--------------------------------------------------------------------------------
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

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

                                   FORM 10-KSB
                            -------------------------


                   ANNUAL REPORT UNDER SECTION 13 OR 15(D) OF
                       THE SECURITES EXCHANGE ACT OF 1934
                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 2002

                         COMMISSION FILE NO.: 001-16207



                        HUGO INTERNATIONAL TELECOM, INC.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


Delaware                                                           98-0226479
--------------------------------------------------------------------------------
(State of other jurisdiction of                                 (IRS Employer
incorporation or organization)                               Identification No.)


                   14B Jan Sebastian Drive, Sandwich MA 02563
--------------------------------------------------------------------------------
                    (Address of principal executive offices)


                                  508-888-5478
--------------------------------------------------------------------------------
               (Registrant's telephone number including area code)

Securities Registered Under Section 12(b) of the Exchange Act:
Title of Each Class                     Name of Each Exchange on Which Registere
Common Stock, $.0001 par value                       None.

Check whether the issuer is not required to file reports pursuant to Section 13
or 15(d) of the Exchange Act. ?

Check mark  whether  the issuer (1) filed all  reports  required  to be filed by
Section 13 or 15(d) of the  Securities  Exchange  Act of 1934 during the past 12
months (or for such shorter  period that the registrant as required to file such
reports),  and (2) has been subject to such filing  requirements for the past 90
days. Yes ___ No _X_.

Check if there is no  disclosure of  delinquent  filers  pursuant to Item 405 of
Regulation S-B is contained in this form,  and no disclosure  will be contained,
to the best of  registrant's  knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in Part III of this Form  10-KSB or any
amendment to this form 10-KSB. ( X_)

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act) Yes X No ___.

The issuer's revenue for the most recent fiscal year was $0.

The number of outstanding shares of $0.0001 par value common stock as of January
13, 2006 was  50,000,000.  Based on the average closing bid and ask price of the
Registrant's  common stock,  the aggregate market value of the voting stock held
by non-affiliates of the registrants as of January 13, 2006 was $280,500.


<PAGE>



                        HUGO INTERNATIONAL TELECOM, INC.


                                AND SUBSIDIARIES
                           ANNUAL REPORT ON FORM 10KSB
                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 2002



                                TABLE OF CONTENTS


<TABLE>
<CAPTION>

Part I                                                                                                  Page No.

<S>                                                                                                         <C>
Item 1.           Description of Business....................................................................3

Item 2.           Description of Properties..................................................................5

Item 3.           Legal Proceedings..........................................................................5

Item 4.           Submission of Matters to a Vote of Security Holders........................................5



Part II

Item 5.           Market for Common Equity, Related Stockholder Matters and Small Business Issuer

                  Purchases of Equity Securities.............................................................6

Item 6.           Management's Discussion and Analysis or Plan of Operation..................................7

Item 7.           Financial Statements.......................................................................8

Item 8.           Changes and Disagreements with Accountants on Accounting and Financial

                  Disclosure................................................................................21

Item 8A.          Controls and Procedures...................................................................21

Item 8B.          Other Information.........................................................................21

PART III

Item 9.           Directors and Executive Officers of the Registrant........................................22

Item 10.          Executive Compensation....................................................................22

Item 11.          Security Ownership of Certain Beneficial Owners and Related Stockholders

                  Matters...................................................................................23

Item 12.          Certain Relationships and Related Transactions............................................23



PART IV

Item 13.          Exhibits .................................................................................24

Item 14           Principal Accountant Fees and Services....................................................24

Signatures        ..........................................................................................25

</TABLE>

<PAGE>


                           Forward Looking Statements

In  addition  to   historical   information,   this   Annual   Report   contains
forward-looking statements, which are generally identifiable by use of the words
"believes,"  "expects,"  "intends,"   "anticipates,"  "plans  to,"  "estimates,"
"projects," or similar expressions. These forward-looking statements are subject
to certain  risks and  uncertainties  that could cause actual  results to differ
materially from those  reflected in these  forward-looking  statements.  Factors
that might  cause such a  difference  include,  but are not  limited  to,  those
discussed in the section entitled "Business Risk Factors." Readers are cautioned
not to place undue reliance on these forward-looking  statements,  which reflect
management's  opinions only as of the date hereof. We undertake no obligation to
revise or publicly release the results of any revision to these  forward-looking
statements.  Readers should carefully review the risk factors described in other
documents  Hugo  International  Telecom,  Inc.  files from time to time with the
Securities and Exchange Commission (the "SEC"),  including the Quarterly reports
on Form 10QSB to be filed by us in the future fiscal years. PART I

ITEM 1.           DESCRIPTION OF BUSINESS

SUMMARY

Hugo International  Telecom,  Inc. ("we", the "Company" or "Hugo") was a holding
company.  Through its now defunct  operating  subsidiaries,  Hugo  International
Limited ("Hugo UK") and Hugo International (Ireland) Ltd. ("Hugo Ireland"), Hugo
supplied cellular telephone, radio and wireless data communications solutions to
business  customers  primarily  in the  British  Isles who had sought to improve
their customer service levels and control their communications costs.

We  incorporated  in the State of Delaware on February 17, 2000 and acquired our
Hugo UK operating subsidiary on February 24, 2000 and our Hugo Ireland operating
subsidiary on July 1, 2001.

On July 27, 2001, Telesytems  International  Wireless,  Inc. ("TIW"), the parent
company of Dolphin,  our major airtime supplier at that time representing 30% of
our revenues,  voluntarily sought protection from its creditors under the United
Kingdom  bankruptcy  laws. On August 23, 2001 Dolphin ceased doing business with
us and on August 29, 2001,  Dolphin  served a statutory  demand upon our Hugo UK
subsidiary for payment of outstanding fees for airtime service to its customers.
As a result of these actions, Hugo UK could no longer provide airtime service to
its customers.

As a result of the statutory demand by Dolphin,  on October 12, 2001 an order of
administration  was entered against Hugo UK under the United Kingdom  bankruptcy
laws. The order provided Hugo UK protection  from its creditors and in September
2002  the  court  appointed  administrators  to aid  Hugo  UK in its  day to day
operations,  resulting  in the  Company's  loss of control  of its UK  operating
subsidiary and the eventual winding down of its operations. As discussed in Note
3 to the  financial  statements,  the Company has  deconsolidated  the financial
results of its UK operating subsidiary as of October 1, 2002.

On November 1, 2004 the Company  entered into a consulting  agreement with Jesse
Dylan Capital,  Inc. ("JDC") whereby JDC agreed to provide management consulting
services  including  developing  a business  plan for the  Company,  negotiating
settlements with creditors, and obtaining sources of financing.  Under the terms
of the consulting  agreement,  JDC received 29,500,000 shares of restricted Hugo
common stock in lieu of a $296,000 cash payment.

In August 2005,  GreenShift  Corporation acquired 300,000 shares of our Series B
Preferred Stock from three of our investors,  which shares are convertible  into
that number of shares of the  Company's  common  stock as are equal to $1.15 per
preferred share at the time of conversion and have voting rights equal to 67% of
the fully diluted capital stock of the Company.  Subsequent to this acquisition,
Hugo entered in to a Management  Services Agreement with GreenShift  Corporation
under which  GreenShift  agreed to provide  interim  management  assistance  and
financial  support  while  preparing  Hugo  for  a  strategic  acquisition.  Two
acquisition  candidates  have  been  identified  and the  Company  is  currently
negotiating agreements to complete those acquisitions.



<PAGE>


ITEM 1.           DESCRIPTION OF BUSINESS (CONTINUED)

BUSINESS RISK FACTORS

There are many  important  factors that have  affected,  and in the future could
affect, Hugo International Telecom's business,  including but not limited to the
factors discussed below,  which should be reviewed carefully together with other
information contained in this report. Some of the factors are beyond our control
and future trends are difficult to predict.

