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

                                   FORM 10-KSB

            [ ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934
                  FOR THE FISCAL YEAR ENDED - MARCH 31, 2005 OR

           X TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                        Commission File Number 000-29331

                               MAILKEY CORPORATION
--------------------------------------------------------------------------------
        (Exact Name of Small Business Issuer as Specified in Its Charter)

               Nevada                                   76-0270295
---------------------------------------    -------------------------------------
    (State or Other Jurisdiction of                    IRS Employer
     Incorporation or Organization)                  Identification No.)

                                17194 Preston Rd.
                                Suite 102 PMB 341
                                Dallas, TX 75248
        -----------------------------------------------------------------
                    (Address of Principal Executive Offices)

                                 1-214-254-3440
        -----------------------------------------------------------------
                (Issuer's Telephone Number, Including Area Code)

           Securities registered pursuant to Section 12(b) of the Act:

          Title of Each Class        Name of Exchange on which Registered
        -----------------------    ---------------------------------------
                 None                                  None

       Securities registered under Section 12(g) of the Exchange Act: None

                     Common stock, $.001 par value per share

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

Yes  X  No
    ---    ---

Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B 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]

State issuer's revenues for its most recent fiscal year:      $5,954,772
                                                            -------------

The aggregate market value of the voting common equity held by non-affiliates of
the registrant based on the closing sale price of the registrant's common stock
as reported on the OTC Bulletin Board on June 28, 2005, was $0.04.

As of June 28, 2005, 94,850,535 shares of the registrant's common stock
were outstanding.

Transitional Small Business Disclosure Format (check one):

Yes     No  X
    ---    ---

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                 DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

        This prospectus contains "forward-looking statements" within the meaning
of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. All statements other than
statements of historical facts included or incorporated by reference in this
prospectus, including, without limitation, statements regarding our future
financial position, business strategy, budgets, projected revenues, projected
costs and plans and objectives of management for future operations, are
forward-looking statements. In addition, forward-looking statements generally
can be identified by the use of forward-looking terminology, such as "may,"
"will," "expects," "intends," "plans," "projects," "estimates," "anticipates,"
or "believes" or the negative thereof or any variation thereon or similar
terminology or expressions.

        These forward-looking statements are subject to risks and uncertainties
that could cause actual results to differ materially from results proposed in
such statements. Although we believe that the expectations reflected in such
forward-looking statements are reasonable, we can give no assurance that such
expectations will prove to be correct. Important factors that could cause actual
results to differ materially from our expectations include, but are not limited
to: our ability to fund future growth and implement our business strategy; our
ability to integrate the operations of any businesses we may acquire; our
ability to attract and retain customers and qualified personnel; competition in
our industry and markets; general economic and business conditions, either
nationally or internationally or in the jurisdictions in which we are doing
business; the condition of the securities and capital markets; legislative or
regulatory changes; and statements of assumption underlying any of the
foregoing, as well as any other factors set forth under the caption "Risk
Factors" and "Plan of Operation" under Item 1 of this report.

        All subsequent written and oral forward-looking statements attributable
to us, or persons acting on our behalf, are expressly qualified in their
entirety by the foregoing. Except as required by law, we assume no duty to
update or revise our forward-looking statements based on changes in internal
estimates or expectations or otherwise.

        Unless otherwise indicated or the context otherwise requires, all
references to "MailKey," the "Company," "we," "us" or "our" and similar terms
refer to MailKey Corporation and its subsidiaries.

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PART I

ITEM 1.  DESCRIPTION OF BUSINESS

        We were formed on July 19, 1996, as a Nevada corporation.

        On August 8, 2001, we entered the online trading solutions market by
acquiring Sutton Online, Inc., a Delaware corporation and an application service
provider providing online trading solutions to individuals, broker dealers and
financial institutions worldwide. In February 2003, we sold Sutton Online, Inc.
and changed our business plan to that of seeking to enter into a business
combination with one or more privately-held operating companies.

        On March 25, 2004 (the "Effective Time"), pursuant to an Agreement and
Plan of Merger, dated February 20, 2004, by and among us, G.D. Acquisition
Corp., a Delaware corporation and our then wholly-owned subsidiary, MK Secure
Solutions Limited, a British Virgin Islands private limited company, and
Westvale Consultants Limited, a principal shareholder of MailKey, as amended by
a First Amendment to Agreement and Plan of Merger, dated March 23, 2004, by and
among us, G.D. Acquisition Corp., MK Secure Solutions Limited and Westvale
Consultants, Ltd., G.D. Acquisition Corp. was merged with and into MK Secure
Solutions Limited, with MK Secure Solutions Limited remaining as the surviving
entity and becoming our wholly-owned subsidiary.

        On November 9, 2004, the Company entered into an Agreement and Plan of
Merger (the "Merger Agreement") by and among the MailKey Corporation (the
"Company"), MailKey Acquisition Corp., a Delaware corporation and our
wholly-owned subsidiary ("Merger Sub"), Inc., a Nevada Corporation ("IElement")
and Ivan Zweig, pursuant to which we agreed to acquire all of the issued and
outstanding shares of capital stock of iElement, Inc. This transaction closed in
January 2005. At the closing of the Merger, Merger Sub was merged into IElement,
at which time the separate corporate existence of Merger Sub ceased and IElement
now continues as the surviving company, as a wholly owned subsidiary of the
Company. As a result of the merger, the Company issued 47,845,836 shares of
common stock of the Company.

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OVERVIEW

In January of 2005, the Company closed its merger agreement with IElement, Inc.,
a facilities-based nationwide telecommunications communications service provider
for services to small and medium sized enterprises that seeks to provide
broadband data, voice and wireless services using integrated T-1 lines with a
Layer 2 Private Network solution to provide dedicated Internet access services,
customizable business solutions for voice, data and Internet, and secure
communications channels between our customers' offices, partners, vendors,
customers and employees without the use of a firewall or encryption devices. In
the first quarter 2005 the Company was unable to continue funding the
development of its messaging security solutions, and the messaging security
solutions rights were transferred to the development team in return for the
cancellation of most of the liabilities which the Company owed to them. The
Company retains an interest of 20% in the messaging security solutions; however
to date there has been no commercialization of the solutions. In the first
quarter 2005 the Company sold its insolvent British Virgin Islands subsidiary,
MK Secure Solutions Limited, for $1 to a UK based accounting firm, SS Khehar &
Company. SS Khehar & Company have agreed to undertake the winding up of the
former subsidiary for a fee of $1,800.

        We now aim to grow IElement and establish it as a leading regional
added-value carrier. The Company intends to:

o       Concentrate its resources on adding customers in the Dallas, Los Angeles
and Chicago markets, while extending its sales reach into the next target
markets.
o       Build out the necessary infrastructure to sell IElement broadband
services (wireless or wireline), as well as reselling voice services over the
same T1 or wireless equivalent.
o       Upsell added value managed services (Blackberry, secure email, VoIP,
prepaid cellular, and storage) to our current and future customer base to raise
our ARPC. Existing infrastructure can serve multiple new markets as they are
brought online before we would need any capital expenditures or additional
software licenses.
o       Look for acquisitions of wireless ISPs (WISPs), and other suitable
telephony and/or data carriers, in secondary and tertiary markets which can be
layered onto the Company's national backbone, which we expect will create
economies of scale and operating efficiencies.

        IElement's focus is to become the leading regional Communication Service
Provider (CSP) from California to Florida. IElement's added value, managed
service strategy includes the potential development of additional subscription
model services such as Managed Microsoft Exchange, prepaid and postpaid cellular
services, email and network security,

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residential/ business based wireless, and Managed Blackberry(tm) services. The
development of these services would allow IElement to offer SMEs access to
Enterprise type applications with little or no software purchase, hardware
investment, upgrade worries, or full-time administration of these services.
These sell through services should increase the Average Revenue Per Customer, as
well as help improve customer retention.

        We anticipate that the number of people who we employ may increase
substantially over the next 12 months as we continue to execute on our business
plan.

ENGAGE IN STRATEGIC ACQUISITIONS AND JOINT VENTURES

        We intend to acquire, where appropriate, additional telecommunication
companies, companies with technologies that we believe are complimentary to our
existing technologies, as well as to acquire wireless broadband Internet service
providers with strategically located networks that will enable the expansion of
our national coverage area. In addition, we intend to acquire companies,
businesses and assets that we believe are complementary to our business. We may
seek to form joint ventures and seek joint venture partners in order to reduce
our investment in a particular project and to help promote the development and
sale of our products.

EMPLOYEES

        As of June 28, 2005, we had approximately 15 employees and approximately
2 consultants. None of our employees are represented by a labor union, and we
have never experienced a work stoppage. We believe that our relations with our
employees are good.

RISK FACTORS

        The following risk factors, among others, may affect our business,
financial condition and results of operations.

RISKS ASSOCIATED WITH OUR BUSINESS

IF WE ACQUIRE ANY COMPANIES OR TECHNOLOGIES IN THE FUTURE, SUCH COMPANIES AND
TECHNOLOGIES COULD PROVE DIFFICULT TO INTEGRATE, DISRUPT OUR BUSINESS, DILUTE
STOCKHOLDER VALUE AND ADVERSELY AFFECT OUR OPERATING RESULTS.

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        We intend to acquire or make investments in complementary companies,
businesses, assets and/or technologies in the future. We have not made any
acquisitions or investments to date, and therefore, our ability to make
acquisitions or investments is unproven. Acquisitions and investments involve
numerous risks, including:

        o       inability to generate sufficient revenue or growth in revenue or
                to offset acquisition or investment costs;

        o       difficulties in integrating operations, technologies, service
                and personnel;

        o       diversion of financial and management resources from existing
                operations;

        o       risk of entering new markets; and

        o       potential loss of key employees;

        Acquisitions could also require us to record substantial amounts of
goodwill and other intangible assets. Any future impairment of such goodwill,
and the amortization of other intangible assets, would adversely affect our
operating results. In addition, if we finance acquisitions by issuing
convertible debt or equity securities, our existing stockholders may be diluted,
which could affect the market price of our stock. If we finance such
acquisitions with bank debt or high yield debt, these arrangements may impose
substantial operating covenants on us and result in interest expense that could
adversely affect our business and operating results. As a result, if we fail to
properly evaluate and execute any future acquisitions or investments, our
business and operating results may be seriously harmed.

OUR GROWTH COULD STRAIN OUR PERSONNEL AND INFRASTRUCTURE RESOURCES, AND IF WE
ARE UNABLE TO IMPLEMENT APPROPRIATE CONTROLS AND PROCEDURES TO MANAGE OUR
GROWTH, WE MAY NOT BE ABLE TO SUCCESSFULLY IMPLEMENT OUR BUSINESS PLAN.

        As we implement our business plan, we may experience a period of rapid
growth in our headcount and operations, which may place a significant strain on
our management, administrative, operational and financial infrastructure.

        Our success will depend in part upon the ability of our senior
management to manage this growth effectively. To do so, we must continue to
hire, train and manage new employees as needed. If our new hires perform poorly,
if we are unsuccessful in hiring, training, managing and integrating these new
employees, or if we are not successful in retaining our existing employees, our
business may be harmed. To manage the expected growth of our operations and
personnel, we will need to continually improve our operational, financial and
management controls and our reporting systems and procedures. The additional
headcount and capital investments we are adding will increase our cost base,
which will make it more difficult for us to offset any future revenue shortfalls
by offsetting expense reductions in the short term. If we fail to successfully
manage our growth, we will be unable to execute our business plan.

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THE MARKET IN WHICH WE PARTICIPATE IS INTENSELY COMPETITIVE, AND IF WE DO NOT
COMPETE EFFECTIVELY, OUR OPERATING RESULTS COULD BE HARMED.

        The market for telecommunications solutions, including local, long
distance, data and Internet products and services, is intensely competitive and
rapidly changing. Barriers to entry into this market have increased due to
regulatory changes and increased costs of doing business with the Incumbent
Local Exchange Carriers (ILECs), but these barriers have been offset by
reductions in costs for bandwidth and the subsequent development of Voice over
Internet Protocol (VoIP), which has allowed new competition to arise in the
telephone services arena. Many of our competitors are larger and have more
resources than we do. With the introduction of new technologies and market
entrants, we expect competition to intensify in the future. Many of our current
and potential competitors enjoy substantial competitive advantages, such as
greater name recognition, longer operating histories, larger research,
development and marketing budgets as well as substantially greater financial,
technical and other resources. In addition, many of our current and potential
competitors have access to larger customer bases and have more extensive
marketing and distribution arrangements with resellers, distributors and OEMs
than we do. As a result, our competitors may be able to respond more quickly and
effectively than we can to new or changing opportunities, technologies,
standards or customer requirements. Furthermore, because of these advantages,
even if we develop products that are more effective than the products that our
competitors offer, potential customers might accept competitive products in lieu
of purchasing our products or services.

        We face competition from businesses that develop their own VoIP and
other Internet based telecommunications services, as well as from ILECs who have
achieved regulatory relief from the Telecommunications Act of 1996, and have
begun to charge more for wholesale prices and in some cases eliminated the
wholesale opportunity based on the size of the market. Our current and potential
principal competitors include:

        o       Other Competitive Local Exchange (CLECs) provider who provide
many of the same telecommunications products and services that we do. Some
examples of CLECs are : XO Communications, Xspedius, Logix Communications and
McLeod Telecom; ILECs such as SBC Communications,Verizon, Qwest and Bell South
who are the largest provider of local, long distance and Internet services to
businesses; VoIP providers such as Vonage, Covad and mPower who can deliver
local and long distance services over an Internet connection.

<PAGE>

WE ARE DEPENDENT ON OUR MANAGEMENT TEAM, AND THE LOSS OF ANY KEY MEMBER OF THIS
TEAM MAY PREVENT US FROM IMPLEMENTING OUR BUSINESS PLAN IN A TIMELY MANNER.

        Our success depends largely upon the continued services of our executive
officers and other key personnel. We have entered into employment agreements
with many of our employees. These agreements provide that the employees may
discontinue their employment with us after providing us with little notice of
their decision (typically one month. As a result, our employees could terminate
their employment with us at any time without penalty and go to work for one of
our competitors. We do maintain key person life insurance policy Ivan Zweig. The
loss of one or more of our key employees could seriously harm our business.

OUR MANAGEMENT TEAM WAS ONLY RECENTLY FORMED, AND OUR SUCCESS DEPENDS ON ITS
ABILITY TO WORK TOGETHER EFFECTIVELY.

