SECURITIES
      AND EXCHANGE COMMISSION WASHINGTON,
      D.C. 20549





**FORM
      10-KSB**




Mark
      One




[X]
            ANNUAL
                REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
                OF
                1934FOR
                THE FISCAL YEAR ENDED:   **September 30,
                2004**OR[  
                ]
            TRANSITION
                REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
                ACT OF
                1934FOR
                THE TRANSITION PERIOD FROM _______ TO
                ________




Commission
      File Number 0-26839




**SNAP2
      CORPORATION**


(f/k/a
      White Rock Enterprises, Ltd.) (Exact
      name of registrant as specified in its charter)




**NEVADA**
            **88-0407246**(State
                of Incorporation)
            (I.R.S.
                Employer Identification No.)





101
      Plaza
      Real South, Suite 210, Boca Raton, FL 33436


(Address
      of principal executive offices and zip code)





2000
      West
      Commercial Blvd. Suite 133, Fort Lauderdale, FL 33309


(Former
      address of principal executive offices and zip code)





(561)
      368-4700


Registrant's
      telephone number, including area code




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




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




Indicate
      by check mark whether the Registration (1) has filed all reports required to
      be
      filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
      the preceding 12 months (or for such shorter period that the Registrant was
      required to files such reports), and (2) has been subject to such filing
      requirements for the past 90 days. (1) X YES as to filing; (2) X Yes as to
      requirement.




As
      of
      September 30, 2004, and currently, the Registrant has outstanding approximately
      48,394,250 shares of common stock ($.001 par value).




Transitional
      Small Business Disclosure Format (check one):  Yes  [ 
]    No  [X]




***Table
          of Contents***


**TABLE
      OF CONTENTS TO ANNUAL REPORT**


**ON
      FORM 10-KSB**


**YEAR
      ENDED SEPTEMBER 30, 2004**






**PART
      I**


**Page**Item
                  1.
              Description
                  of Business
              3Item
                  2.
              Description
                  of Property
              3Item
                  3.
              Legal
                  Proceedings
              3Item
                  4.
              Submission
                  of matters to a Vote of Security
                  Holders
              3**PART
                  II**Item
                  5.
              Market
                  for Registrant's Common Equity & Related
                  Stockholders' Matters
              3Item
                  6.
              Management's
                  Discussion & Analysis of Financial
                  Condition & Results of Operations
              6Item
                  7.
              Financial
                  Statements
              11Item
                  8.
              Changes
                  in and Disagreements with Accountants on Accounting
                  & Financial Disclosure
              12**PART
                  III**Item
                  9.
              Directors
&
Executive
                  Officers, Promoters &
                  Control Persons, Compliance with Section 16 (a) of the Exchange
                  Act
              12Item
                  10.
              Executive
                  Compensation
              12Item
                  11.
              Security
                  Ownership of Certain Beneficial Owners &
                  Management
              12Item
                  12.
              Certain
                  Relationships & Related
                  Transactions
              13Item
                  13.
              Exhibits
              13


2
 ***Table
            of Contents***




PART
      I.




ITEM
      1. DESCRIPTION
      OF BUSINESS




GENERAL




The
      Company operates from 2000 101 Plaza Real South, Suite 210, Boca Raton, FL
      33436.




BUSINESS
      OF ISSUER




Prior
      to
      March 31, 2004 the Company marketed software applications for the in flight
      entertainment and interactive television markets. On March 31, 2004 the Company
      discontinued marketing of its applications for the in flight entertainment
      and
      interactive television markets and discontinued its operations. As of this
      time
      the Company’s primary product is pre-paid phone cards.




EMPLOYEES




The
      Company has no full time employees.  The Company's President has agreed to
      allocate a portion of his time to the activities of the Registrant, without
      compensation.  The President anticipates that the business plan of the
      Company can be implemented by his devoting approximately 10 hours per month
      to
      the business affairs of the Company and, consequently, conflicts of interest
      may
      arise with respect to the limited time commitment by such officer.




ITEM
      2. DESCRIPTION
      OF PROPERTIES




As
      of
      September 30, 2004 our assets totaled $2,037,918.




ITEM
      3. LEGAL
      PROCEEDINGS




The
      Company is not a party to, nor are its properties the subject of, any pending
      legal proceedings and no such proceedings are known to the Company to be
      threatened or contemplated by or against it.




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




No
      matter
      was submitted to a vote of the security holders during the 4th quarter of the
      fiscal year covered by this report.




PART
      II




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




Market
      Information




The
      Company is authorized to issue 50,000,000 shares of its $0.001 par value common
      stock and 20,000,000 shares of its $0.0001 par value preferred stock.  As
      of September 30, 2004, the Company had 48,394,250 issued and outstanding shares
      of common stock.




3
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          of Contents***




The
      Company's common stock is traded on the OTC Electronic Bulletin Board sponsored
      by the National Association of Securities Dealers under the trading symbol
      "SPTO."  The Electronic Bulletin Board is a network of security dealers who
      buy and sell stock. The dealers are connected by a computer network which
      provides information on current "bids" and "asks" as well as volume
      information.




As
      of
      September 30, 2004 the Company had approximately 998 common stock shareholders
      and one shareholder of its preferred stock and there has been only a limited
      public market for the Company's common stock.  The following table shows,
      for the periods indicated, the high and low per share prices of common stock,
      as
      reported on the OTC Electronic Bulletin Board. Such prices represent prices
      between dealers, do not include retail mark-ups, mark downs or conversions
      and
      may not represent actual transactions.




Period
                Ended
            High
            LowMarch
                31, 2001
            $1.56
            $0.46June
                30, 2001
            $1.07
            $0.35September
                30, 2001
            $0.90
            $0.40December
                31, 2001
            $0.49
            $0.17March
                31, 2002
            $0.41
            $0.20June
                30, 2002
            $0.25
            $0.09September
                30, 2002
            $0.08
            $0.03December
                31, 2002
            $0.08
            $0.03March
                31, 2003
            $0.08
            $0.03June
                30, 2003
            $0.03
            $0.10September
                30, 2003
            $0.11
            $0.01December
                31, 2003
            $0.51
            $0.11March
                31, 2004
            $0.22
            $0.07June
                30, 2004
            $1.25
            $0.10September
                30, 2004
            $1.25
            $0.35




On
      September 30, 2004, the closing bid and ask prices of the common stock as
      reported on the OTC Electronic Bulletin Board were $0.35 and $0.35,
      respectively.




The
      prices represented in the quarter ended September 30, 2003 reflect the 1 for
      10
      stock reversal effectuated September 10, 2003.




The
      Company has never declared or paid cash dividends on its capital stock. It
      is
      anticipated that the Company would retain its future earnings, if any, to fund
      the operation and expansion of its business and management does not anticipate
      paying any cash dividends in the foreseeable future.




Effective
      February 28, 2000, SNAP2 Corporation (f/k/a White Rock Enterprises, Ltd.) (the
      Company) merged with ISES Corporation (ISES), with the Company as the surviving
      corporation. At the date of the merger, the Company was a "shell company" as
      the
      Company had no assets or liabilities, had generated no revenues since inception
      and had incurred total expenses of $6,100 since its inception on October 8,
      1998. The merger transaction has been accounted for as a reverse acquisition.
      In
      such a transaction, the operating enterprise (ISES) is determined to be the
      acquiring enterprise for financial reporting purposes. The historical financial
      statements of ISES are presented as the historical financial statements of
      the
      combined enterprise. The equity of ISES is presented as the equity of the
      combined enterprise, however, the capital stock account of ISES is adjusted
      to
      reflect the par value of the outstanding stock of the Company after giving
      effect to the number of shares issued in merger. For periods prior to the
      merger, the equity of the combined enterprise is the historical equity of ISES
      prior to the merger retroactively restated to reflect the number of shares
      received in the merger.




