----

----

| DELAWARE                                                                                   | 23-2442288                                                          |
|--------------------------------------------------------------------------------------------|---------------------------------------------------------------------|
| State                or other jurisdiction of incorporation                or organization | I.R.S.                Employer Identification                Number |
|                                                                                       |                                                                     |
|                                                                                       |                                                                |
| 324                Dutura St., West Palm Beach, FL                                         | 33314                                                               |
| Address                of principal executive offices                                      | Zip                Code                                             |
|                                                                                       |                                                                |
| (561)                719-9841                                                              |
| Issuer's                Telephone Number                                                   |

----

**PART      I**

----

| Rights                Acquired                                                                                                                                                                     | Property                Name | Percentage                Allocation | Value                Allocation                 |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------------------------|--------------------------------------|-------------------------------------------------|
|                                                                                                                                                                                               |                         |                                 |                                            |
| Profit                Participation Ownership                                                                                                                                                      | Z-Force                      | 45%                                  |                                            |
|                                                                                                                                                                                               |                         |                                 |                                            |
| Global                Management & Control of TV & Home Video/DVD Sales, Toys and                Merchandise Licensing, Distribution, Production and all Related                Activities | Z-Force                      | 100%                                 |                                            |
|                                                                                                                                                                                               |                         |                                 |                                            |
| TOTAL                Z-FORCE $ ALLOCATION                                                                                                                                                          |                         |                                 | $1,700,000                                      |
|                                                                                                                                                                                               |                         |                                 |                                            |
| Gross                Royalty Revenue from all World Wide Merchandise Licensing                Activities                                                                                           | Nine                Dog      | 10%                                  |                                            |
|                                                                                                                                                                                               |                         |                                 |                                            |
| Gross                Royalty Revenue from any Toy &Licensing Deals negotiated by                Earthworks                                                                                     | Nine                Dog      | 25%                                  |                                            |
|                                                                                                                                                                                               |                         |                                 |                                            |
| Gross                Royalty Revenue World Wide Home Video/DVD Sales                                                                                                                               | Nine                Dog      | 10%                                  |                                            |
|                                                                                                                                                                                               |                         |                                 |                                            |
| TOTAL                NINE DOG $ ALLOCATION                                                                                                                                                         |                         |                                 |                     300,000 |
|                                                                                                                                                                                               |                         |                                 |                                            |
| Total                                                                                                                                                                                              |                         |                                 | $2,000,000                                      |

For      accounting purposes these assets have been valued at Mr. Keefe’s cost, which is      zero.

----

|   | A. | The                Company is actively looking to acquire ownership positions in                entertainment properties and to be successful will need additional                shares                to complete such transactions, as called for in such agreements,                on a case                by case basis. |
|--------|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | B. | To                attract and keep key executives. Shares made available for incentives                and                employment agreements. |
|--------|----|--------------------------------------------------------------------------------------------------------------------------------------------------|

|   | C. | Shares                made available for Employee Stock Ownership Plans                (ESOP) |
|--------|----|-----------------------------------------------------------------------------------------------|

|   | D. | The                Company's success depends in large part on its ability to raise capital.                In order for the Company to raise capital, additional shares must                be made                available for offerings including common stock, equity, convertible                preferred, or convertible debt. |
|--------|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| For        | Against | Abstain |
|------------|---------|---------|
| 25,211,662 | 860,888 | 2,580   |

| For        | Against | Abstain |
|------------|---------|---------|
| 24,792,327 | 461,457 | 821,346 |

| For        | Against | Abstain |
|------------|---------|---------|
| 25,937,500 | 26,480  | 111,150 |

**PART      II**

**.**

----

|                                                |   | HIGH                BID |   | LOW                BID |   |
|-----------------------------------------------------|--------|-------------------------|--------|------------------------|--------|
| FISCAL                YEAR ENDED SEPTEMBER 30, 2002 |   |                    |   |                   |   |
| First                Quarter                        |   | $                       | .23    |                   | $      | .03 |   |
| Second                Quarter                       |   | $                       | .20    |                   | $      | .06 |   |
| Third                Quarter                        |   | $                       | .54    |                   | $      | .04 |   |
| Fourth                Quarter                       |   | $                       | .30    |                   | $      | .04 |   |
|                                                |   |                    |   |                   |   |   |   |
| FISCAL                YEAR ENDED SEPTEMBER 30, 2003 |   |                    |   |                   |   |   |   |
| First                Quarter                        |   | $                       | .07    |                   | $      | .04 |   |
| Second                Quarter                       |   | $                       | .09    |                   | $      | .02 |   |
| Third                Quarter                        |   | $                       | .09    |                   | $      | .03 |   |
| Fourth                Quarter                       |   | $                       | .40    |                   | $      | .04 |   |
|                                                |   |                    |   |                   |   |   |   |
| FISCAL                YEAR ENDED SEPTEMBER 30, 2004 |   |                    |   |                   |   |   |   |
| First                Quarter                        |   | $                       | .31    |                   | $      | .14 |   |
| Second                Quarter                       |   | $                       | .29    |                   | $      | .15 |   |
| Third                Quarter                        |   | $                       | .27    |                   | $      | .15 |   |
| Fourth                Quarter                       |   | $                       | .21    |                   | $      | .14 |   |

** **

----

----

| Television                (pay, free, cable & satellite) | School                Supplies                                        |
|--------------------------------------------------------------|-----------------------------------------------------------------------|
| Home                Video/DVD                                | Educational                Licensing                                  |
| Merchandise                                                  | Music                & Book Publishing                            |
| Toys                & Video Games                        | Direct                Marketing (to Retail chains through catalogues) |
| Apparel                                                      | Internet                Applications                                  |
| Theme                Park Licensing                          | Gifts                & Novelties                                  |
| Fast                Food Promotions                          |                                                                  |

----

|   | (1) | satisfy                its current obligations, |
|--------|-----|-------------------------------------------------|

|   | (2) | continue                its development of properties and projects,                and |
|--------|-----|----------------------------------------------------------------------------------------|

|   | (3) | successfully                implement its plans to market the properties and                projects. |
|--------|-----|-------------------------------------------------------------------------------------------------------|

----

| Consolidated                Financial Statements of the Registrant, Earthworks Entertainment,                Inc.                (fka eContent, Inc.) and Subsidiaries                                                                                                                                                                                                                 | PAGES  |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                                                                                                                                                                                                                                                                                                                                                                   |   |
| Report                of Rosenberg Rich Baker Berman and Company                                                                                                                                                                                                                                                                                                                  | F-1    |
|                                                                                                                                                                                                                                                                                                                                                                                   |   |
| Consolidated                Balance Sheet of Earthworks Entertainment, Inc. (fka eContent, Inc.)                and                Subsidiaries as of September 30, 2004 (As Restated)                                                                                                                                                                                                 | F-2    |
|                                                                                                                                                                                                                                                                                                                                                                                   |   |
| Consolidated                Statements of Operations of Earthworks Entertainment,Inc. (fka eContent,                Inc.) and Subsidiaries for the years ended September 30, 2004 and                September 30, 2003 (As Restated) and for the period from April 1,                1998 (Inception)  through September 30, 2004 (As                Restated)         | F-3    |
|                                                                                                                                                                                                                                                                                                                                                                                   |   |
| Consolidated                Statements of Changes in Stockholders' Equity (Net Capital Deficiency)                of                Earthworks Entertainment, Inc. (fka eContent, Inc.) and Subsidiaries                for                the period from October 1, 1997 (Inception) to September 30, 2004 (As                Restated)                                         | F-4    |
|                                                                                                                                                                                                                                                                                                                                                                                   |   |
| Consolidated                Statements of Cash Flows of Earthworks Entertainment,Inc. (fka eContent,                Inc.) and Subsidiaries for the years ended September 30, 2004 (As                Restated) and September 30, 2003 (As Restated) and for the period                from April 1, 1998 (Inception) through September 30, 2004 (As                Restated) | F-10   |
|                                                                                                                                                                                                                                                                                                                                                                                   |   |
| Notes                to Consolidated Financial Statements (As Restated)                                                                                                                                                                                                                                                                                                                | F-12   |