The Company is not a going concern.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will continue as a going concern.  The Company,  however,  is a
shell company without any  operations.  As of September 30, 2005 the Company did
not have any cash, and current liabilities  exceeded current assets by $197,872.
These matters raise substantial doubt about the Company's ability to continue as
a going concern.

The bankruptcy  proceeding of our Hugo International  Telecom,  Ltd., subsidiary
exposes us to risks and uncertainties.

The wholly owned subsidiary,  Hugo International  Telecom,  Ltd. (`Limited') was
placed into administrative status of the UK bankruptcy code as of October, 2001.
Limited  was  restated  as a  discontinued  operation  through  the  date of the
bankruptcy filing for financial  statement purposes and was deconsolidated as of
the bankruptcy date for financial statement purposes.  If Limited fails to honor
certain  of its  contractual  obligations  because of the  bankruptcy  filing or
otherwise,  claims  may be made  against  us for  breaches  by  Limited of those
contracts as to which we are primarily or secondarily liable as a guarantor.  In
addition,  Limited  bankruptcy  might bring certain claims against us or seek to
hold us liable for certain  transfers made by Limited to us and/or for Limited's
obligations  to creditors  under various  equitable  theories  recognized  under
bankruptcy law. As of January 13, 2006,  there have been no claims filed against
the Company or any of its current or former officers or directors, and we do not
expect  any  material  claims to be  filed.  However,  the  outcome  of  complex
litigation  (including  claims  which  may be  asserted  against  us)  cannot be
predicted  with certainty and is dependent upon many factors beyond our control;
however, any such claims, if successful, could have a material adverse impact on
our financial  condition.  Finally,  we may incur additional costs in connection
with our involvement in the Limited bankruptcy proceedings.

The  Company is not likely to hold annual  shareholder  meetings in the next few
years.

Delaware  corporation law provides that members of the board of directors retain
authority  to act  until  they are  removed  or  replaced  at a  meeting  of the
shareholders.  A  shareholder  may petition  the  Delaware  Court of Chancery to
direct that a shareholders  meeting be held. But absent such a legal action, the
board has no obligation to call a  shareholders  meeting.  Unless a shareholders
meeting is held, the existing directors elect directors to fill any vacancy that
occurs on the board of directors. The shareholders,  therefore,  have no control
over the constitution of the board of directors,  unless a shareholders  meeting
is held.  Management  does not expect to hold annual meetings of shareholders in
the next few years, due to the expense involved. Kevin Kreisler is currently the
sole  director of the Company and was appointed to that position by the previous
directors. If other directors are added to the Board in the future, it is likely
that Mr.  Kreisler  will appoint  them.  As a result,  the  shareholders  of the
Company will have no effective  means of exercising  control over the operations
of the Company.

Some of our  existing  stockholders  can exert  control over us and may not make
decisions that further the best interests of all stockholders.

Our   officers,   directors  and   principal   stockholders   (greater  that  5%
stockholders)  together  control  approximately  67% of our voting  stock.  As a
result,  these stockholders,  if they act individually or together,  may exert a
significant degree of influence over our management and affairs and over matters
requiring stockholder approval, including the election of directors and approval
of  significant  corporate  transactions.  In addition,  this  concentration  of
ownership  may delay or prevent a change in  control of us and might  affect the
market  price of our common  stock,  even when a change in control may be in the
best  interest  of  all  stockholders.   Furthermore,   the  interests  of  this
concentration  of ownership  may not always  coincide  with our interests or the
interests of other  stockholders and  accordingly,  they could cause us to enter
into transactions or agreements which we would not otherwise consider.

Investing in our stock is highly speculative and you could lose some or all of
your investment.

The value of our common stock may decline and may be affected by numerous market
conditions, which could result in the loss of some or the entire amount invested
in our stock. The securities  markets  frequently  experience  extreme price and
volume  fluctuations  that affect  market  prices for  securities  of  companies
generally and very small capitalization companies such as us in particular.



<PAGE>


ITEM 1.           DESCRIPTION OF BUSINESS (CONTINUED)

BUSINESS RISK FACTORS (continued)

Our common stock  qualifies as a "penny stock" under SEC rules which may make it
more difficult for our stockholders to resell their shares of our common stock.

The holders of our common stock may find it more  difficult  to obtain  accurate
quotations  concerning  the  market  value of the stock.  Stockholders  also may
experience greater  difficulties in attempting to sell the stock than if it were
listed on a stock exchange or quoted on the NASDAQ National Market or the NASDAQ
Small-Cap Market. Because our common stock does not trade on a stock exchange or
on the NASDAQ National  Market or the NASDAQ  Small-Cap  Market,  and the market
price of the  common  stock is less  than  $5.00 per  share,  the  common  stock
qualifies as a "penny stock." SEC Rule 15g-9 under the  Securities  Exchange Act
of 1934 imposes  additional sales practice  requirements on broker-dealers  that
recommend  the purchase or sale of penny stocks to persons  other than those who
qualify as an "established  customer" or an "accredited investor." This includes
the  requirement  that  a  broker-dealer   must  make  a  determination  on  the
appropriateness  of  investments  in penny stocks for the customer and must make
special  disclosures  to the  customer  concerning  the  risks of penny  stocks.
Application  of the penny  stock  rules to our common  stock  affects the market
liquidity of the shares,  which in turn may affect the ability of holders of our
common stock to resell the stock.

Only a small portion of the investment  community  will purchase  "penny stocks"
such as our common stock.

Our common stock is defined by the SEC as a "penny stock" because it trades at a
price  less than  $5.00 per share.  Our  common  stock  also  meets most  common
definitions  of a "penny  stock," since it trades for less than $1.00 per share.
Many brokerage  firms will  discourage  their  customers from  purchasing  penny
stocks,  and even more brokerage firms will not recommend a penny stock to their
customers.  Most  institutional  investors  will not invest in penny stocks.  In
addition,  many  individual  investors  will not  consider a purchase of a penny
stock due, among other things, to the negative reputation that attends the penny
stock market.  As a result of this  widespread  disdain for penny stocks,  there
will be a limited  market  for our  common  stock as long as it remains a "penny
stock." This situation may limit the liquidity of your shares.

ITEM 2.           DESCRIPTION OF PROPERTIES

None

ITEM 3.           LEGAL PROCEEDINGS

BANKRUPTCY - Hugo International Telecom, Limited

As a result  of the  statutory  demand  by one of the  Company's  suppliers,  on
October  12,  2001,  an  order  of  administration   was  entered  against  Hugo
International Limited, an operating subsidiary,  under United Kingdom bankruptcy
laws.  The  order  provides  Hugo  International  Limited  protection  from  its
creditors and appoints an administrator to aid Hugo International Limited in its
day-to-day operations.  The effects of this on the Company's operations resulted
in the loss of control of the Subsidiary and the winding down of operations.

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

Hugo  International  Telecom,  Inc.,  did not  submit  any  matters to a vote of
security holders during 2002.