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          of Contents***




In
      connection with the merger of ISES with and into the Company, the Acquisition
      Agreement and Plan of Merger (previously filed as Exhibit 1.1 to the Company's
      Current Report on Form 8-K filed March 1, 2000) provided for the issuance of
      10,000,000 shares of common stock and 10,000 shares of convertible preferred
      stock for 100% of the outstanding shares of ISES. The convertible preferred
      stock automatically converts to 10,000,000 shares of common stock on February
      28, 2002. Also in connection with the merger, an additional 2,200,000 shares
      of
      common stock were issued to others in exchange for locating investors and a
      commitment to raise $2,000,000 to fund the Company's working capital needs
      and
      general corporate purposes. As of September 30, 2001, $615,650 of the $2,000,000
      had been received and recorded as additional paid-in capital. Management
      believes that it is unlikely that any additional capital will be provided by
      those entities, and is in the process of attempting to recover as many of those
      shares as possible.  As of September 30, 2001, approximately 1,097,000
      shares have been surrendered by these entities in lieu of additional capital
      contributions. The Company has not taken action to either establish these shares
      as treasury stock or to cancel them and return them to authorized but unissued
      shares.  Accordingly, the shares are outstanding in the names of the
      original owners on the Company's stock records.  The Company plans to
      cancel these shares and return them to authorized but unissued
      shares.




On
      March
      31, 2003, the Company entered into an Escrow Agreement with its majority
      stockholder, and another entity, whereby the majority stockholder sold his
      interest in the Company constituting 74.2% of the issued and outstanding shares
      of the Company to the other entity for $100,000 in a private stock transaction.
      For the $100,000 consideration, the majority stockholder received the assets
      of
      the Company and assumed the liabilities of the Company, with the Company
      providing a promissory note to the majority stockholder for $84,000.





The
      condensed consolidated financial statements for the Year Ended September 30,
      2003 include reclassifications of the operations of the Company to reflect
      the
      disposal of its business, which took effect March 31, 2003.





In
      accordance with the Escrow Agreement, the Company signed an indemnification
      agreement, indemnifying the Company of any liability with respect to the
      majority stockholder’s assumption of the debt acquired by him. The Company,
      however, in accordance with FASB 5 and FIN 45, has elected to recognize a
      liability on its books due to the guarantee imposed that the debt gets paid
      off.
      Under FIN 45, the Company recorded the liability at the inception of the
      guarantee and only will reflect a reduction of the payable, i.e. release from
      guarantee upon the expiration or settlement of the guarantee, by a systematic
      and rational amortization method or as the fair value of the guarantee
      changes.





On
      April
      19, 2004 The Company acquired the assets of Call Now America Prepaid LLC in
      a
      stock-for-assets acquisition.





The
      Company has amended its previously issued unaudited financial statements for
      the
      year ended September 30, 2003. The Company did not have an independent review
      of
      its financial statements by an independent certified public accountant.
      Additionally, the Company has restated its financial statements to take effect
      for the disposal of its business.




Holders




At
      September 30, 2004, there were approximately 988 holders of record of the
      Company's common stock.  As of September 30, 2004, there were approximately
      48,394,250 shares outstanding.




Dividends




The
      Company has never declared or paid cash dividends on its capital stock. It
      is
      anticipated that the Company would retain its future earnings, if any, to fund
      the operation and expansion of its business and management does not anticipate
      paying any cash dividends in the foreseeable future.




5
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          of Contents***




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




**Forward-Looking
      Statements**





Historical
      results and trends should not be taken as indicative of future operations.
      Management’s statements contained in this report that are not historical facts
      are forward-looking statements within the meaning of Section 27A of the
      Securities Act of 1933, as amended, and Section 21E of the Securities and
      Exchange Act of 1934 (the “Exchange Act”), as amended. Actual results may differ
      materially from those included in the forward-looking statements. The Company
      intends such forward-looking statements to be covered by the safe-harbor
      provisions for forward-looking statements contained in the Private Securities
      Litigation Reform Act of 1995, and is including this statement for purposes
      of
      complying with those safe-harbor provisions. Forward-looking statements, which
      are based on certain assumptions and describe future plans, strategies and
      expectations of the Company, are generally identifiable by use of the words
      “believe,” “expect,” “intend,” “anticipate,” “estimate,” “project,” “prospects,”
or similar expressions. The Company’s ability to predict results or the actual
      effect of future plans or strategies is inherently uncertain. Factors which
      could have a material adverse affect on the operations and future prospects
      of
      the Company on a consolidated basis include, but are not limited to: changes
      in
      economic conditions, legislative/regulatory changes, availability of capital,
      interest rates, competition, and generally accepted accounting principles.
      These
      risks and uncertainties should be considered in evaluating forward-looking
      statements and undue reliance should not be placed on such statements. Further
      information concerning the Company and its business, including additional
      factors that could materially affect the Company’s financial results, is
      included herein and in the Company’s other filings with the SEC.





**Restatement
      of Prior Issued Financial Statements**





The
      Company has amended its previously issued unaudited financial statements for
      the
      three months ended June 30, 2004. The Company did not have an independent review
      of its financial statements by an independent certified public accountant.
      Additionally, the Company has restated its financial statements to take effect
      for the disposal of its business.





**General**





The
      Company was incorporated on October 8, 1998 under the laws of the State of
      Nevada originally for the purpose of developing and marketing its only product,
      a boot dryer that dries both boots and shoes for commercial and consumer use.
      Effective February 28, 2000 the Company merged with ISES Corporation (an Iowa
      corporation originally incorporated on May 14, 1997) ("ISES") with the Company
      being the survivor. In connection with the merger, the Company disposed of
      its
      boot dryer product to the original owner. The Company's name was subsequently
      changed to SNAP2 Corporation pursuant to Articles of Amendment filed July 12,
      2000.





Prior
      to
      March 31, 2004 SNAP2 Corporation (f/k/a White Rock Enterprises, Ltd.) (the
      "Company") was a software product developer and software service provider for
      in-flight entertainment systems (IFE) for passenger aircraft and interactive
      set-top boxes (STB) for interactive television. As of March 2003 the Company
      discontinued all prior operations.





The
      Company is registered with the SEC as SNAP2 Corporation and is traded on the
      over-the-counter bulletin board: OTCBB: SPTO.





On
      December 3, 2003, the Company acquired Digital Marketing Networks, LLC and
      Ez
      Direct Marketing, Inc. through a share for share exchange. Digital Marketing
      Networks, LLC is a software company concentrating in internet sales. Ez Direct
      Marketing, Inc is a marketing company focusing on retail sales. Additionally,
      on
      April 19, 2004, the Company acquired the assets of Call Now America Prepaid
      Corporation. Call Now America sells prepaid phone services.





Digital
      Marketing Networks, LLC was an inactive company and had no assets or
      liabilities. Digital Marketing Networks was acquired for its president’s ideas
      and its contacts.