----

**Rosenberg      Rich Baker Berman & Company**

----

| ASSETS                                                                                                                                                    |   |   |        |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|-------------|
| Current                Assets:                                                                                                                            |   |   |        |   |
| Cash                                                                                                                                                      |   | $      | 142,731     |   |
| Other                current assets                                                                                                                       |   |   | 1,867       |   |
| Total                Current Assets                                                                                                                       |   |   | 144,598     |   |
|                                                                                                                                                      |   |   |        |   |
| Production                costs                                                                                                                           |   |   | 22,184      |   |
| Property                and equipment                                                                                                                     |   |   | 1,054       |   |
|                                                                                                                                                      |   |   |        |   |
| Total                Assets                                                                                                                               |   | $      | 167,836     |   |
|                                                                                                                                                      |   |   |        |   |
|                                                                                                                                                      |   |   |        |   |
| LIABILITIES                AND NET CAPITAL DEFICIENCY                                                                                                     |   |   |        |   |
| Current                Liabilities:                                                                                                                       |   |   |        |   |
| Accounts                payable and accrued expenses                                                                                                      |   | $      | 112,394     |   |
| Accrued                interest                                                                                                                           |   |   | 73,174      |   |
| Settlements                payable                                                                                                                        |   |   | 137,200     |   |
| Promissory                notes                                                                                                                           |   |   | 59,000      |   |
|                                                                                                                                                      |   |   |        |   |
| Total                Current Liabilities                                                                                                                  |   |   | 381,768     |   |
|                                                                                                                                                      |   |   |        |   |
| Convertible                debentures, net of discount of $500,000                                                                                        |   |   | 300,000     |   |
| Convertible                debentures, payable to officers, net of discount of                $169,315                                                    |   |   | 30,685      |   |
|                                                                                                                                                      |   |   |        |   |
| Total                Liabilities                                                                                                                          |   |   | 712,453     |   |
|                                                                                                                                                      |   |   |        |   |
| Net                Capital Deficiency:                                                                                                                    |   |   |        |   |
| Common                stock, par value $.0015 per share; authorized 100,000,000 shares,                63,347,738 shares issued and outstanding           |   |   | 95,022      |   |
| Convertible                preferred stock, authorized 1,000,000 shares, par value $10.00; no                shares                issued and outstanding |   |   | --          |   |
| Additional                paid in capital                                                                                                                 |   |   | 14,681,789  |   |
| Stock                subscription receivable                                                                                                              |   |   | (19,000     | ) |
| Deferred                compensation                                                                                                                      |   |   | (119,583    | ) |
| Prepaid                consulting fees                                                                                                                    |   |   | (110,413    | ) |
| Deficit                accumulated during development stage                                                                                               |   |   | (15,072,432 | ) |
|                                                                                                                                                      |   |   |        |   |
| Total                Net Capital Deficiency                                                                                                               |   |   | (544,617    | ) |
|                                                                                                                                                      |   |   |        |   |
| Total                Liabilities and Net Capital Deficiency                                                                                               |   | $      | 167,836     |   |

----

|                                                                                                     |   | For                The Years EndedSeptember                30, |       | FromApril                1, 1998(Inception)To                September 30, |   |
|----------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------------|------------|----------------------------------------------------------------------------|--------|
|                                                                                                     |   | 2003                                                           |       | 2004                                                                       |   | 2004 |   |
|                                                                                                     |   | (As                Restated)                                   |       | (As                Restated)                                               |   | (As                Restated) |   |
|                                                                                                     |   |                                                           |       |                                                                       |   |   |   |
| Net                Revenues                                                                              |   | $                                                              | --         |                                                                       | $      | -- |   | $ | -- |   |
|                                                                                                     |   |                                                           |       |                                                                       |   |   |   |   |   |   |
| Direct                Costs and Expenses:                                                                |   |                                                           |       |                                                                       |   |   |   |   |   |   |
| Development,                production and distribution                                                  |   |                                                           | 95,990     |                                                                       |   | 121,049 |   |   | 2,474,445 |   |
|                                                                                                     |   |                                                           |       |                                                                       |   |   |   |   |   |   |
| General                and administrative                                                                |   |                                                           | 749,085    |                                                                       |   | 1,280,126 |   |   | 11,321,687 |   |
|                                                                                                     |   |                                                           |       |                                                                       |   |   |   |   |   |   |
| Depreciation                and amortization                                                             |   |                                                           | 35,421     |                                                                       |   | 96 |   |   | 133,019 |   |
|                                                                                                     |   |                                                           |       |                                                                       |   |   |   |   |   |   |
| Total                Costs and Expenses                                                                  |   |                                                           | 880,496    |                                                                       |   | 1,401,271 |   |   | 13,929,151 |   |
|                                                                                                     |   |                                                           |       |                                                                       |   |   |   |   |   |   |
| Loss                from operations before other expenses and provisions for income                taxes |   |                                                           | (880,496   | )                                                                          |   | (1,401,271 | ) |   | (13,929,151 | ) |
|                                                                                                     |   |                                                           |       |                                                                       |   |   |   |   |   |   |
| Other                Operating Income (Expense):                                                         |   |                                                           |       |                                                                       |   |   |   |   |   |   |
| Interest                income                                                                           |   |                                                           | -          |                                                                       |   | 1,075 |   |   | 2,741 |   |
| Settlement                income                                                                         |   |                                                           | 110,381    |                                                                       |   | - |   |   | 1,345,490 |   |
| Interest                expense                                                                          |   |                                                           | (34,417    | )                                                                          |   | (446,127 | ) |   | (556,763 | ) |
| Equity                in earnings of unconsolidated Subsidiary                                           |   |                                                           | -          |                                                                       |   | - |   |   | 96,774 |   |
| Loss                from termination of interest in unconsolidated subsidiary                            |   |                                                           | -          |                                                                       |   | - |   |   | (1,985,901 | ) |
| Loss                on disposal of assets                                                                |   |                                                           | (45,622    | )                                                                          |   | - |   |   | (45,622 | ) |
|                                                                                                     |   |                                                           |       |                                                                       |   |   |   |   |   |   |
| Total                Other Operating Income (Expense)                                                    |   |                                                           | 30,342     |                                                                       |   | (445,052 | ) |   | (1,143,281 | ) |
|                                                                                                     |   |                                                           |       |                                                                       |   |   |   |   |   |   |
| Operating                (Loss) before income taxes                                                      |   |                                                           | (850,154   | )                                                                          |   | (1,846,323 | ) |   | (15,072,432 | ) |
|                                                                                                     |   |                                                           |       |                                                                       |   |   |   |   |   |   |
| Provision                for income taxes                                                                |   |                                                           | -          |                                                                       |   | - |   |   | - |   |
|                                                                                                     |   |                                                           |       |                                                                       |   |   |   |   |   |   |
| Net                (Loss)                                                                                |   | $                                                              | (850,154   | )                                                                          | $      | (1,846,323 | ) | $ | (15,072,432 | ) |
|                                                                                                     |   |                                                           |       |                                                                       |   |   |   |   |   |   |
| Loss                per common share, basic and diluted                                                  |   | $                                                              | (0.02      | )                                                                          | $      | (0.03 | ) |   |   |   |
|                                                                                                     |   |                                                           |       |                                                                       |   |   |   |   |   |   |
| Weighted                average common shares outstanding,basic and diluted                              |   |                                                           | 36,848,346 |                                                                       |   | 56,527,082 |   |   |   |   |