        We appointed Ivan Zweig, our Chairman and Chief Executive Officer, in
January 2005. Timothy Dean-Smith, our Chief Financial Officer, was appointed in
September 2004 . In addition, the majority of our senior management team has
joined us in the last 12 months. Our future success depends on the integration
of this management team and its ability to work together effectively. If our
management team fails to work together effectively, our business could be
harmed.

BECAUSE COMPETITION FOR OUR TARGET EMPLOYEES IS INTENSE, WE MAY NOT BE ABLE TO
ATTRACT AND RETAIN THE HIGHLY SKILLED EMPLOYEES WE NEED TO SUPPORT OUR PLANNED
GROWTH.

        To execute our growth plan, we must attract and retain highly qualified
personnel. We may need to hire additional personnel in virtually all operational
areas, including selling and marketing, , operations and technical support,
customer service and administration.. We may not be successful in attracting and
retaining qualified personnel. We have from time to time in the past
experienced, and we expect to continue to experience in the future, difficulty
in hiring and retaining highly skilled employees with appropriate
qualifications. Many of the companies with which we compete for experienced
personnel have greater resources than we have. If we fail to attract new
personnel or fail to retain and motivate our current personnel, our business and
future growth prospects could be severely harmed.

WE MAY BECOME INVOLVED IN LITIGATION, WHICH COULD BE COSTLY AND TIME CONSUMING
TO DEFEND.

        We may become involved in litigation such as securities class actions,
intellectual property, employment (unfair hiring or terminations) and/ or issues
pertaining to delivering E911 services, among others. For example, we may be
subject to lawsuits by parties claiming that we did not offer E911 services that
are required by law. Parties trying to call 911 from locations that we service
may not be able to complete the call based on the fact that a T1 is a digital
service, and that emergencies such as fires, power outages, or simple equipment
failure could disable the ability for a person to dial out over our local lines.
Any of these sources could claim we are interfering with the lawful conduct of
their business. Although we believe we have properly informed our customers,
given them information on backup E911 procedures, as well as paying for backup
lines to be installed, litigation still may occur. Litigation involves costs in
defending the action and the risk of an adverse judgment. Any resulting
litigation, with or without merit, could result in substantial costs and divert
management's attention and resources, which could seriously harm our business
and operating results.

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                         RISKS ASSOCIATED WITH OUR STOCK

WE INTEND TO ATTEMPT TO RAISE ADDITIONAL FUNDS IN THE FUTURE, AND SUCH
ADDITIONAL FUNDING MAY BE DILUTIVE TO STOCKHOLDERS OR IMPOSE OPERATIONAL
RESTRICTIONS.

        We intend to attempt to raise additional capital in the future to help
fund our operations through sales of shares of our common stock or securities
convertible into shares of our common stock, as well as issuances of debt. Such
additional financing may be dilutive to our stockholders, and debt financing, if
available, may involve restrictive covenants which may limit our operating
flexibility. If additional capital is raised through the issuances of shares of
our common stock or securities convertible into shares of our common stock, the
percentage ownership of our stockholders will be reduced. These stockholders may
experience additional dilution in net book value per share and any additional
equity securities may have rights, preferences and privileges senior to those of
the holders of our common stock.

THE MARKET PRICE OF OUR COMMON STOCK IS LIKELY TO BE HIGHLY VOLATILE AND SUBJECT
TO WIDE FLUCTUATIONS.

        The market price of our common stock is likely to be highly volatile and
could be subject to wide fluctuations in response to a number of factors that
are beyond our control, including:

        o       announcements of new products or services by our competitors;

        o       fluctuations in revenue from our indirect sales channels.

        In addition, the market price of our common stock could be subject to
wide fluctuations in response to:

        o       quarterly variations in our revenues and operating expenses;

        o       announcements of technological innovations or new products or
                services by us; and

        o       our technological capabilities to accommodate the future growth
                in our operations or those of our customers.

        In addition, the stock market has experienced significant price and
volume fluctuations that have particularly affected the market price of the
stock of many Internet-related companies, and that often have been unrelated or
disproportionate to the operating performance of these companies. Market
fluctuations such as these may seriously harm the market price of our common
stock. Further, securities class action suits have been filed against companies
following periods of market volatility in the price of their securities. If such
an action is instituted against us, we may incur substantial costs and a

<PAGE>

diversion of management attention and resources, which would seriously harm our
business, financial condition and results of operations.

IF WE EXPERIENCE SIGNIFICANT FLUCTUATIONS IN OUR OPERATING RESULTS OR FAIL TO
MEET REVENUE AND EARNINGS EXPECTATIONS, OUR STOCK PRICE MAY FALL.

        Due to our limited operating history and the unpredictability of the
telecommunications industry, we may not be able to accurately forecast our
future operating results. In addition, our expenses are to a large extent fixed
in the short term, and we expect that these expenses will increase in the
future. We may not be able to adjust our spending quickly enough if our expenses
exceed our expectations.

        Factors that could cause our quarterly financial results to fluctuate
include:

        o       the successful development of our products and implementation of
                our products by organizations;

        o       the addition of added value products and services, and the
                effect those new products will have on our ability to retain
                existing customers and to win new customers;

        o       the introduction of competitive services and the pricing of
                these services;

        o       reduced demand for our T1 based services;

        o       significant increases in expenses to drive the growth of our
                business, which may not yield corresponding increases in
                revenue;

        o       the effectiveness of future legislation in further increasing
                the cost of leasing lines from the ILEC or decreasing the
                ability to buy wholesale services from the ILEC ;

        o       changes in customer demands and needs for T1 based services; and

        As a result, we may not generate significantly increased revenues, and
our earnings may be harmed. We believe that period-to-period comparisons of our
historical operating results may not be meaningful, and you should not rely on
them as an indication of future performance.

WE DO NOT INTEND TO PAY DIVIDENDS.

        We have never declared or paid any cash dividends on our common stock.
We currently intend to retain any future profits from operations to fund growth
and do not expect to pay any dividends in the foreseeable future.

<PAGE>

APPLICABLE SEC RULES GOVERNING THE TRADING OF "PENNY STOCKS" LIMITS THE TRADING
AND LIQUIDITY OF OUR COMMON STOCK WHICH MAY AFFECT THE TRADING PRICE OF OUR
COMMON STOCK.

        Our common stock currently trades on the OTC Bulletin Board. Since our
common stock trades at a price below $5.00 per share, our common stock is
considered a "penny stock" and is subject to SEC rules and regulations which
impose limitations upon the manner in which our shares can be publicly traded.
These regulations require the delivery, prior to any transaction involving our
stock, of a disclosure schedule explaining the penny stock market and the
associated risks. Under these regulations, certain brokers who recommend our
securities to persons other than established customers or certain accredited
investors must make a special written suitability determination regarding such a
purchaser and receive such purchaser's written agreement to the transaction
prior to sale. These regulations may have the effect of limiting the trading
activity of our common stock and reducing the liquidity of an investment in our
common stock.

ITEM 2.  DESCRIPTION OF PROPERTY

        Our corporate headquarters and principal offices are located at 13714
Gamma Road, Farmers Branch, Texas 75244, where we sub-lease approximately 3284
square feet of office space for a monthly service charge of approximately $2500.
This lease was negotiated as a month to month agreement. We believe that our
office space is adequate to support our current operations.

ITEM 3.  LEGAL PROCEEDINGS

        We are currently being sued by indirect sales agents who believe they
have not been adequately compensated for past sales. We intend to vigorously
defend the Company against these suits. We believe we have sufficient reserves
set aside for these legal proceedings. The suits are as follows:

        o       KK Solutions, Inc., vs. IElement, et al. filed on April 19, 2005
                in Los Angeles Superior Court

        o       Communications Plus Consultants Corporation, Inc vs. IElement,
                et al. filed on April 26, 2005 in Los Angeles Superior Court

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

In January 2005 the Board submitted to shareholders for shareholder approval the
Company's Agreement and Plan of Merger (the "Merger Agreement") by and among the
MailKey Corporation (the "Company"), MailKey Acquisition Corp., a Delaware
corporation and our wholly-owned subsidiary ("Merger Sub"), Inc., a Nevada
Corporation ("IElement") and Ivan Zweig, pursuant to which we agreed to acquire
all of the issued and outstanding shares of capital stock of IElement, Inc. This
transaction closed in January 2005. At the closing of the Merger, Merger Sub was
merged into IElement, at which time the separate corporate existence of Merger
Sub ceased and IElement now continues as the surviving company, as a wholly
owned subsidiary of the Company. As a result of the merger, the Company issued
47,845,836 shares of Common Stock of the Company.

<PAGE>

PART II

ITEM 5. MARKET FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND SMALL BUSINESS
ISSUER PURCHASES OF EQUITY SECURITIES

MARKET INFORMATION

        Our common stock currently trades on the OTC Bulletin Board under the
symbol "MAKY". The following table sets forth the range of high and low bid
prices for shares of our common stock on the OTC Bulletin Board for the periods
indicated, as reported by Nasdaq. These quotations represent inter-dealer
prices, without retail mark-up, markdown or commission, and may not represent
actual transactions.

        Fiscal Year Ended March 31, 2005            High       Low
        --------------------------------            ----       ---

        Quarter ended March 31, 2005               $0.09     $0.03
        Quarter ended December 31, 2004             1.01      0.06
        Quarter ended September 30, 2004            3.00      0.85
        Quarter ended June 30, 2004                 3.70      2.55

        Fiscal Year Ended March 31, 2004            High       Low
        --------------------------------            ----       ---

        Quarter ended March 31, 2004               $3.25     $0.15
        Quarter ended December 31, 2003             0.15      0.15
        Quarter ended September 30, 2003            0.15      0.15
        Quarter ended June 30, 2003                 2.40      0.15

        The last price of our common stock as reported on the OTC Bulletin Board
on June 28, 2005, was $0.04 per share.

HOLDERS

        As of June 28, 2005, the number of stockholders of record of our common
stock was 300.

DIVIDENDS

        We have not paid any cash dividends on our common stock to date, nor do
we currently anticipate paying any cash dividends on our common stock in the
foreseeable future. We currently intend to retain future earnings, if any, to
finance the operation and development of our business.

<PAGE>

TRANSFER AGENT

        The transfer agent for our common stock is Madison Stock Transfer, P.O.
Box 145, Brooklyn, NY 11229; (718) 627-4453.


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

        The following discussion should be read in conjunction with, and is
qualified in its entirety by, our consolidated financial statements and notes
thereto included elsewhere in the annual report. Historical results are not
necessarily indicative of trends in operating results for any future period.

        The statements contained in the annual report that are not historical
facts are forward-looking statements that evolve a number of risks and
uncertainties. The actual results of the future events described in such
forward-looking statements in this annual report could differ materially from
those stated in such forward-looking statements.

        This "Plan of Operation" and other parts of this report contain
forward-looking statements that involve risks and uncertainties. All
forward-looking statements included in this report are based on information
available to us on the date hereof, and we assume no obligation to update any
such forward-looking statements. Our actual results may differ materially from
those anticipated in these forward-looking statements as a result of a number of
factors, including those set forth under the caption "Risk Factors" and
elsewhere in this report. The following should be read in conjunction with our
audited financial statements and the related notes thereto contained elsewhere
in this report.

OUR PLAN OF OPERATION

        In January of 2005, the Company closed its merger agreement with
IElement, Inc., a facilities-based nationwide telecommunications communications
service provider for services to small and medium sized enterprises that seeks
to provide broadband data, voice and wireless services using integrated T-1
lines with a Layer 2 Private Network solution to provide dedicated Internet
access services, customizable business solutions for voice, data and Internet,
and secure communications channels between our customers' offices, partners,
vendors, customers and employees without the use of a firewall or encryption
devices. In the first quarter 2005 the Company was unable to continue funding
the development of its messaging security solutions, and the rights were
transferred to the development team in return for the cancellation of most of
the liabilities which the Company owed to them. The Company retains an interest
of 20% in the messaging security solutions; however to date there has been no
commercialization of the solutions. In the first quarter 2005, the Company sold
its insolvent British Virgin Islands subsidiary, MK Secure Solutions Limited,
for $1 to a UK based accounting firm, SS Khehar & Company. SS Khehar & Company
have agreed to deal with the winding up of the former subsidiary, for a fee of
$1,800.

<PAGE>

We now aim to grow IElement and establish it as a leading regional added-value
carrier.

IElement's focus is to become the leading regional Communication Service
Provider (CSP) from California to Florida. IElement's added value, managed
service strategy includes the potential development of additional subscription
model services such as Managed Microsoft Exchange, prepaid and postpaid cellular
services, email and network security, residential/ business based wireless, and
Managed Blackberry(tm) services. The development of these services would allow
IElement to offer SMEs the chance to have access to Enterprise type applications
with little or no software purchase, hardware investment, upgrade worries, or
full-time administration of these services. These sell through services should
increase the ARPC, as well as help improve customer retention.

The Company intends to:

o       Concentrate its resources on adding customers in the Dallas, Los Angeles
and Chicago markets, while extending its sales reach into the next target
markets.
o       Build out the necessary infrastructure to sell IElement broadband
services (wireless or wireline), as well as reselling voice services over the
same T1 or wireless equivalent.
o       Upsell added value managed services to our current and future customer
base to raise our Average Revenue Per Customer (ARPC). Existing infrastructure
can serve multiple new markets as they are brought online, before we would need
any capital expenditures or additional software licenses.
o       Look for acquisitions of wireless ISPs (WISPs), and other suitable
telephony and/or data carriers, in secondary and tertiary markets, which can be
layered onto the Company's national backbone, which should create economies of
scale and operating efficiencies.

        We anticipate that the number of people who we employ may increase
substantially over the next 12 months as we continue to execute on our business
plan.

LIQUIDITY AND CAPITAL RESOURCES

        Since our inception, we have funded our operations primarily through
private sales of equity securities and the utilization of short-term convertible
debt. As of March 31, 2005, we had a cash balance of $340,321.

        We do not currently maintain a line of credit or term loan with any
commercial bank or other financial institution. To date, our capital needs have
been principally met through the receipt of proceeds from sales of our equity
and debt securities.

        We believe that our current cash resources will not be sufficient to
sustain our current operations for the next twelve (12) months, and that we will
need to raise additional capital to execute our business plan. The Company
anticipates, based on currently proposed plans and assumptions relating to its
operations, that it is essential to secure additional working capital.
Additionally, in the event that the Company's plans change, its assumptions
prove to be inaccurate or its cash flow proves to be insufficient (due to
unanticipated expenses, inadequate revenues, difficulties, problems or
otherwise), the Company may be required to seek additional financing or curtail
its activities.