6
 ***Table
          of Contents***


Ez
      Direct
      Marketing, Inc. was an inactive company and had no assets or liabilities. Ez
      Direct Marketing, Inc. was acquired for its president’s ideas, its contacts and
      customer lists.





Call
      Now
      America Prepaid, LLC distributes prepaid phone cards for the domestic,
      international and wireless markets in Florida, Georgia, New York and Texas
      through distributors in each of the respective states.




**Operations**





The
      Company operates from 101 Plaza Real South, Suite 210, Boca Raton, FL
      33432




**Products**





Prior
      to
      March 31, 2004 the Company marketed software applications for the in flight
      entertainment and interactive television markets. On March 31, 2004 the Company
      discontinued marketing of its applications for the in flight entertainment
      and
      interactive television markets and discontinued its operations. As of this
      time
      the Company’s primary product is pre-paid phone cards.




**Assets**





As
      of
      September 30, 2004 our assets were $2,037,918.




**Liabilities
      and Stockholders’ Deficit**





Our
      total
      liabilities as of September 30, 2004, were $1,321,297.





As
      of
      September 30, 2004, total Stockholders’ equity totaled $ 716,621.




**Results
      of Operations**





All
      revenues reported by Snap 2 Corporation are derived from the sale of pre-paid
      phone cards. Total revenues for the year ended September 30, 2004 and September
      30, 2003 (Restated) were $2,116,074 and $0, respectively.





Cost
      of
      operations for the year ended September 30, 2004 and September 30, 2003
      (Restated) were $2,091,417 (98.8%) and $0, respectively. The increase in gross
      profit dollars is the direct result of revenue derived from the sale of pre-paid
      phone cards. There was no revenue for the year ended September 30,
      2003.





Gross
      profit for the year ended September 30, 2004 and September 30, 2003 (Restated)
      were $24,657 (1.2%) and $0, respectively. The increase in gross profit dollars
      is the direct result of revenue derived from the sale of pre-paid phone cards.
      There was no revenue for the year ended September 30, 2003.





Total
      operating expenses increased to $1,351,480 for the year ended September 30,
      2004
      and $236,000 for the year ended September 30, 2003 (Restated), respectively,
      an
      increase in expenses of $(1,115,480).. The increase in the current period is
      attributable to expenses incurred to operate the company due to its new product
      offering, pre-paid phone cards.





The
      operating loss for the year ended September 30, 2004 was $(1,326,823) compared
      to $(236,000) for the year ended September 30, 2003 (Restated), an increase
      of
      $(1,090,823). As discussed above, the increase primarily consists of increased
      operating expenses and other expenses.





Total
      other income (expense) for the year ended September 30, 2004 was $(3,200,000)
      as
      compared to $0 for the year ended September 30, 2003 (Restated), an increase
      in
      expenses of $(3,200,000). During the year ended September 30, 2004, Snap 2
      Corporation recognized the impairment of stock issued. On January 5, 2004,
      the
      Company agreed to acquire Digital Marketing Networks, LLC and Ez Direct
      Marketing, Inc., through a share for share exchange. The fair market value
      of
      the common stock on the date of the exchange date was $.10 per share and the
      32,000,000 shares were issued on January 5, 2004.


7
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          of Contents***


The
      income from discontinued operations for the year ended September 30, 2004 was
      $0
      as compared to $90,376 for the year ended September 30, 2003 (Restated), a
      decrease in the income of $(90,376). The income recognized from discontinued
      operations was a direct result of factors discussed above from reclassifications
      of the operations of the Company to reflect the disposal of its business, which
      took effect March 31, 2003.





The
      loss
      before provisions for income taxes for the year ended September 30, 2004 was
      $(4,526,823) compared to $(145,624) for the year ended September 30, 2003
      (Restated), an increase of $(4,381,199). As discussed above, the increase
      primarily consists of increased operating expenses and other
      expenses.





There
      was
      no provision for income taxed for the year ended September 30, 2004 September
      30, 2003 (Restated).





Net
      loss
      for the year ending September 30, 2004 was $(4,526,823) as compared to net
      loss
      of $(145,624) for the year ending September 30, 2003 (Restated). The increase
      in
      the net loss of $(4,381,199) was the result of the factors discussed
      above.





**Employees**





At
      September 30, 2004, the Company had no full time employees. The Company's
      President has agreed to allocate a portion of his time to the activities of
      the
      Registrant, without compensation.  The President anticipates that the
      business plan of the Company can be implemented by his devoting approximately
      10
      hours per month to the business affairs of the Company and, consequently,
      conflicts of interest may arise with respect to the limited time commitment
      by
      such officer.




**Liquidity
      and Capital Resources**





At
      September 30, 2004, the Company had cash, accounts receivable and inventory
      of
      $418,568 and current liabilities of $689,741.





*Cash
      used by operating activities.* The
      Company used $(231,966) in cash for operating activities in the year ended
      September 30, 2004. This was primarily the result of the cash used to fund
      the
      loss from current operating activities.





*Cash
      provided by financing activities.* Financing activities in the year ended September 30, 2004 provided a total
      of
      $278,188 in cash. This consisted of net proceeds from the issuance of stock
      and
      repayment of loan from the Company’s officer.




**Going
      Concern**





Our
      independent registered public accounting firm has stated in their Report
      included in our annual report on Form 10-KSB/A for the period ended September
      30, 2004 that we have incurred operating losses, accumulated deficit, and
      negative cash flow from operations. Our ability to raise capital through future
      issuances of common stock is unknown. Our future is dependent on our ability
      to
      obtain financing and develop the business of Call Now America Prepaid. These
      factors, among others, raise substantial doubt about our ability to continue
      as
      a going concern. Our financial statements do not include any adjustments that
      may result from the outcome of these aforementioned uncertainties.




**Critical
      Accounting Policies And Estimates**




Our
      consolidated financial statements are prepared in accordance with accounting
      principles generally accepted in the United States of America, or GAAP. These
      accounting principles require us to make certain estimates, judgments and
      assumptions. We believe that the estimates, judgments and assumptions upon
      which
      we rely are reasonably based upon information available to us at the time that
      these estimates, judgments and assumptions are made. These estimates, judgments
      and assumptions can affect the reported amounts of assets and liabilities as
      of
      the date of the financial statements, as well as the reported amounts of revenue
      and expenses during the periods presented. To the extent there are material
      differences between these estimates, judgments and assumptions and




8
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actual
      results, our financial statements will be affected. The significant accounting
      policies that we believe are the most critical to aid in fully understanding
      and
      evaluating our reported financial results include the following:




·
            Revenue
                recognition;




·
            Allowance
                for doubtful accounts; and




·
            Accounting
                for income taxes.




In
      many
      cases, the accounting treatment of a particular transaction is specifically
      dictated by GAAP and does not require management's judgment in its application.
      There are also areas in which management's judgment in selecting among available
      alternatives would not produce a materially different result. Our senior
      management has reviewed these critical accounting policies and related
      disclosures. See Notes to Condensed Consolidated Financial Statements, which
      contain additional information regarding our accounting policies and other
      disclosures required by GAAP.




**Off
      Balance Sheet Arrangements**





As
      of
      September 30, 2004, there were no off balance sheet arrangements.