----

|                                                                                                                                                       |   | Common                Stock |      | DeferredCompen- |   | Prepaid                Consulting |   | StockSub-scription |    | Additional                Paid In |   | RetainedEarnings                (Accum-ulated |   | Stock-holders’Equity(Net                Capital |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------|-----------|-----------------|--------|-----------------------------------|--------|--------------------|---------|-----------------------------------|--------|-----------------------------------------------|--------|-------------------------------------------------------|--------|
|                                                                                                                                                       |   | Shares                      |      | Amount          |   | Sation                            |   | Fees               |    | Receivable                        |   | Capital                                       |   | Deficit)                                              |   | Deficency) |   |
|                                                                                                                                                       |   |                        |      |            |   |                              |   |               |    |                              |   |                                          |   |                                                  |   |   |   |
| Balance,                October 1, 1997                                                                                                                    |   |                        | 398,045   |            | $      | 318,436                           |   | $                  | --      |                              | $      | --                                            |   | $                                                     | --     |   | $ | (318,436 | ) | $ | (86,099 | ) | $ | (86,099 | ) |
| Change                of par value from $.80 to $.08                                                                                                       |   |                        | --        |            |   | (286,592                          | )      |               | --      |                              |   | --                                            |   |                                                  | --     |   |   | 286,592 |   |   | -- |   |   | -- |   |
| Retroactive                effect of recapitalization on January 4, 1999 including the elimination                of                prior retained deficit |   |                        | 4,000,000 |            |   | 320,000                           |   |               | --      |                              |   | --                                            |   |                                                  | --     |   |   | (320,000 | ) |   | 86,099 |   |   | 86,099 |   |
|                                                                                                                                                       |   |                        |      |            |   |                              |   |               |    |                              |   |                                          |   |                                                  |   |   |   |   |   |   |   |   |   |   |   |
| Balance                as restated for recapitalization effective April 1, 1998                                                                            |   |                        | 4,398,045 |            |   | 351,844                           |   |               | --      |                              |   | --                                            |   |                                                  | --     |   | $ | (351,844 | ) |   | -- |   |   | -- |   |
| Issuance                of common stock, in private placement, net of offering costs of                $14,011                                             |   |                        | 255,000   |            |   | 20,400                            |   |               | --      |                              |   | --                                            |   |                                                  | --     |   |   | 220,589 |   |   | -- |   |   | 240,989 |   |
| Correction                of predecessor shares canceled in reverse split and cancellation                of                indebtedness                   |   |                        | (2,836    | )               |   | (227                              | )      |               | --      |                              |   | --                                            |   |                                                  | --     |   |   | 227 |   |   | -- |   |   | -- |   |
| Net                loss for the period from April 1, 1998 (date of inception) to September                30, 1998                                         |   |                        | --        |            |   | --                                |   |               | --      |                              |   | --                                            |   |                                                  | --     |   |   | -- |   |   | (141,759 | ) |   | (141,759 | ) |
|                                                                                                                                                       |   |                        |      |            |   |                              |   |               |    |                              |   |                                          |   |                                                  |   |   |   |   |   |   |   |   |   |   |   |
| Balance,                September 30, 1998, as restated                                                                                                    |   |                        | 4,650,209 |            |   | 372,017                           |   |               | --      |                              |   | --                                            |   |                                                  | --     |   |   | (131,028 | ) |   | (141,759 | ) |   | 99,230 |   |
| Issuance                of common stock in connection with the extension of note                payable                                                    |   |                        | 500,000   |            |   | 40,000                            |   |               | --      |                              |   | --                                            |   |                                                  | --     |   |   | (15,000 | ) |   | -- |   |   | 25,000 |   |
| Issuance                of common stock in private placements, net of offering costs of                $62,472                                             |   |                        | 912,500   |            |   | 73,000                            |   |               | --      |                              |   | --                                            |   |                                                  | --     |   |   | 776,028 |   |   | -- |   |   | 849,028 |   |
| Issuance                of common stock in consideration for cancellation of note payable                plus                accrued interest              |   |                        | 500,000   |            |   | 40,000                            |   |               | --      |                              |   | --                                            |   |                                                  | --     |   |   | 227,500 |   |   | -- |   |   | 267,500 |   |
| Issuance                of common stock to employees for services                                                                                          |   |                        | 3,400,000 |            |   | 272,000                           |   |               | --      |                              |   | --                                            |   |                                                  | --     |   |   | 2,754,000 |   |   | -- |   |   | 3,026,000 |   |
| Issuance                of stock options to employees                                                                                                      |   |                        | --        |            |   | --                                |   |               | (88,333 | )                                 |   | --                                            |   |                                                  | --     |   |   | 106,000 |   |   | -- |   |   | 17,667 |   |
| Net                loss for the year ended September 30, 1999                                                                                              |   |                        | --        |            |   | --                                |   |               | --      |                              |   | --                                            |   |                                                  | --     |   |   | -- |   |   | (3,942,234 | ) |   | (3,942,234 | ) |
|                                                                                                                                                       |   |                        |      |            |   |                              |   |               |    |                              |   |                                          |   |                                                  |   |   |   |   |   |   |   |   |   |   |   |
| Balance                at September 30, 1999                                                                                                               |   |                        | 9,962,709 |            | $      | 797,017                           |   | $                  | (88,333 | )                                 | $      | --                                            |   | $                                                     | --     |   | $ | 3,717,500 |   | $ | (4,083,993 | ) | $ | 342,191 |   |

----

|                                                                                                                                  |   | Common                Stock |       | DeferredCompen- |   | Prepaid                Consulting |   | StockSub-scription |    | Additional                Paid In |   | RetainedEarnings(Accum-ulated |   | Stock-holders’Equity(NetCapital |   |
|---------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------|------------|-----------------|--------|-----------------------------------|--------|--------------------|---------|-----------------------------------|--------|-------------------------------|--------|---------------------------------------|--------|
|                                                                                                                                  |   | Shares                      |       | Amount          |   | sation                            |   | Fees               |    | Receivable                        |   | Capital                       |   | Deficit)                              |   | Deficency) |   |
|                                                                                                                                  |   |                        |       |            |   |                              |   |               |    |                              |   |                          |   |                                  |   |   |   |
| Balance                at October 1, 1999                                                                                             |   |                        | 9,962,709  |            | $      | 797,017                           |   | $                  | (88,333 | )                                 | $      | --                            |   | $                                     | --     |   | $ | 3,717,500 |   | $ | (4,083,993 | ) | $ | 342,191 |   |
| Shares                issued in consideration for cancellation of officer loans                                                       |   |                        | 805,424    |            |   | 64,434                            |   |               | --      |                              |   | --                            |   |                                  | --     |   |   | 740,990 |   |   | -- |   |   | 805,424 |   |
| Issuance                of shares in connection with investment in MPI subsidiary                                                     |   |                        | 1,350,000  |            |   | 108,000                           |   |               | --      |                              |   | --                            |   |                                  | --     |   |   | 4,042,000 |   |   | -- |   |   | 4,150,000 |   |
| Issuance                of stock options to employee of subsidiary                                                                    |   |                        | --         |            |   | --                                |   |               | --      |                              |   | --                            |   |                                  | --     |   |   | 368,750 |   |   | -- |   |   | 368,750 |   |
| Exercise                of stock options                                                                                              |   |                        | 500,000    |            |   | 40,000                            |   |               | --      |                              |   | --                            |   |                                  | --     |   |   | 60,000 |   |   | -- |   |   | 100,000 |   |
| Issuance                of common stock for services                                                                                  |   |                        | 1,135,000  |            |   | 90,800                            |   |               | --      |                              |   | --                            |   |                                  | --     |   |   | 1,801,952 |   |   | -- |   |   | 1,892,752 |   |
| Issuance                of shares in private placement, together with warrants, net of cash                offering costs of $184,975 |   |                        | 3,437,181  |            |   | 274,974                           |   |               | --      |                              |   | --                            |   |                                  | --     |   |   | 1,811,706 |   |   | -- |   |   | 2,086,680 |   |
| Shared                issued for cash and guarantee of acquisition note                                                               |   |                        | 400,000    |            |   | 32,000                            |   |               | --      |                              |   | --                            |   |                                  | --     |   |   | 118,000 |   |   | -- |   |   | 150,000 |   |
| Amortization                of deferred compensation                                                                                  |   |                        | --         |            |   | --                                |   |               | 35,333  |                              |   | --                            |   |                                  | --     |   |   | -- |   |   | -- |   |   | 35,333 |   |
| Net                Loss for the year ended September 30, 2000                                                                         |   |                        | --         |            |   | --                                |   |               | --      |                              |   | --                            |   |                                  | --     |   |   | -- |   |   | (3,595,192 | ) |   | (3,595,192 | ) |
|                                                                                                                                  |   |                        |       |            |   |                              |   |               |    |                              |   |                          |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Balance,                September 30, 2000                                                                                            |   |                        | 17,590,314 |            | $      | 1,407,225                         |   | $                  | (53,000 | )                                 | $      | --                            |   | $                                     | --     |   | $ | 12,660,898 |   | $ | (7,679,185 | ) | $ | 6,335,938 |   |