<PAGE>


                                     PART II

ITEM 5.           MARKET FOR  REGISTRANT'S  COMMON EQUITY,  RELATED  STOCKHOLDER
                  MATTERS AND SMALL BUSINESS  ISSUER PURCHASE OF EQUITY
                  SECURITIES

The Company's  Common Stock is listed for quotation on the pink sheets under the
symbol "HGOI." The following table sets forth,  for the periods  indicated,  the
high and low bid  prices  for the  Company's  Common  Stock.  The  reported  bid
quotations  reflect  inter-dealer  prices  without  retail  markup,  markdown or
commissions, and may not necessarily represent actual transactions.
<TABLE>
<CAPTION>

---------------------------------------------------------------------------------------------------------------------
Period                                                    High                                   Low
---------------------------------------------------------------------------------------------------------------------
<S>                                                       <C>                                    <C>
2002 Fourth Quarter                                       0.25                                   0.03
2002 Third Quarter                                        0.50                                   0.10
2002 Second Quarter                                       0.62                                   0.15
2002 First Quarter                                        0.60                                   0.07
2001 Fourth Quarter                                       2.20                                   0.26
2001 Third Quarter                                        6.50                                   1.10
2001 Second Quarter                                       6.10                                   3.75
2001 First Quarter                                        3.50                                   1.37

Title of Class                                            Approximate Number of Holders of Record
Common Stock, 0.0001 par value                                              436

</TABLE>


The number of holders  does not give effect to  beneficial  ownership  of shares
held in the street name of stock  brokerage  houses or clearing  agents and does
not necessarily reflect the actual ownership of the shares. Based on information
from nominee  holders,  we believe that the number of owners of our common stock
exceeds 436.







<PAGE>


ITEM 6    MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

OVERVIEW

Hugo International Telecom, Inc. was a holding company. However it no longer has
any  operating  subsidiaries.  In the  past  its  operating  subsidiaries,  Hugo
International Limited, and Hugo International (Ireland), Ltd., supplied cellular
telephone,   radio  and  wireless  data  communications  solutions  to  business
customers  primarily in the British Isles who sought to improve  their  customer
service levels and control their  communications  costs. Both of these operating
subsidiaries  are no longer in  operation.  Hugo  Ireland was closed in 2002 and
Hugo International  Limited was wound down in 2003. The Company lost significant
capabilities of influencing the day to day operations from the  administrator of
Hugo International Limited in October of 2001.

The Company  incorporated  in the State of  Delaware  on  February  17, 2000 and
acquired our now defunct Hugo  International  Limited  operating  subsidiary  on
February 24, 2000 and our defunct Hugo Ireland  operating  subsidiary on July 1,
2001.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The preparation of our  consolidated  financial  statements  requires us to make
estimates that affect the reported amounts of assets, liabilities,  revenues and
expenses.  The  following  are the areas that we believe  require  the  greatest
amount of estimates in the preparation of our financial statements.

We may be subject to legal  proceedings  related to our  bankrupt  subsidiaries.
Accruals are established for legal matters when, in our opinion,  it is probable
that a liability exists and the liability can be reasonably estimated. Estimates
of the costs  associated  with dispute  settlement are adjusted as facts emerge.
Actual expenses  incurred in future periods can differ  materially from accruals
established.

GAIN/(LOSS) FROM DISCONTINUED OPERATIONS

As discussed in Note 3 to the financial statements,  the company  deconsolidated
the operating  results of its UK subsidiary as of October 1, 2002, and therefore
has reported all results of the UK operations  for periods prior to that date as
income/(loss) from discontinued operations, net.

Gain/(loss) from discontinued  operations,  net, was $1,347,258 and $(2,351,870)
for the years ended December 31, 2002 and December 31, 2001, respectively.

LIQUIDITY AND CAPITAL RESOURCES

The Company had a working  capital  deficit of $161,993 as of December 31, 2002,
which  represented an increase of $1,861,669 from the working capital deficit of
$2,023,662 as of December 31, 2001.

The company had no cash balance as of December 31, 2002.  There remains $161,693
of accounts  payable and $300 of accrued  expenses  unsettled as of December 31,
2002.

The company has  incurred  continued  operating  losses,  has  negative  working
capital and liabilities  exceed assets as of December 31, 2002. These conditions
are due to the  winding  down  process and are  expected to continue  unless new
operating subsidiaries are acquired

<PAGE>



ITEM 7.  FINANCIAL STATEMENTS
<TABLE>
<CAPTION>

                                                                                                           Page No
FINANCIAL STATEMENTS

<S>                                                                                                              <C>
  Reports of Independent Registered Public Accounting Firms.......................................................9

  Consolidated Balance Sheet as of December 31, 2002.............................................................11

  Consolidated Statements of Operations for the Years Ended December 31, 2002 and  2001..........................12

  Consolidated Statements of Stockholders' Deficiency for the Years Ended December 31, 2002 and 2001.............13

  Consolidated Statements of Cash Flows for the Years Ended December 31, 2002  and 2001..........................14

   Notes to Consolidated Financial Statements....................................................................15

</TABLE>


<PAGE>



ITEM 7.  FINANCIAL STATEMENTS (continued)



             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the Board of Directors and Stockholders,
Hugo International Telecom Inc. and Subsidiaries:


We  have  audited  the   accompanying   consolidated   balance   sheet  of  Hugo
International  Telecom,  Inc. and  Subsidiaries  as of December 31, 2002 and the
related consolidated statements of operations, stockholders' deficiency and cash
flows for the year ended December 31, 2002.  These financial  statements are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these  financial  statements  based on our audits.  The  consolidated
financial  statements  as of December  31, 2001 were  audited by other  auditors
whose  report  dated  March  15,  2002  contained  a   modification   expressing
substantial doubt about the Company's ability to continue as a going concern.


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


In our opinion,  the financial  statements  referred to above present fairly, in
all material respects, the consolidated financial position of Hugo International
Telecom,  Inc. and  Subsidiaries  as of December  31, 2002 and the  consolidated
results  of their  operations  and their  cash  flows for the year then ended in
conformity with accounting principles generally accepted in the United States of
America.


The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. As more fully discussed in
Note 2 to the financial statements, the Company has suffered recurring losses
from operations and has a working capital deficiency as of December 31, 2002.
These conditions raise substantial doubt about its ability to continue as a
going concern. Management's plans in regard to these matters are also described
in Note 2. The consolidated financial statements do not include any adjustments
that might result from the outcome of this uncertainty.

                                /s/  Rosenberg, Rich, Baker & Berman and Company
                                     Bridgewater, New Jersey
                                     January 4, 2006
















<PAGE>


ITEM 7.  FINANCIAL STATEMENTS (continued)


REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors
Hugo International Telecom Inc. and Subsidiaries:

We have audited the accompanying consolidated statements of operations,  changes
in stockholders'  deficiency,  and cash flows of Hugo International Telecom Inc.
and  Subsidiaries  for  the  year  ended  December  31,  2001.  These  financial
statements   are  the   responsibility   of  the   Company's   management.   Our
responsibility  is to express an opinion on these financial  statements based on
our audit.

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

In our opinion, the consolidated  financial statements referred to above present
fairly,  in all material  respects,  the consolidated  results of operations and
cash flows of Hugo  International  Telecom  Inc. and  Subsidiaries  for the year
ended  December 31, 2001 in  conformity  with  accounting  principles  generally
accepted in the United States of America.

The accompanying  consolidated  financial statements have been prepared assuming
the Company will continue as a going concern. As more fully discussed in Note 2,
at  December  31,  2001,  the  Company  has  a  working  capital  deficiency  of
approximately   $2,024,000  and  a  stockholders'  deficiency  of  approximately
$1,575,000 and it has a net loss of approximately  $2,352,000 for the year ended
December 31, 2001, which raises substantial doubt about the Company's ability to
continue  as a going  concern.  The  consolidated  financial  statements  do not
include any adjustments  relating to the  recoverability  and  classification of
recorded  asset amounts or the amount and  classification  of  liabilities  that
might be necessary should the Company be unable to continue in existence.