**Evaluation
      of Disclosure Controls and Procedures**





The
      term
      "disclosure controls and procedures" is defined in Rules 13a-15(e) and 15d-15(e)
      of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). This
      term refers to the controls and procedures of a company that are designed to
      ensure that information required to be disclosed by a company in the reports
      that it files under the Exchange Act is recorded, processed, summarized, and
      reported within the required time periods.





In
      July
      of 2003 the company was moved from the over the counter bulletin boards to
      the
      pinks sheets as the result of the former management’s failure to timely file its
      periodic reports under the SEC rules and regulated governing such companies.
      Current management has determined that effective controls and procedures were
      not in place at the end of the period covered by this report.





Current
      management is attempting to bring those periodic reports current and will then
      request to have the company moved back to the bulletin boards. There is no
      guarantee that this will happen.





The
      current management has implemented effective controls and procedures as of
      this
      time. They have concluded that, as of this date, former management's disclosure
      controls and procedures were not effective at September 30, 2004 in ensuring
      that the required information was disclosed on a timely basis. However, current
      management has put procedures in place that will ascertain that the timely
      filing of reports will be attained. Additionally those reports will contain
      the
      necessary disclosures to comply with current standards.





**Changes
      in Internal Control over Financial Reporting**





The
      company has made dramatic change in our internal control over financial
      reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act)
      during the period covered by this report that has materially affected, or is
      reasonably likely to materially affect, our internal control over financial
      reporting. The company has made these changes because former management did
      not
      exhibit the proper controls as defined in rules 13a-15f and
      15d-15f.


9
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          of Contents***




**RISK
      FACTORS THAT MAY AFFECT FUTURE RESULTS OF OPERATIONS**




In
      addition to the other risk factors contained herein and within other filings
      with the Securities and Exchange Commission, the Company believes the following
      additional risk factors should be taken into consideration in evaluating its
      business:




Additional
      Funding Needed




The
      Company needs additional funding to pay its obligations as they come due,
      further develop or enhance its products, and take advantage of future
      opportunities or respond to competitive pressures or unanticipated requirements.
      Without additional funding the Company may not be able to continue as a going
      concern.




The
      Company Expects to Incur Operating and Net Losses




The
      Company has a limited operating history, has incurred significant losses in
      the
      past year and, at September 30, 2004, had an accumulated deficit of $(7,334,236)
      and a stockholders' equity of $716,621.




Volatility
      of Stock Price




The
      market price of the Company's common stock is likely to fluctuate in the future.
      The Company believes that various factors, including quarterly fluctuations
      in
      results of operations, announcements of new products or partners by the Company
      or by its competitors, changes in the business markets in general, or general
      economic, political and market conditions may significantly affect the market
      price of its common stock.




10
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          of Contents***




ITEM
      7.               
FINANCIAL STATEMENTS


**Page(s)**Report
                  of Independent Registered Public Accounting Firm
              F-1Financial
                  Statements:Balance
                  Sheet at September 30, 2004
              F-2Statements
                  of Operations for the Years Ended September 30, 2004 and
                  2003
              F-3Statement
                  of Changes in Stockholders’ Equity (Deficit) for the Years Ended September
                  30, 2004 and 2003
              F-4Statements
                  of Cash Flow for the Years Ended September 30, 2004 and
                  2003
              F-5Notes
                  to the Financial Statements
              F-6
                  - F-13






11
 ***Table
          of Contents***


**REPORT
        OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**
 
 The
        Board
        of Directors and Stockholders
 Snap
        2
        Corporation
 Ft.
        Lauderdale, Florida
  We
        have
        audited the accompanying consolidated balance sheet of Snap 2 Corporation
        (a
        Nevada Corporation) as of September 30, 2004 and the related consolidated
        statements of operations, changes in stockholders’ equity (deficit) and cash
        flows for the years then ended September 30, 2004 and 2003. These consolidated
        financial statements are the responsibility of the Company’s management. Our
        responsibility is to express an opinion on these consolidated financial
        statements based on our audit.
 
 We
        conducted our audits in accordance with the standards of the Public Company
        Accounting Oversight Board (United States). Those standards require that
        we plan
        and perform the audits to obtain reasonable assurance about whether the
        financial statements are free of material misstatement. An audit includes
        examining, on a test basis, evidence supporting the amounts and disclosures
        in
        the financial statements. An audit also includes assessing the accounting
        principles used and significant estimates made by management, as well as
        evaluating the overall financial statement presentation. We believe that
        our
        audits provide a reasonable basis for our opinion.
 
 As
        discussed in Note 1 to the financial statements, the Company has restated
        its
        September 30, 2003 financial statements that were filed on November 17, 2003
        due
        to the fact that they were prepared by internal management and not audited
        by an
        independent registered public accounting firm. Moreover, the effects of the
        restatement are to increase the net loss by $139,624 and to properly state
        the
        basic components of the financial statements.
 
 The
        accompanying consolidated financial statements have been prepared assuming
        that
        the Company will continue as a going concern. As discussed in Note 8 to the
        consolidated financial statements, the Company has experienced net losses
        for
        the years ended September 30, 2004 and 2003 and prior that has resulted in
        substantial accumulated deficits. The Company’s financial position and lack of
        operations raise substantial doubt about its ability to continue as a going
        concern. Management’s plans with regard to these matters are also described in
        Note 8. The financial statements do not include any adjustments that might
        result from the outcome of this uncertainty.
 
 In
        our
        opinion, the consolidated financial statements referred to above present
        fairly,
        in all material respects, the financial position of Snap 2 Corporation as
        of
        September 30, 2004 and 2003 and the results of its operations and cash flows
        for
        the years then ended in conformity with accounting principles generally accepted
        in the United States.
  **Bagell
        Josephs & Company, LLC**
 
 Bagell
        Josephs & Company, LLC
 Gibbsboro,
        New Jersey
 
 August
        25, 2005




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 ***Table
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**SNAP2
      CORPORATIONCONSOLIDATED BALANCE SHEETSEPTEMBER 30,
      2004**


**ASSETS****CURRENT
                  ASSETS**Cash and cash equivalents
              
              $
              60,022Accounts receivable
              
              
              324,363Inventory
              
              
              34,183**Total current assets**
              
              
              418,568**OTHER
                  ASSETS**Goodwill
              
              
              1,619,350**Total other assets**
              
              
              1,619,350**TOTAL
                  ASSETS**
              
              $
              2,037,918**LIABILITIES
                  AND STOCKHOLDERS' EQUITY (DEFICIT)****CURRENT
                  LIABILITIES**Accounts payable and accrued liabilities
              
              $
              426,553Note payable
              
              
              84,000Stockholder loan
              
              
              29,188Liability for stock to be issued
              
              
              150,000**Total current liabilities**
              
              
              689,741**Long-term
                  Liabilities**Commitments
              
              
              631,556**Total liabilities**
              
              
              1,321,297**STOCKHOLDERS'
                  EQUITY (DEFICIT)**Preferred stock, $.001 par value; 20,000,000 shares
                  authorized;0 shares issued and outstanding
              
              
              -Common stock, $.001 par value; 50,000,000 shares
                  authorized;48,394,250 shares issued and outstanding
              
              
              48,394Additional paid-in capital
              
              
              8,002,463Accumulated deficit
              
              
              (7,334,236
              )**Total stockholders' equity (deficit)**
              
              
              716,621**TOTAL
                  LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)**
              
              $
              2,037,918




The
      accompanying notes are an integral part of these consolidated financial
      statements.