----

|                                                                                                                                       |   | Common                Stock |       | DeferredCompen- |   | Prepaid                Consulting |   | StockSub-scription |    | Additional                Paid In |   | RetainedEarnings(Accum-ulated |   | Stock-holders’Equity(NetCapital |   |
|--------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------|------------|-----------------|--------|-----------------------------------|--------|--------------------|---------|-----------------------------------|--------|-------------------------------|--------|---------------------------------------|--------|
|                                                                                                                                       |   | Shares                      |       | Amount          |   | sation                            |   | Fees               |    | Receivable                        |   | Capital                       |   | Deficit)                              |   | Deficency) |   |
|                                                                                                                                       |   |                        |       |            |   |                              |   |               |    |                              |   |                          |   |                                  |   |   |   |
| Balance,                September 30, 2000                                                                                                 |   |                        | 17,590,314 |            | $      | 1,407,225                         |   | $                  | (53,000 | )                                 | $      | --                            |   | $                                     | --     |   | $ | 12,660,898 |   | $ | (7,679,185 | ) | $ | 6,335,938 |   |
|                                                                                                                                       |   |                        |       |            |   |                              |   |               |    |                              |   |                          |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares in private placement, together with warrants, net of cash                offering costs of $130,018      |   |                        | 1,469,575  |            |   | 117,566                           |   |               | --      |                              |   | --                            |   |                                  |   |   |   | 352,416 |   |   | -- |   |   | 469,982 |   |
| Exercise                of warrants and issuance of reparative shares, net of cash offering                costs                of $99,718 |   |                        | 2,454,975  |            |   | 196,398                           |   |               | --      |                              |   | --                            |   |                                  | --     |   |   | 834,964 |   |   | -- |   |   | 1,031,362 |   |
| Issuance                of shares in private placement                                                                                     |   |                        | 100,000    |            |   | 8,000                             |   |               | --      |                              |   | --                            |   |                                  | --     |   |   | 32,000 |   |   | -- |   |   | 40,000 |   |
| Issuance                of common stock for production rights                                                                              |   |                        | 100,000    |            |   | 8,000                             |   |               | --      |                              |   | --                            |   |                                  | --     |   |   | 104,500 |   |   | -- |   |   | 112,500 |   |
| Amortization                of deferred compensation                                                                                       |   |                        | --         |            |   | --                                |   |               | 25,999  |                              |   | --                            |   |                                  | --     |   |   | -- |   |   | -- |   |   | 25,999 |   |
| Return                of shares pursuant to settlement agreement with certain                management                                    |   |                        | (1,675,688 | )               |   | (134,055                          | )      |               | --      |                              |   | --                            |   |                                  | --     |   |   | (1,273,489 | ) |   | -- |   |   | (1,407,544 | ) |
| Cancellation                of options pursuant to settlement agreement with certain                management                             |   |                        | --         |            |   | --                                |   |               | 27,001  |                              |   | --                            |   |                                  | --     |   |   | (27,001 | ) |   | -- |   |   | -- |   |
| Return                of shares in connection with termination of stock purchase agreement,                effective July 30, 2001         |   |                        | (1,350,000 | )               |   | (108,000                          | )      |               | --      |                              |   | --                            |   |                                  | --     |   |   | (4,042,000 | ) |   | -- |   |   | (4,150,000 | ) |
| Issuance                of shares in settlement                                                                                            |   |                        | 91,833     |            |   | 7,347                             |   |               | --      |                              |   | --                            |   |                                  | --     |   |   | 6,428 |   |   | -- |   |   | 13,775 |   |
| Issuance                of shares to directors to cancel debt and accrue                compensation                                       |   |                        | 1,442,563  |            |   | 115,405                           |   |               | --      |                              |   | --                            |   |                                  | --     |   |   | -- |   |   | -- |   |   | 115,405 |   |
| Issuance                of common stock for services                                                                                       |   |                        | 1,970,000  |            |   | 157,600                           |   |               | --      |                              |   | --                            |   |                                  | --     |   |   | 336,030 |   |   | -- |   |   | 493,630 |   |
| Net                loss for the year ended September 30, 2001                                                                              |   |                        | --         |            |   | --                                |   |               | --      |                              |   | --                            |   |                                  | --     |   |   | -- |   |   | (3,118,454 | ) |   | (3,118,454 | ) |
|                                                                                                                                       |   |                        |       |            |   |                              |   |               |    |                              |   |                          |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Balance,                September 30, 2001                                                                                                 |   |                        | 22,193,572 |            | $      | 1,775,486                         |   | $                  | --      |                              | $      | --                            |   | $                                     | --     |   | $ | 8,984,746 |   | $ | (10,797,639 | ) | $ | (37,407 | ) |

----

|                                                          |   | Common                Stock |       | DeferredCompen- |   | Prepaid                Consulting |   | StockSub-Scription |   | Additional                Paid In |   | Retained                Earnings (Accum-Ulated |   | Stock-holders’Equity(NetCapital |   |
|---------------------------------------------------------------|--------|-----------------------------|------------|-----------------|--------|-----------------------------------|--------|--------------------|--------|-----------------------------------|--------|------------------------------------------------|--------|---------------------------------------|--------|
|                                                          |   | Shares                      |       | Amount          |   | Sation                            |   | Fees               |   | Receivable                        |   | Capital                                        |   | Deficit)                              |   | Deficency) |   |
|                                                          |   |                        |       |            |   |                              |   |               |   |                              |   |                                           |   |                                  |   |   |   |
| Balance,                September 30, 2001                    |   |                        | 22,193,572 |            | $      | 1,775,486                         |   | $                  | --     |                              | $      | --                                             |   | $                                     | --     |   | $ | 8,984,746 |   | $ | (10,797,639 | ) | $ | (37,407 | ) |
|                                                          |   |                        |       |            |   |                              |   |               |   |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Issuance                of Warrants in Production Contract    |   |                        | --         |            |   | --                                |   |               | --     |                              |   | --                                             |   |                                  | --     |   |   | 235,200 |   |   | -- |   |   | 235,200 |   |
|                                                          |   |                        |       |            |   |                              |   |               |   |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Issuance                of Shares in settlement               |   |                        | 400,000    |            |   | 32,000                            |   |               | --     |                              |   | --                                             |   |                                  | --     |   |   | 67,000 |   |   | -- |   |   | 99,000 |   |
|                                                          |   |                        |       |            |   |                              |   |               |   |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Issuance                of Shares in settlement note          |   |                        | 100,000    |            |   | 8,000                             |   |               | --     |                              |   | --                                             |   |                                  | --     |   |   | 12,000 |   |   | -- |   |   | 20,000 |   |
|                                                          |   |                        |       |            |   |                              |   |               |   |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Issuance                of Shares for compensation            |   |                        | 2,050,000  |            |   | 164,000                           |   |               | --     |                              |   | --                                             |   |                                  | --     |   |   | 122,000 |   |   | -- |   |   | 286,000 |   |
|                                                          |   |                        |       |            |   |                              |   |               |   |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Issuance                of Shares for services                |   |                        | 1,245,000  |            |   | 99,600                            |   |               | --     |                              |   | --                                             |   |                                  | --     |   |   | 374,250 |   |   | -- |   |   | 473,850 |   |
|                                                          |   |                        |       |            |   |                              |   |               |   |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Net                loss for the year ended September 30, 2002 |   |                        | --         |            |   | --                                |   |               | --     |                              |   | --                                             |   |                                  | --     |   |   | -- |   |   | (1,578,316 | ) |   | (1,578,316 | ) |
|                                                          |   |                        |       |            |   |                              |   |               |   |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Balance,                September 30, 2002                    |   |                        | 25,988,572 |            | $      | 2,079,086                         |   | $                  | --     |                              | $      | --                                             |   | $                                     | --     |   | $ | 9,795,196 |   | $ | (12,375,955 | ) | $ | (501,673 | ) |

