a Royalty and
     Development Agreement with Ultimatte Corporation (Ultimatte) to develop a
     "keyer unit" based on patented technology held by Ultimatte. The keyer unit



                                      F-18
<PAGE>


                              SBS INTERACTIVE, CO.

                   SUPPLEMENTARY CONSOLIDATING BALANCE SHEETS



     enables the patented technology of the Company to interact with the
     consumer and is crucial to the Company's existing plans for development and
     production of its intended product. In accordance with the agreement, the
     Company is obligated to pay $130,000 to Ultimatte in development fees, of
     which $90,000 has been paid through December 31, 2002.

     The contract calls for the manufacture of the keyer units by the Company
     after the test units are delivered and FCC approval is received. The
     contract also calls for the Company, after final acceptance of the test
     units, to manufacture 200,000 units within two years and 600,000 units
     within three years or the company loses their exclusive rights to the
     technology in this market.

     The Company shall pay to Ultimatte royalties accrued during each quarter no
     later than the end of the month following such quarter in accordance with
     the following table:

     Cumulative number of keyer units for               Royalty amount per
     which royalties have been paid                        unit produced
     ------------------------------------               ------------------
     Less than 100,001 units                                 $  3.00
     100,001 to 500,000 units                                $  2.50
     500,001 to 1,000,000 units                              $  2.25
     1,000,000 to 5,000,000 units                            $  2.00
     More than 5,000,000 units                               $  1.00


12.  COMMITMENT AND CONTINGENCIES
     ----------------------------

     The Company currently maintains an office in Canada. The Company does not
     currently own or operate any manufacturing, operating or repair facilities.
     Substantially all of the Company's operations are devoted to the
     development of its patented technology. The Company believes that it is in
     substantial compliance with all environmental laws and regulations
     applicable to its business as currently conducted.

     Lease rent expense for the periods ended December 31, 2002 and 2001
     amounted to $4,718 and $3,361. At December 31, 2002, the Company was
     subleasing the office space under a month-to-month lease from a related
     company for monthly payments of $1,715 Canadian.




                                      F-19
<PAGE>


                              SBS INTERACTIVE, CO.

                   SUPPLEMENTARY CONSOLIDATING BALANCE SHEETS



13.  SUPPLEMENTAL CASH FLOW INFORMATION
     ----------------------------------

     Supplemental disclosure is as follows:


      December 31,                                        2002         2001
      ------------                                    ----------    -----------

      Cash paid for interest                          $    2,221    $         -
      Cash paid for taxes                                      -              -

      Non-cash investing and financing activities:

      Issuance of stock for services                                  3,875,000

      Non-cash interest, beneficial conversion
      feature                                             33,000

      Stock issued in acquisition of SBS
      Interactive, Inc.                               10,338,198        562,500








                                      F-20