<PAGE>

        We intend to obtain additional cash resources within the next twelve
(12) months through sales of debt or equity securities. The sale of any
additional equity or convertible debt securities will result in additional
dilution to our shareholders. The issuance of additional debt will result in
increased expenses and could subject us to covenants that may have the effect of
restricting our operations. If we are unable to obtain additional funds when
they are needed or if such funds cannot be obtained on terms favorable to us, we
may be required to delay or scale back any plans we may have to acquire such
companies, businesses, assets or technologies. The Company currently has no
arrangements or understandings for additional financing and there can be no
assurance that additional financing will be available to the Company if
required.

OFF-BALANCE SHEET ARRANGEMENTS

        As of March 31, 2005, we did not have any relationships with
unconsolidated entities or financial partners, such as entities often referred
to as structured finance or special purpose entities, that had been established
for the purpose of facilitating off-balance sheet arrangements or other
contractually narrow or limited purposes. As such, we are not materially exposed
to any financing, liquidity, market or credit risk that could arise if we had
engaged in such relationships.

Plant & Equipment

The Company expects it will be able to continue to purchase and capitalize
telecommunication equipment as required for growing business needs.

CRITICAL ACCOUNTING POLICIES

        Our discussion and analysis of our financial condition and results of
operations are based upon our consolidated financial statements and accompanying
notes, which have been prepared in accordance with accounting principals
generally accepted in the United States. The preparation of these financial
statements requires management to make estimates and assumptions that affect the
reported amounts of assets, liabilities, revenues and expenses, and related
disclosure of contingent assets and liabilities. When making these estimates and
assumptions, we consider our historical experience, our knowledge of economic
and market factors and various other factors that we believe to be reasonable
under the circumstances. Actual results may differ under different estimates and
assumptions.

        The accounting estimates and assumptions discussed in this section are
those that we consider to be the most critical to an understanding of our
financial statements because they inherently involve significant judgments and
uncertainties.

REVENUE RECOGNITION

The Company records its transactions under the accrual method of accounting
whereby income is recognized when the services are provided rather than when
billed or the fees are collected, and costs and expenses are recognized in the
period they are incurred rather than paid for.

<PAGE>

ITEM 7.  FINANCIAL STATEMENTS

        See Financial Statements beginning on page F-1.

ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.

        Not applicable.

ITEM 8A. CONTROLS AND PROCEDURES

        An evaluation of the effectiveness of our "disclosure controls and
procedures" (as such term is defined in Rules 13a-15(e) or 15d-15(e) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) was carried
out by us under the supervision and with the participation of Graham
Norton-Standen, our preceding chief executive officer and chief financial, and
our current chief executive officer and chief financial officer, Ivan Zweig and
Tim Dean Smith, respectively, officer. Based upon that evaluation, Mr. Zweig and
Mr. Dean Smith concluded that, as of the end of the period covered by this
Annual Report, our disclosure controls and procedures were effective to provide
reasonable assurance that information we are required to disclose in reports
that we file or submit under the Exchange Act is recorded, processed, summarized
and reported within the time periods specified in the Securities and Exchange
commission rules and forms. There has been no change in our internal control
over financial reporting identified in connection with that evaluation that
occurred during our most recent fiscal quarter that has materially affected, or
is reasonably likely to materially affect, our internal control over financial
reporting.

                                    PART III

ITEM 9.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

        The following sets forth certain information about each of our directors
and executive officers.

Name                      Age        Positions Held
----                      ---        --------------
Ivan Zweig                32         Chief Executive Officer and Chairman
Tim Dean-Smith            39         Chief Financial Officer and Director
Susan Walton              XX         Director

        The following is a brief summary of the business experience of each of
our directors and executive officers:

        IVAN ZWEIG has been our Chairman, Chief Executive Officer and since the
closing of the merger on January 18, 2005. Ivan Zweig founded the ICCC in
December of 1998. The concept started merely as a re-biller of different
carriers in the industry for Internet traffic.

<PAGE>

With excellence constantly being the number one goal, the Company began to buy
wholesale from NKOB networks, which evolved into the goal of becoming a
facilities based carrier. ICCC sold off its assets to IELEMENT in March of 2003
excluding any and all regulated licenses or permits. Ivan was the Western Region
Dedicated Sales Manager of NET-tel Communications from February of 1998 until he
founded ICCC. He was responsible for Internet sales for 52 reps in the Western
Region. Ivan was previously employed by MidCom Communications, where he was a
Sales Manager after being an Account Executive for a short time. MidCom was
purchased by Winstar, and then all of the management team migrated over to
NET-tel from MidCom when that opportunity arose. Before Midcom, Ivan raised over
$500,000 from private investors to fund a health food and nutrition franchise
called Smoothie King. He purchased the rights to build 18 stores in the Bay Area
and sold his interest after building the first two. Additionally, he started a
city magazine called Dallas/Ft.Worth Lifestyles. Ivan sold enough advertising as
an account executive in the first 60 days to carry the magazine for the entire
first year of operations. This was Ivan's first venture after college and a
brief stint of playing professional baseball. Ivan attended Tulane University
and was a member of Team USA in 1991, which played in Cuba for the Pan American
Games. He was also a two-time All-American pitcher while at Tulane.

        TIM DEAN-SMITH has been our Chief Financial Officer and director since
the closing of the merger in January of 2005 and has been with the Company since
its March 2004 merger with MK Secure Solutions Limited, which Mr. Dean-Smith
founded. Mr. Dean-Smith has been providing venture capital and/or management and
fund-raising services to the following companies since the dates specified: (i)
Polestar Space Applications, an internet/GPS asset tracking business
specializing in the commercial shipping and yachting markets, since October
1998; (ii) Nextbus, a San Francisco based company that provides real time bus
arrival information to passengers via the internet and mobile phone networks,
since March 1996; (iii) ByBox, a logistics solutions company that produces
locker banks that can be remotely programmed to enable the secure delivery of
letters and parcels by couriers for consumers and businesses, since August 1999.
In November 1998, Mr. Dean-Smith was an early investor in Valuad, a financial
analysis software company that was acquired in July 2001, and in April 1999 was
an early investor in Ibidlive, a technology company that enabled real time
bidding in auctions via the internet, fixed phone lines and mobile phones and in
which QXL PLC acquired a controlling stake in December 1999. Mr Dean-Smith was a
founding investor and Chairman of Cube8 Group, an internet investment company,
from August 1999 until its merger with Room Service Deliveries (UK) Limited in
January 2002. From 1992 to 1996, Mr. Dean-Smith engaged in the purchase,
investment and development or refurbishment of commercial property and
residential properties in London, England. Mr. Dean-Smith studied for an MBA at
London Business School and the Haas School of Business (University of
California, Berkeley), receiving his MBA in 1995, and studied law at King's
College in London, graduating with an LLB with Honors in 1986.

BOARD OF DIRECTORS

        Our Board of Directors is currently comprised of Ivan Zweig, Tim
Dean-Smith, and Susan Walton. We anticipate that each of Messrs. Zweig,
Dean-Smith and Ms. Walton will

<PAGE>

serve as Directors until the next annual meeting of shareholders or until their
respective successor is duly elected and qualified. Directors are elected at the
annual meeting of shareholders or by written consent of the shareholders, and
each Director holds office until his successor is duly elected and qualified or
he resigns, unless sooner removed. Officers are elected annually by our Board of
Directors and serve at the discretion of the Board. During the fiscal year ended
March 31, 2004, the Board of Directors held no meetings. All actions of the
Board of Directors were taken by written consent. We do not currently have any
committees of our Board of Directors.

DIRECTOR COMPENSATION

        Messrs. Zweig and Dean-Smith received no compensation as directors, as
they are also officers of the Company. Ms. Walton receives $5,000 per month as
compensation for being on the board of directors. Members of our board are
entitled to be reimbursed for their reasonable costs and expenses incurred in
attending board meetings.

DIRECTOR NOMINATIONS

        We currently have approximately 15 employees and conduct limited
operations. As a result, our Board of Directors is currently comprised of only 3
individuals, Ivan Zweig, Tim Dean-Smith and Susan Walton. Each of Messrs. Zweig,
Dean-Smith and Ms. Walton are integrally involved with our business and
operations and are able to contribute valuable insights into the identification
of suitable candidates for nomination to the Board. As a result, we believe that
it is in our best interest that our entire Board oversee the composition and
operations of our Board of Directors and therefore, we have not created a
standing nominating committee of the Board.

SHAREHOLDER COMMUNICATIONS

        In light of the limited operations we conduct and the limited number of
record and beneficial shareholders that we have, we have not implemented any
formal procedures for shareholder communication with our Board of Directors. Any
matter intended for the Board, or for any individual member or members of the
Board, should be directed to our corporate secretary at MailKey Corporation,
17194 Preston Rd., Suite 102 PMB 341, Dallas, TX 75248. In general, all
shareholder communication delivered to the corporate secretary for forwarding to
the Board or specified Board members will be forwarded in accordance with the
shareholder's instructions. However, the corporate secretary reserves the right
to not forward to Board members any abusive, threatening or otherwise
inappropriate materials.

AUDIT COMMITTEE AND AUDIT COMMITTEE FINANCIAL EXPERT

        Our Board of Directors has not created a standing audit committee of the
Board. Instead, our full Board of Directors acts as our audit committee.

        The Board of Directors determined that our internal controls are
adequate to insure that financial information is recorded, processed, summarized
and reported in a timely and accurate manner in accordance with applicable rules
and regulations of the Securities and Exchange Commission. Accordingly, our
Board of Directors concluded that the benefits of

<PAGE>

retaining an individual who qualifies as an "audit committee financial expert,"
as that term is defined in Item 401(e) of Regulation S-B promulgated under the
Securities Act, would be outweighed by the costs of retaining such a person. As
a result, no member of our Board of Directors is an "audit committee financial
expert."

SECTION 16 BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

        Section 16(a) of the U.S. Securities and Exchange Act of 1934, as
amended (the "Exchange Act"), requires our officers and directors and persons
who own more than ten percent (10%) of our common stock to file with the SEC
initial reports of ownership and reports of changes in ownership of our common
stock. Such officers, directors and ten percent (10%) stockholders are also
required by applicable SEC rules to furnish to us copies of all forms filed with
the SEC pursuant to Section 16(a) of the Exchange Act. Based solely on our
review of the copies of such forms received by us or written representations
from such persons that no other reports were required for such persons, we
believe that during the fiscal year ended March 31, 2005, all Section 16(a)
filing requirements applicable to our officers, directors and ten percent (10%)
stockholders were satisfied in a timely fashion.

CODE OF BUSINESS CONDUCT AND ETHICS

        We have adopted a Code of Business Conduct and Ethics that applies to
our principal executive officer, principal financial officer, principal
accounting officer or controller, or persons performing similar functions. Our
Code of Business Conduct and Ethics is designed to deter wrongdoing and promote:
(i) honest and ethical conduct, including the ethical handling of actual or
apparent conflicts of interest between personal and professional relationships;
(ii) full, fair, accurate, timely and understandable disclosure in reports and
documents that we file with, or submit to, the SEC and in our other public
communications; (iii) compliance with applicable governmental laws, rules and
regulations; (iv) the prompt internal reporting of violations of the code to an
appropriate person or persons identified in the code; and (v) accountability for
adherence to the Code of Ethics.

        A copy of our Code of Business Conduct and Ethics is attached hereto as
Exhibit 14.1 and incorporated by reference herein.

ITEM 10. EXECUTIVE COMPENSATION

        The following table provides certain summary information concerning
compensation paid to or accrued by the executive officers named below during the
three months ended March 31, 2005, and the years ended December 31, 2004 and
2003.

<PAGE>

                           SUMMARY COMPENSATION TABLE

                               ANNUAL COMPENSATION

Name and
Principal Position           Calendar    Salary ($)   Bonus ($)      ALL
Compensation ($)               Year                                 OTHER
----------------             --------    ----------  -----------  ----------
Ivan Zweig                     2005        75,000          -0-       -0-
CHAIRMAN,                      2004       300,000      60,000        -0-
CHIEF EXECUTIVE OFFICER        2003       180,000          -0-       -0-

Timothy Dean-Smith             2005        27,000          -0-       -0-
CHIEF FINANCIAL OFFICER        2004       120,000          -0-       -0-
DIRECTOR                       2003        80,000          -0-       -0-

Graham Norton-Standen          2005            -0-         -0-       -0-
FORMER CHAIRMAN,               2004         7,182          -0-       -0-
CHIEF EXECUTIVE OFFICER,       2003            -0-         -0-       -0-
AND SECRETARY

Andrew J. Kacic (1)            2005            -0-         -0-       -0-
FORMER CHAIRMAN AND            2004            -0-         -0-    3,750 (2)
CHIEF EXECUTIVE OFFICER        2003            -0-         -0-       -0-


(1) Mr. Kacic was an executive officer and Director of the Company from November
2002 until his resignation on March 26, 2004.

(2) Consisted of 25,000 shares of our common stock issued to Mr. Kacic under the
Company's 2001 Employee Stock Compensation Plan, calculated based on the closing
price of $.15 per share on the OTC Bulletin Board on March 25, 2004, the date of
grant.

        Graham Norton Standen, our preceding Chairman, Chief Executive Officer
and Secretary, received annual compensation in the amount of approximately
$420,000. Roger B. Ponting, our former Chief Financial Officer, received annual
compensation in the amount of approximately $140,000.

                      OPTION/SAR GRANTS IN LAST FISCAL YEAR
                               (INDIVIDUAL GRANTS)

        We did not grant any stock options or stock appreciation rights to any
of our named executive officers during the fiscal year ended March 31, 2005.

<PAGE>

                 AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL
                   YEAR AND FISCAL YEAR-END OPTION/SAR VALUES

        Ivan Zweig exercised 10,153,486 stock options prior to the merger with
IElement in January 2005. No other stock options or stock appreciation rights
were exercised by any of our named executive officers during the fiscal year
ended March 31, 2005, and no stock appreciation rights were issued and
outstanding at the end of such fiscal year.

        The following table provides certain summary information concerning the
number of stock options exercised by such executive officers during the fiscal
year ended March 31, 2005, and the aggregate number and value of options issued
and outstanding at the end of such fiscal year.