----

|                                                                                                                                 |   | Common                Stock |       | DeferredCompen- |   | Prepaid                Consulting |   | StockSub-Scription |     | Additional                Paid In |   | Retained                Earnings (Accum-Ulated |   | Stock-holders’Equity(NetCapital |   |
|--------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------|------------|-----------------|--------|-----------------------------------|--------|--------------------|----------|-----------------------------------|--------|------------------------------------------------|--------|---------------------------------------|--------|
|                                                                                                                                 |   | Shares                      |       | Amount          |   | Sation                            |   | Fees               |     | Receivable                        |   | Capital                                        |   | Deficit)                              |   | Deficency) |   |
|                                                                                                                                 |   |                        |       |            |   |                              |   |               |     |                              |   |                                           |   |                                  |   |   |   |
| Balance,                September 30, 2002                                                                                           |   |                        | 25,988,572 |            | $      | 2,079,086                         |   | $                  | --       |                              | $      | --                                             |   | $                                     | --     |   | $ | 9,795,196 |   | $ | (12,375,955 | ) | $ | (501,673 | ) |
|                                                                                                                                 |   |                        |       |            |   |                              |   |               |     |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| To                revise par value from $.08 to $.0015                                                                               |   |                        | --         |            |   | (2,040,103                        | )      |               | --       |                              |   | --                                             |   |                                  | --     |   | $ | 2,040,103 |   |   | -- |   |   | -- |   |
|                                                                                                                                 |   |                        |       |            |   |                              |   |               |     |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Balance,                October 1, 2002                                                                                              |   |                        | 25,988,572 |            | $      | 38,983                            |   | $                  | --       |                              | $      | --                                             |   | $                                     | --     |   | $ | 11,835,299 |   | $ | (12,375,955 | ) | $ | (501,673 | ) |
|                                                                                                                                 |   |                        |       |            |   |                              |   |               |     |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares to cancel production contract and retire                warrants                                   |   |                        | 125,000    |            |   | 188                               |   |               | --       |                              |   | --                                             |   |                                  | --     |   |   | 36,062 |   |   | -- |   |   | 36,250 |   |
|                                                                                                                                 |   |                        |       |            |   |                              |   |               |     |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares to convert bridge notes                                                                            |   |                        | 458,333    |            |   | 687                               |   |               | --       |                              |   | --                                             |   |                                  | --     |   |   | 18,813 |   |   | -- |   |   | 19,500 |   |
|                                                                                                                                 |   |                        |       |            |   |                              |   |               |     |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares to cancel unpaid compensation and professional                fees                                 |   |                        | 10,675,000 |            |   | 16,013                            |   |               | --       |                              |   | --                                             |   |                                  | --     |   |   | 215,887 |   |   | -- |   |   | 231,900 |   |
|                                                                                                                                 |   |                        |       |            |   |                              |   |               |     |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares for reparations                                                                                    |   |                        | 750,000    |            |   | 1,125                             |   |               | --       |                              |   | --                                             |   |                                  | --     |   |   | 13,875 |   |   | -- |   |   | 15,000 |   |
|                                                                                                                                 |   |                        |       |            |   |                              |   |               |     |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares to settle license fees                                                                             |   |                        | 1,200,000  |            |   | 1,800                             |   |               | --       |                              |   | --                                             |   |                                  | --     |   |   | 22,200 |   |   | -- |   |   | 24,000 |   |
|                                                                                                                                 |   |                        |       |            |   |                              |   |               |     |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares @ $.03 per share in private placements                                                             |   |                        | 1,433,333  |            |   | 2,150                             |   |               | --       |                              |   | --                                             |   |                                  | --     |   |   | 42,850 |   |   | -- |   |   | 45,000 |   |
|                                                                                                                                 |   |                        |       |            |   |                              |   |               |     |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares @ $.08 per share in private placements                                                             |   |                        | 625,000    |            |   | 938                               |   |               | --       |                              |   | --                                             |   |                                  | --     |   |   | 49,062 |   |   | -- |   |   | 50,000 |   |
|                                                                                                                                 |   |                        |       |            |   |                              |   |               |     |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares @ $.10 per share in private placements, net of cash offering                costs of $46,006       |   |                        | 1,637,500  |            |   | 2,456                             |   |               | --       |                              |   | --                                             |   |                                  | --     |   |   | 115,289 |   |   | -- |   |   | 117,745 |   |
|                                                                                                                                 |   |                        |       |            |   |                              |   |               |     |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares to settle $50,000 loan and collateral in connection with                cancelled merger agreement |   |                        | 2,400,000  |            |   | 3,600                             |   |               | --       |                              |   | --                                             |   |                                  | --     |   |   | 140,400 |   |   | -- |   |   | 144,000 |   |
|                                                                                                                                 |   |                        |       |            |   |                              |   |               |     |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares for employment agreement with President                                                            |   |                        | 3,000,000  |            |   | 4,500                             |   |               | (210,000 | )                                 |   | --                                             |   |                                  | --     |   |   | 205,500 |   |   | -- |   |   | -- |   |
|                                                                                                                                 |   |                        |       |            |   |                              |   |               |     |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Amortization                of deferred compensation                                                                                 |   |                        | --         |            |   | --                                |   |               | 20,417   |                              |   | --                                             |   |                                  | --     |   |   | -- |   |   | -- |   |   | 20,417 |   |
|                                                                                                                                 |   |                        |       |            |   |                              |   |               |     |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Net                loss for the year ended September 30, 2003                                                                        |   |                        | --         |            |   | --                                |   |               | --       |                              |   | --                                             |   |                                  | --     |   |   | -- |   |   | (850,154 | ) |   | (850,154 | ) |
|                                                                                                                                 |   |                        |       |            |   |                              |   |               |     |                              |   |                                           |   |                                  |   |   |   |   |   |   |   |   |   |   |   |
| Balance,                September 30, 2003 (As Restated)                                                                             |   |                        | 48,292,738 |            | $      | 72,440                            |   | $                  | (189,583 | )                                 | $      | --                                             |   | $                                     | --     |   | $ | 12,695,237 |   | $ | (13,226,109 | ) | $ | (648,015 | ) |

----

|                                                                                                                                                            |   | Common                Stock |       | DeferredCompen- |   | Prepaid                Consulting |   | StockSub-Scription |     | Additional                Paid In |   | RetainedEarnings(Accumu-Lated |   | Stock-holders’Equity(NetCapital |    |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------|------------|-----------------|--------|-----------------------------------|--------|--------------------|----------|-----------------------------------|--------|-------------------------------|--------|---------------------------------------|---------|
|                                                                                                                                                            |   | Shares                      |       | Amount          |   | Sation                            |   | Fees               |     | Receivable                        |   | Capital                       |   | Deficit)                              |    | Deficency) |   |
|                                                                                                                                                            |   |                        |       |            |   |                              |   |               |     |                              |   |                          |   |                                  |    |   |   |
| Balance,                September 30, 2003                                                                                                                      |   |                        | 48,292,738 |            | $      | 72,440                            |   | $                  | (189,583 | )                                 | $      | --                            |   | $                                     | --      |   | $ | 12,695,237 |   | $ | (13,226,109 | ) | $ | (648,015 | ) |
|                                                                                                                                                            |   |                        |       |            |   |                              |   |               |     |                              |   |                          |   |                                  |    |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares @ $.08 per share in private placements                                                                                        |   |                        | 2,100,000  |            |   | 3,150                             |   |               | --       |                              |   | --                            |   |                                  | --      |   |   | 166,850 |   |   | -- |   |   | 170,000 |   |
|                                                                                                                                                            |   |                        |       |            |   |                              |   |               |     |                              |   |                          |   |                                  |    |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares to Company President for license rights                                                                                       |   |                        | 10,000,000 |            |   | 15,000                            |   |               | --       |                              |   | --                            |   |                                  | --      |   |   | (15,000 | ) |   | -- |   |   | -- |   |
|                                                                                                                                                            |   |                        |       |            |   |                              |   |               |     |                              |   |                          |   |                                  |    |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares and warrants to settle bridge notes and accrued                interest                                                       |   |                        | 1,050,000  |            |   | 1,575                             |   |               | --       |                              |   | --                            |   |                                  | --      |   |   | 288,199 |   |   | -- |   |   | 289,774 |   |
|                                                                                                                                                            |   |                        |       |            |   |                              |   |               |     |                              |   |                          |   |                                  |    |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares to cancel unpaid compensation and professional                fees                                                            |   |                        | 900,000    |            |   | 1,350                             |   |               | --       |                              |   | --                            |   |                                  | --      |   |   | 198,650 |   |   | -- |   |   | 200,000 |   |
|                                                                                                                                                            |   |                        |       |            |   |                              |   |               |     |                              |   |                          |   |                                  |    |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares for services                                                                                                                  |   |                        | 600,000    |            |   | 899                               |   |               | --       |                              |   | --                            |   |                                  | --      |   |   | 101,101 |   |   | -- |   |   | 102,000 |   |
|                                                                                                                                                            |   |                        |       |            |   |                              |   |               |     |                              |   |                          |   |                                  |    |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares to settle advances                                                                                                            |   |                        | 200,000    |            |   | 300                               |   |               | --       |                              |   | --                            |   |                                  | --      |   |   | 39,700 |   |   | -- |   |   | 40,000 |   |
|                                                                                                                                                            |   |                        |       |            |   |                              |   |               |     |                              |   |                          |   |                                  |    |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares pursuant to exercise of warrants                                                                                              |   |                        | 180,000    |            |   | 270                               |   |               | --       |                              |   | --                            |   |                                  | (19,000 | ) |   | 21,730 |   |   | -- |   |   | 3,000 |   |
|                                                                                                                                                            |   |                        |       |            |   |                              |   |               |     |                              |   |                          |   |                                  |    |   |   |   |   |   |   |   |   |   |   |
| Issuance                of shares and warrants for prepaid consulting                                                                                           |   |                        | 25,000     |            |   | 38                                |   |               | --       |                              |   | (265,360                      | )      |                                  | --      |   |   | 265,322 |   |   | -- |   |   | -- |   |
|                                                                                                                                                            |   |                        |       |            |   |                              |   |               |     |                              |   |                          |   |                                  |    |   |   |   |   |   |   |   |   |   |   |
| Debt                discout related to issuance of warrants and beneficial conversion                of                convertible promissory notes             |   |                        | --         |            |   | --                                |   |               | --       |                              |   | --                            |   |                                  | --      |   |   | 800,000 |   |   | -- |   |   | 800,000 |   |
|                                                                                                                                                            |   |                        |       |            |   |                              |   |               |     |                              |   |                          |   |                                  |    |   |   |   |   |   |   |   |   |   |   |
| Debt                discout related to issuance of warrants and beneficial conversion                of                convertible promissory notes to officers |   |                        | --         |            |   | --                                |   |               | --       |                              |   | --                            |   |                                  | --      |   |   | 200,000 |   |   | -- |   |   | 200,000 |   |
|                                                                                                                                                            |   |                        |       |            |   |                              |   |               |     |                              |   |                          |   |                                  |    |   |   |   |   |   |   |   |   |   |   |
| Offering                costs                                                                                                                                   |   |                        | --         |            |   | --                                |   |               | --       |                              |   | --                            |   |                                  | --      |   |   | (80,000 | ) |   | -- |   |   | (80,000 | ) |
|                                                                                                                                                            |   |                        |       |            |   |                              |   |               |     |                              |   |                          |   |                                  |    |   |   |   |   |   |   |   |   |   |   |
| Amortization                of deferred compensation                                                                                                            |   |                        | --         |            |   | --                                |   |               | 70,000   |                              |   | --                            |   |                                  | --      |   |   | -- |   |   | -- |   |   | 70,000 |   |
|                                                                                                                                                            |   |                        |       |            |   |                              |   |               |     |                              |   |                          |   |                                  |    |   |   |   |   |   |   |   |   |   |   |
| Amortization                of prepaid consulting fees                                                                                                          |   |                        |       |            |   |                              |   |               | --       |                              |   | 154,947                       |   |                                  | --      |   |   | -- |   |   | -- |   |   | 154,947 |   |
|                                                                                                                                                            |   |                        |       |            |   |                              |   |               |     |                              |   |                          |   |                                  |    |   |   |   |   |   |   |   |   |   |   |
| Net                loss for the year ended September 30, 2004                                                                                                   |   |                        | --         |            |   | --                                |   |               | --       |                              |   | --                            |   |                                  | --      |   |   | -- |   |   | (1,846,323 | ) |   | (1,846,323 | ) |
|                                                                                                                                                            |   |                        |       |            |   |                              |   |               |     |                              |   |                          |   |                                  |    |   |   |   |   |   |   |   |   |   |   |
| Balance,                September 30, 2004 (As Restated)                                                                                                        |   |                        | 63,347,738 |            | $      | 95,022                            |   | $                  | (119,583 | )                                 | $      | (110,413                      | )      | $                                     | (19,000 | ) | $ | 14,681,789 |   | $ | (15,072,432 | ) | $ | (544,617 | ) |