                                 /s/ Mahoney Cohen & Company, CPA, P.C.
                                     ---------------------------------
                                     New York, New York
                                     March 15, 2002


<PAGE>


                        HUGO INTERNATIONAL TELECOM, INC.
                                AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
                             AS OF DECEMBER 31, 2002

<TABLE>
<CAPTION>

                                                                              12/31/02
                                                                            ------------
ASSETS:

<S>                                                                         <C>
TOTAL ASSETS                                                                $         --
                                                                            ============


LIABILITIES AND STOCKHOLDERS' DEFICIENCY:
Current liabilities:
     Accounts payable                                                            161,693
     Accrued expenses                                                                300
                                                                            ------------
       Total current liabilities                                                 161,993


Stockholders' Impairment:
Preferred stock, $0.0001 par value:
       Authorized 600,000 shares
       Issued and outstanding 0 shares                                                --

Preferred convertible stock, $0.0001
par value:
       Authorized 400,000 shares
         Issued and Outstanding 90,000 shares
       Liquidation value of $450,000                                                  9

Common Stock, par value - $0.0001
       Authorized - 50,000,000 shares
       Issued and outstanding - 20,500,000                                        2,050
Additional paid-in capital                                                    2,207,139
Accumulated other comprehensive income
Accumulated deficit                                                          (2,371,191)
                                                                             -------------
         Total stockholders' equity                                            (161,993)
                                                                             -----------
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY                               $         0
                                                                             ===========
</TABLE>

            The notes to the Consolidated Financial Statements are an
                       integral part of these statements.





















<PAGE>

                        HUGO INTERNATIONAL TELECOM, INC.
                                AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                 FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001
<TABLE>
<CAPTION>

                                                                   12/31/02      12/31/01
                                                                ---------------------------

Revenues:
<S>                                                             <C>             <C>
   Cost of revenues .........................................   $       --      $       --
Gross Profit ................................................           --              --
                                                                ------------    ------------

Operating expenses:
   Selling, general and administrative expenses .............           --              --
                                                                ------------    ------------
Income/(loss) from continuing operations before taxes .......           --              --

Provision for income taxes ..................................          6,762            --
                                                                ------------    ------------
Income/(loss) from continuing operations ....................         (6,762)           --

Gain/(loss) from discontinued operations, net of income taxes
   of $69,446 in 2001 .......................................      1,347,258      (2,351,870)
                                                                ------------    ------------

Net income/(loss) ...........................................   $  1,340,496    $ (2,351,870)
                                                                ============    ============

Basic income/(loss) attributable to common shareholders:
   Continuing operations ....................................   $       --      $       --
   Discontinued Operations ..................................   $       0.07    $      (0.11)

Diluted income/(loss) attributable to common shareholders:
   Continuing Operations ....................................   $       --      $       --
   Discontinued Operations ..................................   $       0.07    $      (0.11)

Weighted average shares of common stock
   Outstanding basic and dilutive ...........................     20,500,000      20,533,265
</TABLE>



            The notes to the Consolidated Financial Statements are an
                       integral part of these statements.


<PAGE>



                        HUGO INTERNATIONAL TELECOM, INC.
                                AND SUBSIDIARIES
         CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY
                 FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001
<TABLE>
<CAPTION>

                                                                                                Additional
                                       Common                        Preferred                   Paid-In     Accumulated
                                       Shares         Amount           Shares       Amount       Capital        Deficit
                                       ------         ------           ------       ------       -------        -------

<S>                                  <C>           <C>              <C>          <C>          <C>           <C>
Balance, January 1, 2001 ........    20,500,000    $     2,050           --            --     $ 1,207,386   $(1,359,817)
Common stock issued in
    satisfaction of notes payable        25,356              3           --            --          19,015          --
Preferred stock issued for cash .          --             --           90,000             9       449,991          --
Common stock issued for the
    acquisition of subsidiary ...        31,950              3           --            --         191,697          --
Capital contribution ............          --             --             --            --         200,000          --
Collection of stock subscription
    receivable ..................          --             --             --            --            --            --
Comprehensive loss:
    Foreign currency translation
       adjustment ...............          --             --             --            --            --            --
    Net loss for the year .......          --             --             --            --            --      (2,351,870)
                                    -----------    -----------    -----------   -----------   -----------   -----------
        Total comprehensive loss           --             --             --            --            --      (2,351,870)
                                    -----------    -----------    -----------   -----------   -----------   -----------
Balance, December 31, 2001 ......    20,557,306          2,056         90,000             9     2,068,089    (3,711,687)
Common stock cancelled ..........       (57,306)            (6)          --            --               6          --
Capital Contribution ............          --             --             --            --         139,044          --
Comprehensive loss:
    Foreign currency translation
       adjustment ...............          --             --             --            --            --            --
    Net income for the year .....          --             --             --            --
                                                                                                     --       1,340,496
                                    -----------    -----------    -----------   -----------   -----------   -----------
        Total comprehensive loss           --             --             --            --            --       1,340,496
                                    -----------    -----------    -----------   -----------   -----------   -----------
Balance, December 31, 2002 ......    20,500,000    $     2,050         90,000   $         9   $ 2,207,139   $(2,371,191)
                                    ===========    ===========    ===========   ===========   ===========   ===========
</TABLE>


<TABLE>
<CAPTION>

                                   Accumulated Other    Stock          Total
                                     Comprehensive   Subscription   Stockholders
                                        Income        Receivable     Deficiency
                                        ------        ----------     ----------

<S>                                 <C>            <C>            <C>
Balance, January 1, 2001 ........   $    31,578    $    (1,541)   $  (120,344)
Common stock issued in
    satisfaction of notes payable          --             --           19,018
Preferred stock issued for cash .          --             --          450,000
Common stock issued for the
    acquisition of subsidiary ...          --             --          191,700
Capital contribution ............          --             --          200,000
Collection of stock subscription
    receivable ..................          --            1,541          1,541
Comprehensive loss:
    Foreign currency translation
       adjustment ...............        35,056           --           35,056
    Net loss for the year .......          --             --       (2,351,870)
                                    -----------    -----------    -----------

        Total comprehensive loss         35,056           --       (2,316,814)
                                    -----------    -----------    -----------
Balance, December 31, 2001 ......        66,634           --       (1,574,899)
Common stock cancelled ..........          --             --             --
Capital Contribution ............          --             --          139,044
Comprehensive loss:
    Foreign currency translation
       adjustment ...............       (66,634)          --          (66,634)
    Net income for the year .....          --             --        1,340,496
                                    -----------    -----------    -----------
        Total comprehensive loss           --             --       1, 273,862
                                    -----------    -----------    -----------
Balance, December 31, 2002 ......   $      --      $      --      $  (161,993)
                                    ===========    ===========    ===========
</TABLE>

<PAGE>

                        HUGO INTERNATIONAL TELECOM, INC.
                                AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                 FOR THE YEARS ENDED DECEMBER 31, 2002 AND 2001


<TABLE>
<CAPTION>

                                                                           12/31/02      12/31/01
                                                                          -----------------------

Cash flow from operating activities
<S>                                                                       <C>          <C>
   Income/(loss) from continuing operations ...........................   $  (6,762)   $    --
   Adjustments to reconcile net loss to net cash used
     in operating activities:
           Cash used in operating activities of discontinued operations    (812,386)     (90,735)
                                                                          ---------    ---------
     Net cash used in operating activities ............................    (819,148)     (90,735)

Cash flow from investing activities
   Cash used in investing activities of discontinued operations .......      (2,853)     (32,296)
                                                                                       ---------
     Net cash used in investing activities ............................      (2,853)     (32,296)


Cash flow from financing activities
   Proceeds from issuance of preferred stock ..........................        --        450,000
   Capital Contributions ..............................................        --        200,000
   Collection of stock subscription receivable ........................        --          1,541
   Cash from other financing activities of discontinued operations ....     538,218     (311,728)
                                                                          ---------    ---------
     Net cash provided by financing activities ........................     538,218      339,813

Effect of exchange rates on cash of discontinued operations ...........      12,436       (4,077)
                                                                                       ---------

Net increase/(decrease) in cash .......................................    (271,347)     212,705
Cash, beginning of year ...............................................     271,347       58,642
                                                                          ---------    ---------
Cash, end of year .....................................................   $    --      $ 271,347
                                                                          =========    =========


SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

Cash paid during the year for:
   Interest ...........................................................   $  27,046    $  88,943
   Income Taxes .......................................................   $   6,762    $    --
</TABLE>


SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES

During the year ended  December 31, 2002 an officer of the Company paid accounts
payable of $139,044.