<TABLE>
<CAPTION>
                                                           Number of Securities       Value of Unexercised
                                                               Underlying                 In-the-Money
                                                            Unexercised Options           Options at
                                Shares                     at Fiscal Year-End (#)     Fiscal Year-End ($)
                             Acquired on       Value            Exercisable/             Exercisable/
Name                           Exercise      Realized          Unexercisable           Unexercisable (1)
----                           --------      --------          -------------           -----------------
<S>                           <C>                 <C>        <C>                               <C>
Ivan Zweig                    10,153,486          ---              0 / 0                       ---

Timothy Dean Smith

Graham Norton-Standen                ---          ---        366,600 / 1,133,400               ---

Andrew J. Kacic                      ---          ---                ---                       ---
</TABLE>


(1) The last price of our common stock as reported on the OTC Bulletin Board on
June 28, 2005, was $0.035 per share.


            LONG-TERM INCENTIVE PLANS AND AWARDS IN LAST FISCAL YEAR

        We did not make any awards under long-term incentive plans to any of our
named executive officers during the fiscal year ended March 31, 2005.

<PAGE>

EQUITY COMPENSATION PLAN INFORMATION

        The following table provides information as of March 31, 2005 with
respect to shares of our common stock that may be issued under our existing
equity compensation plan.

<TABLE>
<CAPTION>
                                                                                Number of securities
                                          Number of           Weighted-         remaining available
                                      securities to be         average          for future issuance
                                        issued upon         exercise price          under equity
                                         exercise of        of outstanding      compensation plans
                                         outstanding           options,        (excluding securities
                                      options, warrants        warrants             reflected in
                                         and rights           and rights              column (a))
                                            (a)                  (b)                      (c)
<S>                                         <C>              <C>                      <C>
Equity compensation plans
   approved by security holders (1)         -0-              Not applicable            3,675,000

Equity compensation plans not
   approved by security holders             -0-              Not applicable            1,500,000

         Total                              -0-              Not applicable            5,175,000
</TABLE>

(1) Consists of the 2001 Employee Stock Compensation Plan.


DESCRIPTION OF PLANS NOT APPROVED BY SECURITY HOLDERS

        In March 2004, the board of directors of MK Secure Solutions Limited
adopted the MK Secure Solutions Limited Employee Benefit Trust (the "Trust").
The Trust provides for the distribution by one or more trustees ("Trustees") of
income, property and other assets of the Trust ("Trust Property") to current and
former employees and directors of MK Secure Solutions Limited, or any parent to
or subsidiaries of MK Secure Solutions Limited, as well as members of such
persons' immediate family (the "Beneficiaries"). The Trust was formed for the
purpose of providing incentives to the Beneficiaries to exert maximum efforts
for the success of MK Secure Solutions Limited.

        The Trust has been funded with approximately $12,500 and 1,500,000
shares of our common stock. Under the terms of the Trust, Trustees may
distribute the Trust Property for the benefit of any one or more of the
Beneficiaries in such manner as the Trustees determine in their sole discretion.
The Trustees are entitled to remuneration for services performed as well as
reimbursement of reasonable expenses incurred in the performance of such
services.

<PAGE>

Trustees may be appointed to and removed from the Trust in MK Secure Solutions
Limited's sole discretion. The current Trustee is Confiance Limited, a Guernsey
private limited company.

        As of June 30, 2005, the Trustee had not made any distributions of Trust
Property to any Beneficiaries. There was no activity under the Trust during the
fiscal year ended 2005.

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

        The following table sets forth, as of March 31, 2005, information with
respect to the securities holdings of all persons that we, pursuant to filings
with the SEC and our stock transfer records, have reason to believe may be
deemed the beneficial owner of more than five percent (5%) of the common stock.
The following table also sets forth, as of such date, the beneficial ownership
of the common stock by all of our executive officers and directors, both
individually and as a group. The beneficial owners set forth below have been
determined in accordance with Rule 13d-3 under the Securities Exchange Act of
1934, as amended.

<TABLE>
<CAPTION>
                                                                   Amount and
                                                                    Nature of         Percentage
Name and Address of Beneficial Owner                          Beneficial Ownership    of Class (1)
------------------------------------                          --------------------    ------------
<S>                                                            <C>                      <C>
Ivan Zweig                                                      18,770,966 (2)           19.8%

Tim Dean-Smith                                                   4,982,752                5.3%

Susan Walton                                                       441,777               0.47%

All directors and executive officers as a group                 24,195,495               25.5%

Including all above, regardless of status as current director/ officer.

</TABLE>
---------------------

(1) The percentages have been calculated based upon 94,850,535 shares of common
stock outstanding as of June 28, 2005 plus, for each person or group, the number
of shares of our common stock issuable upon the exercise of any convertible
securities beneficially owned by such person or group.

(2) Includes 18,685,966 shares owned by Kramerica Corp., over which Mr. Zweig
has sole voting and investment power, and 0 (zero) shares issuable upon the
exercise of outstanding options.

<PAGE>

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

NONE.

ITEM 13.  EXHIBITS, LIST AND REPORTS ON FORM 8-K

(a)     The following documents are filed as exhibits to this report.

Exhibit No.                              Description
-----------                              -----------

     3.1        Articles of Incorporation (incorporated by reference to Exhibit
                3.1(1) to the Company's Registration Statement on Form 10SB
                filed with the SEC on February 3, 2000 (the "Registration
                Statement"))

     3.2        Bylaws (incorporated by reference to Exhibit 3.2 to the
                Registration Statement)

     3.3        Articles of Amendment to Articles of Incorporation (incorporated
                by reference to Exhibit 3.1(2) to the Registration Statement)

     3.4        Articles of Amendment to Articles of Incorporation (incorporated
                by reference to Exhibit 3.1(3) to the Company's Annual Report on
                Form 10-KSB for the year ended March 31, 2003)

     3.5        Certificate of Correction to Articles of Amendment to Articles
                of Incorporation (incorporated by reference to Exhibit 3.1(4) to
                the Company's Annual Report on Form 10-KSB for the year ended
                March 31, 2003)

     4.1        Specimen Stock Certificate (incorporated by reference to Exhibit
                4.1 to the Registration Statement)

    10.1        Stock Purchase and Sale Agreement, dated as of February 5, 2003,
                by and between MailKey Corporation (f/k/a/ Sutton Trading
                Solutions, Inc.) and Link Investment Holdings Inc. Limited
                (incorporated by reference to Exhibit 10.1 to the Company's
                Quarterly Report on Form 10-QSB for the quarter ended December
                31, 2002)

    31.1        Certification of Chief Executive Officer of the Company required
                by Rule 13a-14(a) under the Securities Exchange Act of 1934, as
                amended

<PAGE>

    31.2        Certification of Chief Finanical Officer of the Company required
                by Rule 13a-14(a) under the Securities Exchange Act of 1934, as
                amended

    32          Certification of Chief Executive Officer and Chief Financial
                Officer of the Company required by Rule 13a-14(b) under the
                Securities Exchange Act of 1934, as amended

(b)     Reports on Form 8-K.


----------------------------------------- --------------------------------------
DATE OF EVENT REPORTED                    ITEMS REPORTED
----------------------------------------- --------------------------------------
April 12, 2005 (8-K/A)                    4 and 7
----------------------------------------- --------------------------------------
April 5, 2005 (8-K/A)                     4 and 9
----------------------------------------- --------------------------------------
February 28, 2005 (8-K/A)                 4 and 9
----------------------------------------- --------------------------------------
February 4, 2005                          4
----------------------------------------- --------------------------------------
January 25, 2005                          1, 2, 3, 5 and 9
----------------------------------------- --------------------------------------
January 6, 2005                           1
----------------------------------------- --------------------------------------
November 12, 2004                         1
----------------------------------------- --------------------------------------
November 10, 2004                         5
----------------------------------------- --------------------------------------
October 25, 2004                          1 and 9
----------------------------------------- --------------------------------------
October 6, 2004                           5
----------------------------------------- --------------------------------------
September 8, 2004                         1 and 9
----------------------------------------- --------------------------------------
July 14, 2004                             Item 4
----------------------------------------- --------------------------------------
June 8, 2004                              Item 4
----------------------------------------- --------------------------------------
April 9, 2004                             Item 1, 2 and 7
----------------------------------------- --------------------------------------



ITEM 14.   CONTROLS AND PROCEDURES

As required by Rule 13a-15 under the Securities Exchange Act of 1934, as
amended, as of the end of the period covered by this report, MailKey carried out
an evaluation of the effectiveness of the design and operation of MailKey's
disclosure controls and procedures. This evaluation was carried out by Ivan
Zweig, MailKey's Chief Executive Officer and Timothy Dean-Smith, MailKey's Chief
Financial Officer, who concluded that MailKey's disclosure controls and
procedures are effective. There have been no significant changes in MailKey's
internal controls or in other factors, which could significantly affect internal
controls subsequent to the date MailKey carried out its evaluation.

<PAGE>

Disclosure controls and procedures are controls and other procedures that are
designed to ensure that information required to be disclosed in MailKey's
reports filed or submitted under the Exchange Act is recorded, processed,
summarized and reported, within the time periods specified in the SEC's rules
and forms. Disclosure controls and procedures include, without limitation,
controls and procedures designed to ensure that information required to be
disclosed in MailKey's reports filed under the Exchange Act is accumulated and
communicated to management, including MailKey's Chief Executive Officer and
Chief Financial Officer, to allow timely decisions regarding required
disclosure.

ITEM 15.   Principal Accountant Fees and Services

The aggregate fees billed for the year ended March 31, 2005 for professional
services rendered by BAGELL, JOSEPHS & COMPANY, L.L.C. ("BJC"), for the audit of
the Company's annual financial statements and review of financial statements
included in the Company's Form 10-QSB or services that are normally provided by
the accountant in connection with statutory and regulatory filings or
engagements for the year ended March 31, 2005 was $19,500.

BJC also performed the Company's independent audit to examine the financial
statements of the Company for the fiscal years ended March 31, 2004. BJC has
performed the following services and has been paid the following fees for these
fiscal years.

Audit Fees

The aggregate fees billed for the year ended March 31, 2005 for professional
services rendered by BJC for the audit of the Company's annual financial
statements and review of financial statements included in the Company's Form
10-QSB or services that are normally provided by the accountant in connection
with statutory and regulatory filings or engagements for the year ended March
31, 2005 was $19,500.

Audit-Related Fees

No fees were billed for the year ended March 31, 2005 for assurance and related
services by BJC that are reasonably related to the performance of the audit or
review of the Company's financial statements and are not reported under the
category Audit Fees described above.

Tax Fees

No fees were billed for the year ended March 31, 2005 for tax compliance, tax
advice, or tax planning services by BJC that are reasonably related to the
performance of the audit or review of the Company's financial statements and are
not reported under the category Audit Fees described above.

<PAGE>

All Other Fees

No fees were billed for the year ended March 31, 2005 for products and services
provided by BJC, other than the services reported in the Audit Fees,
Audit-Related Fees, and Tax Fees categories above.

Audit Committee Pre-Approval Policies

The Company's standing audit committee currently does not have any pre-approval
policies or procedures concerning services performed by BJC. All the services
performed by BJC that are described above were pre-approved by the Company's
standing audit committee. None of the hours expended on BJC's engagement to
audit the Company's financial statements for the year ended March 31, 2005 were
attributed to work performed by persons other than BJC's full-time, permanent
employees.


SIGNATURES

In accordance with the requirements the Exchange Act, the registrant caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized.

                                              MAILKEY CORPORATION


Date:  June 29, 2005                          /s/ Ivan Zweig
                                              ---------------
                                              Chief Executive Officer, Chairman


Date:  June 29, 2005                          /s/ Timothy Dean Smith
                                              -----------------------
                                              Chief Financial Officer, Director

<PAGE>


                       MAILKEY CORPORATION AND SUBSIDIARY
                        CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004
                 AND THE YEARS ENDED DECEMBER 31, 2004 AND 2003

                                TABLE OF CONTENTS




Consolidated Audited Financial Statements:..
                                                                    PAGE(S)
                                                                    -------

Report of Independent Registered Public Accounting Firm             F-1

Consolidated Balance Sheet as of March 31, 2005                     F-2

Consolidated Statements of Operations for the Three
   Months Ended March 31, 2005 and 2004 and the Years
   Ended December 31, 2004 and 2003                                 F-3

Consolidated Statement of Changes in Stockholders'
   (Deficit) for the Period March 11, 2003 (Inception)
   to March 31, 2005                                                F-4 - F-7

Consolidated Statements of Cash Flow for the Three
   Months Ended March 31, 2005 and 2004 and the Years
   Ended December 31, 2004 and 2003                                 F-8 - F-9

Notes to Consolidated Financial Statements.                         F-10 - F-27

<PAGE>

                        BAGELL, JOSEPHS & COMPANY, L.L.C.
                          Certified Public Accountants
                               High Ridge Commons
                                 Suites 400-403
                           200 Haddonfield Berlin Road
                           Gibbsboro, New Jersey 08026
                        (856) 346-2828 Fax (856) 346-2882


REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

MailKey Corporation and Subsidiary
Dallas, Texas

We have audited the accompanying consolidated balance sheet of MailKey
Corporation and Subsidiary (the "Company") as of March 31, 2005 and the related
statements of operations and cash flow for the three months ended March 31, 2005
and 2004, the years ended December 31, 2004 and 2003 and the related statement
of stockholders' equity (deficit) from March 11, 2003 (inception) to March 31,
2005. 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 audits.

We conducted our audits in accordance with 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
consolidated financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the consolidated financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall consolidated financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

The accompanying consolidated financial statements for the three months ended
March 31, 2005 and 2004 and for the years ended December 31, 2004 and 2003 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
sustained operating losses and capital deficits that raise substantial doubt
about its ability to continue as a going concern. Management's plan in regard to
these matters are also described in Note 8. The consolidated financial
statements do not include any adjustments that might result from the outcome of
these uncertainties.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of MailKey Corporation
and Subsidiary as of March 31, 2005 and the results of its operations and cash
flow for the three months ended March 31, 2005 and 2004 and the years ended
December 31, 2004 and 2003 and changes in stockholders' equity (deficit) from
March 11, 2003 (inception) to March 31, 2005 in conformity with accounting
principles generally accepted in the United States of America.