----

|                                                                                                      |   | For                The Years EndedSeptember                30, |     | FromApril                1, 1998 (Inception) ToSeptember                30,  |   |
|-----------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------------|----------|-----------------------------------------------------------------------------------|--------|
|                                                                                                      |   | 2003                                                           |     | 2004                                                                              |   | 2004 |   |
|                                                                                                      |   | (As                Restated)                                   |     | (As                Restated)                                                      |   | (As                Restated) |   |
| Cash                flows from operating activities:                                                      |   |                                                           |     |                                                                              |   |   |   |
| Net                Loss                                                                                   |   | $                                                              | (850,154 | )                                                                                 | $      | (1,846,323 | ) | $ | (15,072,432 | ) |
| Adjustments                to reconcile net loss to net cash used in operating                activities: |   |                                                           |     |                                                                              |   |   |   |   |   |   |
| Depreciation                and amortization                                                              |   |                                                           | 35,421   |                                                                              |   | 96 |   |   | 133,018 |   |
| Amortization                of loan discount                                                              |   |                                                           | --       |                                                                              |   | 330,685 |   |   | 348,185 |   |
| Loan                fees                                                                                  |   |                                                           | --       |                                                                              |   | -- |   |   | 25,000 |   |
| Loss                on abandonment of equipment                                                           |   |                                                           | 45,622   |                                                                              |   | -- |   |   | 45,622 |   |
| Stock                based compensation and expenses paid with equity                                     |   |                                                           | 327,567  |                                                                              |   | 399,221 |   |   | 8,497,622 |   |
| Equity                in earnings of unconsolidated subsidiary                                            |   |                                                           | --       |                                                                              |   | -- |   |   | (96,774 | ) |
| Settlement                income relating to stock                                                        |   |                                                           | (110,381 | )                                                                                 |   | -- |   |   | (1,504,150 | ) |
| Loss                on termination of interest in unconsolidated subsidiary                               |   |                                                           | --       |                                                                              |   | -- |   |   | 1,985,909 |   |
| Changes                in assets and liabilities:                                                         |   |                                                           |     |                                                                              |   |   |   |   |   |   |
| Deferred                charges and other current assets                                                  |   |                                                           | 413,597  |                                                                              |   | (24,051 | ) |   | 499,616 |   |
| Other                liabilities                                                                          |   |                                                           | 91,202   |                                                                              |   | 137,268 |   |   | 554,281 |   |
| Accounts                payable and accrued expenses                                                      |   |                                                           | (79,307  | )                                                                                 |   | 178,239 |   |   | 872,548 |   |
|                                                                                                      |   |                                                           |     |                                                                              |   |   |   |   |   |   |
| Net                cash used in operating activities                                                      |   |                                                           | (126,433 | )                                                                                 |   | (884,865 | ) |   | (3,711,555 | ) |
|                                                                                                      |   |                                                           |     |                                                                              |   |   |   |   |   |   |
| Cash                flows from investing activities:                                                      |   |                                                           |     |                                                                              |   |   |   |   |   |   |
| Investment                in intangible assets                                                            |   |                                                           | --       |                                                                              |   | -- |   |   | (90,481 | ) |
| Investment                in property and equipment                                                       |   |                                                           | --       |                                                                              |   | (1,150 | ) |   | (68,528 | ) |
| Advance                on production rights                                                               |   |                                                           | --       |                                                                              |   | -- |   |   | (337,500 | ) |
| Investment                in MPI                                                                          |   |                                                           | --       |                                                                              |   | -- |   |   | (1,850,000 | ) |
|                                                                                                      |   |                                                           |     |                                                                              |   |   |   |   |   |   |
| Net                cash used in investing activities                                                      |   |                                                           | --       |                                                                              |   | (1,150 | ) |   | (2,346,509 | ) |
|                                                                                                      |   |                                                           |     |                                                                              |   |   |   |   |   |   |
| Cash                flows from financing activities:                                                      |   |                                                           |     |                                                                              |   |   |   |   |   |   |
| Net                proceeds from issuance of equity                                                       |   |                                                           | 212,745  |                                                                              |   | 173,000 |   |   | 4,798,911 |   |
| Proceeds                from loans, net of offering costs                                                 |   |                                                           | --       |                                                                              |   | 720,000 |   |   | 1,310,213 |   |
| Advances                from officers and stockholders                                                    |   |                                                           | --       |                                                                              |   | -- |   |   | 400,954 |   |
| Repayment                of loans                                                                         |   |                                                           | --       |                                                                              |   | (10,570 | ) |   | (309,283 | ) |
|                                                                                                      |   |                                                           |     |                                                                              |   |   |   |   |   |   |
| Net                cash provided by financing activities                                                  |   |                                                           | 212,745  |                                                                              |   | 882,430 |   |   | 6,200,795 |   |
|                                                                                                      |   |                                                           |     |                                                                              |   |   |   |   |   |   |
| Net                increase (decrease) in cash and cash equivalents                                       |   |                                                           | 86,312   |                                                                              |   | 56,415 |   |   | 142,731 |   |
|                                                                                                      |   |                                                           |     |                                                                              |   |   |   |   |   |   |
| Cash                and cash equivalents, Beginning of Period                                             |   |                                                           | 4        |                                                                              |   | 86,316 |   |   | -- |   |
|                                                                                                      |   |                                                           |     |                                                                              |   |   |   |   |   |   |
| Cash                and cash equivalents, End of Period                                                   |   | $                                                              | 86,316   |                                                                              | $      | 142,731 |   | $ | 142,731 |   |
|                                                                                                      |   |                                                           |     |                                                                              |   |   |   |   |   |   |
| SUPPLEMENTAL                CASH FLOW INFORMATION:                                                        |   |                                                           |     |                                                                              |   |   |   |   |   |   |
| Interest                paid                                                                              |   | $                                                              |  -- |                                                                              | $      |  -- |   | $ | -- |   |
| Income                taxes paid                                                                          |   | $                                                              | --       |                                                                              | $      | -- |   | $ |  -- |   |