During the year ended  December  31, 2001 the Company  issued  25,356  shares of
common stock in satisfaction of notes payable in the amount of $19,018.

During the year ended December 31, 2001 the Company acquired Hugo  International
(Ireland) Ltd., a wholly-owned subsidiary, for common stock valued at $191,700.


<PAGE>

               HUGO INTERNATIONAL TELECOM, INC., AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1        BASIS OF PRESENTATION

Hugo  International  Telecom,  Inc. ("we", the "Company" or "Hugo") is a holding
company that no longer has any  operating  subsidiaries.  The  company's  former
operating  subsidiaries,   Hugo  International  Limited  ("Hugo  UK")  and  Hugo
International   (Ireland)  Ltd.  ("Hugo   Ireland"),   entered  into  bankruptcy
protection  under  United  Kingdom  bankruptcy  laws  and  went  through  formal
liquidation  procedures.   These  two  defunct  subsidiaries  supplied  cellular
telephone,   radio  and  wireless  data  communications  solutions  to  business
customers  primarily  in the  British  Isles.  The  Company  no  longer  has any
operations.

PRINCIPLES OF CONSOLIDATION

For the year  ended  2001 the  accompanying  consolidated  financial  statements
include the accounts of the following:  Hugo International  Telecom Inc. and its
wholly-owned   subsidiaries,   Hugo  UK  and  Hugo  Ireland.   All   significant
intercompany  balances and transactions  were eliminated in  consolidation.  The
consolidated  financial  statements for the year ended December 31, 2001 include
the accounts of Hugo Ireland beginning July 1, 2001.

As of October 1, 2002 the Company  ceased to  consolidate  its former  operating
subsidiaries.  The operations of the former subsidiaries are included in results
from discontinued  operations,  net through the date of deconsolidation  and are
discussed more fully in Note 3. Certain prior year amounts and balances  related
to the discontinued  operation have been  reclassified to conform to the current
classifications with no overall effect on the financial results.

2        GOING CONCERN

The accompanying  consolidated  financial statements have been prepared assuming
the company will continue as a going  concern.  The Company had working  capital
deficiencies  of  $161,993  and  $2,023,662  as of  December  31, 2002 and 2001,
respectively, and it had no operating subsidiaries as of December 31, 2002 which
raises  substantial  doubt  about the  company's  ability to continue as a going
concern.  For the year ended  December 31, 2001 the Company  sustained a loss of
$2,351,870  and as of December  31, 2001 it had a  stockholders'  deficiency  of
$1,574,899.  The company has gone through a winding down of its operations,  and
the ability to continue as a going  concern is  dependent  upon the  addition of
profitable operations and support from stockholders and investors.

The consolidated financial statements do no include any adjustments relating to
the recoverability and classification of recorded asset amounts or the amount
and classification of liabilities that might be necessary should the Company be
unable to continue as a going concern.

3        CERTAIN ACCOUNTING POLICIES

USE OF ESTIMATES

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

FAIR VALUE OF FINANCIAL INSTRUMENTS

For accounts payable and accrued expenses, the carrying amount approximates fair
value because of the short term maturity of these instruments.

Fair value  estimates  are made at a specific  point in time,  based on relevant
information and information about the financial instrument.  These estimates are
subjective  in nature and  involve  uncertainties  and  matters  of  significant
judgment  and  therefore  cannot  be  determined  with  precision.   Changes  in
assumptions could significantly affect the estimates.

NET INCOME/(LOSS) PER SHARE

The  Company  calculates  net  income  per share as  required  by  Statement  of
Financial  Accounting Standards No. 128, "Earnings Per Share" ("SFAS 128"). SFAS
128 replaces the  calculation  of primary and fully  diluted  earnings per share
with basic and diluted  earnings per share.  Unlike primary  earnings per share,
basic earnings per share excludes any dilutive effect of stock options, warrants
and convertible securities.

<PAGE>

               HUGO INTERNATIONAL TELECOM, INC., AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

3        CERTAIN ACCOUNTING POLICIES (CONTINUED)

INCOME TAXES

Deferred  income taxes are  recognized  for the tax  consequences  of "temporary
differences" by applying enacted  statutory tax rates applicable to future years
to  differences  between the financial  statement  carrying  amounts and the tax
bases of existing  assets and  liabilities.  The effect on  deferred  taxes of a
change in tax rates is  recognized  in income in the period  that  includes  the
enactment date.  Valuation  allowances are established  when necessary to reduce
deferred tax assets to the amount expected to be realized. Income tax expense is
the tax payable or refundable for the period plus or minus the change during the
period in deferred tax assets and liabilities.


TRANSLATION OF FOREIGN CURRENCIES

Assets  and  liabilities  of  foreign  subsidiaries  are  translated  at current
exchange rates and the effects of these translation  adjustments are reported as
a separate  component of  stockholders'  equity.  Realized gains and losses from
foreign currency  transactions  are included in the  consolidated  statements of
operations,  as are unrealized  gains and losses arising from the translation of
the foreign  subsidiaries'  intercompany  liability  accounts into U.S. dollars.
Market risk is the potential  loss arising from adverse  changes in market rates
and prices, such as foreign currency exchange rates.

ADVERTISING EXPENSES

Advertising  expenses are charged to  operations in the period in which they are
incurred.  Advertising  expenses  for the year  ended  December  31,  2001  were
approximately $20,000.

REVENUE RECOGNITION

The Company recognizes revenue as follows:


     -    Product  sales - upon  shipment  of  products  to  customers

     -    Airtime  contracts - as services are rendered

     -    Equipment rental - as services are rendered

     -    Maintenance  contracts - deferred and recognized ratably over the term
          of the maintenance agreement, which is typically three months

GOODWILL

Goodwill  acquired  prior to July 1, 2001 is amortized  using the  straight-line
method  over  ten  years.   All  other   intangibles  are  amortized  using  the
straight-line  method  over the  respective  estimated  useful  lives.  Goodwill
amortization  for  the  year  ended  December  31,  2001  totaled  $126,000  and
accumulated   amortization  at  December  31,  2001  amounted  to  approximately
$214,000.  Commencing January 1, 2002 as a result of adopting SFAS 142, goodwill
is no longer being  amortized,  but is reviewed for impairment.  If SFAS 142 had
been in effect for the twelve months ended December 31, 2001 net loss would have
decreased by  $126,000.  The per share impact would have been less than $.01 per
share in  2001.  During  2001,  goodwill  and  customer  lists of  approximately
$586,000 related to a previously  acquired company were written off because they
were considered to have no continuing value.

BANKRUPTCY - HUGO INTERNATIONAL TELECOM, LIMITED

As a result  of the  statutory  demand  by one of the  Company's  suppliers,  on
October 12, 2001 an order of  administration  was  entered  against  Hugo UK, an
operating  subsidiary,  under United Kingdom bankruptcy laws. The order provides
Hugo UK protection  from its creditors and in September 2002 the court appointed
administrators to aid Hugo UK in its day-to-day operations.  The effects of this
on the Company's operations resulted in the winding down of operations.