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 ***Table
          of Contents***


**SNAP2
        CORPORATIONCONSOLIDATED STATEMENTS OF OPERATIONSFOR THE YEARS ENDED
        SEPTEMBER 30, 2004 AND 2003**


**2004**
              
              **2003****OPERATING
                  REVENUE**
              
              $
              2,116,074
              
              $
              -**COST
                  OF OPERATIONS**
              
              
              2,091,417
              
              
              -**GROSS
                  PROFIT**
              
              
              24,657
              
              
              -**OPERATING
                  EXPENSES**Consulting
                  fees
              
              
              1,207,552
              
              
              230,000General
                  and administrative
              
              
              12,026
              
              
              6,000Professional
              
              
              110,500
              
              
              -Rent
              
              
              21,402
              
              
              -**Total
                  operating expenses**
              
              
              1,351,480
              
              
              236,000**OPERATING
                  (LOSS)**
              
              
              (1,326,823
              )
              
              (236,000
              )**OTHER
                  INCOME (EXPENSE)**Impairment
              
              
              (3,200,000
              )
              
              -**Total
                  other (expense)**
              
              
              (3,200,000
              )
              
              -**(LOSS)
                  BEFORE INCOME TAXES**
              
              
              (4,526,823
              )
              
              (236,000
              )Provision
                  for income taxes
              
              
              -
              
              
              -**LOSS
                  FROM CONTINUING OPERATIONS**
              
              
              (4,526,823
              )
              
              (236,000
              )**DISCONTINUED
                  OPERATIONS**Income
                  (loss) from discontinued operatons (net)
              
              
              -
              
              
              218,925Gain
                  (loss) on disposal of business
              
              
              -
              
              
              (128,549
              )**Net
                  Income (loss) before provisions income taxes**
              
              
              (4,526,823
              )
              
              (145,624
              )Provision
                  for income taxes
              
              
              -
              
              
              -**NET
                  (LOSS)**
              
              $
              (4,526,823
              )
              $
              (145,624
              )**BASIC
                  AND DILUTED INCOME (LOSS) PER SHARE**Basic
                  from continuing operations
              
              $
              (0.03
              )
              $
              (0.09
              )Diluted
                  from continuing operations
              
              $
              (0.03
              )
              $
              (0.09
              )Basic
                  from discontinued operations
              
              $
              -
              
              $
              0.08Diluted
                  from discontinued operations
              
              $
              -
              
              $
              0.08Basic
                  from disposal
              
              $
              -
              
              $
              (0.05
              )Diluted
                  from disposal
              
              $
              -
              
              $
              (0.05
              )**WEIGHTED
                  AVERAGE NUMBER OF BASIC**
              
              
              47,090,953
              
              
              2,694,250**COMMON
                  SHARES OUTSTANDING****WEIGHTED
                  AVERAGE NUMBER OF DILUTED**
              
              
              47,090,953
              
              
              2,694,250**COMMON
                  SHARES OUTSTANDING**




The
        accompanying notes are an integral part of these consolidated financial
        statements.
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 ***Table
            of Contents***
 **SNAP2
          CORPORATION**
 **CONDENSED
          CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) -
          REVISED**
 **FOR
          THE YEARS ENDED SEPTEMBER 30, 2004 AND 2003**
 **(Restated
                    and)****Additional**
                
                **(Reclassified)****Preferred
                    Stock**
                
                **Common
                    Stock**
                
                **Paid-in**
                
                **Accumulated****Shares**
                
                **Amount**
                
                **Shares**
                
                **Amount**
                
                **Capital**
                
                **Deficits**
                
                **Total**Balance,
                    September 30, 2002
                
                
                -
                
                
                -
                
                
                2,694,250
                
                $
                2,694
                
                $
                1,474,488
                
                $
                (2,661,789
                )
                $
                (1,184,607
                )Repricing
                    of fair value options
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                378,675
                
                
                -
                
                
                378,675Issuance
                    of stock for services
                
                
                -
                
                
                -
                
                
                2,300,000
                
                
                2,300
                
                
                227,700
                
                
                -
                
                
                230,000Net
                    loss for the year
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                (145,624
                )
                
                (145,624
                )Balance
                    September 30, 2003
                
                
                -
                
                
                -
                
                
                4,994,250
                
                
                4,994
                
                
                2,080,863
                
                
                (2,807,413
                )
                
                (721,556
                )Issuance
                    of stock for cash
                
                
                -
                
                
                -
                
                
                100,000
                
                
                100
                
                
                99,900
                
                
                -
                
                
                100,000Issuance
                    of stock for services
                
                
                -
                
                
                -
                
                
                8,300,000
                
                
                8,300
                
                
                1,036,700
                
                
                -
                
                
                1,045,000Issuance
                    of stock for acquisitions
                
                
                -
                
                
                -
                
                
                35,000,000
                
                
                35,000
                
                
                4,785,000
                
                
                -
                
                
                4,820,000Net
                    loss for the year
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                -
                
                
                (4,526,823
                )
                
                (4,526,823
                )Balance
                    September 30, 2004
                
                
                -
                
                
                -
                
                
                48,394,250
                
                $
                48,394
                
                $
                8,002,463
                
                $
                (7,334,236
                )
                $
                716,621
   
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 ***Table
            of Contents***
 SNAP2
        CORPORATION **CONSOLIDATED
          STATEMENTS OF CASH FLOWS**
 **FOR
          THE YEARS ENDED SEPTEMBER 30, 2004 AND 2003**
 **2004**
                
                **2003****CASH
                    FLOW FROM OPERATING ACTIVITIES****Continuing
                    Operations:**Net
                    income (loss)
                
                $
                (4,526,823
                )
                $
                (236,000
                )**Adjustments
                    to reconcile net (loss) to net cash****used
                    in operating activities:**Common
                    stock issued for consulting services
                
                
                1,045,000
                
                
                230,000Impairment
                
                
                3,200,000
                
                
                -**Changes
                    in assets and liabilities**Increase
                    in accounts receivable
                
                
                (316,038
                )
                
                -Increase
                    in inventory
                
                
                (18,743
                )
                
                -Increase
                    in accounts payable and accrued liabilities
                
                
                384,638
                
                
                6,000Total
                    adjustments
                
                
                4,294,857
                
                
                236,000Net
                    cash used in operating activities - continuingoperations
                
                
                (231,966
                )
                
                -**Discontinued
                    Operations:**Income
                    from discontinued operations
                
                
                -
                
                
                90,376Adjustments
                    to reconcile net cash used indiscontinued
                    operations
                
                
                -
                
                
                (106,781
                )Net
                    cash used in operating activities - discontinued
                    operations
                
                
                -
                
                
                (16,405
                )**CASH
                    FLOWS FROM INVESTING ACTIVITIES**Acquisition
                    of fixed assets
                
                
                -
                
                
                (702
                )**Net
                    cash used in investing activities**
                
                
                -
                
                
                (702
                )**CASH
                    FLOWS FROM FINANCING ACTIVITIES**Payments
                    of long term debt
                