----

| During                the fiscal year ended September 30, 2004, the Company had the following                non-cash investing and financing                activities: |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Debt                discount relating to issuance of warrants                                                                                    |   | $      | 800,000 |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|---------|--------|
|                                                                                                                                             |   |   |    |   |
| Issuance                of 900,000 shares of common stock to two officers to settle unpaid                expenses and compensation              |   | $      | 200,000 |   |
|                                                                                                                                             |   |   |    |   |
| Issuance                of 1,050,000 shares of common stock to settle bridge notes and accrued                interest                           |   | $      | 217,500 |   |
|                                                                                                                                             |   |   |    |   |
| Issuance                of warrants in payment for offering costs                                                                                |   | $      | 115,265 |   |
|                                                                                                                                             |   |   |    |   |
| Issuance                of 25,000 shares of common stock and 1,300,00 warrants for prepaid                consulting                             |   | $      | 265,361 |   |
|                                                                                                                                             |   |   |    |   |
| Issuance                of convertible debentures to two officers in settlement of accrued                compensation                           |   | $      | 200,000 |   |
|                                                                                                                                             |   |   |    |   |
| Debt                discount relating to beneficial conversion of convertible debentures                payable to officers                      |   | $      | 200,000 |   |
|                                                                                                                                             |   |   |    |   |
| Issuance                of 200,000 shares of common stock in settlement of advances and accrued                interest                          |   | $      | 40,000  |   |
|                                                                                                                                             |   |   |    |   |
| Issuance                of 180,000 shares of common stock upon exercise of warrants in exchange                for stock subscription receivable |   | $      | 19,000  |   |

| During                the fiscal year ended September 30, 2003, the Company had the following                non-cash investing and financing                activities: |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Issuance                of 458,333 shares of common stock for repayment of loan and accrued                interest and the conversion of Bridge Notes and accrued                interest |   | $      | 19,500  |   |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|---------|--------|
|                                                                                                                                                                                       |   |   |    |   |
| Issuance                of 2,400,000 shares of common stock to settle $50,000 loan and collateral,                in connection with cancelled merger agreement                            |   | $      | 144,000 |   |
|                                                                                                                                                                                       |   |   |    |   |
| Issuance                of 3,000,000 shares of common stock for deferred                compensation                                                                                       |   | $      | 210,000 |   |

----

|   | (1) | satisfy                its current obligations, |
|--------|-----|-------------------------------------------------|

|   | (2) | continue                its development of properties and projects, and |
|--------|-----|-------------------------------------------------------------------------|

|   | (3) | successfully                implement its plans to market the properties and                projects. |
|--------|-----|-------------------------------------------------------------------------------------------------------|

----

|                               |   | Year                EndedSeptember                30, 2004 |        |
|------------------------------------|--------|------------------------------------------------------------|-------------|
|                               |   | As                Reported                                 |        | As                Restated |   |
| Net                Revenues        |   | $                                                          | --          |   | $ | -- |   |
| Accumulated                Deficit |   | $                                                          | (16,066,722 | ) | $ | (15,072,432 | ) |
| Net                Loss            |   | $                                                          | (2,365,315  | ) | $ | (1,846,323 | ) |
| Loss                Per Share      |   | $                                                          | (.04        | ) | $ | (.03 | ) |
| Total                Assets        |   | $                                                          | 2,163,654   |   | $ | 167,836 |   |

|                                 |   | Year                  EndedSeptember                  30, 2003 |        |
|--------------------------------------|--------|----------------------------------------------------------------|-------------|
|                                 |   | As                  Reported                                   |        | As                  Restated |   |
| Net                  Revenues        |   | $                                                              | --          |   | $ | -- |   |
| Accumulated                  Deficit |   | $                                                              | (13,701,406 | ) | $ | (13,226,109 | ) |
| Net                  Loss            |   | $                                                              | (1,325,451  | ) | $ | (850,154 | ) |
| Loss                  Per Share      |   | $                                                              | (.04        | ) | $ | (.02 | ) |
| Total                  Assets        |   | $                                                              | 148,192     |   | $ | 86,316 |   |

----

----

|                                          |   | 2004   |       | 2003   |   |
|-----------------------------------------------|--------|--------|------------|--------|--------|
|                                          |   |   |       |   |   |
| Stock                Options                  |   |   | 750,000    |   |   | 550,000 |   |
| Stock                Warrants                 |   |   | 10,939,189 |   |   | 4,153,772 |   |
| Convertible                debt, if converted |   |   | 12,500,000 |   |   | -- |   |
|                                          |   |   |       |   |   |   |   |
| Total                                         |   |   | 24,189,189 |   |   | 4,703,772 |   |

----

----

|                                             |   | NUMBER                OFOPTIONS |    | WEIGHTEDAVERAGEEXERCISEPRICE |   |
|--------------------------------------------------|--------|---------------------------------|---------|------------------------------|--------|
|                                             |   |                            |    |                         |   |
| Outstanding                at October 1, 2002    |   |                            | 250,000 |                         |   | .25 |   |
| Granted                                          |   |                            | 700,000 |                         |   | .25 |   |
| Exercised                                        |   |                            | --      |                         |   | -- |   |
| Canceled                                         |   |                            | --      |                         |   | -- |   |
|                                             |   |                            |    |                         |   |   |   |
| Outstanding                at September 30, 2003 |   |                            | 950,000 |                         | $      | .25 |   |
| Granted                                          |   |                            | --      |                         |   | -- |   |
| Exercised                                        |   |                            | --      |                         |   | -- |   |
| Canceled                                         |   |                            | --      |                         |   | -- |   |
|                                             |   |                            |    |                         |   |   |   |
| Outstanding                at September 30, 2004 |   |                            | 950,000 |                         |   | .25 |   |
|                                             |   |                            |    |                         |   |   |   |
| Exercisable                at September 30, 2004 |   |                            | 750,000 |                         | $      | .25 |   |

----

|                               |   | September                30, |       | September                30, |   |
|------------------------------------|--------|------------------------------|------------|------------------------------|--------|
|                               |   | 2004                         |       | 2003                         |   |
|                               |   | (As                Restated) |       | (As                Restated) |   |
| Net                loss:           |   |                         |       |                         |   |
| As                reported         |   | $                            | (1,846,323 | )                            | $      | (850,154 | ) |
| Proforma                           |   | $                            | (1,859,559 | )                            | $      | (853,148 | ) |
|                               |   |                         |       |                         |   |   |   |
| Earnings                Per Share: |   |                         |       |                         |   |   |   |
| As                reported         |   | $                            | (.03       | )                            | $      | (.02 | ) |
| Proforma                           |   | $                            | (.03       | )                            | $      | (.02 | ) |

----

|                                             |   | NUMBER                OFWARRANTS |       | WEIGHTEDAVERAGEEXERCISEPRICE |   |
|--------------------------------------------------|--------|----------------------------------|------------|------------------------------|--------|
|                                             |   |                             |       |                         |   |
| Outstanding                at October 1, 2002    |   |                             | 4,153,772  |                         | $      | 1.26 |   |
| Granted                                          |   |                             | --         |                         |   | -- |   |
| Exercised                                        |   |                             | --         |                         |   | -- |   |
| Canceled                or expired               |   |                             | --         |                         |   | -- |   |
|                                             |   |                             |       |                         |   |   |   |
| Outstanding                at September 30, 2003 |   |                             | 4,153,772  |                         |   | 1.26 |   |
| Granted                                          |   |                             | 6,998,417  |                         |   | .21 |   |
| Exercised                                        |   |                             | (180,000   | )                            |   | .12 |   |
| Canceled                or expired               |   |                             | (33,000    | )                            |   | .12 |   |
|                                             |   |                             |       |                         |   |   |   |
| Outstanding                at September 30, 2004 |   |                             | 10,939,189 |                         | $      | .61 |   |

----

----

|                             |   | September                30, |   |
|----------------------------------|--------|------------------------------|--------|
|                             |   | 2004                         |   | 2003 |   |
|                             |   | (As                Restated) |   | (As                Restated) |   |
| Currently                payable |   |                         |   |   |   |
| Federal                          |   | $                            | --     |   | $ | -- |   |
| State                            |   |                         | --     |   |   | -- |   |
|                             |   | $                            | --     |   | $ | -- |   |

| Federal                and State Net Operating |   |   |        |
|------------------------------------------------|--------|--------|-------------|
|                                           |   |   |        |
| Losses                                         |   | $      | 14,800,000  |   |
|                                           |   |   | (14,800,000 | ) |
| Less:                Valuation Allowance       |   | $      | --          |   |
|                                           |   |   |        |   |
| Net                Deferred Tax Asset          |   | $      | --          |   |

|                                                  |   | September                30, |   |
|-------------------------------------------------------|--------|------------------------------|--------|
|                                                  |   | 2004                         |   | 2003 |   |
|                                                  |   | (As                Restated) |   | (As                Restated) |   |
| Statutory                Benefit                      |   |                         | 40%    |   |   | 40% |   |
|                                                  |   |                         |   |   |   |   |   |
| Loss                for Which No Benefit Was Received |   |                         | (40%   | ) |   | (40% | ) |
|                                                  |   |                         |   |   |   |   |   |
| Effective                Rate                         |   |                         | --     |   |   | -- |   |

| Office                equipment              |   | $      | 1,150 |   |
|----------------------------------------------|--------|--------|-------|--------|
| Less                accumulated depreciation |   |   | (96   | )      |
|                                         |   | $      | 1,054 |   |

----

----

----

----

**PART      III**

| NAME                                | AGE    | POSITION                HELD                          |
|-------------------------------------|--------|-------------------------------------------------------|
|                                |   |                                                  |
| Peter                Keefe          | 52     | President/CEO,                Director                |
|                                |   |                                                  |
| William                H. Campbell  | 59     | Executive                Vice President/CFO, Director |
|                                |   |                                                  |
| Catherine                Malatessta | 45     | Director                (Effective October 19, 2004)  |
|                                |   |                                                  |
| Gary                A. Goodell      | 53     | Director                (Through October 19, 2004)    |