DISCONTINUED OPERATIONS AND DECONSOLIDATION OF SUBSIDIARIES

Under  generally  accepted  accounting  principles,  consolidation  is generally
required for investments of more than 50% of the outstanding  voting stock of an
investee,  except when  control is not held by the majority  owner.  Under these
rules,  legal  reorganization  or  bankruptcy  represent  conditions  which  can
preclude  consolidation  in instances  where  control  lies with the  bankruptcy
court, rather than the majority owner. Accordingly, due to the appointment of an
administrator, the Company ceased to consolidate the financial results of its UK
subsidiaries beginning

<PAGE>

               HUGO INTERNATIONAL TELECOM, INC., AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

3        CERTAIN ACCOUNTING POLICIES (CONTINUED)

October 1, 2002. The operations of the UK  subsidiaries  are included in results
from discontinued operations,  net, in the accompanying  consolidated statements
of operations through the date of deconsolidation.

The  results  of the  discontinued  operations  are shown as  "Gain/(loss)  from
discontinued  operations"  on the  consolidated  statement of operations and are
comprised of:
<TABLE>
<CAPTION>
                                                                       Period ended
                                                              12/31/02          12/31/01
                                                              --------------------------

<S>                                                           <C>             <C>
         Revenues                                             $2,486,112      $4,242,099

         Operating loss (net of income taxes
         of $69,446 in 2001)                                    (708,771)     (2,351,870)

         Gain on disposal                                      2,056,029            --
                                                              ------------    ----------

         Gain/(loss) loss from discontinued operations        $1,347,258     $(2,351,870)
                                                              ==========       =========
</TABLE>


NEW ACCOUNTING PRONOUNCEMENTS

In June 2001, the Financial Accounting Standards Board ("FASB") issued statement
of  Financial  Accounting  Standards  No. 142,  "Goodwill  and Other  Intangible
Assets" ("SFAS 142"). SFAS 142 requires that goodwill and intangible assets with
indefinite  useful  lives no longer be  amortized,  but  instead  be tested  for
impairment  at least  annually in  accordance  with the  provisions of SFAS 142.
Goodwill  and  intangible  assets  acquired in business  combinations  completed
before July 1, 2001 were amortized through the end of 2001. Beginning January 1,
2002,  in  accordance  with  SFAS  142,  the  Company  is  no  longer  recording
amortization expense related to goodwill.  The Company adopted the provisions of
SFAS 142 effective  January 1, 2002. As of December 31, 2002, the Company has no
unamortized goodwill.

In August 2001, the FASB issued SFAS No. 144,  "Accounting for the Impairment of
Long-Lived  Assets  and for  Long-Lived  Assets  to be  disposed  of."  SFAS 144
requires  that  long-lived  assets be reviewed for  impairment  whenever  events
change or changes in  circumstances  indicate that their carrying amount may not
be  recoverable  and is measured by a comparison  of the  carrying  amount of an
asset to  undiscounted  future net cash flows  expected to be  generated  by the
asset.  If  the  carrying  amount  of an  asset  exceeds  its  estimated  future
undiscounted  cash flows,  an impairment  charge is recognized for the amount by
which the carrying amount of the asset exceeds the fair value of the asset. SFAS
144 requires companies to separately report discontinued  operations and extends
that  reporting to a component of an entity that either has been disposed of (by
sales,  abandonment or in a distribution to owners) or is classified as held for
sale. The Company adopted SFAS 144 on January 1, 2002.

4        MAJOR SUPPLIERS

Purchases  from two suppliers for the year ended  December 31, 2001  represented
approximately 56% of non-affiliated purchases.

5        PENSION PLAN

Hugo International  Limited has a non-contributory  pension plan that covers its
executives. Contributions to the plan are made at the discretion of the Board of
Directors of the Company.  Hugo International Limited did not make contributions
to the plan for the years ended December 31, 2001.


<PAGE>

               HUGO INTERNATIONAL TELECOM, INC., AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


6        INCOME TAXES

Hugo  International  Telecom Inc. is a corporation that reports and files a U.S.
corporation  business tax return.  Its former  wholly-owned  subsidiaries,  Hugo
International  Limited and Hugo  Ireland,  were  corporations  that reported and
filed their  corporate  business tax returns in the United  Kingdom and Ireland,
respectively. The components of the provision for income taxes consist of:


                                                              2001
                                                             -----
                Current:
                Foreign                                  $  69,446
                                                          ========

The following is a reconciliation of income taxes at the U.S. federal and
statutory rate to the amount of income taxes at the effective tax rate for
consolidated financial statement purposes:

                                                               2001
                                                              -----
         Tax benefit at U.S. statutory tax rate          $ (776,024)
            Differential arising from:
              Foreign loss                                  258,625
                Change in valuation allowance               581,913
                Other non-deductible expenses for taxes       4,932
                                                         ----------
                                                         $   69,446
                                                          =========

The tax laws of the United  Kingdom  and  Ireland do not allow a  deduction  for
amortization of intangible assets;  however, these amounts may be used to reduce
the gain from the sale of a business enterprise.  Management has determined that
it is more likely than not that the Company  will not realize the  deferred  tax
asset and, therefore,  has established a valuation allowance equal to the amount
of the deferred tax asset as of December 31, 2001.

                                                              2001
                                                             -----
        Tax benefit of non-deductible amortization
         and impairment charge                            $ 328,699
        Tax benefit of net operating losses                 429,055
        Valuation allowance                                (757,754)
                                                          ---------
             Net deferred tax asset                       $     --
                                                          =========

The Company has a U.S. income tax operating loss  carryforward of  approximately
$744,000  that  expires  through the year 2021.  In  addition  the Company had a
United  Kingdom net operating loss  carryforward  of $789,000 as of December 31,
2001, which may be carried forward indefinitely by Hugo UK.


7        ACQUISITION OF HUGO IRELAND

On July 1, 2001, Hugo  International  Telecom Inc. entered into a share exchange
with all of the stockholders of Hugo Ireland, a company formed under the laws of
Ireland,  pursuant  to which  Hugo  International  Telecom  Inc.  issued  31,950
restricted  shares of its common  stock,  with a fair market  value of $6.00 per
share,  in exchange  for 1,000 shares of Hugo  Ireland's  capital  stock,  which
constitutes all of Hugo Ireland's issued and outstanding capital stock. Upon the
consummation  of  the  share  exchange,   Hugo  Ireland  became  a  wholly-owned
subsidiary of Hugo  International  Telecom Inc. The  acquisition was consummated
for the purpose of expanding its geographical presence.

<PAGE>


               HUGO INTERNATIONAL TELECOM, INC., AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

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

Current assets .............   $ 115,774
Property and equipment .....      40,030
Goodwill ...................     133,718
                               ---------
   Total assets acquired ...     289,522
                               ---------
Current liabilities ........     (65,886)
Long-term liabilities ......     (31,936)
                               ---------
   Total liabilities assumed     (97,822)
                               ---------
   Net assets acquired .....   $ 191,700
                               =========


8        PROPOSED MERGER WITH WORLDLINK TECHNOLOGIES, INC.

In May 2002,  the Company  entered into a  preliminary  agreement for a proposed
merger with Worldlink technologies, Inc. ("Worldlink"). Under the agreement, the
Company  would  have  acquired  100% of the  issued  and  outstanding  shares of
Worldlink's  common stock in exchange  for  approximately  69% of the  Company's
currently outstanding shares. On November 6, 2002, the Company withdrew from the
proposed  merger  agreement  with  Worldlink and the  preliminary  agreement was
terminated.