                                         MEMBER OF:
BAGELL, JOSEPHS & COMPANY, L.L.C.        AMERICAN INSTITUTE OF CERTIFIED PUBLIC
                                         ACCOUNTANTS  NEW JERSEY SOCIETY OF
                                            CERTIFIED PUBLIC
                                         ACCOUNTANTS PENNSYLVANIA INSTITUTE OF
                                            CERTIFIED PUBLIC ACCOUNTANTS

/s/ BAGELL, JOSEPHS & COMPANY, L.L.C.
-------------------------------------
Certified Public Accountants
Gibbsboro, New Jersey
 June 28, 2005

                                      F-1

<PAGE>
<TABLE>
<CAPTION>
<S>                                                                       <C>
                            MAILKEY CORPORATION AND SUBSIDIARY
                                CONSOLIDATED BALANCE SHEET
                                      MARCH 31, 2005
                                         AUDITED


                              ASSETS

                                                                            March 31,
                                                                              2005
                                                                        ----------------
CURRENT ASSETS:
  Cash and cash equivalents                                               $   340,321
  Accounts receivable, net                                                    520,644
  Other current assets                                                          1,780
                                                                        ----------------

          TOTAL CURRENT ASSETS                                                862,745
                                                                        ----------------

  Fixed assets, net of depreciation                                           889,051
                                                                        ----------------
OTHER ASSETS:
  Goodwill                                                                  2,079,665
  Deposits                                                                     58,993
                                                                        ----------------

          TOTAL OTHER ASSETS                                                2,138,658
                                                                        ----------------

TOTAL ASSETS                                                              $ 3,890,454
                                                                        ================

              LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES:
  Accounts payable and accrued expenses                                   $ 1,400,992
  Customer deposits                                                           164,112
  Receivable financing payable                                                483,114
  Commissions payable                                                         176,136
  Liability for stock to be issued                                             75,000
  Deferred revenue                                                            815,036
  Current portion - notes payable                                             461,590
                                                                        ----------------

          TOTAL CURRENT LIABILITIES                                         3,575,980
                                                                        ----------------
LONG-TERM LIABILITIES:
  Notes payable, net of current portion                                       293,188
                                                                        ----------------

          TOTAL LONG-TERM LIABILITIES                                         293,188
                                                                        ----------------

      TOTAL LIABILITIES                                                     3,869,168
                                                                        ----------------
STOCKHOLDERS' EQUITY (DEFICIT)
  Common stock, $.001 Par Value, 100,000,000 shares
    authorized; 91,783,730 shares issued and outstanding
    at March 31, 2005                                                          91,783
  Additional paid-in capital                                                  910,808
  Accumulated deficit                                                        (981,305)
                                                                        ----------------

      TOTAL STOCKHOLDERS' EQUITY (DEFICIT)                                     21,286
                                                                        ----------------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)                      $ 3,890,454
                                                                        ================


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

                                           F-2
</TABLE>
<PAGE>
<TABLE>
<CAPTION>

                                              MAILKEY CORPORATION AND SUBSIDIARY
                                            CONSOLIDATED STATEMENTS OF OPERATIONS
                                    FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                                          THE YEARS ENDED DECEMBER 31, 2004 AND 2003


                                                                 THREE MONTHS ENDED                    YEARS ENDED
                                                                 ------------------                    -----------
                                                               MARCH 31,      MARCH 31,       DECEMBER 31,     DECEMBER 31,
                                                                 2005           2004              2004            2003
                                                              (AUDITED)      (UNAUDITED)        (AUDITED)       (AUDITED)
                                                             -------------  -------------     -------------    -------------
<S>                                                           <C>            <C>               <C>              <C>
OPERATING REVENUE:
   Service income                                             $ 1,228,411    $ 1,530,427       $ 5,954,772      $ 4,552,436

COST OF SALES                                                     736,275        819,756         3,042,978        2,716,680
                                                             -------------  -------------     -------------    -------------

GROSS PROFIT                                                      492,136        710,671         2,911,794        1,835,756
                                                             -------------  -------------     -------------    -------------
OPERATING EXPENSES
   General and administrative                                     687,928        458,311         2,033,764        1,116,810
   Selling expenses                                               116,263        109,240           519,600          518,425
   Depreciation & amortization                                     68,164         60,403           260,806          159,070
   Interest expense                                                 6,992         31,354           138,576          122,100
   Receivable factoring fees                                       29,874         33,085           129,021          118,504
                                                             -------------  -------------     -------------    -------------

       TOTAL OPERATING EXPENSES                                   909,221        692,393         3,081,767        2,034,909
                                                             -------------  -------------     -------------    -------------

INCOME (LOSS) BEFORE OTHER (EXPENSE)                             (417,085)        18,278          (169,973)        (199,153)
                                                             -------------  -------------     -------------    -------------
OTHER (EXPENSE)
   Loss on sale of investments                                          -        (86,558)         (125,068)         (65,903)
                                                             -------------  -------------     -------------    -------------

       TOTAL OTHER EXPENSES                                             -        (86,558)         (125,068)         (65,903)
                                                             -------------  -------------     -------------    -------------

NET LOSS BEFORE PROVISION FOR INCOME TAXES                       (417,085)       (68,280)         (295,041)        (265,056)

PROVISION FOR INCOME TAXES                                              -              -                 -                -
                                                             -------------  -------------     -------------    -------------

NET LOSS APPLICABLE TO COMMON SHARES                          $  (417,085)   $   (68,280)      $  (295,041)     $  (265,056)
                                                             =============  =============     =============    =============

NET LOSS PER BASIC AND DILUTED SHARES                         $     (0.01)   $     (1.40)      $     (0.09)     $         -
                                                             =============  =============     =============    =============

WEIGHTED AVERAGE NUMBER OF COMMON
    SHARES OUTSTANDING                                         38,143,835         48,825         3,222,743                1
                                                             =============  =============     =============    =============


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

                                                             F-3
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

                                                 MAILKEY CORPORATION AND SUBSIDIARY
                            CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) - AUDITED
                                     FOR THE PERIOD MARCH 11, 2003 (INCEPTION) TO MARCH 31, 2005


                                                                                 ADDITIONAL
                                             MINORITY       COMMON STOCK         PAID - IN   SUBSCRIPTION     DEFERRED
                                             INTEREST     SHARES      AMOUNT      CAPITAL     RECEIVABLE    COMPENSATION
                                             --------     ------      ------      -------     ----------    ------------
<S>                                          <C>          <C>         <C>        <C>          <C>            <C>
Balance at March 11, 2003 (Inception)
Old Company (MailKey Corporation)            $      -             -   $     -    $       -    $      -       $       -

Issuance of "founders" shares
  at $0.001 per share - March                       -     8,692,900     8,693       (7,824)          -               -

Issuance of shares at $0.05 per share
  for $0.001 cash and $0.0499
  services - October                                -     5,110,397     5,110      250,921           -               -

Issuance of shares at $0.05 per share
  for cash - October                                -     1,976,318     1,976       96,845           -               -

Issuance of shares at $0.05 per share
  for services - October                            -       483,800       484       23,703           -               -

Issuance of shares and warrants at
  $0.25 per share plus 1/2 of a
  warrant - June - Aug.                             -     3,306,000     3,306      823,194           -               -

Issuance of shares valued at $0.1919
  per share for services - June - Aug.              -     1,230,585     1,231      235,041           -               -

Issuance of shares and warrants at
  $0.50 per share plus 1/2 of a
  warrant - Aug. - Nov.                             -       490,000       490      244,510           -               -

Issuance of shares valued at $0.3878
  per share for services - Aug. - Nov.              -       230,000       230       88,986           -               -

Issuance of shares and warrants at
  $0.85 for one share plus 1/2 of a
  warrant - Nov. - Dec.                             -       375,000       375      318,375           -               -

Consulting fees paid in conjunction
  with 2003 share issuances                         -             -         -     (149,790)          -               -

Options issued for services                         -             -         -       53,520           -               -

Issuance of minority interest in
  subsidiary                                      411             -         -            -           -               -

Foreign currency translation
  adjustments                                       -             -         -            -           -               -

Minority interest in loss                        (411)            -         -            -           -               -


(continued)

                                         ACCUMULATED
                                          FOREIGN
                                          EXCHANGE
                                         TRANSLATION     ACCUMULATED
                                         ADJUSTMENT        DEFICIT          TOTAL
                                         ----------        -------          -----

Balance at March 11, 2003 (Inception)
Old Company (MailKey Corporation)          $      -       $       -      $       -

Issuance of "founders" shares
  at $0.001 per share - March                     -               -            869

Issuance of shares at $0.05 per share
  for $0.001 cash and $0.0499
  services - October                              -               -        256,031

Issuance of shares at $0.05 per share
  for cash - October                              -               -         98,821

Issuance of shares at $0.05 per share
  for services - October                          -               -         24,187

Issuance of shares and warrants at
  $0.25 per share plus 1/2 of a
  warrant - June - Aug.                           -               -        826,500

Issuance of shares valued at $0.1919
  per share for services - June - Aug.            -               -        236,272

Issuance of shares and warrants at
  $0.50 per share plus 1/2 of a
  warrant - Aug. - Nov.                           -               -        245,000

Issuance of shares valued at $0.3878
  per share for services - Aug. - Nov.            -               -         89,216

Issuance of shares and warrants at
  $0.85 for one share plus 1/2 of a
  warrant - Nov. - Dec.                           -               -        318,750

Consulting fees paid in conjunction
  with 2003 share issuances                       -               -       (149,790)

Options issued for services                       -               -         53,520

Issuance of minority interest in
  subsidiary                                      -               -            411

Foreign currency translation
  adjustments                                 9,251               -          9,251

Minority interest in loss                         -               -           (411)



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

                                                                 F-4
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

                                                 MAILKEY CORPORATION AND SUBSIDIARY
                     CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) - AUDITED - (CONTINUED)
                                     FOR THE PERIOD MARCH 11, 2003 (INCEPTION) TO MARCH 31, 2005


                                                                               ADDITIONAL
                                            MINORITY       COMMON STOCK        PAID - IN     SUBSCRIPTION    DEFERRED
                                            INTEREST     SHARES      AMOUNT     CAPITAL      RECEIVABLE     COMPENSATION
                                            --------     ------      ------     -------      ----------     ------------
<S>                                          <C>         <C>         <C>        <C>          <C>            <C>
Transfer of shares $0.6468 per share
  for employee benefit trust                 $     -     1,500,000   $ 1,500    $ 968,700    $        -     $          -

650,000 warrants issued in conjunction
  with notes payable of $650,000
  beneficial conversion feature on
  notes payable - January 23 to
  February 23, 2004                                -             -         -      246,727             -                -

Issuance of shares at $0.85 per share
  for cash - March 24                              -       950,000       950      806,550      (212,500)               -

Issuance of shares on exercise of
  warrants at $0.50 - March 24                     -     1,001,000     1,001      499,499             -                -

Issuance of shares on exercise of
  warrants at $1 - March 24                        -       100,000       100       99,900       (50,000)               -

Issuance of shares on exercise of
  options at $0.125 - March 24                     -       800,000       800       99,200             -                -

Consulting fees incurred in
  conjunction with 2004 share
  issuances                                        -             -         -      (93,756)            -                -

Options issued to consultants in
  connection with services in
  January 2004                                     -             -         -    2,086,523             -       (2,086,523)

Amortization of options issued to
  consultants  -                                   -         -            -           -        163,888                 -

Shares deemed issued in
  recapitalization transaction -
  March 25, 2004                                   -     2,619,238     2,619       (2,619)            -                -

Foreign currency translation                       -             -         -            -             -                -

Net loss                                           -             -         -            -             -                -
                                            ---------  -----------  --------  ------------  -------------  ---------------

Balance March 31, 2004                       $     -    28,865,238  $ 28,865   $ 6,688,205   $ (262,500)    $ (1,922,635)
                                            =========  ===========  ========  ============  =============  ===============

(continued)

                                             ACCUMULATED
                                               FOREIGN
                                               EXCHANGE
                                              TRANSLATION     ACCUMULATED
                                              ADJUSTMENT        DEFICIT            TOTAL
                                              ----------        -------            -----
Transfer of shares $0.6468 per share
  for employee benefit trust                  $       -      $          -      $   970,200

650,000 warrants issued in conjunction
  with notes payable of $650,000
  beneficial conversion feature on
  notes payable - January 23 to
  February 23, 2004                                   -                 -          246,727

Issuance of shares at $0.85 per share
  for cash - March 24                                 -                 -          595,000

Issuance of shares on exercise of
  warrants at $0.50 - March 24                        -                 -          500,500

Issuance of shares on exercise of
  warrants at $1 - March 24                           -                 -           50,000

Issuance of shares on exercise of
  options at $0.125 - March 24                        -                 -          100,000

Consulting fees incurred in
  conjunction with 2004 share
  issuances                                           -                 -          (93,756)

Options issued to consultants in
  connection with services in
  January 2004                                        -                 -                -

Amortization of options issued to
  consultants  -                                     -            163,888

Shares deemed issued in
  recapitalization transaction -
  March 25, 2004                                      -                 -                -

Foreign currency translation                     (3,047)                -           (3,047)

Net loss                                              -        (4,667,885)      (4,667,885)
                                             -----------   ----------------  ---------------

Balance March 31, 2004                        $   6,204      $ (4,667,885)     $  (129,746)
                                             ===========   ================  ===============


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

                                                                 F-5
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

                                                 MAILKEY CORPORATION AND SUBSIDIARY
                     CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) - AUDITED - (CONTINUED)
                                     FOR THE PERIOD MARCH 11, 2003 (INCEPTION) TO MARCH 31, 2005


                                                                               ADDITIONAL
                                           MINORITY         COMMON STOCK       PAID - IN    SUBSCRIPTION      DEFERRED
                                           INTEREST     SHARES       AMOUNT     CAPITAL      RECEIVABLE     COMPENSATION
                                           --------     ------       ------     -------      ----------     ------------
<S>                                        <C>         <C>         <C>        <C>            <C>            <C>
Issuance of shares at $0.85 per share
  in connection with conversion of
  bridge loan, 470,588 shares issued,
  294,118 issuable at June 30,
  2004 - J-ne                              $      -       764,706  $    765   $  649,235     $       -      $        -

Issuance of shares at $0.85 per share
  in connection with conversion of
  bridge loan, 19,425 shares issued,
  8,831 issuable at June 30, 2004 -
  June                                            -        28,256        28       23,990             -               -

Issuance of shares at $0.50 per share
  in connection with exercise of
  warrants between June 18, 2004 -
  August 20, 2004                                 -       462,000       462      230,538             -               -

Issuance of shares at $1.00 per share
  in connection with exercise of
  warrants between June 18, 2004 -
  August 20, 2004                                 -       953,019       953      952,066             -               -

Offering costs incurred in conjunction
  with June and July 2004 warrant
  conversions                                     -             -         -     (114,897)            -               -