----

| NAME                OF INDIVIDUALOR                NUMBER OFPERSONS                IN GROUP |   | CAPACITIES                INWHICH                SERVED |                           | F.Y.                2004SALARIES,FEES,DIRECTOR'SFEES,COMMISSIONAND                BONUSES |                     | F.Y.                2004SECURITIESAND                PROPERTYINSURANCEBENEFITS                ORREPAYMENTOFPERSONALBENEFITS |   |
|---------------------------------------------------------------------------------------------|--------|---------------------------------------------------------|--------------------------------|-------------------------------------------------------------------------------------------|--------------------------|-----------------------------------------------------------------------------------------------------------------------------|--------|
| Peter                Keefe (1)                                                              |   | President                                               |       |                                                                                      |      |                                                                                                                        |   |
|                                                                                        |   | CEO,                                                    |                           |                                                                                      |                     |                                                                                                                        |   |
|                                                                                        |   | Director,                                               |                           |                                                                                      |                     |                                                                                                                        |   |
|                                                                                        |   |  President                                         |                           | $                                                                                         | 190,396                  |                                                                                                                        |        | 70,000 | (1) |
|                                                                                        |   |                                                    |                           |                                                                                      |                     |                                                                                                                        |   |   |   |
| William                H. Campbell (1)                                                      |   | Executive                Vice                           |                           |                                                                                      |                     |                                                                                                                        |   |   |   |
|                                                                                        |   | President,                                         |                           |                                                                                      |                     |                                                                                                                        |   |   |   |
|                                                                                        |   |  Director                                          |                           | $                                                                                         | 169,125                  |                                                                                                                        | $      | 60,000 | (2) |
|                                                                                        |   |                                                    |                           |                                                                                      |                     |                                                                                                                        |   |   |   |
| Gary                A. Goodell (1)                                                          |   |  Director                                          |                           | $                                                                                         | 69,883                   |                                                                                                                        | $      | 60,000 | (2) |
|                                                                                        |   |                                                    |                           | $                                                                                         | 429,404                  |                                                                                                                        | $      | 190,000 |   |

|  | (1) | Deferred                compensation. |
|--|-----|---------------------------------------|

|  | (2) | Issuance                of 250,000 shares of common stock in payment of expenses and                settlement. |
|--|-----|-----------------------------------------------------------------------------------------------------------------|

| NAME                AND ADDRESS     |   | AMOUNT                AND NATURE OF BENEFICIAL OWNERSHIP |       | PERCENTAGE                CLASS OWNED |   |
|-------------------------------------|--------|----------------------------------------------------------|------------|---------------------------------------|--------|
|                                |   |                                                     |       |                                  |   |
| Peter                Keefe (1)(3)   |   |                                                     | 13,300,000 |                                  |   | 20.83 | % |
| William                Campbell (2) |   |                                                     | 6,350,000  |                                  |   | 9.95 | % |
| Gary                Goodell         |   |                                                     | 4,850,000  |                                  |   | 7.60 | % |

|  | (1) | Includes                300,000 options vested as of September 30,                2004. |
|--|-----|-----------------------------------------------------------------------------------------|

|  | (2) | Includes                200,000 options vested as of September 30,                2004. |
|--|-----|-----------------------------------------------------------------------------------------|

|  | (3) | Includes                10,000,000 shares in connection to rights agreement approved on executed                on April 26, 2004. |
|--|-----|------------------------------------------------------------------------------------------------------------------------------------|

----

----

**PART      IV**

| EXHIBIT                NUMBERREFERENCE | DESCRIPTION                                                                                                                                                |
|----------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 2a*                                    | 2nd                Amended Plan of Reorganization                                                                                                          |
|                                   |                                                                                                                                                       |
| 2b*                                    | Agreement                and Plan of Merger between Media Vision Production,Inc. and Media                Vision                Properties, Inc.           |
|                                   |                                                                                                                                                       |
|                                   |                                                                                                                                                       |
| 3a*                                    | Articles                of Incorporation, as amended                                                                                                       |
|                                   |                                                                                                                                                       |
| 3b*                                    | By-laws,                as amended                                                                                                                         |
|                                   |                                                                                                                                                       |
| 4*                                     | Specimen                of Common Stock certificate                                                                                                        |
|                                   |                                                                                                                                                       |
| 10*                                    | Agreement                with:                                                                                                                             |
|                                   |                                                                                                                                                       |
| 10.1*                                  | (a)                John P. Sgarlat                                                                                                                         |
|                                   | (b)                William Campbell                                                                                                                        |
|                                   | (c)                Gary Goodell                                                                                                                            |
|                                   |                                                                                                                                                       |
| 10.2*                                  | (a)                Assignment of Rocky Mountain Music Marketing Contract                                                                                   |
|                                   |                                                                                                                                                       |
| 10.3*                                  | (b)                Contract with Independence Public Media                                                                                                 |
|                                   |                                                                                                                                                       |
| 10.4*                                  | (c)                Licensing Agreement Spartan Sporting Goods                                                                                              |
|                                   |                                                                                                                                                       |
| 10.5*                                  | Stock                Purchase Agreement between MPI Media Productions International, Inc.                and                Earthworks Entertainment, Inc. |
|                                   |                                                                                                                                                       |
| 10.6*                                  | Stock                Warrant                                                                                                                               |
|                                   |                                                                                                                                                       |
| 10.7*                                  | Programming                deal memo                                                                                                                       |
|                                   |                                                                                                                                                       |
| 10.8*                                  | General                release with indemnity from Company to Marty                                                                                        |
|                                   |                                                                                                                                                       |
| 10.9*                                  | General                release with indemnity from Marty to Company                                                                                        |
|                                   |                                                                                                                                                       |
| 10.10*                                 | Employment                agreements with Peter Keefe and William Campbell                                                                                 |
|                                   |                                                                                                                                                       |
| 10.98.1                                | (a)                Convertible Bridge Note Agreement with C. Baker                                                                                         |
|                                   | (b)                Convertible Bridge Note Agreement with Anasazi PTRS II                                                                                  |
|                                   | (c)                Convertible Bridge Note Agreement with Anasazi PTRS III                                                                                 |
|                                   | (d)                Convertible Bridge Note Agreement with Anasazi PTRS III                                                                                 |
|                                   | (e)                Convertible Bridge Note Agreement with PK Acquisition                                                                                   |
|                                   | (f)                Convertible Bridge Note Agreement with Cimorolo PTRS                                                                                    |
|                                   | (g)                Convertible Bridge Note Agreement with P. Keefe                                                                                         |
|                                   | (h)                Convertible Bridge Note Agreement with W. Campbell                                                                                      |
|                                   |                                                                                                                                                       |

| 31.1       | Rule                    13a-14(a) Certification - Chief Executive Officer                |
|------------|------------------------------------------------------------------------------------------|
|  31.2 | Rule                  13a-14(a) Certification - Chief Financial Officer                  |
|  32.1 | Rule                    13a-14(a) Certification - Chief Executive Officer                |
|  32.2 | Rule                  13a-14(b) Certification - Chief Financial                  Officer |

----

|                                   | Earthworks                Entertainment, Inc.                                                                                                                                                                                                                                               |
|----------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                   |                                                                                                                                                                                                                                                                                        |
| Dated:                January 13, 2006 |                                                                                                                                                                                                                                                                                        |
|                                   |                                                                                                                                                                                                                                                                                        |
|                                   | By:                /s/ Peter                Keefe                                        |
|                                   | Peter                Keefe, CEO/President                                                                                                                                                                                                                                                   |

| NAME                                                                                                                                                                                                                                                            | TITLE                            | DATE                            |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------|---------------------------------|
|                                                                                                                                                                                                                                                            |                             |                            |
|                                                                                                                                                                                                                                                            |                             |                            |
| /s/                PETER                KEEFE                                    | CEO,                President    | January                13, 2006 |
| Peter                Keefe                                                                                                                                                                                                                                      |                             |                            |
|                                                                                                                                                                                                                                                            |                             |                            |
| /s/                WILLIAM H.                CAMPBELL                                                                                                                           | CFO,                Executive VP | January                13, 2006 |
| William                H. Campbell                                                                                                                                                                                                                              |                             |                            |
|                                                                                                                                                                                                                                                            |                             |                            |
| /s/                CATHERINE                MALATESSTA                                                                                                                                                   | Director                         | January                13, 2006 |
| Catherine                Malatessta                                                                                                                                                                                                                             |                             |                            |
|                                                                                                                                                                                                                                                            |                             |                            |
| /s/                GARY                GOODELL                                                                 | Director                         | January                13, 2006 |
| Gary                Goodell                                                                                                                                                                                                                                     |                             |                            |

----