                
                -
                
                
                (30,000
                )Proceeds
                    for stock issued
                
                
                100,000
                
                
                -Proceeds
                    for stock subscribed
                
                
                150,000
                
                
                -Officer
                    loan - net
                
                
                29,188
                
                
                -**Net
                    cash provided by (used in) financing activities**
                
                
                279,188
                
                
                (30,000
                )**NET
                    INCREASE (DECREASE) IN****CASH
                    AND CASH EQUIVALENTS**
                
                
                47,222
                
                
                (47,107
                )**CASH
                    AND CASH EQUIVALENTS -****BEGINNING
                    OF YEAR**
                
                
                12,800
                
                
                47,107**CASH
                    AND CASH EQUIVALENTS - END OF YEAR**
                
                $
                60,022
                
                $
                -**SUPPLEMENTAL
                    DISCLOSURE OF CASH FLOW INFORMATION:**Cash
                    paid during the year for:Interest
                    paid
                
                $
                -
                
                $
                2,583**SUPPLEMENTAL
                    DISCLOSURE OF NONCASH INFORMATION:**Common
                    stock issued for consulting services
                
                $
                1,045,000
                
                $
                230,000Common
                    stock issued for purchase of companies
                
                $
                3,200,000
                
                $
                -
 The
        accompanying notes are an integral part of these consolidated financial
        statements.
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 ***Table
            of Contents***
  **SNAP
        2 CORPORATION**
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS**
 **SEPTEMBER
        30, 2004 AND 2003**
 
 **NOTE
        1
        -** **NATURE
        OF BUSINESS**
 
 Snap
        2
        Corporation, was incorporated as White Rock Enterprises, Ltd. On October
        8, 1998
        under the laws of the State of Nevada. The Company was originally formed
        to
        develop and market a dryer for boots and shoes. On February 28, 2000, the
        Company merged with ISES Corporation with the Company being the surviving
        entity. In connection with the merger, the Company issued 10,000,000 shares
        of
        common stock and 10,000 shares of convertible preferred stock automatically
        converted to 10,000,000 shares of common stock on February 28, 2002.
 
 For
        accounting purposes, the transaction was been accounted for as a reverse
        acquisition under the purchase method of accounting. Accordingly, the Company
        will be treated as the continuing entity for accounting purposes, and the
        financial statements presented herein are those of the Company.
 
 In
        connection with the reverse merger, the Company became a software product
        developer and software service provider for in-flight entertainment systems
        and
        set-top boxes for interactive television. The Company changed its name to
        Snap 2
        Corporation pursuant to an Articles of Amendment filed July 12, 2000.
 On
        March
        31, 2003, the Company entered into an Escrow Agreement with its majority
        stockholder, and another entity, whereby the majority stockholder sold his
        interest in the Company constituting 74.2% of the issued and outstanding
        shares
        of the Company to the other entity for $100,000 in a private stock transaction.
        For the $100,000 consideration, the majority stockholder received the assets
        of
        the Company and assumed the liabilities of the Company, with the Company
        providing a promissory note to the majority stockholder for $84,000.
 
 The
        consolidated financial statements for the Year Ended September 30, 2003 include
        reclassifications of the operations of the Company to reflect the disposal
        of
        its business, which took effect March 31, 2003.
 
 In
        accordance with the Escrow Agreement, the Company signed an indemnification
        agreement, indemnifying the Company of any liability with respect to the
        majority stockholder’s assumption of the debt acquired by him. The Company,
        however, in accordance with FASB 5 and FIN 45, has elected to recognize a
        liability on its books due to the guarantee
 
 
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 ***Table
              of Contents***
 
 **SNAP
        2 CORPORATION**
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)**
 **SEPTEMBER
        30, 2004 AND 2003**
 
 
 **NOTE
        1
        -** **NATURE
        OF BUSINESS** **(CONTINUED)**
 
 imposed
        that the debt gets paid off. Under FIN 45, the Company recorded the liability
        at
        the inception of the guarantee and only will reflect a reduction of the payable,
        i.e. release from guarantee upon the expiration or settlement of the guarantee,
        by a systematic and rational amortization method or as the fair value of
        the
        guarantee changes.
 
 On
        January 5, 2004, the Company acquired Digital Marketing Networks, LLC and
        Ez
        Direct Marketing, Inc., through a share for share exchange. After acquiring
        the
        companies, management determined that it would not be able to utilize the
        customer lists acquired and as a result fully impaired them.
 
 On
        April
        19 th 2004 The
        Company acquired the assets of Call Now America Prepaid LLC in a
        stock-for-assets acquisition.
 
 The
        Company has amended its previously issued unaudited financial statements
        for the
        year ended September 30, 2003. The Company did not have an independent review
        of
        its financial statements by an independent certified public accountant.
        Additionally, the Company has restated its financial statements to take effect
        for the disposal of its business.
 
 **NOTE
        2-** **SUMMARY
        OF SIGNIFICANT ACCOUNTING POLICIES**
 
 **Principles
        of Consolidation**
 
 The
        consolidated financial statements include the accounts of the Company and
        its
        wholly-owned subsidiary. All significant intercompany accounts and transactions
        have been eliminated in consolidation.
 
 **Cash
        and Cash Equivalents**
 
 For
        financial statement presentation purposes, the Company considers short-term,
        highly liquid investments with original maturities of three months or less
        to be
        cash and cash equivalents. There were no cash equivalents at September 30,
        2004
        and 2003.
 
 The
        Company maintains cash and cash equivalent balances at a financial institution
        that is insured by the Federal Deposit Insurance Corporation up to $100,000.
        There were no uninsured cash balances at September 30, 2004 and
        2003.
 
 
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 ***Table
              of Contents***
 
 **SNAP
        2 CORPORATION**
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)**
 **SEPTEMBER
        30, 2004 AND 2003**
 
 **NOTE
        2
        -** **SUMMARY
        OF SIGNIFICANT ACCOUNTING
        POLICIES** **(CONTINUED)**
 
 **Revenue
        Recognition**
 
 The
        Company records its transactions under the accrual method of accounting whereby
        income is recognized when the services are rendered and collection is reasonable
        assured.
 
 **Income
        Taxes**
 
 The
        provision for income taxes includes the tax effects of transactions reported
        in
        the financial statements. Deferred taxes would be recognized for differences
        between the basis for assets and liabilities for financial statement and
        income
        tax purposes. The major difference relates to the net operating loss
        carryforwards generated by sustaining deficits during the development stage.
        The
        Company lost all prior net operating loss carryforwards prior to September
        30,
        2003 due to the change in control.
 
 **Earnings
        (Loss) Per Share of Common Stock**
 
 Historical
        net income (loss) per common share is computed using the weighted average
        number
        of common shares outstanding. Diluted earnings per share (EPS) includes
        additional dilution from common stock equivalents, such as stock issuable
        pursuant to the exercise of stock options and warrants. Common stock equivalents
        are not included in the computation of diluted earnings per share when the
        Company reports a loss because to do so would be antidilutive for the periods
        presented.
 
 The
        following is a reconciliation of the computation for basic and diluted
        EPS:
 September
                    30,
                
                September
                    30,2004
                
                2003Net
                    loss
                
                $
                (4,526,823
                )
                $
                (145,624
                )Weighted-average
                    common sharesoutstanding (Basic)
                
                
                47,090,953
                
                
                2,694,250Weighted-average
                    common stockequivalents:Stock
                    options and warrants
                
                
                -
                
                
                -Weighted-average
                    common sharesoutstanding (Diluted)
                
                
                47,090,953
                
                
                2,694,250
   The
        company at September 30, 2004 and 2003 had no common stock
        equivalents.