Stock subscriptions received                      -             -         -            -       160,000               -

Issuance of shares to consultants at
  $0.60 per share in lieu of fees
  owed - September                                -        51,803        52       31,032             -               -

Revalue options issued to consultants
  in conjunction with services in
  December 2003 and January 2004                  -             -         -   (1,264,864)            -       1,264,864

Amortization of expense for options
  issued to consultants                           -             -         -            -             -         512,382

Issuance of shares to consultants in
  November and December 2004                      -     3,601,333     4,101    1,205,001             -               -

Subscription receivable written-off               -             -         -            -       102,500               -

Deferred compensation written-off                 -             -         -            -             -         145,389

Foreign currency translation                      -             -         -            -             -               -

Net loss for the nine months ended
  December 31, 2004                               -             -         -            -             -               -
                                          ----------  -----------  --------  ------------  -------------  --------------

Balance December 31, 2004                  $      -    34,726,355  $ 35,226   $8,400,306     $       -      $        -
                                          ==========  ===========  ========  ============  =============  ==============

(continued)

                                           ACCUMULATED
                                             FOREIGN
                                            EXCHANGE
                                          TRANSLATION       ACCUMULATED
                                           ADJUSTMENT         DEFICIT         TOTAL
                                           ----------         -------         -----

Issuance of shares at $0.85 per share
  in connection with conversion of
  bridge loan, 470,588 shares issued,
  294,118 issuable at June 30,
  2004 - J-ne                               $       -     $          -    $   650,000

Issuance of shares at $0.85 per share
  in connection with conversion of
  bridge loan, 19,425 shares issued,
  8,831 issuable at June 30, 2004 -
  June                                              -                -         24,018

Issuance of shares at $0.50 per share
  in connection with exercise of
  warrants between June 18, 2004 -
  August 20, 2004                                   -                -        231,000

Issuance of shares at $1.00 per share
  in connection with exercise of
  warrants between June 18, 2004 -
  August 20, 2004                                   -                -        953,019

Offering costs incurred in conjunction
  with June and July 2004 warrant
  conversions                                       -                -       (114,897)

Stock subscriptions received                        -                -        160,000

Issuance of shares to consultants at
  $0.60 per share in lieu of fees
  owed - September                                  -                -         31,084

Revalue options issued to consultants
  in conjunction with services in
  December 2003 and January 2004                    -                -              -

Amortization of expense for options
  issued to consultants                             -                -        512,382

Issuance of shares to consultants in
  November and December 2004                        -                -      1,209,102

Subscription receivable written-off                 -                -        102,500

Deferred compensation written-off                   -                -        145,389

Foreign currency translation                   47,441                -         47,441

Net loss for the nine months ended
  December 31, 2004                                 -       (4,816,835)    (4,816,835)
                                           -----------  ----------------  ------------

Balance December 31, 2004                   $  53,645     $ (9,484,720)   $  (995,543)
                                           ===========  ================  ============



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

                                                                 F-6
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

                                                 MAILKEY CORPORATION AND SUBSIDIARY
                     CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT) - AUDITED - (CONTINUED)
                                     FOR THE PERIOD MARCH 11, 2003 (INCEPTION) TO MARCH 31, 2005


                                                                                  ADDITIONAL
                                        MINORITY            COMMON STOCK          PAID - IN    SUBSCRIPTION      DEFERRED
                                        INTEREST      SHARES          AMOUNT       CAPITAL      RECEIVABLE    COMPENSATION
                                        --------      ------          ------       -------      ----------    ------------
<S>                                      <C>         <C>             <C>          <C>             <C>            <C>
Balance December 31, 2004 - carried
  forward                                $     -     34,726,355      $  35,226    $ 8,400,306     $      -       $       -

Recapitalization                               -    (30,406,963)       (30,907)    (8,028,127)           -               -

New equity - reverse merger -
  I-Element                                    -      4,319,392          4,319        372,179            -               -

Shares of common stock issued in
  exercise of options                          -      4,578,223          4,578         41,204            -               -

Issuance of common stock in
  conversion of notes payable                  -      4,694,953          4,695        821,617            -               -

Shares issued in reverse merger -
  Exchange - new company assumed
  liabilities                                        68,979,623         68,979       (545,267)           -               -

Issuance of shares at $0.025 per
  share for services                           -      7,487,587          7,488        179,701            -               -

Issuance of shares at $0.025 per
  share in conversion of accounts
  payable                                      -        693,280            693         16,639            -               -

Issuance of shares at $0.025 per share
  in conversion of debt to equity              -      1,030,672          1,031         24,735            -               -

Net loss for the three months ended
  March 31, 2005
                                        ---------  -------------  -------------  -------------  -------------  -------------

Balance March 31, 2005                   $     -     91,783,730      $  91,783    $   910,808     $      -       $       -
                                        =========  =============  =============  =============  =============  =============

(continued)

                                          ACCUMULATED
                                            FOREIGN
                                           EXCHANGE
                                          TRANSLATION    ACCUMULATED
                                          ADJUSTMENT       DEFICIT         TOTAL
                                          ----------       -------         -----

Balance December 31, 2004 - carried
  forward                                $    53,645    $ (9,484,720)   $6(995,543)

Recapitalization                             (53,645)     8,920, 500       807,821

New equity - reverse merger -
  I-Element                                        -        (564,220)     (187,722)

Shares of common stock issued in
  exercise of options                              -               -        45,782

Issuance of common stock in
  conversion of notes payable                      -               -       826,312

Shares issued in reverse merger -
  Exchange - new company assumed
  liabilities                                      -               -      (476,288)

Issuance of shares at $0.025 per
  share for services                               -               -       187,189

Issuance of shares at $0.025 per
  share in conversion of accounts
  payable                                          -               -        17,332

Issuance of shares at $0.025 per share
  in conversion of debt to equity                  -                        25,766

Net loss for the three months ended
  March 31, 2005                                            (417,085)     (417,085)
                                        ------------  ---------------  ------------

Balance March 31, 2005                   $         -    $   (981,305)   $   21,286
                                        ============  ===============  ============


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

                                                                 F-7
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

                                           MAILKEY CORPORATION AND SUBSIDIARY
                                          CONSOLIDATED STATEMENTS OF CASH FLOW
                                 FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                                       THE YEARS ENDED DECEMBER 31, 2004 AND 2003


                                                              THREE MONTHS ENDED                  YEARS ENDED
                                                              ------------------                  -----------
                                                           MARCH 31,       MARCH 31,     DECEMBER 31,    DECEMBER 31,
                                                             2005            2004            2004            2003
                                                           (AUDITED)      (UNAUDITED)     (AUDITED)        (AUDITED)
                                                          ----------       ---------      ----------      ----------
<S>                                                       <C>             <C>            <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES
   Net (loss)                                             $ (417,085)     $ (68,280)     $ (295,041)     $ (265,056)
                                                          ----------       ---------      ----------      ----------

   ADJUSTMENTS TO RECONCILE NET LOSS TO NET CASH
     PROVIDED BY (USED IN) OPERATING ACTIVITIES:
     Depreciation and amortization                            68,164          60,403         260,806         159,070
     Acquisition of fixed assets in business combination           -               -               -        (893,611)
     Debt and accrued interest assumed in business
        combination                                                -               -               -         824,480
     Goodwill                                                      -               -               -      (2,079,665)
     Stock issued for services                               187,189               -               -               -
     Loss on disposal of equipment                             1,877               -           2,296               -

  CHANGES IN ASSETS AND LIABILITIES
     (Increase) decrease in accounts receivable               67,361         239,346         159,934        (747,939)
     (Increase) decrease in other current assets               2,470          (2,471)         (4,077)           (173)
     (Increase) decrease in deposits                          10,530             468         (14,517)        (55,006)
     Increase (decrease) in accounts payable                 294,777         (19,316)        154,463         904,740
     Increase in accrued interest                                  -          17,289          77,364          56,507
     Increase (decrease) in payroll taxes payable            (17,230)         27,232          17,230               -
     Increase (decrease) in customer deposits                 (4,878)        (14,819)        (35,010)        204,000
     Increase (decrease) in receivable financing payable     (20,807)       (342,679)       (153,082)        657,003
     Increase in commissions payable                          18,411          43,786          98,994          58,731
     Increase (decrease) in refunds payable                   (1,079)         (1,526)           (936)          2,015
     Increase (decrease) in deferred revenue                 (19,940)         93,331        (262,959)      1,097,935
                                                          ----------       ---------      ----------      ----------

     Total adjustments                                       586,845         101,044         300,506         188,087
                                                          ----------       ---------      ----------      ----------

     NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES     169,760          32,764           5,465         (76,969)
                                                          ----------       ---------      ----------      ----------

CASH FLOWS FROM INVESTING ACTIVITIES
     Proceeds from sale of equipment                           2,800               -           3,451               -
     Acquisition of fixed assets                              (9,485)       (163,766)       (233,396)       (251,023)
                                                          ----------       ---------      ----------      ----------

      NET CASH (USED IN) INVESTING ACTIVITIES                 (6,685)       (163,766)       (229,945)       (251,023)
                                                          ----------       ---------      ----------      ----------


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

                                                          F-8
</TABLE>

<PAGE>
<TABLE>
<CAPTION>

                                           MAILKEY CORPORATION AND SUBSIDIARY
                                    CONSOLIDATED STATEMENTS OF CASH FLOW (CONTINUED)
                                 FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                                       THE YEARS ENDED DECEMBER 31, 2004 AND 2003


                                                             THREE MONTHS ENDED                 YEARS ENDED
                                                             ------------------                 -----------
                                                           MARCH 31,       MARCH 31,     DECEMBER 31,    DECEMBER 31,
                                                             2005            2004            2004            2003
                                                           (AUDITED)      (UNAUDITED)      (AUDITED)       (AUDITED)
                                                           ---------       ---------       ---------       ---------
<S>                                                        <C>             <C>            <C>              <C>
CASH FLOWS FROM FINANCING ACTIVITES
    Payments of notes payable                              $ (32,909)      $ (32,600)     $ (465,344)      $ (46,193)
    Proceeds from notes payable                               22,450         100,000         625,331         467,054
    Common stock issued for cash                                   -               -         119,300               -
    Proceeds in exercise of stock options                     39,954               -              75               -
                                                           ---------       ---------       ---------       ---------

       NET CASH PROVIDED BY FINANCING ACTIVITIES              29,495          67,400         279,362         420,861
                                                           ---------       ---------       ---------       ---------
NET INCREASE (DECREASE) IN CASH
    AND CASH EQUIVALENTS                                     192,570         (63,602)         54,882          92,869

CASH AND CASH EQUIVALENTS -
    BEGINNING OF YEAR / PERIOD                               147,751          92,869          92,869               -
                                                           ---------       ---------       ---------       ---------

CASH AND CASH EQUIVALENTS - END OF
    YEAR / PERIOD                                          $ 340,321       $  29,267       $ 147,751       $  92,869
                                                           =========       =========       =========       =========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW
  INFORMATION:

CASH PAID DURING THE YEAR FOR:
    Interest expense                                       $   2,563       $   3,890       $  34,983       $   6,459
                                                           =========       =========       =========       =========
SUPPLEMENTAL DISCLOSURE OF NONCASH
  ACTIVITIES:

    Accounts payable converted to equity                   $  17,332       $   5,000       $   5,000       $       -
                                                           =========       =========       =========       =========

    Accounts payable converted to debt                     $  70,000       $       -       $  50,000       $       -
                                                           =========       =========       =========       =========

    Conversion of notes payable to equity                  $ 852,078       $       -       $ 248,000       $       -
                                                           =========       =========       =========       =========

    Issuance of stock for redemption of ICCC shares        $       -       $   4,123       $   4,123       $       -
                                                           =========       =========       =========       =========

    Debt converted to accounts payable                     $ 126,000       $       -       $       -       $       -
                                                           =========       =========       =========       =========

    Debt converted in exercise of options                  $   5,828       $       -       $       -       $       -
                                                           =========       =========       =========       =========

    Accounts payable and accrued expenses
      acquired in reverse merger                           $  63,343       $       -       $       -       $       -
                                                           =========       =========       =========       =========

    Debt acquired in reverse merger                        $ 337,945       $       -       $       -       $       -
                                                           =========       =========       =========       =========

    Stock issued for services                              $ 187,189       $       -       $       -       $       -
                                                           =========       =========       =========       =========


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

                                                          F-9
</TABLE>

<PAGE>

                       MAILKEY CORPORATION AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
             FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                   THE YEARS ENDED DECEMBER 31, 2004 AND 2003

NOTE 1- ORGANIZATION AND BASIS OF PRESENTATION

        MK Secure Solutions Ltd. was established as a messaging security and
        management. On March 25, 2004, pursuant to an Agreement and Plan of
        Merger, Global Diversified Acquisition Corp. ("GDAC"), acquired all of
        the outstanding capital stock of MK Secure Solutions Ltd ("MKSS"), a
        holding company incorporated on March 11, 2003, under the laws of the
        British Virgin Islands. The transaction was effected by the issuance of
        shares such that the former MKSS shareholders owned approximately 90% of
        the outstanding MailKey stock after the transaction. GDAC then changed
        its name to MailKey Corporation ("MailKey").

        The Company's Chairman and Chief Executive Officer resigned in September
        2004 and the Company's Chief Financial Officer and member of the Board
        resigned in November 2004. Both positions have been filled by the
        Company's founder and deputy chairman.

        In the first quarter of 2005 the Company was unable to continue funding
        the development of its messaging security solutions, and the rights were
        transferred to the development team in return for the cancellation of
        most of the liabilities which the Company owed to them. The Company
        retains an interest of 20% in the messaging security solutions; however
        to date there has been no commercialization of the solutions. In the
        first quarter 2005 the Company sold its insolvent British Virgin Islands
        subsidiary, MK Secure Solutions Limited, for $1 to a UK based accounting
        firm, SS Khehar & Company. SS Khehar & Company has agreed to deal with
        the winding up of the former subsidiary, for a fee of $1,800.

        On November 9, 2004, the Company entered into an Agreement and Plan of
        Merger (the "Merger Agreement") by and among the MailKey Corporation,
        MailKey Acquisition Corp., a Delaware corporation and our wholly-owned
        subsidiary ("Merger Sub"), Inc., a Nevada Corporation, I-Element, Inc.
        ("I-Element") and Ivan Zweig, pursuant to which the Company agreed to
        acquire all of the issued and outstanding shares of capital stock of
        I-Element. This transaction closed in January 2005. At the closing of
        the Merger, Merger Sub was merged into I-Element, at which time the
        separate corporate existence of Merger Sub ceased and I-Element now
        continues as the surviving company. The Share Exchange has been
        accounted for as a reverse merger under the purchase method of
        accounting. Accordingly, I-Element will be treated as the continuing
        entity for accounting purposes and the historical financial statements
        presented will be those of I-Element.