9        AMOUNTS DUE TO FACTOR

In August of 2002, Hugo UK signed a financing agreement with a commercial factor
for a maximum  (pound)200,000  line of credit.  The  borrowings  were based on a
percentage of eligible  accounts  receivable.  Under the terms of the agreement,
Hugo UK paid  interest  at 2.5% above the base rate.  Borrowings  under the line
were secured by the related accounts  receivable and were also guaranteed by the
Company  and  two  of  its  affiliates,   Hugo  Globecom  Limited  and  Tradecom
Telecommunications  Limited.  In addition,  two of the Company's  Directors each
guaranteed up to  (pound)50,000  of this  indebtedness.  These  agreements  were
satisfied as of March 31, 2003.

10       EMPLOYMENT AGREEMENTS

In July 2002, the Company entered into an employment agreement with David Foden,
the Company's Chairman and Chief Executive Officer of the Company. The agreement
provided for base salary of  (pound)132,000  and an annual incentive bonus based
upon  the  Company's  attainment  of  earnings.  The  agreement  also  contained
provisions  whereby if Mr. Foden was  terminated by the Company,  or resigns his
position,  he will be entitled to a $6,000,000  lump sum payment.  The agreement
was  entered  into  in  contemplation  of the  proposed  merger  with  Worldlink
described in Note 4. As such,  the  employment  agreement  was  cancelled and no
amounts are owed to Mr. Foden.  Mr. Foden  tendered his  resignation  in January
2005 and it was accepted by the Board of Directors.

11       RELATED PARTY TRANSACTIONS

The Company paid  approximately  $114,000 in management  fees for the year ended
December 31, 2001 to an entity controlled by certain directors of the Company.

The Company had sales to related parties of  approximately  $31,000 for the year
ended December 31, 2001

The Company paid  expenses on behalf of certain  companies  affiliated by common
ownership during the year ended December 31, 2001.


<PAGE>

               HUGO INTERNATIONAL TELECOM, INC., AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

12       CONTINGENCIES

The wholly owned subsidiary,  Hugo International  Telecom,  Ltd. (`Limited') was
placed into  administrative  status of the UK bankruptcy  code as of October 12,
2001. If Limited fails to honor certain of its contractual  obligations  because
of the  bankruptcy  filing or otherwise,  claims may be made against the Company
for  breaches  by Limited of those  contracts  as to which we are  primarily  or
secondarily liable as a guarantor.  In addition,  Limited bankruptcy might bring
certain  claims  against  the  Company  or seek to hold the  Company  liable for
certain   transfers  made  by  Limited  to  the  Company  and/or  for  Limited's
obligations  to creditors  under various  equitable  theories  recognized  under
bankruptcy  law. As of January 4, 2006,  there have been no claims filed against
the Company or any of its current or former officers or directors, and we do not
expect  any  material  claims to be  filed.  However,  the  outcome  of  complex
litigation  (including  claims  which  may be  asserted  against  us)  cannot be
predicted  with  certainty  and its  dependent  upon  many  factors  beyond  the
Company's  control;  however,  any such  claims,  if  successful,  could  have a
material  adverse  impact on the  Company's  financial  condition.  We may incur
additional  costs in connection  with the Company's  involvement  in the Limited
bankruptcy proceedings.

13       SUBSEQUENT EVENTS

CONSULTING AGREEMENT WITH JESSE DYLAN CAPITAL

On November 1, 2004 the Company  entered into a consulting  agreement with Jesse
Dylan Capital,  Inc. ("JDC") whereby JDC agreed to provide management consulting
services  including  developing  a business  plan for the  Company,  negotiating
settlements with creditors, and obtaining sources of financing.  Under the terms
of the consulting  agreement,  JDC received 29,500,000 shares of restricted Hugo
common stock in lieu of a $296,000 cash payment.

David Foden, our former CEO and majority shareholder,  received 4,900,000 shares
of our common stock from JDC relating to JDC's consulting agreement.

ACQUISITION BY GREENSHIFT CORPORATION

In August 2005, GreenShift  Corporation acquired 300,000 shares of the Company's
Series B Preferred Stock from three of the Company's shareholders,  which shares
are convertible  into that number of shares of the Company's common stock as are
equal to $1.15 per  preferred  share at the time of  conversion  and have voting
rights equal to 67% of the fully  diluted  capital  stock of the Company.  Kevin
Kreisler,  the Companuy's new Chairman and CEO, is also the Chariman  and CEO of
GreenShift  Corporation.  Subsequent to this  acquisition,  Hugo entered in to a
Management Services Agreement with GreenShift Corporation under which GreenShift
agreed to provide  interim  management  assistance  and financial  support while
preparing Hugo for a strategic acquisition. Two acquisition candidates have been
identified and the Company is currently negotiating agreements to complete those
acquisitions.



<PAGE>



               HUGO INTERNATIONAL TELECOM, INC., AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

ITEM 8.           CHANGES AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
                  FINANCIAL DISCLOSURES

None



ITEM 8A.          CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

Our  principal   executive   officer  and  principal   financial   officer  have
participated  in and supervised  the  evaluation of our disclosure  controls and
procedures (as defined in Rules 13(a)-15(e) and 15(d)-15(e) under the Securities
Exchange  Act of 1934,  as amended  (the  "Exchange  Act")) that are designed to
ensure that  information  required to be  disclosed by us in the reports that we
file is recorded,  processed,  summarized  and reported  within the time periods
specified  in  the  Securities  and  Exchange   Commission's  rules  and  forms.
Disclosure  controls and procedures include,  without  limitation,  controls and
procedures  designed to ensure that the information  required to be disclosed by
us in the reports that we file or submit  under the Exchange Act is  accumulated
and communicated to our management, including our principal executive officer or
officers and principal  financial officer,  to allow timely decisions  regarding
required disclosure.  Hugo International Telecom, Inc.'s chief executive officer
and chief financial officer determined that, as of the end of the period covered
by this report;  these  controls and  procedures  are adequate and  effective in
alerting  them in a timely  manner  to  material  information  relating  to Hugo
International  Telecom,  Inc.  required  to be  included  in Hugo  International
Telecom, Inc's periodic SEC filings.

CHANGES IN INTERNAL CONTROLS

There was no change in internal controls over financial reporting (as defined in
Rule 13a-15(f) promulgated under the Securities Exchange Act or 1934) identified
in connection  with the  evaluation  described in the preceding  paragraph  that
occurred  during  the  fourth  quarter  of  Hugo's  2002  fiscal  year  that has
materially affected or is reasonably likely to materially affect Hugo's internal
control over financial reporting.

ITEM 8B.          OTHER INFORMATION

On August 19, 2005 the company's  Board of Directors  elected Kevin  Kreisler to
the board and to the post of Chairman of the Company's  Board of Directors.  The
company's then-current board members John Filgliolini, Brian Zucker, Louis Feld,
Rafael Marte,  and Leon Gold, as well as all of the  Company's  former  officers
resigned  from the  Company's  board.  Kevin  Kreisler  has since  served as the
Company's sole director and officer.

<PAGE>


                                    PART III

ITEM 9.           DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Name                      Age      Position
--------------------------------------------------------------------------------
Kevin Kreisler               33  Chairman of the Board, Chief Executive Officer,
                                 and Chief Financial Officer

Mr.  Kreisler  has  over  fifteen  years  of  diversified   business  experience
specifically including the operation of publicly-traded  companies. Mr. Kreisler
is  currently  the  Chairman  of the Board,  Chief  Executive  Officer and Chief
Compliance Officer of GreenShift  Corporation,  and he serves as Chairman of the
Board of Veridium Corporation,  GreenWorks Corporation,  INSEQ Corporation,  and
TDS  (Telemedicine),  Inc., and is a member of the board of directors of Ovation
Products Corporation. Mr. Kreisler served as Veridium's vice-president from 1998
to 2000,  president from 2000 to 2002, and chief executive  officer from 2002 to
February  2005.  Mr.  Kreisler  is a graduate of Rutgers  University  College of
Engineering  (B.S.,  Civil  and  Environmental   Engineering,   1994),   Rutgers
University Graduate School of Management (M.B.A.,  1995), and Rutgers University
School of Law (J.D.,  1997).  Mr.  Kreisler is  admitted to practice  law in New
Jersey and the United States District Court for the District of New Jersey.