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 ***Table
              of Contents***
 
 **SNAP
        2 CORPORATION**
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)**
 **SEPTEMBER
        30, 2004 AND 2003**
 
 **NOTE
        2-** **SUMMARY
        OF SIGNIFICANT ACCOUNTING POLICIES** **(CONTINUED)**
 
 **Property
        and Equipment**
 
 All
        property and equipment was recorded at cost and depreciated over their estimated
        useful lives, generally three, five or seven years, using the straight-line
        method. Upon sale or retirement, the costs and related accumulated depreciation
        are eliminated from their respective accounts, and the resulting gain or
        loss is
        included in the results of operations. Repairs and maintenance charges which
        do
        not increase the useful lives of the assets are charged to operations as
        incurred.
 
 **Advertising**
 
 Costs
        of
        advertising and marketing are expensed as incurred. There were no advertising
        or
        marketing costs for the year ended September 30, 2004 and 2003.
 
 **Stock-Based
        Compensation**
 
 The
        Company has elected to follow Accounting Principles Board Opinion No. 25,
        “ *Accounting
        for Stock Issued to Employees* ”
(APB
        No. 25), and related interpretations, in accounting for their employee stock
        options rather than the alternative fair value accounting allowed by SFAS
        No.
        123, “ *Accounting
        for Stock-Based Compensation* ”,
        and
        has adopted the enhanced disclosure provisions of SFAS No. 148, *“Accounting
        for Stock Based Compensation - Transition and Disclosures”* ,
        an
        amendment of SFAS No. 123. APB No. 25 provides that the compensation expense
        relative to the Company’s employee stock options is measured based on the
        intrinsic value of the stock option. SFAS No. 123 requires companies that
        continue to follow APB No. 25 to provide a pro-forma disclosure of the impact
        of
        applying the fair value method of SFAS No. 123.
 
 **Stock-Based
        Compensation** **(Continued)**
 
 During
        the Year Ended September 30, 2003, the Company cancelled employee stock options
        for 475,000 shares of common stock due to employment terminations. Any remaining
        stock options will be exercisable in conformity with a stock option plan
        that
        was approved by a Board of Directors and a majority of the shareholders of
        the
        Company on March 15, 2000. Stock options are generally granted at fair value
        and
        vest over a four-year period. The plan is more restrictive for any options
        granted to shareholders owning in excess of ten percent of outstanding common
        stock. No options were exercised during the period. The Company had outstanding
        26,942,500 shares of common stock at
 
 F
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 ***Table
              of Contents***
 
 **SNAP
        2 CORPORATION**
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)**
 **SEPTEMBER
        30, 2004 AND 2003**
 
 **NOTE
        2
        -** **SUMMARY
        OF SIGNIFICANT ACCOUNTING POLICIES**
 **(CONTINUED)**
 
 September
        30, 2003 before giving rise to the 1:10 reverse stock split. Upon the disposal
        of its business, all remaining options were cancelled by new management.
        No
        additional options have been issued since then.
 
 **NOTE
        3
        -** **STOCKHOLDERS’
        DEFICIT**
 
 The
        Company is authorized to issue 50,000,000 common shares and 20,000,000 preferred
        shares all of a par value of $.001. At September 30, 2004, the Company had
        48,494,250 common shares outstanding, and no preferred shares issued and
        outstanding.
 
 On
        August
        23, 2003, the Company issued 23,000,000 shares of its common stock for services
        rendered. The fair value of the common stock on the date of the issued shares
        was $.001 per share, with a value of $23,000.
 
 On
        September 4, 2003, the Company authorized a 1 for 10 reverse stock split.
        The
        post-split shares at September 4, 2003 were 4,994,250.
 
 On
        January 5, 2004, the Company acquired Digital Marketing Networks, LLC and
        Ez
        Direct Marketing, Inc., through a share for share exchange. The fair market
        value of the common stock on the date of the exchange date was $.10 per share
        and the 32,000,000 shares were issued on January 5, 2004. After acquiring
        the
        companies, management determined that it would not be able to utilize the
        customer lists acquired and as a result fully impaired them.
 
 On
        January 5, 2004, the Company issued 8,000,000 shares for consulting services
        provided. The fair market value of the common stock on the date of the issuance
        was $0.10 per share.
 
 On
        March
        9, 2004, the Company issued 100,000 shares for cash. The fair market value
        of
        the common stock on the date of the issuance was $1.00 per share.
 
 On
        April
        14, 2004, the Company issued 200,000 shares for consulting services provided.
        The fair market value of the common stock on the date of the issuance was
        $1.00
        per share.
 
 On
        May 7,
        2004, the Company issued 3,000,000 shares for the acquisition of Call Now
        America Prepaid Company, LLC. The fair market value of the common stock on
        the
        date of the issuance was $0.54 per share.
 
 F
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              10
 ***Table
              of Contents***
 
 **SNAP
        2 CORPORATION**
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)**
 **SEPTEMBER
        30, 2004 AND 2003**
 
 **NOTE
        3
        -** **STOCKHOLDERS’
        DEFICIT** **(CONTINUED)**
 
 On
        May
        20, 2004, the Company issued 100,000 shares for consulting services provided.
        The fair market value of the common stock on the date of the issuance was
        $0.45
        per share.
 
 **NOTE
        4
        -** **LINE
        OF CREDIT**
  The
        Company had a $200,000 line of credit with a bank bearing interest at the
        bank’s
        commercial base rate. This line of credit was guaranteed by an officer of
        the
        Company. Funds advanced were secured by the Company’s accounts receivable and
        equipment. The line of credit matured February 10, 2003 at which time the
        Company repaid all existing amounts due. The line was not renewed.
 
 **NOTE
        5
        -** **COMMITTMENTS**
 
 In
        accordance with the Escrow Agreement, the Company signed an indemnification
        agreement, indemnifying the Company of any liability with respect to the
        majority stockholder’s assumption of the debt acquired by him. The Company,
        however, in accordance with FASB 5 and FIN 45, has elected to recognize a
        liability on its books due to the guarantee imposed that the debt gets paid
        off.
        Under FIN 45, the Company recorded the liability at the inception of the
        guarantee and only will reflect a reduction of the payable, i.e. release
        from
        guarantee upon the expiration or settlement of the guarantee, by a systematic
        and rational amortization method or as the fair value of the guarantee changes.
        Statement of Financial Accounting Standards Number 5, discusses disclosures
        and
        recognition of liabilities relating to loss contingencies. A prime example
        discussed is the guarantees of indebtedness of others. Under this pronouncement,
        the Company has disclosed the guarantee and has recorded the liability, because
        the amounts currently due are probable and reasonably estimated.
 
 **NOTE
        6
        -** **LONG-TERM
        DEBT**
 
 On
        June
        20, 1999, the Company entered into a promissory note with a related party
        of the
        Company’s president whereby $135,000 was borrowed by the Company. The note bears
        interest at 9% per annum on the unpaid principal balance. Under the terms
        of the
        note, principal payments of $10,385 along with interest are due in quarterly
        installments beginning July 1, 2001. The Company had not paid the $83,080
        due
        under this note, as well as the accrued interest, since July 1, 2000. Principal
        payments had not been accelerated under this note by the noteholder. The
        former
        majority shareholder assumed the payments of this note pursuant to an Assignment
        of Indebtedness dated April 29, 2003. The Company has recorded this liability
        due to its guarantee on the debt (see Note 5).
 