                                      F-10
<PAGE>

                       MAILKEY CORPORATION AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
             FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                   THE YEARS ENDED DECEMBER 31, 2004 AND 2003

NOTE 1- ORGANIZATION AND BASIS OF PRESENTATION (CONTINUED)

        Under the terms of the Merger Agreement, MailKey issued its common
        stock, $.001 par value per share, in exchange for all of the issued and
        outstanding shares of capital stock of I-Element. The exchange ratio
        setting forth the number of shares of MailKey common stock issued for
        each issued and outstanding share of capital stock of I-Element was 3.52
        shares of MailKey common stock for each issued and outstanding share of
        capital stock of I-Element.

        I-Element, incorporated in Nevada on December 30, 2002, is a
        facilities-based nationwide communications service provider that
        provides state-of-the-art telecommunications services to small and
        medium sized enterprises ("SMEs"). I-Element provides broadband data,
        voice and wireless services by offering integrated T-1 lines as well as
        Layer 2 Private Network solutions that provide SMEs with dedicated
        Internet access services, customizable business solutions for voice,
        data, wireless and Internet, and secure communications channels between
        the SME offices, partners, vendors, customers and employees without the
        use of a firewall or encryption devices. I-Element has a network
        presence in 18 major markets in the United States, including facilities
        in Los Angeles, Dallas, and Chicago. The Company started business in
        2003.

        In connection with the closing of the merger, MailKey entered into a
        letter of intent with Ivan Zweig and Kramerica Capital Corporation
        ("Kramerica"), a corporation wholly-owned by Mr. Zweig, which
        contemplates that MailKey and I-Element will enter into a four year
        employment agreement with Kramerica and Mr. Zweig pursuant to which Mr.
        Zweig will serve as the Chief Executive Officer of MailKey and
        I-Element. The letter of intent provides that Mr. Zweig will receive an
        annual base salary of $300,000. In addition to his base salary, Mr.
        Zweig will be entitled to annual performance bonuses with targets
        ranging from $1,000,000 to $3,000,000 during the second, third and
        fourth years provided I-Element achieves certain performance goals. If
        Mr. Zweig is terminated without cause, MailKey is obligated to pay the
        remaining salary owed to Mr. Zweig for the complete term of the
        employment agreement, to pay off all notes owed to Mr. Zweig or
        Kramerica, all outstanding options shall become fully vested, MailKey
        shall pay all earned performance bonuses and all accrued vacation. If
        Mr. Zweig is terminated for any reason other than cause, MailKey shall
        pay in full the


                                      F-11
<PAGE>

                       MAILKEY CORPORATION AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
             FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                   THE YEARS ENDED DECEMBER 31, 2004 AND 2003


NOTE 1- ORGANIZATION AND BASIS OF PRESENTATION (CONTINUED)

        Notes owed to either Mr. Zweig or Kramerica Capital Corporation and at
        least 75% of the earned bonus plan set forth by the directors. Effective
        January 24, 2005, Mr. Zweig was also appointed to the Board of Directors
        of MailKey.

        Ivan Zweig has served as the Chief Executive Officer of I-Element since
        March 2003. Mr. Zweig is also the Chief Executive Officer, director and
        sole shareholder of Kramerica, a personnel services corporation. Since
        December 1998, Mr. Zweig has served as the Chief Executive Officer and
        director of Integrated Communications Consultants Corp. ("ICCC"), a
        nationwide data carrier specializing in high speed Internet access and
        secure data transaction. ICCC provides I-Element with resold telecom
        services and I-Element pays ICCC approximately $97,000 on a monthly
        basis for such services. On October 1, 2004, ICCC filed for Chapter 11
        bankruptcy protection in the United States Bankruptcy Court, Northern
        District of Texas, Dallas Division.

        Upon the consummation of the acquisition, I-Element has issued
        outstanding promissory notes to, among others, Kramerica in the
        aggregate amount of $120,000 (the "Notes"). I-Element has also issued
        Notes in the aggregate amount to members of Mr. Zweig's immediate
        family. The Notes are payable in 36 monthly installments with the first
        payment commencing six months after the closing of the merger and will
        continue to be secured by substantially all of the assets of I-Element.

        The Company's consolidated financial statements are prepared on the
        accrual basis of accounting in accordance with accounting principles
        generally accepted in the United States of America, and have been
        presented on a going concern basis which contemplates the realization of
        assets and the satisfaction of liabilities in the normal course of
        business.


                                      F-12
<PAGE>

                       MAILKEY CORPORATION AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
             FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                   THE YEARS ENDED DECEMBER 31, 2004 AND 2003


NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

        BASIS OF CONSOLIDATION

        The consolidated financial statements include the financial position and
        results of I-Element. All significant intercompany accounts and
        transactions have been eliminated in consolidation.

        USE OF ESTIMATES

        The preparation of consolidated 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 consolidated financial
        statements and the reported amounts of revenues and expenses during the
        reporting period. Actual results could differ from those estimates.

        CASH AND CASH EQUIVALENTS.

        The Company considers all highly liquid debt instruments and other
        short-term investments with an initial maturity of three months or less
        to be cash or cash equivalents.

        The Company maintains cash and cash equivalents with a financial
        institution which is insured by the Federal Deposit Insurance
        Corporation up to $100,000. At various times throughout the year the
        Company had amounts on deposit at the financial institution in excess of
        federally insured limits.

        REVENUE AND COST RECOGNITION

        The Company records its transactions under the accrual method of
        accounting whereby income is recognized when the services are provided
        rather than when billed or the fees are collected, and costs and
        expenses are recognized in the period they are incurred rather than paid
        for.


                                      F-13
<PAGE>

                       MAILKEY CORPORATION AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
             FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                   THE YEARS ENDED DECEMBER 31, 2004 AND 2003

NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -  (CONTINUED)

        ACCOUNTS RECEIVABLE

        The Company factors 99% of its billings with an outside agency. The
        Company invoices its customers on the 28th of the month for services to
        be rendered two months subsequent to the billing date. The Company
        receives 75% of the aggregate net face value of the assigned accounts at
        the time of placement with the factor.

        DEFERRED REVENUE

        Deferred revenue consists of customers billed in advance of revenue
        being earned.

        PROVISION FOR BAD DEBT

        Under SOP 01-6 "Accounting for Certain Entities (including Entities with
        Trade Receivables), the Company has intent and belief that all amounts
        in accounts receivable are collectible. The Company has determined that
        based on their collections an allowance for doubtful accounts of $6,673
        and $6,098 has been recorded at March 31, 2005 and December 31, 2004.

        Bad debt expense for the three months ended March 31, 2005 and 2004 was
        $4,821 and $17,626, respectively and for the years ending December 31,
        2004 and 2003 was $63,498 and $52,241, respectively.

        ADVERTISING COSTS

        The Company expenses the costs associated with advertising and marketing
        as incurred. Advertising and marketing expenses, included in the
        statements of operations for the three months ended March 31, 2005 and
        2004 were $660 and $9,216, respectively, and for the years ended
        December 31, 2004 and 2003 were $24,556 and $5,901, respectively.


                                      F-14
<PAGE>

                       MAILKEY CORPORATION AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
             FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                   THE YEARS ENDED DECEMBER 31, 2004 AND 2003


NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -  (CONTINUED)

        INCOME TAXES

        The income tax benefit is computed on the pretax loss based on the
        current tax law. Deferred income taxes are recognized for the tax
        consequences in future years of differences between the tax basis of
        assets and liabilities and their financial reporting amounts at each
        year-end based on enacted tax laws and statutory tax rates. No benefit
        is reflected for the three months ended March 31, 2005 and 2004 and for
        the years ended December 31, 2004 and 2003, respectively.

        FAIR VALUE OF FINANCIAL INSTRUMENTS

        The carrying amount reported in the balance sheets for cash and cash
        equivalents, accounts receivable, accounts payable and accrued expenses
        approximate fair value because of the immediate or short-term maturity
        of these financial instruments. The carrying amount reported for notes
        payable approximates fair value because, in general, the interest on the
        underlying instruments fluctuates with market rates.

        FIXED ASSETS

        Fixed assets are stated at cost. Depreciation is computed using the
        straight-line method over the estimated useful lives of the assets.

                 Furniture and equipment            5 Years
                 Telecommunications equipment       5 Years

        When assets are retired or otherwise disposed of, the costs and related
        accumulated depreciation are removed from the accounts, and any
        resulting gain or loss is recognized in income for the period. The cost
        of maintenance and repairs is charged to income as incurred; significant
        renewals and betterments are capitalized. Deduction is made for
        retirements resulting from renewals or betterments.


                                      F-15
<PAGE>

                       MAILKEY CORPORATION AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
             FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                   THE YEARS ENDED DECEMBER 31, 2004 AND 2003


NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -  (CONTINUED)

        (LOSS) PER SHARE OF COMMON STOCK

        Historical net (loss) per common share is computed using the weighted
        average number of common shares outstanding. Common stock equivalents
        were not included in the computation of diluted earnings per share when
        the Company reported a loss because to do so would be antidilutive for
        the periods presented.

        (LOSS) PER SHARE OF COMMON STOCK (CONTINUED)


        The following is a reconciliation of the computation for basic and
        diluted EPS:

<TABLE>
<CAPTION>
                                                 THREE MONTHS ENDED                  YEARS ENDED
                                                 ------------------                  -----------
                                              MARCH 31,        MARCH 31,    DECEMBER 31,      DECEMBER 31,
                                                2005            2004           2004              2003
                                              (AUDITED)      (UNAUDITED)     (AUDITED)         (AUDITED)
                                             ------------     ---------     -----------       -----------

<S>                                          <C>              <C>           <C>               <C>
        Net loss                             $   (417,085)    $ (68,280)    $  (295,041)      $  (265,056)
                                             ------------     ---------     -----------       -----------
        Weighted-average common
        shares Outstanding (Basic)             38,143,835        48,825       3,222,743                 1

        Weighted-average common
        stock Equivalents
             Stock options                              -             -               -                 -
             Warrants                                   -             -               -                 -
                                             ------------     ---------     -----------       -----------
        Weighted-average common
        shares Outstanding (Diluted)           38,143,835        48,825       3,222,743                 1
                                             ------------     ---------     -----------       -----------
</TABLE>

        The Company had no options or warrants granted during the period,
        therefore there were no common stock equivalents.

                                      F-16
<PAGE>

                       MAILKEY CORPORATION AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
             FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                   THE YEARS ENDED DECEMBER 31, 2004 AND 2003


NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -  (CONTINUED)

        GOODWILL AND OTHER INTANGIBLE ASSETS

        In June 2001, the FASB issued Statement No. 142 "Goodwill and Other
        Intangible Assets". This Statement addresses financial accounting and
        reporting for acquired goodwill and other intangible assets and
        supersedes APB Opinion No. 17, Intangible Assets. It addresses how
        intangible assets that are acquired individually or with a group of
        other assets (but not those acquired in a business combination) should
        be accounted for in financial statements upon their acquisition. This
        Statement also addresses how goodwill and other intangible assets should
        be accounted for after they have been initially recognized in the
        financial statements.

        STOCK-BASED COMPENSATION

        Employee stock awards under the Company's compensation plans are
        accounted for in accordance with Accounting Principles Board Opinion No.
        25 ("APB 25"), "ACCOUNTING FOR STOCK ISSUED TO EMPLOYEES", and related
        interpretations. The Company provides the disclosure requirements of
        Statement of Financial Accounting Standards No. 123, "ACCOUNTING FOR
        STOCK-BASED COMPENSATION" ("SFAS 123"), and related interpretations.
        Stock-based awards to non-employees are accounted for under the
        provisions of SFAS 123 and has adopted the enhanced disclosure
        provisions of SFAS No. 148 "Accounting for Stock-Based Compensation-
        Transition and Disclosure, an amendment of SFAS No. 123".

        The Company measures compensation expense for its employee stock-based
        compensation using the intrinsic-value method. Under the intrinsic-value
        method of accounting for stock-based compensation, when the exercise
        price of options granted to employees is less than the estimated fair
        value of the underlying stock on the date of grant, deferred
        compensation is recognized and is amortized to compensation expense over
        the applicable vesting period. In each of the periods presented, the
        vesting period was the period in which the options were granted. All
        options were expensed to compensation in the period granted rather than
        the exercise date.


                                      F-17
<PAGE>

                       MAILKEY CORPORATION AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
             FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                   THE YEARS ENDED DECEMBER 31, 2004 AND 2003


NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -  (CONTINUED)

        STOCK-BASED COMPENSATION (CONTINUED)

        The Company measures compensation expense for its non-employee
        stock-based compensation under the Financial Accounting Standards Board
        (FASB) Emerging Issues Task Force (EITF) Issue No. 96-18, "ACCOUNTING
        FOR EQUITY INSTRUMENTS THAT ARE ISSUED TO OTHER THAN EMPLOYEES FOR
        ACQUIRING, OR IN CONJUNCTION WITH SELLING, GOODS OR SERVICES".

        The fair value of the option issued is used to measure the transaction,
        as this is more reliable than the fair value of the services received.
        The fair value is measured at the value of the Company's common stock on
        the date that the commitment for performance by the counterparty has
        been reached or the counterparty's performance is complete. The fair
        value of the equity instrument is charged directly to compensation
        expense and additional paid-in capital.

        Stock-based compensation for the three months ended March 31, 2005 and
        2004 was $0 and $0, respectively and for the years ended December 31,
        2004 and 2003 was $0 and $0, respectively.

        RECENT ACCOUNTING PRONOUNCEMENTS

        On October 3, 2001, the FASB issued Statement of Financial Accounting
        Standards No. 144, "ACCOUNTING FOR THE IMPAIRMENT OR DISPOSAL OF
        LONG-LIVED ASSETS" ("SFAS 144"), that is applicable to financial
        statements issued for fiscal years beginning after December 15, 2001.
        The FASB's new rules on asset impairment supersede SFAS 121, "ACCOUNTING
        FOR THE IMPAIRMENT OF LONG-LIVED ASSETS AND FOR LONG-LIVED ASSETS TO BE
        DISPOSED OF," and portions of Accounting Principles Board Opinion 30,
        "Reporting the Results of Operations."