Audit Committee

The Board of Directors has not appointed an Audit Committee.  The functions that
would  be  performed  by an  Audit  Committee  are  performed  by the  Board  of
Directors.  The Board of Directors does not have an "audit  committee  financial
expert," because the Company has no operations.

Code of Ethics

The Company has not adopted a formal code of ethics  applicable to its executive
officers.  The Board of Directors has  determined  that the Company's  financial
operations are not sufficiently  complex to warrant adoption of a formal code of
ethics.

Section 16(a) Beneficial Ownership Reporting Compliance

None of the  officers,  directors or  beneficial  owners of more than 10% of the
Company's  common stock failed to file on a timely basis the reports required by
Section 16(a) of the Exchange Act during the year ended December 31, 2002.

ITEM 10.          EXECUTIVE COMPENSATION

The following table sets forth compensation information for Hugo International
Telecom, Inc.'s executive officers during the years indicated as relevant.
<TABLE>
<CAPTION>

Name and Principal Position                 Annual Compensation              Long-term Compensation

---------------------------------------------------------------------------------------------------------------------
                                   Year     Salary       Bonus      Other      Securities Underlying        All Other
                                                                            Options Granted (shares)     Compensation
---------------------------------------------------------------------------------------------------------------------
<S>                                 <C>   <C>        <C>        <C>                         <C>         <C>
David Foden, Chairman of the Board, 2004  $      --  $      --  $      --                        --     $        --
and Chief Executive Officer *       2003         --         --         --                        --              --
                                    2002         --         --         --                        --              --
</TABLE>

*Mr.  Foden  resigned  from his position as an officer of the company in January
2005. Kevin Kreisler,  the current CEO of the Company,  received no compensation
during 2004, 2003, or 2002.

Option  Grants  in Last  Fiscal  Year to Named  Executive  Officers.  The  named
executive officers of Hugo International Telecom, Inc. do not hold any option to
purchase shares of Hugo International Telecom, Inc.'s common stock.

EMPLOYMENT AGREEMENTS

None.

COMPENSATION OF DIRECTORS

None

STOCK OPTION AND ISSUANCE PLANS

None





<PAGE>



ITEM 11.          SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND RELATED
                  STOCKHOLDERS MATTERS

The following  table sets forth certain  information  regarding the  "beneficial
ownership" of Hugo International  Telecom, Inc's common stock as of December 21,
2005 by each of Hugo International  Telecom's  directors and executive officers,
all current  directors and executive  officers as a group, and persons or groups
owning more than 5% of the outstanding  Common Stock.  This information is based
upon information  received from or on behalf of the named individuals.  SEC Rule
13d-3 under the Securities Exchange Act of 1934 defines  "beneficial  ownership"
to mean the right to vote or exercise investment power, or to share in the right
to vote or exercise investment power, with respect to the specified  securities,
whether or not the specified  person has any economic  interest in the specified
securities. In computing the number of shares beneficially owned by a person and
the  percentage  ownership  of that person,  shares of common  stock  subject to
options or  warrants  held by that  person  that are  currently  exercisable  or
exercisable within 60 days of the date hereof are deemed outstanding.  Except as
indicated in the  footnotes to this table and pursuant to  applicable  community
property  laws,  each  stockholder  named  in the  table  has  sole  voting  and
investment   power  with  respect  to  the  shares  set  forth   opposite   such
stockholder's  name. The percentage  ownership is based on 50,000,000  shares of
Common Stock issued and outstanding as of December 31, 2005.
<TABLE>
<CAPTION>

Name and Address of                 Amount and Nature                  Aggregate                          Percent of
Beneficial Owners                 of Beneficial Ownership              Percent of Class                   Voting Power
                                    Common    Preferred                Common    Preferred
---------------------------------------------------------------------------------------------------------------------
<S>                               <C>         <C>                    <C>       <C>                       <C>
Kevin Kreisler (1) (2)(3)           -0-          300,000                0%        100% Series B             67%

Current executive officers and
 directors as a group               -0-           300,000               0%        100% Series B             67%

Sonata Ventures, LLC              7,500,000          -0-               15%          0%                       5%
230 Sillick Street,
Suite 1A
Clifton, NJ 07013

Fig Leaf Enterprise, Inc.         7,500,000          -0-               15%          0%                       5%
776 Chilver Road
Windsor, Ontario N8Y2K3
Canada

Carolina Menendez-                7,500,000          -0-               15%          0%                       5%
Hernandez
Manuel DeFalla No. 8
Madrid, Spain  28036

</TABLE>



ITEM 12.          CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

In August 2005, the Company  entered into a Management  Services  Agreement with
GreenShift  Corporation  under  which  GreenShift  agreed to provide  management
assistance,  financial support, and business development services. The agreement
is for a term of five years and provides for GreenShift to receive  $150,000 per
year payable in cash or Hugo common stock.


<PAGE>


                                     PART IV

ITEM 13.          EXHIBITS

The following are exhibits filed as part of the Company's Form 10-KSB for the
period ended December 31, 2002:

Exhibit Number                       Description

     10-a Management  Services  Agreement  with  GreenShift   Corporation  dated
          August 20, 2005.

     31.1 Certification of Chief Executive  Officer and Chief Financial  Officer
          Pursuant to Rule  13a-14(a)/15d-14(a),  as adopted pursuant to Section
          302 of the Sarbanes-Oxley Act of 2002.

     32.1 Certification of Chief Executive  Officer and Chief Financial  Officer
          pursuant  to 18  U.S.C.  Section  1350,  as  adopted  pursuant  to the
          Sarbanes-Oxley Act of 2002.



ITEM 14.          PRINCIPAL ACCOUNTANT FEE AND SERVICES

          In September  2005 Hugo retained  Rosenberg Rich Baker Berman & Co. as
          its  principal  accountant.  Rosenberg  Rich  Baker  Berman & Co.  had
          performed no services for Hugo prior to that date.

         Audit Fees

          Rosenberg  Rich  Baker  Berman & Co.  billed  the  Company  $10,000 in
          connection  with the audit of the Company's  financial  statements for
          the year ended December 31, 2002.

         Audit-Related Fees

          Rosenberg  Rich Baker  Berman & Co. did not bill the  Company  for any
          Audit-Related fees in the year ended December 31, 2002.

         Tax Fees

          Rosenberg Rich Baker Berman & Co. did not bill the Company in the year
          ended  December 31, 2002 for  professional  services  rendered for tax
          compliance, tax advice and tax planning.

         All Other Fees

          Rosenberg  Rich Baker  Berman & Co. did not bill the  Company  for any
          other fees in the year ended December 31, 2002.

          It is the policy of Hugo International Telecom, Inc.'s audit committee
          to approve all  engagements  of their  independent  auditors to render
          audit or non-audit services prior to the initiation of such services.

<PAGE>


                                   SIGNATURES

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

HUGO INTERNATIONAL TELECOM, INC.

By:    /s/ Kevin Kreisler
       -----------------------------
           Kevin Kreisler
           Chief Executive Officer
Date:      January 24, 2006

          Pursuant to the  requirements of the Securities  Exchange Act of 1934,
          this report has been signed below by the  following  persons on behalf
          of the registrant and in the capacities and on the dates indicated.


By:    /s/ Kevin Kreisler
       -----------------------------
           Chief Executive Officer, Chief Financial Officer, and Director
Date:      January 24, 2006