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              -
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 **SNAP
        2 CORPORATION**
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)**
 **SEPTEMBER
        30, 2004 AND 2003**
 
 **NOTE
        6
        -** **LONG-TERM
        DEBT** **(CONTINUED)**
 
 On
        August
        17, 1999, the Company entered into an agreement with the Iowa Department
        of
        Economic Development (“IDED”) whereby the Company would receive $100,000 of
        financial assistance of under the Community Economic Betterment Account
        (“CEBA”). Under the terms of the agreement, the Company shall pay an annual
        royalty equal to 1.5% of the prior year total gross revenues to IDED in
        semi-annual payments each June 1 and December 1, until a repayment amount
        of
        $200,000 has been reached. Approximately $66,000 was due under this agreement
        at
        September 30, 2004 and 2003. The Company has recorded this liability due
        to its
        guarantee on the debt (see Note 5).
 
 **NOTE
        7
        -** **GOING
        CONCERN**
 
 The
        Company’s consolidated financial statements are prepared using accounting
        principles generally accepted in the United States of America which contemplate
        the realization of assets and liquidation of liabilities in the normal course
        of
        business.
 
 There
        is
        substantial doubt about the Company’s ability to continue as a going concern
        because of the substantial losses incurred since the company has been
        operational and there is no guarantee that the operations of the newly purchased
        subsidiary can sustain the company.
 
 Management’s
        plans with respect to the Company’s future involve working with a newly formed
        Board of Directors that consists of responsible and experienced directors,
        and
        establishing and implementing a business plan that will enable the company
        to
        grow and support its operations and working capital needs.
 
 **NOTE
        8
        -** **PROVISION
        FOR INCOME TAXES**
 
 Deferred
        income taxes will be determined using the liability method for the temporary
        differences between the financial reporting basis and income tax basis of
        the
        Company’s assets and liabilities. Deferred income taxes will be measured based
        on the tax rates expected to be in effect when the temporary differences
        are
        included in the Company’s tax return. Deferred tax assets and liabilities are
        recognized based on anticipated future tax consequences attributable to
        differences between financial statement carrying amounts of assets and
        liabilities and their respective tax bases.
 
 
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 **SNAP
        2 CORPORATION**
 **NOTES
        TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)**
 **SEPTEMBER
        30, 2004 AND 2003**
 
 **NOTE
        8
        -** **PROVISION
        FOR INCOME TAXES** **(CONTINUED)**
 
 At
        September 30, 2004, deferred tax assets consist of the following:
 Net
                    deferred tax assets
                
                $
                1,830,000Less:
                    valuation allowance
                
                
                (1,830,000
                )$
                -0-
 At
        September 30, 2004, the Company had federal net operating loss carryforwards
        in
        the approximate amount of $7,334,000, available to offset future taxable
        income
        through 2024. The Company established a valuation allowance equal to the
        full
        amount of the deferred tax asset due to the uncertainty of the utilization
        of
        the operating losses in future periods.
 
 **NOTE
        9
        -** **RESTATEMENT
        OF PRIOR ISSUED FINANCIAL STATEMENTS**
 
 The
        Company has amended its previously issued unaudited financial statements
        for the
        Year Ended September 30, 2003. The Company did not have an independent review
        of
        its financial statements by an independent certified public accountant.
        Additionally, the Company has restated its financial statements to take effect
        for the disposal of its business.
 
 **NOTE
        10 -** **MAJOR
        CUSTOMERS AND MAJOR SUPPLIERS**
 
 In
        the
        year ended September 30, 2004 the company collected ten percent of more of
        its
        revenues from each of four customers, 36%, 26%, 21% and 15% specifically,
        and
        purchased ten percent or more of its goods to be sold from four suppliers,
        36%,
        26%, 13% and 11% specifically.
 
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  ITEM
        8. CHANGESIN
& DISAGREEMENTS 
WITH 
ACCOUNTANTS
        ON ACCOUNTING


& FINANCIAL DISCLOSURE




The
      Company is not aware, and has not been advised by its auditors, of any
      disagreement on any matter of accounting principles or practices, financial
      statement disclosure, or auditing scope or procedure




PART
      III




ITEM
      9. DIRECTORS,
      EXECUTIVE OFFICERS, PROMOTERS & CONTROL PERSONS,


COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT




The
      Directors and Officers of the Company are as follows:




Name
            Age
            Positions
                and Offices HeldKevin
                D. Johnson
            42
            President




Involvement
      in Certain Legal Proceedings




None
      of
      the director/officers have been involved in any material legal proceedings
      which
      occurred within the last five years of any type as described in Regulation
      S-K.




Compliance
      With Section 16(a) of the Exchange Act




The
      Company does not have a class of equity securities registered pursuant to
      Section 12 of the Exchange Act.  As a result, no reports are required to be
      filed pursuant to Section 16(a).




ITEM
      10. EXECUTIVE
      COMPENSATION




During
      the last fiscal year, the Company's officer and director did not receive any
      salary, wage or other compensation.  During the current fiscal year the
      Company has no present plans or means to pay compensation to its officers and
      directors.




ITEM
      11. SECURITY
      OWNERSHIP OF CERTAIN BENEFICIAL OWNERS & MANAGEMENT


The
      following table sets forth each person known to SNAP2 CORPORATION, as of
      September 30, 2004, to be a beneficial owner of five percent (5%) or more of
      SNAP2 CORPORATION common stock, by SNAP2 CORPORATION directors individually.
      Each person has sole voting and investment power with respect to the shares
      shown.




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SECURITY
      OWNERSHIP OF BENEFICIAL OWNERS




Title
                of Class
            Name
                of Owner
            Shares
                Beneficially
              Owned
            Percentage
                of OwnershipCommon
              Common
              
              Common
              
              Common
              
              Common
            Kevin
                D Johnson
              
              William
                O’Keefe
              
              Anthony
                Rick
              
              Frank
                Ormstead
              
              David
                Bowlby
            17,000,000
              
              15,000,000
              
              4,000,000
              4,000,000
              
              3,000,000
            34%
              
              28%
              
              8%
              
              8%
              
              6%




SECURITY
      OWNERSHIP OF MANAGEMENT




Title
                of Class
            Name
                of
              Beneficial
                Owner
            Amount
                and Nature
              of
                Beneficial Owner
            Percentage
                of ClassCommon
            None
            None
            0%




ITEM
      12.      
CERTAIN RELATIONSHIPS & RELATED TRANSACTIONS




None.




ITEM
      13.           
EXHIBITS




**Exhibit
                Number**
            **Description
                of Exhibit****31.1**
            Certification
                of Chief Executive Officer pursuant to
                18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the
                Sarbanes-Oxley Act of 2002**31.2**
            Certification
                of Chief Financial Officer pursuant to
                18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the
                Sarbanes-Oxley Act of 2002**32.1**
            Certification
                of Chief Executive Officer pursuant to
                18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
                Sarbanes-Oxley Act of 2002





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**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 thereunder duly authorized.




**SNAP2
                CORPORATION**Dated:  December
                19, 2005
            By:/s/
                Kevin D.
                Johnson
              Kevin D. Johnson, President









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