        This Standard provides a single accounting model for long-lived assets
        to be disposed of and significantly changes the criteria that would have
        to be met to classify an asset as held-for-sale. Classification as
        held-for-sale is an important distinction since such assets are not
        depreciated and are stated at the lower of fair value and carrying
        amount.

                                      F-18
<PAGE>

                       MAILKEY CORPORATION AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
             FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                   THE YEARS ENDED DECEMBER 31, 2004 AND 2003


NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -  (CONTINUED)

        RECENT ACCOUNTING PRONOUNCEMENTS (CONTINUED)

        This Standard also requires expected future operating losses from
        discontinued operations to be displayed in the period (s) in which the
        losses are incurred, rather than as of the measurement date as presently
        required. The adoption of SFAS No. 144 did not have an impact on the
        Company's results of operations or financial position.

        In April 2002, the FASB issued SFAS No. 145, Rescission of FASB
        Statements No. 4, 44 and 64, Amendment of FASB Statement No. 13, and
        Technical Corrections. This statement rescinds SFAS No. 4, "REPORTING
        GAINS AND LOSSES FROM EXTINGUISHMENT OF DEBT," and an amendment of that
        statement, SFAS No. 44, "ACCOUNTING FOR INTANGIBLE ASSETS OF MOTOR
        CARRIERS," and SFAS No. 64, "EXTINGUISHMENTS OF DEBT MADE TO SATISFY
        SINKING-FUND REQUIREMENTS". This statement amends SFAS No. 13,
        "ACCOUNTING FOR LEASES", to eliminate inconsistencies between the
        required accounting for sales-leaseback transactions and the required
        accounting for certain lease modifications that have economic effects
        that are similar to sales-leaseback transactions.

        Also, this statement amends other existing authoritative pronouncements
        to make various technical corrections, clarify meanings, or describe
        their applicability under changed conditions. Provisions of SFAS No. 145
        related to the rescissions of SFAS No. 4 were effective for the Company
        on November 1, 2002 and provisions affecting SFAS No. 13 were effective
        for transactions occurring after May 15, 2002. The adoption of SFAS No.
        145 did not have a significant impact on the Company's results of
        operations or financial position.

        In June 2003, the FASB issued SFAS No. 146, "ACCOUNTING FOR COSTS
        ASSOCIATED WITH EXIT OR DISPOSAL ACTIVITIES". This statement covers
        restructuring type activities beginning with plans initiated after
        December 31, 2002. Activities covered by this standard that are entered
        into after that date will be recorded in accordance with provisions of
        SFAS No. 146. The adoption of SFAS No. 146 did not have a significant
        impact on the Company's results of operations or financial position.


                                      F-19
<PAGE>

                       MAILKEY CORPORATION AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
             FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                   THE YEARS ENDED DECEMBER 31, 2004 AND 2003


NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -  (CONTINUED)

        RECENT ACCOUNTING PRONOUNCEMENTS (CONTINUED)

        In December 2002, the FASB issued Statement No. 148, "ACCOUNTING FOR
        STOCK-BASED COMPENSATION-TRANSITION AND DISCLOSURE, AN AMENDMENT OF FASB
        STATEMENT NO. 123"("SFAS 148"). SFAS 148 amends FASB Statement No. 123,
        "ACCOUNTING FOR STOCK-BASED COMPENSATION," to provide alternative
        methods of transition for an entity that voluntarily changes to the fair
        value based method of accounting for stock-based employee compensation.
        It also amends the disclosure provisions of that Statement to require
        prominent disclosure about the effects on reported net income of an
        entity's accounting policy decisions with respect to stock-based
        employee compensation. Finally, this Statement amends Accounting
        Principles Board ("APB") Opinion No. 28, "INTERIM FINANCIAL REPORTING",
        to require disclosure about those effects in interim financial
        information. SFAS 148 is effective for financial statements for fiscal
        years ending after December 15, 2002. The Company will continue to
        account for stock-based employee compensation using the intrinsic value
        method of APB Opinion No. 25, "ACCOUNTING FOR STOCK ISSUED TO
        EMPLOYEES," but has adopted the enhanced disclosure requirements of SFAS
        148.


        In May 2003, the FASB issued SFAS Statement No. 150, "ACCOUNTING FOR
        CERTAIN FINANCIAL INSTRUMENTS WITH CHARACTERISTICS OF BOTH LIABILITIES
        AND EQUITY". This Statement establishes standards for how an issuer
        classifies and measures certain financial instruments with
        characteristics of both liabilities and equity. It requires that an
        issuer classify a financial instrument that is within its scope as a
        liability (or an asset in some circumstances). This statement is
        effective for financial instruments entered into or modified after May
        31, 2003, and otherwise is effective at the beginning of the first
        interim period beginning after June 15, 2003, except for mandatorily
        redeemable financial instruments of nonpublic entities, if applicable.
        It is to be implemented by reporting the cumulative effect of a change
        in an accounting principle for financial instruments created before the
        issuance date of the Statement and still existing at the beginning of
        the interim period of adoption. The adoption of this statement


                                      F-20
<PAGE>

                       MAILKEY CORPORATION AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
             FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                   THE YEARS ENDED DECEMBER 31, 2004 AND 2003

NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -  (CONTINUED)

        RECENT ACCOUNTING PRONOUNCEMENTS (CONTINUED)

        did not have a significant impact on the Company's results of operations
        or financial position.

        In November 2002, the FASB issued Interpretation No. 45 ("FIN 45"),
        "GUARANTOR'S ACCOUNTING AND DISCLOSURE REQUIREMENTS FOR GUARANTEES,
        INCLUDING INDIRECT GUARANTEES OF INDEBTEDNESS OF Others". FIN 45
        requires a company, at the time it issues a guarantee, to recognize an
        initial liability for the fair value of obligations assumed under the
        guarantees and elaborates on existing disclosure requirements related to
        guarantees and warranties. The recognition requirements are effective
        for guarantees issued or modified after December 31, 2002 for initial
        recognition and initial measurement provisions. The adoption of FIN 45
        did not have a significant impact on the Company's results of operations
        or financial position.

        In January 2003, the FASB issued FASB Interpretation No. 46 ("FIN 46"),
        "CONSOLIDATION OF VARIABLE INTEREST ENTITIES, AN INTERPRETATION OF ARB
        NO. 51". FIN 46 requires certain variable interest entities to be
        consolidated by the primary beneficiary of the entity if the equity
        investors in the entity do not have the characteristics of a controlling
        financial interest or do not have sufficient equity at risk for the
        entity to finance its activities without additional subordinated
        financial support from other parties. FIN 46 is effective for all new
        variable interest entities created or acquired after January 31, 2003.
        For variable interest entities created or acquired prior to February 1,
        2003, the provisions of FIN 46 must be applied for the first interim or
        annual period beginning after June 15, 2003. The adoption of FIN 46 did
        not have a significant impact on the Company' results of operations or
        financial position.

        On December 16, 2004, the Financial Accounting Standards Board ("FASB")
        published Statement of Financial Accounting Standards No. 123 (Revised
        2004), "SHARE-BASED PAYMENT" ("SFAS 123R"). SFAS 123R requires that
        compensation cost related to share-based payment transactions be
        recognized in the financial statements. Share-based payment transactions
        within the scope of SFAS 123R include stock

                                      F-21
<PAGE>

                       MAILKEY CORPORATION AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
             FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                   THE YEARS ENDED DECEMBER 31, 2004 AND 2003


NOTE 2- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES -  (CONTINUED)

        RECENT ACCOUNTING PRONOUNCEMENTS (CONTINUED)

        options, restricted stock plans, performance-based awards, stock
        appreciation rights, and employee share purchase plans.

        The provisions of SFAS 123R are effective for small business issuers as
        of the first interim period that begins after December 15, 2005.
        Accordingly, the Company will implement the revised standard in the
        first quarter of fiscal year 2006. Currently, the Company accounts for
        its share-based payment transactions under the provisions of APB 25,
        which does not necessarily require the recognition of compensation cost
        in the financial statements. Management is assessing the implications of
        this revised standard, which may materially impact the Company's results
        of operations in the first quarter of fiscal year 2006 and thereafter.

        On December 16, 2004, FASB issued Statement of Financial Accounting
        Standards No. 153, "EXCHANGES OF NON-MONETARY ASSETS, AN AMENDMENT OF
        APB OPINION NO. 29, ACCOUNTING FOR NON-MONETARY TRANSACTIONS" (" SFAS
        153"). This statement amends APB Opinion 29 to eliminate the exception
        for non-monetary exchanges of similar productive assets and replaces it
        with a general exception for exchanges of non-monetary assets that do
        not have commercial substance. Under SFAS 153, if a non-monetary
        exchange of similar productive assets meets a commercial-substance
        criterion and fair value is determinable, the transaction must be
        accounted for at fair value resulting in recognition of any gain or
        loss. SFAS 153 is effective for non-monetary transactions in fiscal
        periods that begin after June 15, 2005. The Company does not anticipate
        that the implementation of this standard will have a material impact on
        its financial position, results of operations or cash flow.


                                      F-22
<PAGE>

                       MAILKEY CORPORATION AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
             FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                   THE YEARS ENDED DECEMBER 31, 2004 AND 2003


NOTE 3-  FIXED ASSETS

        Property and equipment as of March 31, 2005 was as follows:

                                                      MARCH 31,
                                                        2005
                                                  ---------------

          Property and equipment                      $1,373,268
          Less: accumulated depreciation                (484,217)
                                                  ---------------
          Net book value                              $  889,051
                                                  ===============

        There was $68,164 and $60,403 charged to operations for depreciation
        expense for the three months ended March 31, 2005 and 2004, respectively
        and $260,806 and $156,691 was charged to operations for depreciation
        expense for the years ended December 31, 2004 and 2003, respectively.

NOTE 4- NOTES PAYABLE

        The Company has several notes payable at March 31, 2005. Proceeds from
        the notes were utilized to finance the general working capital
        requirements of the Company, purchase equipment and pay certain
        liabilities assumed by the Company in the purchase of the principal
        assets of Integrated Communications Consultants Corporation in March of
        2003. The notes carry varying interest rates between zero and 5.75%.
        Prior to the effective merger of I-Element with MailKey, certain of the
        notes were converted into shares of common stock.


                                      F-23
<PAGE>


                       MAILKEY CORPORATION AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
             FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                   THE YEARS ENDED DECEMBER 31, 2004 AND 2003


NOTE 4-  NOTES PAYABLE (CONTINUED)

        Accrued interest on the notes is $4,767 at March 31, 2005.

        The notes payable balances at March 31, 2005 were as follows:

                                                         March 31,
                                                           2005
                                                     ----------------

         Total notes payable                               $ 754,778
         Less current maturities                            (461,590)
                                                     ----------------

         Long-term notes payable                           $ 293,188
                                                     ================

         The amount of principal maturities of the
         notes payable for the next four years
         ending March 31, and in the aggregate
         is as follows:

                                      2006                 $ 461,590
                                      2007                   125,652
                                      2008                   125,652
                                      2009                    41,884
                                                     ----------------

                                                           $ 754,778
                                                     ================



                                      F-24
<PAGE>

                       MAILKEY CORPORATION AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
             FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                   THE YEARS ENDED DECEMBER 31, 2004 AND 2003

NOTE 5- OPERATING LEASES

        The Company leases office space under leases commencing in March and
        June of 2004. The leases are payable on a month-to-month basis. Monthly
        payments under the current leases are $3,900. The Company also leased
        additional office space in Texas and California. The Company ceased
        leasing this additional space during the year ended December 31, 2004.

        Rental payments charged to expense for the three months ended March 31,
        2005 and 2004 were $11,700 and $15,050, respectively and during the
        years ended December 31, 2004 and 2003 were $82,072 and $68,750,
        respectively.

NOTE 6- STOCKHOLDERS' EQUITY (DEFICIT)

        COMMON STOCK

        As of March 31, 2005, the Company has 100,000,000 shares of common stock
        authorized at a par value of $0.001, and 91,783,730 shares issued and
        outstanding.

        The following details the stock transactions for the three months ended
        March 31, 2005:

        The Company issued 4,578,223 shares of common stock due to the exercise
        of options.

        The Company issued 4,694,953 shares of common stock for the conversion
        of debt to equity valued at $826,312.

        The Company issued 7,487,587 shares of common stock for services valued
        at $187,189.

        The Company issued 693,280 shares of common stock in conversion of
        accounts payable to equity valued at $17,332.

        The Company issued 1,030,672 shares of common stock for the conversion
        of debt to equity valued at $25,766.

        In connection with the recapitalization, there were $337,945 in notes
        payable and $63,343 in liabilities assumed by the new company.


                                      F-25
<PAGE>

                       MAILKEY CORPORATION AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
             FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                   THE YEARS ENDED DECEMBER 31, 2004 AND 2003


NOTE 7- 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.

        At March 31, 2005, deferred tax assets consist of the following:

        Net deferred tax assets              $ 294,392
        Less: valuation allowance             (294,392)
                                             ---------
                                             $     -0-
                                             =========

        At March 31, 2005, the Company had deficits accumulated in the
        approximate amount of $981,305, available to offset future taxable
        income through 2023. The Company established valuation allowances equal
        to the full amount of the deferred tax assets due to the uncertainty of
        the utilization of the operating losses in future periods.

NOTE 8- GOING CONCERN

        As shown in the accompanying consolidated financial statements the
        Company has sustained net operating losses for the three months ended
        March 31, 2005 and 2004 and the years ended December 31, 2004 and 2003.
        There is no guarantee that the Company will be able to raise enough
        capital or generate revenues to sustain its operations. This raises
        substantial doubt about the Company's ability to continue as a going
        concern.

        The Company's future success is dependent upon its ability to achieve
        profitable operations and generate cash from operating activities, and
        upon additional financing. There is no guarantee that the Company will
        be able to raise enough capital or generate revenues to sustain its
        operations. Management believes they can raise the appropriate funds
        needed to support their business plan and acquire an operating, cash
        flow positive company.


                                      F-26
<PAGE>

                       MAILKEY CORPORATION AND SUBSIDIARY
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
             FOR THE THREE MONTHS ENDED MARCH 31, 2005 AND 2004 AND
                   THE YEARS ENDED DECEMBER 31, 2004 AND 2003


NOTE 8- GOING CONCERN

        The consolidated financial statements do not include any adjustments
        relating to the recoverability or classification of recorded assets and
        liabilities that might result should the Company be unable to continue
        as a going concern.










                                      F-27